Organizational Resiliency to Time and Change Effects

The arrow of time in our universe is unidirectional, moving from the past, to the present and forward into the future.  No matter how much we might desire to freeze moments that are precious to us, capturing forever their special meanings, they slip through our fingers as time marches on oblivious, neither slowing, standing still, nor retreating from its own journey. Though we sometimes seem to view ourselves as disconnected observers of time, remembering past and projecting or modifying the future from some place outside of the flow, we live within the time flow and are firmly subject to it.

One thing that is certain, as time moves forward things change. Things change for people as well as for organizations, inexorably. And just like you cannot control the flow of time in which we reside, you cannot slow down, stop or reverse change from happening. But both individuals and organizations can do things that will help them cope with change and to deal with, mitigate and even use its effects to personal and organizational advantage.

One key to dealing with the effects of change is to become more resilient, on an individual level and an organizational level.  How does a child raised in poverty in the Bronx rise to become a Supreme Court judge, or a child from humble roots in Ohio become the Speaker of the House, or a child raised by a teen mom, in an unstable, unpredictable environment, rise to become President of the United States? These were not children of privilege, these were children of resilience. Look at the innumerable children of immigrants, living and growing up in marginal conditions, who over the years became the engines of our economic prosperity, the pillars of our educational institutions, the creative geniuses behind our innovations and technological breakthroughs, or perhaps simply the doctor who saves the life of your child.

Organizations of resilience are seen everywhere we turn, from family farms, to single proprietor craftspeople, to large private sector corporations, to governmental entities, to NGOs and educational institutions. During the course of a year these organizations may be dealing with recession and the resultant drop in business, the next a merger or acquisition perhaps a hostile takeover, the next a disruptive new competitor, the next a disruptive new technology.  Each and every organization out there today will have a continuous stream of challenges that they will need to successfully overcome. And in today’s environment those challenges are coming at them at a faster and more furious pace.  How do these organizations become more rather than less resilient to the forces that will constantly impinge and perhaps even use the constant state-of-change to their advantage?

Resiliency is the notion of positive adaptation when faced with significant adversity or environmental threats. This definition implies that significant threats or severe adversity is present and that the individual or organization positively copes with those threats. The research that has been done on resiliency has shown that being more resilient rather than less leads to more positive outcomes for both individuals and organizations. And it is pretty clear that organizations that partake of certain activities can enhance their resiliency. Cutting across the literature the activities that make organizations more resilient seem to fall within 3 main buckets. The first one is paying attention to and mitigating the effects of the external environmental factors. The second bucket is investing in organizational capabilities and the third is recognition of achievements. Each of these buckets has sub-activities that could be summarized as follows:

Environment

Monitoring: Information collection, environmental monitoring and the appropriate analysis, dissemination and actions surrounding that information (for example, employee, customer and supplier surveys, mystery shopper, competitive benchmarking, technology awareness monitoring, market trends, the gathering and analysis of other business metrics)

Reducing: Minimizing the occurrence of negative chain reactions that can occur from one threat, before they spiral out of control. Compartmentalization of negative events so that they do not affect the entire organization. (for example, by the use of strong internal and external communications networks, strong accountability systems).

Investment

Warding: Investing in a shared vision, a shared operating style, senior leadership, employees, products and services, and quality—the standardization of those products and services as well as organizational procedures. (for example, creating a customer service culture, of a values statement, or a standard of operational excellence)

Transforming: Turning risks into opportunities by developing a culture of innovative and creating organizational capabilities (for example, rewarding innovative ideas and performance that goes above and beyond to solve problems, creating deep bench strength, tapping into the diversity of talent and developing that talent)

Enhancing: Increasing organizational effectiveness and efficacy (for example, cost control, state-of-the-art business processes, contingency planning)

Achievement

Celebrating: Celebrating and rewarding organizational and personal accomplishments (for example, successful completion of organizational and personal goals; installing robust reward and recognition systems)

In reviewing a number of models and then stepping back from any single model of organizational performance, there appear to be six enduring challenges that virtually any organization faces in its pursuit of growth and financial sustainability, in terms of increasing its resiliency or, more generally, Organizational Vitality. These are the challenges that organizations need to become more resilient upon. Three of these challenges can be viewed as internally focused and there can be viewed as externally focused. They are:

Internally

Clear and Compelling Leadership. The overarching mission and direction of the organization needs to be developed and translated through its leaders in order to properly secure and align resources.

Engaged Employees. Organizations need to create an engaging experience to encourage the most from the people who fuel the processes, create the innovation, and deliver for the customers.

Quality Work Processes. Products need to be efficiently created and, along with services, effectively delivered.

Externally

Attractive Offerings. Organizations seek to create value by providing customers—particularly paying customers—with valued and competitive products and services.

Service Orientation. Organizations need to instill a service orientation. No matter what the organization offers, it must be offered in a manner that distinguishes the organization.

Customer as Brand Advocates. Developing brand advocates who are willing to speak highly of your products or service in this interconnected age is critical.

Increasing an organization’s resiliency like any other activity is not a magic bullet that solves each and every problem faced, however the evidence does seem clear that resiliency enhancement can have positive and lasting organizational performance improvement affects.

