The events of 2020 provided an overload of triggers that disrupted most organizations’ normal way of doing business.  Organizations with already fragile operations and those who rarely thought ahead about what would happen if core operations had to suddenly stop were especially vulnerable.  Many business leaders are now realizing they were woefully unprepared for navigating the impacts of the pandemic crisis and most are looking for ways to shore up how they think about the resiliency of their businesses.

Resiliency Planning is a Necessary Reality

A recent article in Harvard Business Review by Martin Reeves and Kevin Whitaker, reminds readers of the importance of enhancing an organization’s resiliency in light of the reality that the global business environment is becoming more dynamic and unpredictable.  The authors highlight a number of reasons why organizations have historically not adequately invested enough time and thought into focusing on resiliency and they lay out a number of steps that leaders can take to be better prepared for the next big disruption.

Factors that Distract from Resiliency Planning

The authors highlight several reasons why organizations under-prepare for operational challenges.  First, resiliency planning requires leaders to be willing to invest now in building robustness for tomorrow’s benefit. Unfortunately, the focus on short-term profits and performance deters investments now for advantages that might not be realized for quite a while. Second, businesses tend to plan for maintaining core operations assuming relatively normal conditions.  Thus, their resiliency playbooks usually are built for relatively predictable situations.  But, big disruptions usually emerge when conditions are turned upside down, with normal operations no longer “normal”.  As a result, those playbooks are not designed with the unstable conditions where they are needed most.  Third, resiliency planning often focuses on issues that might emerge that disrupt core operations to a business model from within.  In doing so, they often under emphasize disruptions triggered by larger, macro-level systemic issues where entire markets and systems in the bigger economy are strained or halted.

Steps for Strengthening Resiliency

The authors highlight several steps leaders can take to strengthen their organization’s ability to continue through a big disruption.  Here are a few ideas they highlight:

  1. Invest in redundancies.  Having back-up-systems and processes can be a lifesaver if a core system fails.
  2. Complement redundancy with diversity. In addition to duplicating systems or processes, it also helps to diversify your options with different avenues to pursue if one particularly approach to a process or system fails.  Having a different kind of process or system creates options if those processes are diverse enough to not be impacted by a disruption in the same way the core system or process is affected.
  3. Break down resiliency planning into subparts.  Analyzing core processes to find ways to put them in stand-alone modules may help isolate the disruption to just one module versus the entire system.  Looking for ways to build “walls” between modules may minimize the pain points triggered by an event by isolating the disruption to a portion of the operations – not the entire operation.
  4. Build in flexibility into the process.  Look for alternative pathways that can be deployed so that if a disruption emerges, there are ways for the process flow to adjust and navigate around the road block using an alternative approach should the main approach be halted.

Benefits Help Plan for the Unknown Triggers

While leaders all wish they had a crystal ball to see into the future so they could know what might disrupt their operations, we know that isn’t reality. But, by investing time and energy in thinking about an organization’s resiliency in advance of an event, helps the organization be better prepared when different kinds of unknown risk emerges. Likely the resiliency game plan will work in a variety of scenarios.  Resiliency planning should help the entity recognize threats faster and that planning should help deflect some of the impact of an unexpected shock.

Read the full article.

Link: A Guide to Building a More Resilient Business,” by Martin Reeves and Kevin Whitaker, Harvard Business Review, July 20, 2020

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