Introduction
One of the latest management phrases is Resilience which has moved the topic of sustainability along from simply surviving to being able to counter or spring back from circumstances that were not foreseen.
To some extent this has it’s roots in ancient philosophy as it is not so much about events themselves, but rather the reaction to events, again a deeper notion is about worry or control. A modern day CEO cannot possibly control every part of the external business environment and cannot possibly predict how things will turn out. What the CEO can do is plan and control the reaction of the business to events to which may or may not happen.
This is the basis for a lot of modern day tools and techniques ranging from Strategic budgetary planning, Risk Registers, KPIs ,disaster recovery plans and scenario planning.
Again, nothing new under the sun and again, it is not only the event that the ‘what if scenario’ comes true but also way the firm reacts to the event either on a planned (preferably) or unplanned basis. Either way has the firm developed enough resilience to cope with the change and re allocate its resources accordingly?
To a large extent it depends also on size , larger firms can have a more direct impact on the environment and set the strategy and markets will emerge, smaller firms may actually sit and wait for the change and then react, some firms, irrespective of size may merely do nothing and ride out the storm whatever happens.
When it comes to resilience, contemplating the view from above at the strategic level is a good place to start.
A CEO with a view
This very much depends on the CEOs own internal perspective and how decision making is done and compromises can be made .
One of the most commonplace practices is taking a view from above to put current problems in perspective , this can be done by placing the current issue literally in perspective in the general economic environment and also looking at the time issue and whether actually doing anything may help or the problem may just disappear over time via self resolution ( not to be confused with procrastination). By contemplating the scale of the issue it could actually pale into insignificance in the broader context of what the firm is actually trying to achieve, so to some extent another phrase that springs to mind is ‘don’t sweat the small stuff’ Not because it is insignificant in itself but because it is insignificant when taken with all the other issues the firm faces and if there is a resource to be allocated, it needs allocating in support of the bigger picture.
A CEO with control
Where resilience is concerned a sense of perspective is also useful about control and how much value we can put on non controllable and controllable events. There is not much a CEO can do about that Asteroid that will one day hit earth, so this non controllable event is simply not worth worrying about, however , a price rise by a supplier is.
A CEO will have a view, which will be transformed into a vision which requires allocation of resources at every level to achieve the overall goal and the subordinate goals along the way, there will be checks, balances and alternative solutions to events which are controllable by the firm in reaction to non controllable, but actionable events.
A CEO will have to understand what is and is not controllable and will have contingency plans in place to ensure that there is in built resilience to the business in response to these external stimuli.
A CEO with control accepts that success or failure isn’t entirely within their control but actually focuses resources on what can be controlled to maximise resilience and minimise adverse organisational reactions
A CEO with reactions
If this section seems like a return to Stoicism, in some respects it is as Stoics themselves were concerned with concepts such as loss, underperformance so the concept is quite old. Resilience is not just about bouncing back to a steady state or where you were before it is also about re arranging the resources you have to get to a place which is more resilient than it was before so that if the event happens again, you are better prepared at least for having already experienced it. If the same event recurs it becomes the new ‘normal’ and the firm continues. A reactionary CEO, or indeed a CEO with reactions knows instinctively that every experiences is a lesson and Resilience means acting or reacting in accordance with the organisational values and in accordance with what the organisation values. However, Stoicism in extremis is not about passive acceptance of everything life or business throws at you (on the basis that, in essence there is little you can control other than your belief system) Stoicism is more of a coping and adaptive mechanism and a way to modify your worst extremes of behaviour to arrive at a way that works around the obstacles that have been presented. It is quite the opposite of a passive approach and resignation it is a dispassionate look at alternatives and ways of doing things which solve the problem in a way that the CEO can remain true to their own belief system and the values embedded in the business. This is sometimes known as a common sense approach to decision making
A CEO with common sense
Here are a few observations
A CEO can only control the controllable
The Actions (and reactions) of a business are controllable
Anything else is uncontrollable
Confusion, dis-ease, pain and blame arises from attempting to control the uncontrollable
Resilience occurs when you differentiate between controllable and uncontrollable and manage to avoid any unpleasant uncontrollables
Lack of resilience (vulnerability) occurs when you direct resources into pursuing the uncontrollable and not achieving your desired result which leads to anger and frustration
Resilience can also be enhanced by acceptance that the chosen action/ decision may not have achieved the desired result. The trick is then to accept the sub optimal outcome and make the best of it, maybe by taking another action/decision that gets you to your ultimate place. In that sense it is always about your reaction (or the organisational reaction) to events.
As stated earlier Resilience is not a wholly passive exercise, not is it about avoidance. In it’s purest from it is about accepting that stuff happens and dealing with it appropriately. The definition of appropriately is underpinned by the prevailing belief system, values and culture of the CEO and the organisation as a whole.
