With a globalised COVID-19 virus killing hundreds of thousands of people, creating massive economic disruption, and heightening geopolitical tensions – the world seems to be a more fragile place. Yet, there are lessons we can take from this pandemic. Learnings which can make us stronger, more resilient, and more realistic.
In this article, I will try to summarise some of the insights gleaned from helping dozens of organisations adapt to today’s realities.
Lessons on Resilience
The first lesson is that a highly interconnected and complex world is also a fragile one. In such a world, some of the so-called “Black Swan” events, or those that seem highly improbable, are in fact inevitable. And some of these events will be incredibly harmful. If this assertion is true, then it makes sense to literally “expect the unexpected”.
This leads us to a second lesson: that resilience thinking is core to both organisational strategy and design. We have regularly seen that our traditional Business Continuity Planning and Risk Management frameworks are necessary but insufficient to deal with a fluidly uncertain world. Research and practice both indicate that we need two sides to our resilience thinking.
- This includes traditional risk thinking in preparing for foreseeable challenges. However, “fortification” strategies also include ways to buy time to respond – for example, the maintenance of capital reserves.
- When faced with an unexpected challenge some organisations can respond faster, and more rationally, than others. These are the entities which are inherently more adaptable. So, adaptability, becomes as important as efficiency in designing organisations.
Fortunately, there was some cause for comfort in the resilience of several of our major enterprises. It turns out that our banks were heavily fortified (great capital reserves), and many leaders have commented to me that our level of adaptability has been better than expected. However, we have also seen organisations suffer from decisions to reduce cost at the expense of resilience. For example, some off-shore service centres proved ineffective or entirely absent, and some supply chains broke down. Furthermore, if we had suffered an early and severe outbreak we would not have had the medical supplies to cope. So, we could and should do better on resilience.
We have also learnt that some of our prior lack of adaptation was, at least in part, due to self-imposed limits to change. We know this because we found that, when push came to shove, we could adapt faster than we had thought. Consider a simple example – for over a decade there has been a slow-moving discussion and debate about whether psychological services can be delivered online. Well now they are, with the potential for major benefits if we can offer such services to remote communities via our now ubiquitous video-conferencing platforms. We should be changing a lot faster now, because such changes make our services, our economy, and indeed our population, much more resilient.
In delivering such changes we have also learnt that we can collaborate in surprising ways. This has been an important part of our ability to adapt quickly. Rather than locking ourselves into fixed and immutable positions we have seen the reasons to work together for the greater good. To paraphrase the stoic Emperor Marcus Aurelius “What is good for the beehive is good for the bee”. This idea, that our self-interests are served by supporting the organisations that sustain us, has been at the heart of our adaptation success. Yet, unfortunately, I do see early signs of this enlightened attitude collapsing as people and functions position themselves for the “new world”. This is folly given that the crisis is not over, rather it has just moved to a new phase in which economic and social disruption is a certainty (and further infection waves are a real threat).
Insights from Systems Thinking
To my delight, some of our leaders are rapidly becoming “systems thinkers”. Systems thinking is a fabulously effective way to understand the reality of “an interconnected world”. We can have a broad variety of systems that rely on connections, including economic, banking, health, public transport, etc. Good systems thinking allows leaders to see that
- Normal is a balance that can be easily disturbed
- Multiple perspectives are needed to design solutions which work in a complex context (hence the importance of diversity of thought)
- Undesired consequences can arise from our interventions. For example, closing schools may reduce the spread of COVID-19 (the jury may still be out on this one) but it can also reduce the ability of some health-care personnel to go to work
- There are often delays in responses to interventionist actions. For example, we might not know the real impact of Job-Keeper until more than a year has passed
- Feedback loops are critical in any system. For example, we need to be monitoring closely the effects of our interventions and adjusting our course accordingly (e.g. we think we have communicated, but how do we know the message has been heard without a feedback loop)
- Vicious and virtuous cycles are important to understand. For example, cutting costs too deeply might reduce the ability of the organisation to adapt to changing circumstances, which leads to further cost reductions which leads to lower adaptive capability (and so it goes on). This is a vicious cycle.
So, there are lessons to learn from our COVID-19 experiences. Surely, we have paid too high a price not to learn from them. Yet, we will need to make a conscious decision to consider and then apply these lessons, because I already see signs of a return to prior postures (e.g. operating in isolated silos to the organisation’s overall disadvantage). Furthermore, the crisis is not over, and there may be more surprises around the corner. So, it makes sense to consider know how you will build your own fortification and adaptation strategies.
By Roger Perry – CEO Bevington Group