The Magic Sauce
Endurance and Resilience in Organisations
Photo by Pedro Sanz on Unsplash
Introduction
Start ups and scale ups tend not to think to far into the future by nature, but established companies need to think about how they will survive long term and how to avoid being eaten by competitors or be overtaken by events.
Inevitably, over time, the products and services provided will change. New technology will challenge the organisation and new competitors emerge. Totally unexpected events may change the competitive landscape e.g. Covid-19 or the Ukrainian war. To endure over time, organisations must become resilient.
This article looks, very briefly, at the last component of the SOCCER model and it links into Strategy, Operations and Change Capability.
This area is hugely rich in lessons around business growth and survival but let’s just keep it short for today and just introduce the topic.
Definitions
Endurance and resilience are often defined in similar and interchangeable ways. The Institute for Strategy, Resilience and Security at UCL (I’m a Senior Fellow) defines resilience as ‘the enduring power of a body for transformation, renewal and recovery through the flux of interactions and flow of events.’
As a result, I regard endurance as an active outcome of resilience and resilient thinking. For some organisations e.g. government agencies, endurance may be more of a passive outcome i.e. they exist because nothing else can readily take their place.
The Limitations of Conventional Strategic Planning
Traditional strategic planning processes typically create a ’rational’ forecast with upper and lower bounds of confidence. Companies tend to ignore “radical uncertainty” – ‘unplannable’ high impact risks- and focus on atomised risk with low impact risks discarded. Corporate history shows that, over the long term, these models of linear extrapolated growth are not reliable.
Therefore, in order to survive, organisations need to be able to change and adapt their strategy to meet not just changing customer needs through a strong customer focus but existential risks such as supply chain issues, new disruptive technologies, legal rulings and external threats from left field such as Covid.
That requires in term strong long term organisational capability - strategic planning, financial stability, talent management, leadership and ethical responsibility but strong change capability - adaptability, innovation and transformational leadership.
The Magic Sauce
Resilient thinking is the magic source of successful enduring organisations. As humans, we are drawn to success stories associated with growth. When I did my MBA, Tesco was the darling of business schools but, over time, people became bored with supermarkets and moved onto tech companies.
Yet Tesco are still around and are still number one in the UK with a turnover of €58.13 billion (2022). Their challenge is to stay there in an increasingly competitive market with newcomers like Aldi, Lidl eating into their (and other existing competitors) marketshare.
Next On Seven Heads
Now we’ve worked our way through the SOCCER model, I’ll be diving back into a more diverse range of articles but I’ll be linking this through the model. I’m going to pause until January, partly for Christmas when you really should have better things to do than read blog posts, partly to develop a content calendar and also to take up a new position. If you’re on LinkedIn, please feel free to follow or connect (unless you’re going to immediately try and sell me something).
I hope you have a restful and happy holiday period.
Best Wishes
Pete