Organisational resilience in the time of uncertainty

The best way to deal with uncertainty is to embrace the fact that it’s here to stay indefinitely (unless AI becomes smart enough to predict the future!). Leaders should consider reevaluating their current operating models, in light of this uncertainty. If you haven’t yet, scenario planning is a practice you may want to start incorporating into your strategic approach. 

If you start planning for future scenarios now, you’ll be better equipped to deal with them when they eventually arrive. We can’t predict the future, but we can make ourselves future-proof.

There’s a 70% chance of global recession in the next 12 months as central banks unleash more pain in the form of higher interest rates to combat inflation, now skirting close to double digits.

It’s never been more important for leaders navigating uncertainty to sharpen their approach to managing volatility and cost reduction. While an economic downturn is never guaranteed, leaders need a strong resilience strategy in order to evaluate trade-offs and successfully lead.

Approach to Organisational Resilience Strategy

An organisational resilience strategy can provide a competitive advantage by enabling leaders to react quickly and decisively — because a situation has been thought through and actions documented, no one has to scramble when in the midst of a crisis.

An organisational resilience strategy also gives executives and boards of directors a framework to make non-emergency decisions more effectively by providing insight into plans, budgets and forecasts and painting a clearer picture of key drivers for business growth and the potential impact of future events.

6 Steps: Build Organisational Resilience Strategy

More resilient organisations can anticipate and respond to threats and opportunities, arising from sudden or gradual changes in their internal and external context. The behaviour of leadership is a key contributor to how an organisation implements its organisational resilience strategies and is rooted in its understanding of itself and its relationship with others. Top management must demonstrate responsibility for the governance and accountability of the organisation’s resilience capability.

1. Strengthen Identity

People long to belong, and they want to be part of something bigger than themselves. Organisations that create a strong identity that meets employees’ needs for affiliation, social cohesion, purpose, and meaning will be more resilient.

• Take a Stance on Purpose: Purpose helps attract people to join an organisation, remain there, and thrive. They know who they are and what they stand for. The organisation’s vision, purpose, and core values are clearly understood and provide coherence and clarity in all decision-making.
• Sharpen Your Value Agenda: Articulate where value is created, what sets the company apart from the pack, and what might propel its success in the future. An understanding of the organisation’s context and relationships allows it to make more effective strategic decisions about priorities for resilience.

More resilient organisations know who they are and what they stand for.  They have a comprehensive understanding of who they are and their relationship with others both internally and externally.

2. Improve Culture

Use culture as your “secret spice”.  Its main ingredients are specific and observable behaviors that employees at all levels adhere to.  The organisation’s culture provides a sense of identity to its people.  It promotes a sense of commitment and reinforces the values of the organisation.

• Engage Your People at all Levels: Leverage your culture as a tool to build and strengthen trust. Embrace change and, in the process, become more flexible and adaptable. 
• Foster Learning, Creativity, and Innovation: Value error-reporting and learning over blame. Encourage your people to communicate their ideas both vertically and horizontally in the organisation. Knowledge and information are widely shared while learning from others is encouraged.

More resilient organisations demonstrate a commitment to a healthy culture where there is a commitment to, and existence of shared beliefs, values, positive attitudes, and behaviour. A healthy organisational culture serves as a control mechanism for shaping behaviour.

The behaviour of an organisation’s leadership is a key contributor to how an organisation implements its organisational resilience strategic objectives and is rooted in its understanding of itself and its relationship with others.

3. Build for Speed and Agility

Operating models need to be fast, nimble, and frictionless to create ways of working that foster agility and simplicity. They need to enable a network of empowered, dynamic teams to find pockets of value, including at the company’s “edges” where employees are closest to customers.

• Structure for High Performance and Managing Change: Adopt models that are designed, nurtured, and grown around people and activities. Flatten your structure as much as possible. Design a workplace that is both flexible and productive. Design networks of local cross-functional teams with clear, accountable roles.  Ensure a clear understanding of how work occurs – the links between work, place, and workers are understood.
• Agile Change Management: Businesses must be prepared for nimble and constant adaptation if they hope to grow with any consistency. Doing so entails constant interaction with stakeholders, technology, and employees. Harness a vibrant ecosystem of partners outside the company’s traditional boundaries.

More resilient organisations demonstrate a commitment to managing change using an agile change management process throughout the organisation and including all personnel.

4. Build a More Resilient Workforce

Organisational resilience is enhanced when knowledge is widely shared as appropriate and applied and is recognised as a critical resource of the organisation.  Treat talent as scarcer than capital – nurturing and retaining talent whenever possible.

• Nurture and Retain Talent: Select and develop leaders with a diversity of skills, capabilities, knowledge, and experience. Foster an inclusive employee experience. Reward and recognise performance to increase engagement. Deploy wellness and mentoring programs.
• Accelerate Learning as an Organisation: Promote a mindset of continuous learning that encourages and supports people to adapt and reinvent themselves to meet shifting needs. Share knowledge and information in a timely manner to enable effective decision-making.

More resilient organisations demonstrate a commitment to its workforce ensuring that its people are engaged, can handle stress, make decisions, and manage continuous change.

5. Use Data to Empower Decisions

The organisation understands that data IS the business. Data should continually empower decisions and the value agenda. The organisation uses predictive analytics and performance management to operate agilely.

• Build Data-Rich Systems for Managing Change: Design systems to anticipate, plan, and respond to changing circumstances. Leverage IT operations data to provide insights, discovery, and capacity planning. 
• Transform to Agile Finance Management: The finance function is the go-to source for decision-support, delivering analytic insight to drive strategy and provide real-time insight into the state of the business.

More resilient organisations use data to inform all decisions, forecasting, and managing change.  Data-driven organisations automate processes to increase agility and flexibility.

6. Increase Preparedness and Manage Risk

The organisation implements systems to anticipate, plan, and respond to changing circumstances. It develops and allocates resources such as people, premises, processes, technology, finance, and information to address vulnerabilities, providing the ability to adapt to changing circumstances.

• Resources are Available, Assigned, and Competent: The organisation develops and allocates resources such as people, premises, processes, technology, finance, and information to address vulnerabilities and providing the ability to adapt to changing circumstances. 

• Risk is Effectively and Efficiently Managed: The organisation anticipates and responds to threats and opportunities arising from sudden or gradual changes to its internal and external context. 

Organisational resilience is enhanced when the organisation intentionally manages risk and prepares for the unexpected. 

No two resilience journeys are the same, with each path forward individually based on region and industry, so Gestaldt’s business resilience consulting experts help leaders recognise their starting points and guide them each step of the way.

Gestaldt’s approach also helps leaders chart their course for the future and build a more resilient enterprise, no matter their starting point. We draw on our strategic heritage to help organisations reinforce their positions and create functional advantage, even in moments of uncertainty.

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