Organizational resilience — a term that everyone of us has probably heard before, at least since the COVID-19 pandemic, but what exactly does it actually mean? We have taken a closer look at this topic for you to find out what organizational resilience actually means and which factors can help companies become more resilient.
Particularly as a result of emerging environmental turbulences such as financial crises, the effects of climate change or globalization, companies are constantly confronted with new (competitive) challenges. In particular, the COVID-19 pandemic has once again shown the fragility of many companies and their value chains, with delivery delays and bottlenecks due to social distancing or the closure of international borders. These challenges are being pushed once again by the war of aggression on Ukraine.
However, if we have learned one thing during the pandemic, it is that companies are affected by it in very different ways and also deal with the resulting challenges in different ways. While some companies were confronted with high uncertainties and lost sales due to suddenly changing customer demands, supply chain disruptions and rapidly changing competition, other companies have proven the ability to draw opportunities from this and increase their own turnover accordingly (even regardless of industry 😉). This in turn leads us to the concept of organizational resilience.
But before we go into it any further, have we asked ourselves the question of what is the difference between risk management and risk management? Did some companies simply have a better knack for their risks or do the reasons lie elsewhere?
Yes. While risk management is concerned with how to anticipate (potential) risks, minimize them or even avoid them, organizational resilience is more about environmental turmoil that cannot or can only barely be anticipated. For example, at the beginning of 2020, who would have thought that the COVID-19 pandemic would reach such an extent? Hardly anyone!
This means that resilience is less about avoiding risks, but more about anticipating new challenges in good time, understanding, accepting and overcoming them (coping) and, above all, adapting to the new reality (adapting) in order to take advantage of the opportunities that arise from such crises. As Stanford economist Paul Romer said:
A crisis is a terrible thing to waste.
Resilience is therefore no substitute for effective risk management, but an important addition to this.
The five most important factors that have helped companies not only to overcome crises such as the one that is currently ongoing, but also to draw opportunities from them.
1. Flexibility and agility
Especially when faced with sudden and unexpected changes, it is important to be able to react flexibly and quickly to them. This can be achieved through diversity, for example in the product portfolio or through suppliers, but also through the type of cooperation.
Especially at the beginning of the pandemic, there was also a high level of uncertainty among us and we first had to evaluate how to deal with the new situation. While we were still working on projects on site with customers from Monday to Thursday before the pandemic, we were abruptly unable to be with customers on site or in the office as usual due to social distancing measures and lockdowns. Faint or sit back and wait? Not an option for us! Even before the pandemic, we had a flexible, agile and digital working environment, which allowed us to quickly switch to virtual work and address individual challenges such as loneliness or increased stress due to a lack of childcare, for example.
In addition, hierarchy-free communication channels have accelerated decision-making processes for changes and, above all, continued to maintain a high level of transparency.
Even though we all missed personal contact in the office (and perhaps even a wine or two on the roof terrace 😉), not only we but also our customers have learned what opportunities and opportunities arise from the new type of virtual collaboration, which is why we want to maintain a hybrid working model in the future.
To ensure that all employees are also optimally equipped at home, 55BirchStreetCoronaExpress delivered a care package to every employee's home right from the start of the pandemic.
2. (Cross-functional) collaboration
Another important factor of resilience is close, transparent and open cooperation and collaboration — not only between internal and external departments, but also with relevant stakeholders. Because in order to be able to react quickly to new challenges, it is important that there are effective and open flows of knowledge and information.
For us, too, it was important, especially at the start of the pandemic, to maintain communication both internally and externally. To do this, we sat down virtually and discussed how to deal with the new situation, in which we can no longer personally coordinate with each other in our office on a weekly basis. As a result, we introduced so-called MonDailys and FriDailys, for example, and have retained them to this day. In these team meetings, the team's mood and challenges are queried twice a week (How are you doing? What are the current issues? How do we deal with the new challenges? Where and how can you be supported?).
As a result, problems can be identified in good time, quick, joint solutions can often be found and team cohesion can be further strengthened. But in order to remain in close contact and exchange with our customers as well, we have introduced many more regular, virtual coordination appointments and routines here as well.
3. Behavior and Cognition
Another important factor is the mindset of employees and managers and the general way of working together within the company. In particular, a corporate culture is important in which people trust and encourages the assumption of responsibility, so that employees develop and implement their own ideas and creative solutions. Speaking openly about mistakes and reflecting on them is also of fundamental importance in order to achieve organizational resilience. We have also noticed that such an open culture has contributed to employees courageously and openly taking on new challenges and changes, quickly developing new solutions and ideas, and learning from mistakes.
4. Digitalization
Even though close, flexible and agile collaboration is the key to resilience, technology is what makes this possible in the first place. Because even we would not have been able to hold meetings, workshops, job interviews and/or onboardings during the pandemic if we had not previously equipped one with laptops and introduced a cloud-based type of collaboration.
This is because the ability to work from anywhere and to remain in close and effective contact and work was based on the software and hardware equipment that employees had previously introduced. In order to be able to continue working together in a hybrid and effective way in the future, for example, we have equipped our offices at home with the necessary technical equipment.
In other organizations, too, we have seen that companies in particular that invested in digitization before or quickly at the start of the pandemic have drawn or developed opportunities because they were able to adapt to new changes so quickly and take advantage of them.
5. Customer orientation
And last but not least, it is of course unavoidable to respond to changing customer needs and to question what do our customers need in the short and long term? And how can I develop myself as a company?
With us, too, many customers first looked at themselves at the beginning of the pandemic and often even stopped ongoing projects. As I said, we too had to briefly evaluate how we would deal with the new situation. But it quickly became clear that now it is perhaps even more important than before to see how we could support our customers. What exactly are the new requirements? How can we support them in such a situation? Where can we start there?
Exactly what organizational resilience is: Unexpected and drastic crises such as these not only cause uncertainties, drastic changes and new challenges, but also offer many new opportunities through new opportunities and changing competitive situations. The start of the pandemic was also a big task for us, but among other things, we have learned that we can now also successfully deliver projects completely virtually — which not only saves travel costs and time, but also broadens our horizons. We were also able to strengthen trust and team cohesion overall by working from home, and we will continue to do so!
What experiences has your company had with organizational resilience in general or during the pandemic?
We are looking forward to talking to you!
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