How to improve organizational resilience?
Is your small or medium-sized organization ready for unexpected shocks and opportunities? Let’s learn from the research on organizational resilience by Denyer & Sutliff with the UK’s National Preparedness Commission, Deloitte and Cranfield University. They found seven resilience practices that succesfull organizations use. Small or medium-sized enterprises (SMEs) can adopt these practices to their benefit. Imagine future failure, for instance. Define your essential outcomes - and what is tolerable when disruption strikes. Anticipate solutions, do some stress testing and develop a learning culture.
(Source: Denyer, D. and Sutliff, M. (2021). Resilience reimagined: a practical guide for organisations. National Preparedness Commission, Cranfield University and Deloitte.)
The seven resilience practices are:
- Discuss future failure: avoid complacency and instil futures thinking. Ask what if? Ask what next? Encourage your people to speak up.
- Consider the connections: seeing these relations between the 'five capitals' (natural, human, social, built and financial) helps understand the potential impact of disruption on stakeholders, organization and society.
- Understand the essential outcomes (EOs): what is important to your stakeholders and to society, what EOs require a high degree of resilience?
- Set impact thresholds for EOs: determine tolerable limits that should not be breached, considering the impact on all five capitals.
- Make strategic choices: balance resilience interventions by weighinh control, agility, efficiency and innovation.
- Conduct stress testing: determine whether you are able to remain within your impact thresholds irrespective of the threat.
- Enable adaptive leadership and culture: develop direction, alignment, and long-term commitment to resilience through a culture of adaptation and empowerment.
Future failure
Every leader in this research experienced a new period of uncertainty and change. The threat landscape develops more complexity and volatility with the emergence of shocks such as a pandemic, extreme weather events, terrorism, and long term challenges such as climate change, an aging society and inequality. Inter-dependent technologies expose businesses to emergent threats and systemic/networked risks.
At the same time, we can all suffer from normalcy bias that makes us underestimate both the possibility of an incident and its impact. "It is so unlikely” and "It can’t happen here"
To overcome normalcy bias and encourage your co-workers to discuss future failure, use “prospective hindsight". You can learn from imagining future failure and looking back to generate better plans for the future.
Resilient organizations accept that plans and operations, are fallible - they ask what if? They make less complacent assumptions about future issues - they ask what next?
What can you do?
Look back on Covid-19 and your expectations at the time. What did you adapt? How fast and effective was your response? What would you have done differently in hindsight? What were some strong points that you discovered? What can you improve? Do you want to anticipate possible futures and prepare your organization for change and resilience? Join the Strategic Foresight & Futures Community here.
Imagine future failure with a Pre-mortem: one of your services or projects fails. What made that happen? This is a fascinating team exercise.
You can start with writing a future newspaper headline about this imagined failure.
Next, vote and choose the most impactful but plausible incident.
Brainstorm how this could happen and create a mess-map: draw the people, processes, technology, facilities and information across the incident timeline.
Next, find the potential actions that could mitigate these issues. The result is a more resilient service and a more resilient team that is more aware of the challenges.
If you want to learn more, join our Strategic Foresight & Futures community. We cover thinking biases and fallacies, and how to do team sessions about scenarios and “what could go wrong”.
Connected impacts
Resilient organizations embrace a whole-system perspective and manage the relations between the five capitals to avoid possible negative impacts:
Financial capital - financial impact
Strive to expand the gains achieved through economic and productivity growth, ensure that organizations thrive in a changing environment. Address issues that threaten the financial integrity of the organization, market, or sector.
Human capital - people impact
Enhance the skills and abilities of people and build capacity. Acknowledge a duty of care to reduce harm to people, improve well-being, and tackle the challenges individuals and society face, especially those most vulnerable.
Built capital - operational impact
Safeguard the security and soundness of infrastructure, critical systems, plants, energy, transportation, communication, infrastructure, technology, supply chain, and other built assets.
Social capital - reputational/regulatory impact
Maintain trust with customers, the public and other stakeholders by delivering high service reliability levels and responding effectively to disruptions. Cooperation and reciprocity involved in relationships matter.
Natural capital - environmental impact
Protect habitats and ecosystems, and natural resources by prioritizing environmental sustainability, zero carbon and circularity.
If you combine the five capitals and possible impacts across three timelines (short, medium and long term), you can see how our actions today shape the future.
