A First Step Toward Resilient Organizations

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Certain practices and capabilities can also train managers to be more aware. For example, mastering piloting, which involves using small-stakes engagements for a better understanding of the world, can help managers develop their awareness and make better decisions in constantly changing environments. By practicing “organized abandonment” of failing projects, managers learn to manage themselves, confront their biases, and develop a self-awareness that their past efforts and engagements don’t define them.

My observations and interviews in the region suggest that decoupling was to blame. Just as dormant tectonic fissures lead to earthquakes, the dormant social polarization and fragmentation surfaced in crisis time. The unstoppable market forces led to a doubling and tripling of the prices of commodities, trucks, containers, and many other necessary supplies. The cultural rift between locals and immigrants led to ineffective resource sharing. The political forces clashed, not just failing to coordinate but also actively undoing each other’s efforts to deliver assistance.

However, building resilience isn’t without challenges. Empowering individuals and relying on them to achieve organizational resilience exposes them to stress. While this can result in higher performance when facing a crisis in the short term, it becomes essential in the long run to provide sufficient resources and time to alleviate the effect of adverse events on organizational members. Managers must recognize that they can’t jeopardize their people for the sake of organizational performance. Their responsibility lies in ensuring the survival of units by providing the necessary resources and allowing them to learn from experiences.

Organizations are intricate systems with various components interacting in diverse ways, making it impossible for any member, even directors and the CEO, to have a complete picture of the organization, despite all efforts to collect data and information. Consequently, all members inevitably focus on partial observations of what happens and fill in the gaps of unobserved reality with their own beliefs and assumptions.

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Achieving resilience is a gradual process that requires patience. It can’t be rushed, but it can be nurtured through clear strategies and awareness as well as material and social collaboration. Managers must recognize the boundaries between the unpredictable and awareness; self-reliance and dependence; and short-term reactions and long-term improvements. Only then can they effectively achieve resilience.

Published Sept. 21, 2023, on INSEAD Knowledge

منبع: https://www.qualitydigest.com/inside/management-article/first-step-toward-resilient-organizations-100523.html

Published: Thursday, October 5, 2023 – 12:02

For instance, the Haier Group Corp. emphasizes self-control, proximity to the user, and decentralized self-management—practices that empower managers and are paramount to enabling quick decision making and adaptability. Numerous micro-enterprises form ecosystem microcommunities (EMCs), each focused on creating value for the consumer. They’re not attached to the product, and they work toward the same goal with their only “boss” being the user. They see themselves as part of a bigger goal, and act in unison when faced with a crisis, just as they did during the coronavirus pandemic.

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A First Step Toward Resilient Organizations

Using clear strategy, heightened awareness, and robust reserves

Renowned management thinker Peter Drucker identifies one source of decoupling. He criticizes “management by drives,” a form of regular crisis drills, and argues that excessive preparation can diminish the sense of urgency needed during a real crisis, a realization that only becomes apparent when it’s too late.

An organization’s resilience can’t be measured in advance. Crises, by definition, emerge not only from unfamiliar, disruptive, and unexpected events, but also when the immediate consequences of such events get entangled and intertwined with the complex dynamics of the organization.

A clear strategy can become an anchor, helping managers distinguish opportunities from threats during crises.

Organizations seeking to enhance resilience shouldn’t seek a one-size-fits-all solution but aim to improve awareness among managers of both internal and external dynamics. In crises, it’s important to be aware of how people feel and what they know. Awareness of the changing business environment will also enable empowered and autonomous managers to successfully redesign tasks, objectives, and performance metrics. Establishing an organizationwide internal strategy is a promising starting point, supported by practices that help managers raise their awareness.

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Decoupling isn’t limited to businesses; it can affect the resilience of regions and even entire countries in the face of disasters. Consider the recent earthquakes in southern Turkey that killed more than 50,000 people and destroyed an even greater number of buildings. Before the earthquake, the affected region generated nearly 10% of the country’s GDP and accounted for 8.5% of its exports—all expected to be drastically diminished now. Was this destruction all due to the unexpected severity of the earthquake?

However, in such decentralized organizations where managers define their own objectives, tasks, and performance metrics, achieving an organizationwide understanding of the ultimate strategy can be difficult and, at times, fall short in preventing decoupling. Therefore, managers who aspire to lead resilient organizations must instill awareness among members.

Raise awareness in individuals and establish support systems

What’s most striking is that all government entities and disaster response organizations conducted a drill in 2019 for a 7.6 magnitude earthquake in exactly the same location as the 2023 event. These drills resulted in developing a disaster response plan that identified all stakeholders and their specific roles and responsibilities. Despite this, the decoupling of the carefully crafted and practiced disaster response plan, along with a fragmented response due to social fissures, lead to a man-made disaster. It’s now a devastating lesson of how organizations are susceptible to the same risk of ineffectively responding to crises.

Prevent decoupling with a clear strategy throughout the organization

One pillar of achieving resilience in organizations is based in preventing and reducing this decoupling phenomenon. A strong, clearly communicated strategy that is consistently implemented throughout the organization is one approach to prevent decoupling. A clear strategy can become an anchor, helping managers distinguish opportunities from threats during crises. The more robust the strategy is during a crisis, the more decisively an organization can act and respond to the adverse event. Resilience then becomes a manifestation of the strategy, assessed by an organization’s ability to fulfill objectives and maintain its performance. This may involve structural changes, cultural transformations, or overhauls of its technological operation. Even business continuity plans should be abandoned if they hinder the organization’s ability to seize opportunities during a crisis.

This “decoupling” between individuals’ beliefs about the organization and the realities elicits difficult-to-predict organizational responses that become an integral part of the crisis. An exacerbated and even more unpredictable situation emerges, and the resilience of the organization is revealed only as the organizational response unfolds.

Having a separate budget for resilience, to be used when operations and innovation are disrupted, discontinued, or dysfunctional, can be an effective strategy. Nevertheless, recognizing the limitations of self-reliance and self-sufficiency as sources of resilience is just as important. Trust-based collaborative partnerships, both within and outside the organization, can facilitate the reallocation of material and human resources to those in need during disruptions.