Feature
“ Resilience and
crisis readiness and workforce agility. It seems investors want to know that when the next major disruption arrives, a business is prepared, can rebound, adapt and thrive. So, how do you prepare your firm for resilience and adaptability? We learned a lot during Covid. Business loves stability and during those stable, before-times, many companies relied on global supply chains to provide the cheapest products “just-in-time.” With structured business models, they leaned out and focused their production, looked for and locked in efficiencies, prioritized operations over R&D, and trimmed every ounce of fat out of the system. And then the pandemic. The flow of global goods dried up; thin inventories disappeared, labor and customers stayed home and firms struggled to innovate and pivot. With little or no slack in the system, many companies just didn’t make it. Resilience is the firm’s ability to absorb a shock and keep going. That means you can’t trim all the fat. If you do, you won’t be prepared for the lean times. That preparation means protecting and maintaining cash flow and cash reserves. If your customers are defecting or just staying home, you’ll need to find new ways to reach them and that may take some time. Cash on hand or a loyal, repeat customer base may buy you that time. An alternative to your primary supply chain may help keep things operating if a ship runs aground in some far-flung canal. Resilience preparation has a lot to do with a careful analysis of your vulnerabilities. Once you make that analysis, it’s a risk, return question. Redundancies, backups, buffers, cost money;
adaptability aren’t strategies. They’re capabilities. And like any capability, they can be built.”
but they’re a lot cheaper than a catastrophic shutdown. Okay, with your buffers and redundancies you’ve managed to handle the initial shock of disruption. But if that disruption is just the first breeze of a dramatic climate change, it’s probably time to evolve, to adapt the way you do business to keep pace with a changing environment. Adaptation preparation? Now there’s an irony. How do you prepare for something you’ve never seen before? That preparation doesn’t happen overnight. You build it, bit by bit, over time. It’s the organizational equivalent of doing your cardio, your pushups and stretches every day. That’s not flashy, but when you need the speed, the strength and the flexibility, you’ve got it. Let’s go back to early 2020 for a second. Businesses large and small shut down. Some were able to pivot. Restaurants became delivery hubs. Breweries made hand sanitizer. Zoom became a verb. But the companies that survived weren’t just lucky. They had already built some degree of adaptability into their operating DNA. Recent research from
McKinsey found that resilient organizations typically outperform peers by 20% during crises and rebound 50% faster post-crisis. Organizations that recover fastest from disruptions have three traits in common: decentralized decision-making, technology- enabled workflows and cross- functional collaboration. These traits are part of the agile firm’s internal business model. What they do every day. In a competitive marketplace speed is an advantage and friction is the enemy of speed. In traditional organizations, decisions crawl up the chain of command, get watered down in committees and often emerge too late to matter. In adaptive firms, decisions happen where the information lives—at the team level. If you flatten the decision structure, you reduce bureaucratic friction. The faster information moves the faster you adapt. Spotify is famous for its “squad” model—small, autonomous teams with end-to- end ownership. The structure sounds loose, but it’s highly disciplined: each squad owns a mission, KPIs and is empowered to act. That empowerment energizes.
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