“Organizational Resilience” Takes Top Billing at Davos

“Organizational Resilience” Takes Top Billing at Davos

One of the most exciting things for me as an advisor to multinationals is comparing patterns I see to the themes at the World Economic Forum. Hearing about issues that CEOs and world leaders are working on gives me a jump on peeking around the corners my clients are likely to encounter. This year the theme “resilience” took top billing. Having written Resilience: It’s Not About Bouncing Back in 2019, I can say, “It’s About Time!”. I am thrilled to have other voices join me on this topic. In 2015, I said, “Resilience is the number one skill leaders need, and no one is talking about it.” It took a pandemic, but better late than never. This topic deserves top billing as the two sure bets are that we aren’t going back to the world we had pre-pandemic and disruption has become constant. Smart CEOs are preparing for that.

Resilience Pays Off

When I started researching resilience, there were exactly two articles to be found about it. But with the benefit of a few years to study resilient companies, we know that those that act in resilient ways outperform their peers by up to 50% on shareholder returns.  We also know that becoming a resilient organization comes with a cost. McKinsey Managing Partner Bob Sternfels, head of the World Economic Forum’s Resilience Consortium, advised leaders to think of building resilience as an investment, rather than an expense. Resilience is an enabler to driving sustainable inclusive growth. In short, he made the point that resilience matters. He went on to say that 20% of GDP growth this decade is at play…it’s going to go up or down, depending on how well we are able to build resilience. This is a massive number.

Resilience Prepares Teams For The Unknown

Also at Davos, the CEO of BNY Mellon, Robin Vince chimed in to point out that resilience is a commercial effort – it is an investment made to ensure you can weather these kinds of storms. The discussion gravitated to how the new work of CEOs is to prepare for all reasonable possibilities. While we cannot predict the future, we surely can prepare for likely outcomes. This can be a daunting effort, but it doesn’t have to be. While I still believe the same framework applies to building individual and organizational resilience that I present in the LeaderShift® Resilience Framework, there is another piece that must join the equation. We must anticipate, plan for and pressure-test our responses to likely scenarios in ways we never have before.

Scenario Planning

Many of my strategic planning clients have done some version of scenario planning in the past, but companies striving to build organizational resilience are now making it mission-critical. We will never be able to predict the future. But we can brainstorm possible scenarios, prioritize them by likelihood of occurrence and build contingencies that can be relied on if, and when the scenario occurs. One of my clients is a multinational consumer products company that is trying to price above inflation. That’s a tough moving target to nail. But they can anticipate a few scenarios that could happen, build some gate checks and adjust their strategies during the year as the numbers move. Even if they don’t beat it, they’ll come a lot closer than they would have if they didn’t consider the scenarios. Going forward, bulletproofing your strategy is about making it resilient by planning for likely scenarios.

If you would like help building a more resilient team, organization, or strategy, call us. It’s what we do. 

To learn more about how leaders and their organizations can build and increase resilience in the midst of disruption, check out our book Resilience: It’s Not About Bouncing Back.