Food Industry Resilience in Focus
BSI research shows that strong leadership and the capacity to adapt are the keys to Organizational Resilience in the food industry. David Horlock, Managing Director for Global Food, Retail and Supply Chain at BSI, explains.
“Organizational Resilience is the ability of an organization to anticipate, prepare for, respond and adapt to incremental change and sudden disruption in order to survive and prosper”.
This definition comes from the latest guidance on Organizational Resilience, BS 65000, which was developed by industry and backed by governments to strengthen organizations and build resilience in economies.
Put simply, to be organizationally resilient means being equipped to stand the test of time. This, in turn, requires a holistic approach, where several key elements combine to enable long-term survival and prosperity.
The long-term resilience of a tree offers a helpful analogy, where several elements, above and below ground, are necessary for it to survive and flourish. Only the trunk, branches and leaves are visible, but the extensive root system is equally vital, providing stability, hydration and nutrients.
For organizations, BSI has identified 16 core elements, ranging from Financial Aspects to Community Engagement.
Organizational Resilience attempts to address all the aspects that are embedded in the 16 core elements.
Continuing the tree analogy, some elements are ‘above ground’ and most organizations have a better handle on these because they are more visible and therefore receive more management attention. Examples relate to Products (product specifications), Process (quality, health and safety, environment), Governance and Accountability, Leadership, Vision and Purpose, Strategy, Resources and Financial Aspects.
The less visible elements – below the ground – are more difficult to manage because they are more complex, less tangible, and attract less attention. These typically relate to People, Culture, and Business Behavior, and include attitudes, communication, and business ethics. Typically Supply Chain, Innovation, Horizon Scanning and Information Security dominate this space.
BSI’s Organizational Resilience Index
For the past three years, BSI has taken a step further, examining the impact of these core resilience elements on organizations, as well as their perceived performance in them, and publishing the findings in our Organizational Resilience Index.
The Index is based on annual surveys of business leaders worldwide, providing a powerful, data-driven insight into what global company bosses see as their own business’s strengths and weaknesses.
Note that the Index is a ‘relative’ study. In other words, all 16 core elements have significant impact on a business, but leaders see some as having more impact than others and have ranked them accordingly. Similarly, they perceive variations in their organization’s performance in the 16 elements, again resulting in a ranking.
Responses from the latest survey of 805 industry leaders has enabled BSI to benchmark the resilience of organizations in a variety of different sectors – including the food industry.
Focusing on the Food industry
Food organizations can benefit from a deeper insight into just how resilient they are in two ways: firstly, by seeing in which core elements they perform relatively well or relatively badly; secondly, by considering which elements have most impact on their business, and which have the least.
Resilience ranking for the Food Industry
70 of the 805 organizations surveyed identified their area of operations as in the food industry
In the food sector, leaders regard their best performance to be in Governance and Accountability.
There is a clear suggestion here that food organizations are exercising good practice, and this is ‘above ground’ – not only visible within individual companies, but also to industry observers and the wider public. This should come as no surprise. Organizations cannot hide, given the high level of concern expressed by consumers – now using the powerful tool of social media – regarding food sourcing, standards and sustainable business practices within the sector.
Equally unsurprising is that Supplier Management is the second-highest performing area, given that this is such a vital discipline for food manufacturers and retailers, and huge resources are focused on it.
Of more concern is that the worst performance is seen in Innovation, closely followed by Awareness and Training, and Horizon Scanning, all of which are less visible business elements, receiving less management attention, but therefore presenting particular risks. In a world that is more open and transparent, with higher expectations with regards to ethics and trust, organizations need to work on these less visible issues because they can massively impact business performance and brand equity.
In terms of impact, it is Adaptive Capacity and Leadership that are seen as the most important for maintaining Organizational Resilience. Clearly, it is critical for food organizations to be adaptable and well led. While this is no doubt true at all times, the current COVID-19 pandemic has provided an unusually severe test for them in both elements.
Most obviously, the coronavirus pandemic has brought intense pressure on food manufacturers, wholesalers, logistics firms and retailers to restock supermarket shelves stripped bare by anxious consumers. To their leaders’ credit, there has been widespread recognition of the sector’s success in meeting the formidable recent challenges.
Among the elements considered to be of relatively low impact are Business Continuity and Community Engagement, but both may find themselves higher in future, not least because of recent events.
Where are your strengths and weaknesses?
Pressures and risks abound in the food industry. However, opportunity also knocks for many companies in the sector – and, alongside their ability to manage risks, it is their ability to grasp opportunities as they arise that is a key aspect in their aspirations to achieve organizational resilience.
It falls to boards and individual leaders to build organizational resilience at both a strategic and operational level. There are tools to help, from sector-specific standards and enterprise training solutions to broader certifications for disciplines such as business continuity management, supplier pre-qualification, sustainable procurements and information security management, as well for Organizational Resilience itself.
To find out your organization’s relative strengths and weaknesses – and how you compare with the organizations behind the BSI Organizational Resilience Index – complete the BSI Organizational Resilience Benchmark tool, a simple questionnaire located online at www.bsigroup.com/organizational-resilience.
This tool will present your results in a spider diagram. It will allow you to compare how you perceive your performance in the 16 core elements against the overall benchmark results.
If, in light of your results, you want to investigate further through a more comprehensive comparison against others in the survey, please contact us at Organizational-Resilience@bsigroup.com.