Roads to Resilience

Enabling ‘Rapid Response’

Achieving rapid and decisive response to changing, challenging and/or adverse circumstances is a key feature of resilient organisations. Organisations need to ensure that identified teams and processes are in place. Rehearsal of potential scenarios is required together with empowered teams to take charge when adverse circumstances arise. Managers need to consider how each of the enablers of resilience, people and culture; business structure; strategy, tactics and operations ; and leadership and governance can be utilised to ensure rapid, decisive and appropriate responses when the unexpected occurs. The achievement of the rapid response principle will also ensure that the organisation can take advantage of unexpected opportunities. Under stable and expected or predictable conditions, risks can be managed by means of structures, standard operating procedures, trained operatives and continuous improvement. Resilient organisations know this and so they make use of clearly defined processes. However, to be able to respond when business conditions become more volatile, resilient organisations also have the people with the right skills, empowerment and motivation to deal with unexpected developments. As the case study organisations illustrate, it requires people with a depth and breadth of experience, who are comfortable with uncertainty and ambiguity, and are able to draw on and integrate diverse perspectives and resources. This tends to lead to the formation of flat, self-organising, multi-disciplinary project teams, supported by a leadership style that gives people high levels of autonomy within their roles and does not stifle creativity and innovation. In service-oriented businesses such as IHG and Virgin Atlantic, employees are empowered to provide an appropriate customer service. The needs of individual guests and passengers vary and are ever-evolving and operating conditions vary from day-to-day. Service delivery therefore cannot be mechanistic and scripted. Employees follow processes, but they also have to be flexible to specific situations and still provide excellent customer service. This capability is also highly relevant in addressing risks. Processes are essential, but the people must have the skills and empowerment to respond when a situation arises that does not exactly match the responses in the pre-prepared process. People and culture

IHG has the awareness to recognise incidents, a strong communication network to report these and also a clear process by which to respond. When a crisis occurs, “we have codified and embedded process management, we go straight into that crisis response mode following the process that we have already previously laid out, we have a crisis management team as well at both a global and regional level so that the process all kicks into place if something comes up” (SVP Head of Global Internal Audit, IHG). Crisis teams are carefully selected because “you must have a rounded team, with the right crisis owner that has the authority to make necessary decisions and include the right risk managers, the right communications people and then you supplement it with specialists” (SVP Head of Global Risk Management, IHG). Critically, these specialist teams include people who “are trained to deal with newspapers and reporters, they are dedicated crisis spokespeople” (VP Global Security Risk Management, IHG). Therefore, senior managers are not put in the position of having to respond to a crisis, the press and other stakeholders at the same time. Crisis teams need to make decisions fast because “the whole thing about emergencies and crises is you’ve got to think to a certain extent on your feet, based on what you know to be correct” (VP Global Security Risk Management, IHG). The case study organisations recognise that this structured approach has become more important with the increasing presence and influence of ‘social media’. Organisational culture needs to support flexibility and empowerment. AIG develops its capability to respond rapidly by conducting trials in markets that are perceived as risky. Drax not only uses scenarios to hone its risk radar but it also practises the types of response necessary. So there are strong links in the way resilient organisations build a capability to spot risk ( risk radar ) and their ability to respond ( rapid response ). Rapid response means that an organisation is neither caught unaware, nor slow in reacting to a situation that has not been predicted or practised. Teams that are responsible and practised at dealing with operational risks are common in resilient organisations, but so are approaches for dealing with strategic and business risk. Rapidly changing circumstances can also impact strategy, making it necessary to establish response processes that will ensure rapid changes to strategy and/or tactics, as necessary. These rapid response situations may relate to seizing a strategic opportunity, responding to the need to modify tactics or responding to an operational crisis.

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Section 5: Resilience Principle No 4: ‘Rapid Response’