This is the second in our four-part Resilience Series, From Nice Word to Powerful Action: The Board’s Role in Creating a Resilient Organization.
In the first part of our series, we explored the shifting and increasing expectations of boards to position organizations not just to withstand external forces, but to find opportunity and advantage in a changing world. In Part 2, we explore what it takes for them to do so.
It’s a tall order: to position an organization to not just survive whatever may come its way, but to turn the shocks of a volatile and uncertain world into advantage and opportunity. How do we make it real? Let’s start with Watson’s definition of resilience.
Defining Resilience
Resilience is adaptability in the face of change. It is the ability to anticipate, prepare, respond to, recover from, and develop resistance to hostile disruption; potentially, to even benefit from disruption.
Resilient organizations build core capabilities, diversity, disciplines, and cultures that help them overcome, adapt, and thrive.
Resilient boards ensure that organizations are adaptable and ready; they cultivate individual and collective resilience amongst directors.
Boards must understand, guide, and create accountability for resilience factors specific to an organization and its business model and environment. At Watson, we’ve identified 8 Resilience Factors that are the hallmarks of organizational resilience. These are the areas a board can guide and look for to have confidence in the resilience of the organization.
Watson’s 8 Resilience Factors
Deeply embedded purpose
Clear, compelling purpose at the heart of the organization
Building for agility
Core capabilities, talent, culture and structures that make the organization truly agile and responsive
Scanning and integrating
Disciplined practices to monitor forces and trends, and integrate consideration into strategy, risk, and planning
Organizational ecosystem and interconnection
Deep awareness of ecosystem complexity and interdependencies with an active role in managing ecosystem risk
Strategy and business model
Evergreen practice around strategy and deliberate evolution of the business model to one that centres around resilience
Continuity and resurgence
Preparation for business continuity and recovery in a wide range of scenarios
Deep and wide risk and opportunity
Mature, deep risk management practice that embeds seeking opportunity
Financial strength and agility
Diversified, sustainable revenue and cost models; ready to withstand disruption and act on opportunities during times of change
Under each of these 8 Resilience Factors are a set of indicators that boards and leaders can review and monitor to understand the current state of governance for resilience. These indicators are the signals that the factors are in place; some are things you will spot in a board evaluation or other feedback process; others can show up through your business intelligence system, pulse surveys and other methods.
If you would like to learn more about the 8 Resilience Factors or key indicators that can help measure and monitor resilience for your organization, just reach out to Watson – we’d be pleased to discuss.
Boards must also cultivate their own resilience, collectively and as individual directors, so that they can sustain their ongoing readiness and focus in a complex and rapidly changing world, and so that they can be responsive and effective when sudden disruptions arise. How does a board begin to invest in its own readiness to govern for resilience and what are the most important first steps towards building a more resilient organization? Check back next week for Part 3 in our series: The Resilient Director.
Reach out to explore how your board can advance resilience. We embed resilience factors in board evaluations and governance reviews, director feedback processes, board education, and advisory projects. We find and place resilience-ready directors and executives. Let’s talk.
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