Proactive resilience and three steps to navigate uncertainty

Taking steps to proactive resilience

Rather than defending against the unpredictable, truly agile organisations need to move towards leveraging opportunities for growth. By anticipating disruption, rather than just reacting, organisations are continuously learning and amending their strategies based on experience.

According to McKinsey , resilience leadership requires creative thinking, first-principles problem solving for navigating through disruptions, and a predisposition to learn from and adjust to crises and downturns. For leaders, the only certainty is that waiting for clarity is a losing strategy.

The best organisations know how to turn uncertainty into sustained growth. That relies on two elements, a clear view of the world and an adaptable plan to win.

It’s important that employees recognise the signs and are confident in what the response should be, depending on the risks involved. Foster anticipation of and response to change as an organisational muscle. Encourage individual managers to monitor the potential impacts of external factors on their departmental objectives, outcomes, and operational resilience.

Consistently revisit scenario plans and potential challenges at every level of decision-making. But, true organisational agility goes beyond just adding agile teams.

Leaders need to shift away from multi-layer reporting structures, rigid annual planning and budgeting cycles and a compliance-oriented culture. Instead, they need to reimagine the organisation as a network of high-performing teams, supported by an effective, stable backbone of strategy, structure, process, people, and technology.

There are three key steps to navigate uncertainty and secure a clear pathway for sustained growth:

1. Harness data to discern market trends, evaluate potential impacts and develop dynamic scenarios to support business decisions.
2. Build resilience across the value chain and functions, including organisational and supply chain resilience
3. Seize growth opportunities to build competitive advantage and medium- to long-term market position

It’s well known that data-driven decision-making at the highest level of the business leads to effective strategy and organisational agility. This is underpinned by a high degree of clarity and transparency about what the organisation is trying to achieve, which increases alignment, efficiency, and accountability.

To navigate uncertainty, it’s critical that all leaders and decision makers have the most robust data and dashboards possible, with embedded external industry data. According to Forbes “Data-focused executives make better decisions in times of volatility and crisis, and data transparency aids challenging conversations across the executive team regarding resourcing, growth, and service.”

CFOs and planning leaders have a role to play in reinventing the workforce, creating a knowledgeable, agile, collaborative, and empowered team to lead the organisation. Additionally, re-evaluating systems and processes enables CFOs to set the vision of moving to a business partnering finance function with a strategically driven approach to planning.

“Organisations must recognise that when so many things are changing so rapidly, they need to invest in people and systems that will help make sense of that change and respond to it. Organisations need data and analytics.” Gareth Herschel, Research Vice President, Gartner.

Data-driven decision-making during a crisis

A poor response can easily magnify the damage directly caused by a crisis. An effective response, on the other hand, can significantly limit the damage. Under pressure, leaders tend to favour action that can be implemented quickly, avoiding a slower, more thoughtful course.

Decisions made under pressure and at speed can result in unintended consequences. Organisations will need to create the means for deciding when to move quickly and when to slow down, and test decisions in a given crisis with people outside of the core network.

To become more data driven, organisations should consider developing three core capabilities: data proficiency, analytics agility, and community. Therefore, real-time data and analytics have to be available to leaders and decision makers in the moment, when decisions are required.

By giving people at all levels access to data will enable them to develop their data skills through practice and application.

“Real change means changing people and processes, not just technology,” says Gareth Herschel, Research Vice President, Gartner

To exercise effective oversight and decision making, boards need to develop an understanding of the global (and local) developments that are impacting the organisation. Also, to establish a benchmark for resilience, organisations should perform regular analytics, briefings, and scenario planning, with a focus on identifying trends.

Underpinning these efforts with good quality data is critical to have productive, value-creating collaboration. To ensure that everyone is on the same page and errors of interpretation do not occur, leaders should embrace technology and data, reinvent core processes, and adopt new collaboration tools.

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