The potential for significant business disruption is growing. Visible risks—such as global climate change, political division, social unrest, and barriers to trade and commerce—are increasingly acute. Equally concerning are unanticipated crises and black swans, those unpredictable events with potentially severe consequences that seem obvious only in hindsight.
An unprecedented level of interconnectivity heightens the risk of disruption. Businesses are vast ecosystems that rely on partners, vendors, global supply chains, and technology networks, all of which can add complexity across systems and operations where interruptions can have wide-ranging effects.
Resiliency is essential for a readiness and agile response. Instead of viewing disruption as an unusual business event, resilient organizations embrace disruption integral to business as usual. This requires approaching preparedness and recovery holistically within your organization and across your business ecosystem.
More than surviving, resilient businesses strategically respond to uncertainty and can thrive in its midst. According to Deloitte, “Resilient organizations plan and invest for disruption, and can adapt, endure, and rebound quickly in a way that enables them to not only succeed in its aftermath, but also to lead the way to a ‘better normal'.”
Disruptions present opportunities to do things better when your business combines a strategic mindset and discipline to preparedness with adaptability to unfolding events. How can you approach disruption as an opportunity?
Every company operates differently. Therefore, depending on your business or industry, resiliency can require different actions. However, regardless of your business model, planning and investment should address financial, operational, and reputational resilience, all pillars of any organization’s stability and strength. Key considerations include:
It’s important to look at your entire business to understand and address weaknesses and gaps and then to customize your resiliency planning to fit your business. Make sure your planning process includes the what-ifs and what-next scenarios that anticipate obstacles to future success in order to eliminate them.
In an environment of disruption, adaptability means rebounding in ways that are better than before. This includes conceiving of new and innovative ways to support employees, serve customers, and strengthen supplier resiliency.
Resilient organizations use lessons learned not only to improve their preparedness but to strengthen their overall approach to doing business. For example, one lesson of the pandemic has been the value of digital transformation in enabling business continuity. Businesses have now accelerated their digitization initiatives. Electronic and digital payments, and working capital processes have been among the key focus areas. During the pandemic, employees realized the value of pay cards and direct deposit over paychecks. Vendors and customers have embraced digital payment alternatives. Supply chain ecosystems have embraced solutions that digitize interactions between buyers, sellers and banks and streamline supply chain financing from end to end.
The ability to pivot requires an openness to embracing new ways of doing things. This is how responses to events can become new operating standards. For example, the shift to a remote workforce during the pandemic has become a new model for a distributed workforce that also broadens access to talent to across the nation or globe.
At the same time, the shift in work practices illustrates how pivots can create new vulnerabilities. Remote work impacted planning and strategy around team meetings, technology infrastructure, and cybersecurity. A strategic viewpoint allows your organization to learn from pivots in order to better identify vulnerabilities and prepare for future unexpected shifts.
Instead of putting a business into disarray, disruption should bring people together. Readiness becomes a common purpose and a mindset of resiliency in your workforce. As operating models continue to evolve in response to disruption, it is important to display confidence in employees and encourage behaviors that strengthen adaptability. This supports an atmosphere of trust.
Successful businesses make their own luck through preparedness. They do this by capitalizing on the lessons they learn. Common purpose becomes incorporated across their broader perspective and partnerships as they engage a strategic mindset, an organizational discipline, and an ecosystem approach that looks ahead and adjusts accordingly. The result is an agility that fosters fresh thinking and better ways of doing business.
This information is provided for educational and illustrative purposes only.
Wells Fargo Bank, N.A. Member FDIC. Deposits held in non-U.S. branches are not FDIC insured.
TM-3282 PAR-0723-00305
LRC-0823
Sign On