What is Organizational Resilience?

Economic uncertainty, disruptive competitors, reputational harm and threats to company’s data security are now viewed as constant uncertainties in a changing world. The recent research and report written by the Economist Intelligence Unit commissioned by BSI, regards these as the leading business risks that drive the need to be more resilient, but prominent organizations could potentially fail unless modern risk management and governance models incorporate scalable resilience metrics.

Incidents in 2015 show that even strong organizations are vulnerable to upheaval, such as the Volkswagen emissions-rigging scandal and Toshiba’s $1.2bn accounting irregularities that led to the resignation of its CEO. To survive and prosper in this new environment of heightened uncertainty and change, organizations must move past traditional risk and governance models and focus instead on organizational resilience. 

Organizational resilience refers to an organizations ability to anticipate, prepare for, respond and adapt to incremental change and sudden disruptions, be they natural disasters, scandals or significant changes in market dynamics, in order to survive and respond to long term challenges and ultimately prosper. 

In recent years the concept of resilience has emerged as a practical response to the decreasing lifespan of organizations and effectively addressing the issues of security, preparedness, risk and survivability. Long-term prosperity in business is rare and decreasing. In the US, for example, research has shown that companies currently remain in the S&P 500 index for an average of just 18 years, down from 61 years in 1958. And it’s a similar story elsewhere in today’s dynamic, interconnected world.

Organizational Resilience can be based upon a much broader view, that being ‘staying power’, which gives organizations the ability to react to crises, but also the ability to structure and run a company in a way that minimizes its exposure to disruptions, whether from internal or external causes. This enables them to not only perform robustly over the long term but also flourish. Organizational Resilience reaches beyond survival, towards a more holistic view of business health and success. A resilient organization is Darwinian, in the sense that it adapts to a changing environment in order to remain fit for purpose.

Organizational Resilience is not a defensive strategy, but a positive, forward-looking ‘strategic enabler’, which allows business leaders to take measured risks with confidence. It is not a one-off exercise, but achieved over time and for the long-term. Robust, resilient organizations are flexible and proactive – seeing, anticipating, creating and taking advantage of new opportunities in order, ultimately, to pass the test of time.

Organizational Resilience also requires commitment from the whole company. It is founded on the values, behaviours, culture and ethos of an organization. It is the leaders of an organization who drive these ‘soft’ factors. However, to make a difference, it requires top-down direction and bottom-up engagement, through clear communication and a willing embrace from all employees. An organization that realizes the benefits of the above definitions of resilience will have a high likelihood of maintaining a successful and thriving enterprise.

To find out more visit our Organizational Resilience page