Importance of Resilience in Organizations
Theresa Carik, Ph.D. October 23, 2023 Culture, Leadership, Talent Management
The workforce has been through some significant shifts over the past few years, and there hasn’t been a single industry exempt from these transformational changes. In the face of so much volatility, having a resilient workforce and organization is more crucial than ever. But what does that mean? In this article, we’re going to explore resilience in the workplace and why it’s important. We’ll also uncover the benefits of organizational resilience, the negative effects of not having it, and provide examples of resilience at work.
What is organizational resilience?
Organizational resilience refers to a company’s ability to withstand and adapt to various challenges, disruptions, and crises while maintaining its core functions and effectively recovering from adverse events. It involves more than just bouncing back from setbacks — it encompasses an organization’s capacity to continue operations, fulfill its mission, and even thrive in the face of adversity. Organizational resilience is often seen as a strategic and holistic approach to risk management and preparedness because it’s built through company culture, leadership, and employee buy-in.
Organizational resilience vs. business continuity
Organizational resilience and business continuity can often become confused with one another, but they are distinct business concepts with their own use cases and scopes. Business continuity is all about keeping a business moving forward through a crisis, and such plans govern the processes in place to keep delivering products or services in the face of disruption.
Organizational resilience, on the other hand, has more of an anticipatory and adaptable edge because it takes a long view of a company’s ability to react and remain viable over time. Organizational resilience emphasizes an organization’s ability to not only recover from unexpected disruptions, but also to transform as needed to keep pace with market demands.
Why is resilience important in the workplace?
Enhanced business continuity, risk mitigation, and increased stakeholder confidence are just a few of the benefits that your business can reap when cultivating organizational resilience. Take the COVID-19 pandemic for example. In its early days, safety protocols for mitigating the virus’ transmission changed almost week to week. Between lockdowns, social distancing, and other mitigation efforts, every organization had its strength tested for months on end. While many businesses closed, the ones that made it through did so because they quickly adapted to changing federal guidelines, consumer behavior, and employee feedback. Though a pandemic doesn’t happen very often, there are a lot of reasons to improve the resilience of your organization:
Enhanced business continuity
One of the most immediate benefits of organizational resilience is improved business continuity. By being prepared for disruptions and crises, your company can minimize downtime, maintain essential operations, and continue to serve your customers. This helps preserve revenue and customer trust. And, because your organization is planning for the future and potential what-ifs, this sort of internal optimization can also have a positive effect on your leadership’s decision-making process.
In the case of COVID-19, leaders who’ve been at the helm of their organizations throughout the pandemic have gained invaluable, first-hand lessons on adaptability, leadership, innovation, and more. Organizational resilience not only instills confidence in the leader of your company, but it also instills confidence in stakeholders — including customers, investors, and employees. When stakeholders perceive that a company is well-prepared to handle disruptions and crises, they are more likely to trust and support the organization, which could have a positive effect on your company morale during difficult times as well.
Resilient companies are more likely to survive and adapt in the face of major challenges, whether these are economic downturns, natural disasters, or industry disruptions. They can also evolve their strategies and business models to remain relevant and sustainable. This is perhaps one of the greatest benefits of organizational resilience, as it gives your business the ability to tangibly plan into the future.
Risk reduction & mitigation
Organizational resilience involves proactive risk management. By identifying and mitigating risks before they become crises, your company can avoid or minimize the impact of adverse events. This can lead to cost savings, increased business efficiency, reduced insurance premiums, and protection of the organization’s reputation.
When your business is resilient through disruptions, whether they’re global or specific to just your industry, everyone takes notice — from customers to suppliers. That’s why resilient companies are better positioned to seize opportunities and gain a competitive edge, because they can adapt to changing market conditions, innovate more effectively, and capitalize on emerging trends. Being seen as a reliable and adaptable partner or provider can also attract new customers and business opportunities, including appealing to top talent and retaining the star employees you already have.
Effects of poor workplace resilience
So we’ve seen how good it can get when your organization is resilient, but we should also know how bad it can be when it’s not. Having a fragile workplace or organization can lead to negative results in the face of change when your team needs cohesion and confidence the most.
Here are a few effects of poor workplace resilience:
- Employee disengagement and or burnout
- Financial burdens due to restructuring
- Poor crisis management
- Reputation damage
- Decreased innovation
- Talent acquisition challenges
- Customer dissatisfaction
Examples of resilience in organizations
Now that you understand the importance of fostering resilience in the workplace, let’s explore some real-life instances of resilience in action within organizations. These examples illustrate how businesses can cultivate resilience to effectively navigate a wide range of challenges, whether it’s a change in leadership or unexpected shifts in market dynamics.
Change of leadership
Imagine a well-established tech company where the CEO unexpectedly decides to leave or retire, leading to the appointment of a new, untested leader from within the organization. Organizational resilience helps mitigate the risks and negative effects associated with an executive departure in part by fostering a strong corporate culture.
Employees who feel resilient at work within your organization are more likely to trust the direction and vision of a new leader and the plans already in place. Implementing succession plans, promoting effective communication, and leveraging past adaptability experiences also go a long way toward cultivating and fostering this kind of resilience, collectively ensuring a smoother leadership transition and maintaining the organization’s overall stability and effectiveness.
For this example, let’s consider a manufacturing company that has decided to restructure its operations due to changing market dynamics and technological advancements — something many firms have had to undergo. This restructuring may involve layoffs, departmental mergers, and changes in production processes.
Having organizational resilience can help mitigate the negative effects and risks of this restructuring process because a well-defined communication strategy would already be in place to ensure that employees are well-informed about the organization’s shift. Further, organizational resilience instills a flexible and can-do attitude in your workforce, encouraging employees to be open to changes in their roles and responsibilities. A resilient organization also has diversified revenue streams and adaptable processes, allowing it to pivot quickly in response to market shifts, which is essential during a restructuring process.
Shift in work processes
For our final example, think of a mid-sized marketing firm that decides to transition from traditional advertising methods to a more digital-focused approach in response to evolving consumer preferences and industry trends. In this scenario, organizational resilience becomes essential because you’re pivoting the way your employees go about their day-to-day activities.
Without the agility instilled by a culture of organizational resilience, your employees could decide to quit, leaving you understaffed and vulnerable during a time of great change for your business. When work processes change, employees in a resilient organization are more likely to embrace these shifts. Resilient organizations also tend to have diversified skill sets among employees. When work processes shift, employees with diverse skill sets can more readily pivot and contribute to the evolving needs of the organization, reducing the risk of skill gaps and productivity lags.
Start developing your talent & resilience
Companies that prioritize resilience not only safeguard their operations but also position themselves for long-term success. While talent development and skills improvement remain critical, it’s equally vital to focus on building an organization’s capacity to adapt, innovate, and thrive in the face of adversity.
At Keystone Partners, we understand the interconnectedness of talent and resilience. Our services encompass not just talent and leadership development but also organizational development as well. We help organizations cultivate the skills and mindset needed to withstand disruptions and emerge stronger.
Contact us today to learn more about how Keystone Partners can tailor a comprehensive resilience and talent development strategy to fortify your organization’s future.
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