Defining Resilience - part 2 to "Resilience - what is it really?"

In my first blog post back in May 2012, I defined resilience as the capability, capacity and will to succeed by anticipating risk and reorientating for survival and advantage in the face of adversity both seen and unseen, known and unknown.

 Exploring this definition we can further break it down as follows:

 ‘The capability to succeed - Having in place the right people, systems, tools, processes and functions to meet the persistent challenges of adversity (seen and unseen, known and unknown). These capabilities must include effective programs for risk management, business continuity management, emergency management, security risk management and organisational development. Capability must be focused on the required business outcomes, including the resilience of the organisation and the supply chain. 

The capacity to succeed - Being able to use our capabilities and will to create, or expand and use our available space to achieve our required (and desired effects). This capacity includes making room for flexible and adaptive response using the available resources and capabilities in the face of unexpected disruption and turbulence. Capacity is further optimised by using the space to persistently scan for and understand risks (both current and emerging) regardless of the shocks, turbulence or disruptions that are about to occur, have occurred or are occurring. Risk intelligence will help maximise that space. Capacity is further characterised by finding the ‘sweet spot’ between a lean capability and crisis capacity. This ‘sweet spot’ is achieved through risk intelligence, adaptive planning and ultimately, good business decisions.

 The will to succeed – having the leaders, staff and stakeholders who understand both the environment and the objectives and who are agile and responsive in the face of change and unprecedented adversity. The will to succeed manifests in a way that organically promotes synergistic effort and results (aligned with the objectives) between the leadership and staff in the organisation, supply chain and sphere of operations and influence. This will to succeed must be embedded in the organisation’s culture and leadership. The will to succeed is characterised by an intrinsic understanding of the mission, vision and values of the organisation and its leaders. Trust must be pervasive otherwise the will to succeed will be under-nourished, diminish the will to succeed, reduce the effectiveness of our capabilities and force a reactive response.

 In many ways capacity, capability and will make up a resilience triangle where if any one of these three components are missing, the organisation's level of resilience will be deficient. Resilience is critical to business success. There are many definitiions around resilience but I hope this adds to the discussion.

Creating space in a crisis

Stephen Covey in his book The 8^th Habit: From Effectiveness to Greatness includes a quote that resounds very strongly with me in terms of business resilience, risk management and crisis leadership.

'Between stimulus and response there is a space. In that space lies our freedom and power to choose our response.....'

According to http://www.brainyquote.com/quotes/quotes/v/viktorefr160380.html the quote comes from Victor E. Frankl. More about Viktor E. Frankl can be read here.

 We get so busy sometimes that we forget that there are limits to our ability to think and act on intuition or 'gut' alone. We need to be able to create space for thinking in response to complexity.

·        We all have the capability to create space

·        That space to think before acting is a capability multiplier in delivering value

·        Failure lays in wait for those that seek to adapt on instinct alone. There is still a need to sense and decide (sometimes very quickly)

·    In that space is our power to act

As crisis leaders, we must create and own the space between stimulus and response. By stepping back, albeit briefly from the crisis, we can articulate assumptions in the absence of facts. We can understand the risks and opportunities, reaffirm our objectives and identify what strategies and actions will best support those objectives,  minimise downside risk and capitialise on opportunities.

We lose effectiveness when we get caught always reacting to issues in our work environment. However, there are times this is necessary. To manage this, make decisions but take the time to identify assumptions and make sure you and your stakeholders understand the uncertainty that is inherent in the decision This then allows you to question and test assumptions and adapt effectively as the true situation (often very complex) becomes clearer. Make this a habit as part of business as usual and it will also serve you well in a crisis.

Take a breath, seek a moment of calm and create that space before you act. Be realistic and know the limitations of information. Where possible create the space or make it larger, especially if the decision is critical. The 8^th Habit may not be for everyone (although it is on my recommended reading list), but this is certainly one powerful tool for business resilience during crisis and for managing through complexity.

Five reasons to invest in resilience - success, culture, knowledge, efficiency and muscle

1.      Business success

Business success is my top reason for investing in organisational resilience. Creeping failure, turbulence and shocks disrupt business as usual, undermine business success and impact on business as usual – thus the key reason for investing in resilience. The rest of the reasons are also closely linked to business success but this is one that has to be called out as the priority reason to invest in resilience.

2.      Organisation culture

While it is not good to be hyper sensitive to potential failures, it is important to be change ready and adaptive. The good health of any organisation requires the team and its leaders to be moving in the same direction.  As a practical tool, emergency, crisis or disaster exercises are a great team building activity that have organisational value. Next time you are thinking about investing in a cultural change or transformation program, look at how emergency exercises may compliment the program. Alternatively, get a business and stakeholder group together and throw at them a wicked problem that is in their mutual interest to solve but outside their normal responsibilities. Resilience is a great way to build a good culture internally and across the supply chain.

3.      Knowledge advantage

Any business worth its salt recognises the value of knowledge. Risk intelligence is a critical element of business resilience and success. We live in a connected world characterised by complexity. Our scanning and sensing activities should focus on understanding this complexity. This includes the interrelationships between economic, environmental, political, cultural, social and technical forces (and many more). When we invest in resilience incorporating risk intelligence, we are placed to succeed.

4.      Business efficiency

The practical aspect of resilience involves the business functions of risk management, emergency management, security management (or security risk management), business continuity management and other aligned disciplines. While ‘other’ is listed here, don’t underestimate the importance of human resource management, business improvement and business planning sections of your business in contributing to resilience. Risk based decision making and disruption or resource based planning are not new. Having silos in the mentioned areas will potentially increase organisational costs, result in duplication, or most dangerously result in a tug of war over finite business resources that is not only unnecessary but can also lead to business failure. Avoid silos and misdirected resourcing at all costs and leverage aligned organisational functions. 

5.      Muscle

Efficient and appropriate investment in resilience will ensure the lean characteristics of the business or supply chain are not creating an unacceptable vulnerability that will lead to business failure. The resilient supply chain for example, needs to include some redundancy or contingency to allow agility and adaptive capacity to be leveraged when complexity strikes. This is not fat, it is lean muscle – Resilience ensures the bones that make up the supply chain are supported, lending strength, endurance and short bursts of speed and agility at need. While this is closely related to efficiency, it also ensures survival of the most adaptive and may include lower recovery costs and improved market position over the competition when things go wrong.