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:
- The level of the threat or degree of risk that the organization is facing
- The organization’s response to the threat or risk
- The appropriateness of the measures that the organization is tracking
- 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:
- Active attention to the environment in which the organization operates
- Preparation for disruptions for the organization and its employees
- Built in flexibility
- Strong internal and external communications networks
- Fostering an environment of innovation
- 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:
- Developing a confident, engaged workforce that does not take their success or customers for granted
- Producing quality products and services that meet customers’ needs
- Delivered with a customer service orientation
- With perceived value in products/services
- Fostering a disciplined growth orientation
- Implementing effective business processes
- Having effective leadership, and in general putting the right people in the right jobs
- Developing a strong new product/services pipeline
- Operating in a sustainable fashion
- Operating with ethics and transparency.
© 2010 by Jeffrey M. Saltzman. All rights reserved.