Building More Resilient Organizations – Dec 2020

Organizations are built on processes (or at least should be) – they are a system of interconnected tasks, activities, and routines that guide employees (or technology) through decisions and procedures that produce products, services, or programs that are of value to customers or stakeholders.  Simply put, organizations are a set of methods to get valuable things done.  Some of those processes are simple (like conducting a meeting, ordering a part, or handling a customer inquiry) and some are quite complex (flying a plane, performing surgery, designing and producing a smart phone, or educating our youth).

During “normal” times, organizations that truly think in terms of systematic process – well-designed, consistent, and repeatable approaches – are better at producing outcomes that are predictable, controllable, and desirable.  In short, their approaches produce outcomes that are of value to customers, other stakeholders, and the organization itself.

But what happens during uncertain times – times where the environment is in constant or accelerating change?  Times like today, when the variables seem to change by the week if not by the day?  The benefits of having systematic processes – those routines proven to produce a certain outcome in stable times – seem to break down when the environment is anything but routine.  In fact, the more hardwired and rigid an organization is with its approaches, the less capable it may be in making quick changes.

During times of rapid change, organizations need the ability to change rapidly – to make adjustments on the fly; to shift products and services; to change quickly how work gets done; to shift strategies or priorities.  As an example, think of the early stages of this pandemic when most organizations couldn’t get access to many critical inputs because supply networks were disrupted.  If you can’t get a critical part or input, you either stop doing whatever it is you need to do, or you quickly change how it is you do it.  You shift; you pivot; you modify; you work around.

This is the essence of organizational agility and resilience – a concept traditionally applied to individuals that has increasing meaning for systems, both organizations and communities.  And if any year required organizational resilience, 2020 would be that year.  The challenges we’ve faced are – in many ways – historic, requiring rapid change and adjustment just to sustain operations and continue producing desired outcomes.

The concept of “resilience” applied to organizations and communities is fairly new, both in research and in practice.  In fact, in the coming days, the Baldrige Performance Excellence Program will release its 2021-22 Framework, and “resilience” is a prominent theme in high performing organizations (for those not as familiar, the Baldrige Framework represents a validated set of leadership and management best practices that lead to high performance).  In short, resilient organizations have more flexible processes and better results, even during uncertain times like today.

Baldrige defines resilience as “the ability to anticipate, prepare for, and recover from disasters, emergencies, and other disruptions (like pandemics, I presume), and – when disruptions occur – to protect and enhance workforce and customer engagement, supply network and financial performance, organizational productivity, and community well-being.  Resilience includes the agility to modify plans, processes, and relationships whenever circumstances warrant.”

Merriam Webster and Oxford dictionaries define resilience as “the capacity to recover quickly from difficulties; toughness” and “the ability to spring back into shape” and “the ability to recover from – or adjust easily to – misfortune or change.”

Taken together, resilience is the ability to recover – to bounce back – as an individual, an organization, or a community.  And, I would suggest, that resilience is the ability to recover systematically.  Resilience – like anything else in an organization – should be a process: a well-designed, consistent, repeatable method that allows an organization (or an individual or a community) to bounce back.

Think about resilience applied to us as humans.  PEN hosted a full-day “Resilience Retreat” last month, featuring seven leading experts, each sharing methods to manage stress, reduce conflict, and improve personal resilience.  Methods included mindfulness, specific wellness activities (like yoga, breathing, exercise, diet, sleep), and various approaches for reducing and managing incivility in the workplace.  Indeed, there are things – processes – each of us can do as people to improve our resilience.  And we know that they are proven scientifically to improve outcomes.

We are now seeing that there are also things organizations and communities can do to improve resilience – processes that allow them to recover quickly and bounce back.  What are they?

One of the cool things about the Baldrige Framework is that it’s nonprescriptive: it doesn’t give leaders the answers; it doesn’t tell leaders how to run their businesses, making it powerful for adaptation and customization.  But one of the more frustrating parts of Baldrige is that it’s nonprescriptive – it doesn’t give leaders the answers!  However, I have always argued that there are some clues in the Baldrige questions themselves – that you can apply a concept like resilience into the design and execution of nearly any organizational process.

