Roads to Resilience

Section 4: Resilience Principle No 3: ‘Relationships and Networks’

Overview of the ‘Relationships and Networks’ principle

to find a way to respond appropriately, rapidly and effectively, including responding to the social media developments, as appropriate. Ultimately, the external reputation of an organisation is built on the way that relationships are managed within its business networks. Central to this network of relationships is the customer, whose needs are at the heart of the rationale behind organisational resilience.

Resilient organisations realise that suppliers, contractors, business partners and customers represent a network of relationships aimed towards a common purpose. An organisation can build strong internal and external relationships by engendering trust and a desire to collaborate. It will then be in a position that, when an issue arises, disruption hits or an opportunity arises, all stakeholders will quickly and openly communicate with each other

Introduction to ‘Relationships and Networks’

2.  No-Blame Culture: Strong relationships are nurtured when a no-blame culture 1 is clearly present, although accountability is maintained. Resilient organisations are able to achieve a balance whereby suppliers, contractors and other business partners accept appropriate accountability, but do not withhold bad news in order to avoid blame and anticipated adverse consequences. Whistle-blowing information is viewed as supportive, although the organisation will seek to avoid the need for staff to engage in whistle-blowing. At IHG apportioning blame is avoided since, as the CEO has stated: “ It is not about assigning blame for somebody, it is about solving the problem and learning from it.” 3.  Open Communication: The research suggests that the development of strong relationships is often allied with flatter organisational forms, increased cross-functional collaboration and self-organising teams with no silos. It is not enough for the whole of an organisation to be on the lookout for emerging risks: information about risks must be quickly and efficiently communicated within the organisational structure, so that appropriate action can be initiated. There should be no ‘glass ceiling’ or ‘glass walls’ to halt or slow the flow of risk information. For this, the sharing of real-time information is crucial, as is keeping the organisation sensitive to emerging risks to avoid board risk blindness.

No organisation can be effective at managing risk in isolation. As well as strong internal working relationships, leading organisations also build strong and extensive external relationships and networks . This is created by engendering trust, a desire to collaborate and a willingness to share information, even if it is bad news. In this way problems can be detected early and, when an incident occurs or an opportunity arises, stakeholders communicate with each other so that the response can be rapid. Risk professionals in resilient organisations manage risk beyond their organisational boundaries and throughout their networks, including suppliers, contractors, business partners and customers.

Understanding ‘Relationships and Networks’ Resilient organisations value and build strong relationships and networks and there are four components associated with this principle:

1.  Shared Purpose and Values: When employees share a common purpose and values, trust emerges and helps to build strong relationships across organisational boundaries. The development of shared purpose and values has to be led by the board. Virgin Atlantic has a clearly defined and well- communicated set of organisation values, typified by the slogan “ fly in the face of ordinary ”. It is also important to build external relationships; the airline recognises that contractors and other business partners are responsible for some customer-facing aspects of service delivery and so it is important for them to share Virgin Atlantic’s desire to offer exceptional service, always.

1 The no-blame culture in the case study organisations was highly advanced, going further than the way in which the term is commonly used. For example, employees proactively discussed their mistakes, to generate learning.

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Section 4: Resilience Principle No 3: ‘Relationships and Networks’