Building organisational resilience

In the first of a series of five articles, BSI explains what organisational resilience is, and why it's important.

Founded in 1937, Polaroid produced its first instant camera in 1948 to immediate success. For much of the 60s and 70s, the company had a unique USP: instant photographs. But by 2000, there were clouds on the horizon. New technology was emerging and sales of digital cameras were threatening to overtake sales of analogue cameras.

Between 2001 and 2009, Polaroid filed for bankruptcy twice. At first glance, it seems as though Polaroid simply failed to keep up with the market; however, the truth is more complex. By 1989, more than 42 per cent of Polaroid’s research funding was focused on digital imaging. The business was taking the necessary steps to evolve with the market – so, what went wrong?

Its failure rested on an incorrect assumption, that people would always want analogue film. The company could envisage a digital world, but it was a world in which digital and analogue existed side by side. This assertion was so firmly ingrained in the business that it almost led to its demise.

Polaroid didn’t manage to keep its market edge, but could organisational resilience have kept it at the forefront of the industry?

What is organisational resilience?

Organisational resilience is ‘the ability of an organisation to anticipate, prepare for, respond and adapt to incremental change and sudden disruptions in order to survive and prosper’.

At first glance, the term ‘resilience’ brings to mind the idea of fortifying a business. But the term is about more than just increasing the robustness of a business – it’s about looking forward to see what might happen and striving to stay one step ahead.

The four pillars of resilience are:

1) Governance: for resilience to be effective, key stakeholders and senior management must be aware of and ready to implement changes.

2) Resilience: taking steps to make a business more robust before anything goes awry is vital.

3) Business continuity: many businesses that are hit by disaster and do not have a continuity plan in place do not make it past the one year mark. Business continuity is about finding a way to mitigate the damage and get back up and running so as not to lose operational profit.

4) Crisis management: when it comes to risk, it’s important to have a plan to implement in a crisis. This will help mitigate the cost and loss that occurs at the time.

Always be prepared – put a plan in place

Having a plan to help you tackle disaster can be invaluable. This could be as simple as strengthening your supply chain. You can make your supply chain more robust by sourcing 70 per cent of a product from one supplier and 30 per cent from another, leaving you an alternative option if disaster strikes.

Look to the future

Organisational resilience is about being forward-facing – anticipating, preparing for, responding and adapting to change. A resilient business is not just one that survives, but one which flourishes.

True resilience is about maintaining best habits and best practice and filtering these competencies throughout an organisation and supply chain. Effective resilience allows a business to take measured risks with confidence.

Why is it necessary?

Research by RSA found that more than half of start-ups don’t last more than five years, which shows how difficult it is to negotiate the modern business marketplace. With the ever-evolving nature of technology and a hyper-aware, hyper-connected business landscape, change is faster than ever. It’s essential that businesses take steps to remain agile enough to effectively negotiate the marketplace.

Typically, successful start-ups constantly reassess their target market and continually change their product in reaction to changes in the marketplace and demand from consumers. This attitude needs to filter up to larger companies. In our current marketplace, a business can take nothing for granted; it must anticipate change and move swiftly towards new opportunities. Organisational resilience is about maintaining this questioning mentality regarding business proposition and adding value to the market.

Taking the time

Redundancy, used in this context to mean taking the time to sit down and analyse the market, is essential. Senior stakeholders need to be involved in this process, as it’s more than just reflection – action is important, too. The very act of taking the time to sit down and look at your modes of working and doing a stock-take of the marketplace can be invaluable – and should be prioritised, no matter how full your schedule gets.

How do standards fit in?

BSI believes that resilience is the ‘missing link’ in the business process that will help companies survive in a volatile marketplace, and standards are the foundation for this resilience.

ISO 22316 Securities and resilience - guidelines for organisational resilience, a landmark standard relating to organisational resilience, will be released later this year. There’s already a British standard in this area – BS 65000 Guidance on Organisational resilience – but the upcoming ISO standard will be international.

In a wider sense, there are many standards that will help to enhance the resilience of a business, from environmental aspects to business continuity. ISO 9001 Quality Management, for example, is hugely popular, with 1.3 million people subscribed, and is a standard that could be seen to improve organisational resilience by creating a more efficient infrastructure. 

The human touch

The true nature of organisational resilience is more complex, and goes one step further than standards. It needs to be inherent in a business, not just in its infrastructure, but in every component. This means that true resilience stretches not just to the idea of company culture, but to every single individual. Just as senior stakeholders need to take an active approach when it comes to keeping an eye on trends, issues and opportunities, so does each and every member of staff.

Although standards can help to reduce your organisation’s vulnerabilities by making you less exposed to a particular event or weakness, it’s ultimately the people that have the greatest potential to ensure true organisation resilience.

So, what’s the key to organisational resilience? Being future-facing, horizon-scanning and adapting before the marketplace changes, not after. And standards are an effective way to help stimulate these organisational changes.

Permission to reproduce extracts from BSI Publications is granted by BSI Standards Limited (BSI). No other use of this material is permitted.

This article was originally published on the BSI Member Portal. If you are interested in learning more about BSI and BSI Membership please contact BSI.      

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