References:

Saltzman, J.M. & Brooks, S.M. (2010), Strategic Surveying in the Global Marketplace and the Role of Vitality Measures. In Lundby, K. (ed.), Going Global: Practical Applications and Recommendations for HR and OD Professionals in the Global Workplace. Jossey Bass.

© 2010 by Jeffrey M. Saltzman. All rights reserved.

Visit OV: www.orgvitality.com

Coping with the Pace of Change by becoming Resilient

The pace of change is quickening. How many times have you heard that? I have heard it plenty of times, and it is true, not just within an industry, geopolitical entity or by level of industrialization but across the board globally. How we choose to deal with change and its pace, both at an individual and at an organizational level will be critical to our long-term success.  The old notion that an organization can achieve a sense of long term stability in its customer base, product line, operating processes, or technology as it deals with an ever changing, increasingly complex, globalizing environment is an unrealistic one if the organization is to thrive and cope with ongoing significant challenges.  Today’s environment is more volatile and will remain so for the foreseeable future. Challenges will become more and more “routine”, and responding effectively to challenges will be a “normal” issue that organizations need to be equipped to face. Organizations need to be able to cope with challenges and to do so in a way that is sustainable and does not limit future options. If for instance in responding to a challenge, the organization demotivates employees, or disenfranchises suppliers or customers, and views that problem solving path as a repeatedly viable choice, over the longer-term that organization is not sustainable as key employees will depart and suppliers as well as customers will question their rationality of continuing to do business with the offending entity.

Additionally, should the organization choose a path that limits future options, its ability to deal with the next challenge will be hamstrung. Balancing the need to respond to challenges in a definitive fashion and not limiting future options, two goals that are somewhat in opposition, are both required for success. Organizations that perform well in these areas as they deal with their challenges will be by definition more resilient to threats and will be exhibiting higher levels of vitality.

“If a corporation aspires to perform as well as the market indexes over the long term, it will have to change at the pace and scale of the market, but without losing control. Companies, of course, do not have to change at the pace and scale of the market, but if they do not, then the research from McKinsey’s Long Term Performance Database shows that they are more than likely to underperform for their investors.” (McKinsey & Company, 2009).  

Resiliency is a construct that has generated increasing interest since the 1990’s and has been studied at the individual and organizational level (both man-made and naturally occurring organizations). Being resilient is the notion of positive adaptation when faced with significant adversity or environmental threats. This definition implies that significant threats or severe adversity is present and that the individual or organization positively copes with those threats. Being more resilient rather than less has been shown to lead to positive outcomes for both individuals and organizations. Under normal conditions, an organization who tracks it level of resiliency appropriately and maintains higher levels of resiliency will outperform the competition. It is important to note that resiliency has been found to be malleable, changeable over time if the correct measures are teamed up with appropriate change processes.  Protection from a loss of resiliency does not only involve the factors impinging at the moment, but rather the way the organization deals with risks and threats – processes which are potential inflection points in the organization’s life, and what they do in these stressful situations. 

Being able to maintain the resiliency of the organization and its level of functioning when environmentally challenged will be dependent upon:

1. The level of the threat or degree of risk that the organization is facing
2. The organization’s response to the threat or risk
3. The appropriateness of the measures that the organization is tracking
4. And the processes and mechanisms that the organization has in place to maintain those measures at a high level, including but not limited to:

• Processes that inform about the current status of risks (e.g. employee, customer and supplier surveys, the gathering and analysis of other business metrics)
• Processes that limit exposure to risk (e.g. maintaining currency, relevance and value of products/services, competitiveness, maintaining employee skill sets, developing employees to perform at higher levels, succession planning, standardization of critical procedures)
• Processes that promote situational and means efficacy (e.g. state-of-the-art business processes, procedures, and technology, development of supportive relationships and celebration of successful completion of goals)
• Processes that create new opportunity (e.g. innovative culture, R&D expenditure, reward & recognition systems)
• Elimination of negative chain reactions that can occur from one threat. (e.g. Johnson & Johnson’s Tylenol recovery strategy).

Overall a well-design organizational resiliency framework builds in a positive fashion off the outcomes that are traditionally cited as the marks of resilience in a person including reduced failure probabilities, reduced consequences from failures and reduced time to recovery. Organizational resiliency factors include:

1. Active attention to the environment in which the organization operates
2. Preparation for disruptions for the organization and its employees
3. Built in flexibility
4. Strong internal and external communications networks
5. Fostering an environment of innovation
6. Developing a shared vision of the future and a shared operating style to get there.

Additional factors that add to the resiliency concept by tracking critical components that have been linked to increasing organizational performance and the organization’s ability to achieve satisfied customers include:

1. Developing a confident, engaged workforce that does not take their success or customers for granted
2. Producing quality products and services that meet customers’ needs
3. Delivered with a customer service orientation
4. With perceived value in products/services
5. Fostering a disciplined growth orientation
6. Implementing effective business processes
7. Having effective leadership, and in general putting the right people in the right jobs
8. Developing a strong new product/services pipeline
9. Operating in a sustainable fashion
10. Operating with ethics and transparency.

© 2010 by Jeffrey M. Saltzman. All rights reserved.