Here is where resilience appears in the new 2021 Baldrige Framework – and therefore areas where leaders could think about making their organizations more adaptable, responsive to change, and agile:

  • How do senior leaders create an environment that cultivates organizational agility and resilience? – how do they consider factors such as risk appetite, technological and organizational innovation, readiness for disruptions, flexibility in culture and work systems, workforce capability and capacity, and core competencies?
  • How does your strategic planning process address the potential need for change, prioritization of change initiatives, and organizational agility and resilience? – how does the organization consider the capacity for rapid change in strategy and the ability to adjust operations as opportunities or needs arise, including identifying blind spots, shifting resources, executing contingency plans?
  • How do you organize and manage your workforce to reinforce organizational resilience, agility, and a customer and business focus? – how does your approach to organizational design – structure, teams, and so forth – consider changes in your internal or external environment, culture, or strategy?
  • How do you manage your supply network to ensure agility and resilience in responding to changes in customer, market, and organizational requirements? – this might include more flexible partnerships, forming more alliances among multiple organizations within the supply network for mutual benefit (and backup contingency plans).
  • How do you ensure business continuity and organizational resilience in the event of disasters or emergencies? – how do you consider risk, prevention, protection, response to enable continuity of operations, and recovery?

So as a theme, the Baldrige Framework now suggests organizations should consider how it systematically builds resilience into its leadership system, its strategic planning process, its organizational design and structure, its supply network, and its business continuity plans.  I would also suggest that resilience could be embedded into other key processes:

  • how an organization executes strategy (more rapid cycles of action plans and resource allocation/shifting);
  • how an organization maintains customer relationships during times of crisis;
  • how an organization uses measures, data, and information for quicker decision making and rapid adjustments;
  • how an organization prepares for and manages change with its workforce, both in terms of capacity and capability; and
  • how an organization designs and manages its key work processes such that they can shift to rapid changes in the environment – think of flexibility in design or delivery of products and services (anyone using Zoom today to deliver value?).

Resilience, then, could – and most certainly should – be embedded in nearly all aspects of how an organization is designed and managed.

Watch for announcements of the new 2021-22 Baldrige Framework.  You can order here, or you can order through PEN and we get $5 per book (just email me how man you’d like).

There was a great article in last month’s Harvard Business Review that explored how to build organizational resilience.  Researchers identified three broad approaches to getting work done, and consequently how leaders can respond more effectively to highly changeable environments.  A quick summary of those three approaches are:

  • How to change organizational routines – which are usually highly repeatable and efficient when work is predictable – when circumstances change;
  • Simple rules or heuristics that help organizations speed up processes and decision-making, and then prioritize the use of resources in less-predictable contexts (one example they give is the benefit of having a pre-defined rule that says “we only invest in projects with a projected ROI of 10% or more”); and
  • Organizational improvisation – spontaneous, creative efforts to address an opportunity or problem (such as quickly changing a production line, shifting suppliers, changing product delivery channels).

The year 2020 has been extraordinary: just about every single size and type of organization has been forced to change, some more or some less.  But we’re in the for a long haul – 2021, 2022, and perhaps even beyond will continue to present significant challenges as we shift to a new normal.  So it’s incumbent upon all of us as individuals – leaders and professionals – and as organizations and communities to maintain resilience and to continue to navigate this new and ever-changing environment.  Most organizations have learned how to shift and adjust as challenges emerge.  I believe our work is just getting started.

What other insights/tips do you have regarding the importance of organizational resilience?  Participate in a discussion on this topic: visit our LinkedIn group to post a comment.  And follow me on Twitter @LassiterBrian!

Stay healthy and never stop improving!

Brian S. Lassiter

President, Performance Excellence Network

www.performanceexcellencenetwork.org

Catalyst for Success Since 1987!

Photo credit waldencroft.com, strategy-business.com, palife.co.uk