Using this five capitals model for decision-making can lead to improved resilience. Conventional processes tend to deprioritize environmental and social elements and promote siloed short-term development. Resilience requires a connected approach across the five capitals.
What can you do?
Map the five capitals and possible positive and negative impacts for your organization. Talk about what you see. How might the action or inaction of your organization impact the five capitals now and in the future (natural, human, social, built and financial)? What can you do today to prevent some risks or benefit from emerging opportunities?
Understand essential outcomes
"People don't want to buy a quarter-inch drill. They want a quarter-inch hole!" said Theodore Levitt. We often focus on improving the resilience of the asset (drill) and processes (drilling) and not the essential outcome EO (holes), creating a misalignment.
What can you do?
Identify your EOs. The extent to which you understand and empathize with your users determines the resilience of your outcomes. Often people closer to the client are better placed to define EOs than those at the top of the organization. Delivering EOs often crosses several business units, departments, and functions.
Next, identify and document the necessary resources like people, processes, technology, facilities, suppliers or third parties, and information required to deliver each of their EOs.
Finally, explore:
What might prevent the delivery or recovery of the EO?
Could the EO be delivered by alternate means?
Do we have sufficient flexibility to deliver the EO in severe scenarios?
Consider working on Strategic Foresight and futures thinking. If you want to learn more, join our Strategic Foresight & Futures community.
Define impact thresholds
Once you have your essential outcomes, which ones do you want to prioritize if a disruption hits? What is an acceptable level of service in case of issues? What is the threshold? Can you still deliver at 80% capacity, at 60, at 40…? What if your staff is unable to come to work? What if your system is offline for X hours? Is it acceptable if clients cannot access your product or service for Y hours?
This is not the traditional risk management approach. This is about finding the thresholds for what is tolerable, and monitoring the metrics that signal that something might go wrong. It helps to prevent and find solutions in advance.
What can you do?
Organize a team session to discuss the thresholds for essential outcomes that are acceptable, and criteria for when they are not. Set up a dashboard with metrics and brainstorm what to do when they signal problems.
Balance strategic choices
Denyer & Sutliff’s research found that organizational resilience strategies differ on two core dimensions: mindset (defensive vs progressive) and design (consistency vs flexibility). These two dimensions form the Strategic Tensions Model, that highlights four common strategies for achieving organizational resilience.
Read more about the strategic tensions.
What can you do?
Organize a team session to talk about the Strategic Tensions Model and understand your organizational preference.
What do you need to deliver your minimum essential outcomes?
How progressive or defensive is the mindset in your organization?
How flexible or consistent is the design in your organization?
How do you balance tensions and leverage a ‘both/and' mindset?
Do you overemphasize some of the resilience strategies? (Resulting in brittleness, stagnation, disorder or fragmentation?
What further investment is required to maintain EOs within acceptable impact thresholds?
Consider working on Strategic Foresight and futures thinking. If you want to learn more, join our Strategic Foresight & Futures community.
Stress test thresholds
Resilient organizations organize sessions for scenario testing. The scenarios include failures within their control (e.g. IT system failures) and outside of their control (e.g. cyber-attack or disruption to the power supply).
What can you do?
Bring a diverse team together that works with a scenario, regardless of how that scenario happened. For instance: What if your buildings couldn't be occupied for X days/weeks?
How will your EOs be achieved during stress or disruption?
How can you be sure that alternative means will enable you to meet EOs within impact thresholds under severe but plausible scenarios?
What actions can you take today to prevent or solve these future scenarios?
Enable adaptive leadership
Leadership is critical for organizational resilience (and for a fitting organizational culture). During COVID-19, leadership teams came together daily to share information and make decisions. The pandemic showed us how quickly events can unfold - are you ready for the next disruption?
For this, you need organization-wide participation in organizational resilience. That only works if the top leadership team fully understands and embraces resilience. It is not a project but a permanent process. You need resilience to be embedded in planning, budgeting, performance management, and reward systems. You want your co-workers to be committed to responding to new challenges and opportunities as they emerge. You want them to take responsibility for resilience. This means working with all staff and developing a culture of resilience, learning, empowerment, and improvisation if necessary.
What can you do?
Get started with workshops or team sessions about resilience as discussed above.
Consider working on Strategic Foresight and futures thinking. If you want: Join the Strategic Foresight & Futures Community here.
© Marcella Bremer, 2025
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