3 lessons from the world’s most resilient organizations

In a time of almost unprecedented geopolitical and geo-economic uncertainty, resilience — the ability to deal with adversity, weather shocks and adapt as crises arise — has never been so important.

That was the main message from a session titled ‘Resilience: What It Means and What to Do About It,’ at the World Economic Forum Annual Meeting.

“This notion of resilience has become at the core of the agenda,” said panellist Odile Françoise Renaud-Basso, President of the European Bank for Reconstruction and Development. “Before COVID, before all the wars we are facing, before the natural disasters we’ve experienced because of climate change, the notion of resilience was less prominent. After what’s happened in the past few years, we really need to address it.”

In fact, as another panellist, Bob Sternfels, Global Managing Partner, McKinsey & Company pointed out, there is a high price to pay when we are not resilient. According to a white paper his company worked on with the World Economic Forum, it can cost us up to 8% of global GDP. On the flip side, increasing our resilience could boost GDP by 15%.

So what does it take to become resilient? That same research could provide some clues. “We came up with a few key findings by looking at 1,000 entities to understand what is best practice when you think about this notion of resilience,” Sternfels explained. Here are some of those findings, drawing on lessons from organizations like the World Food Programme to companies like Siemens.

According to the findings of the research, a “trickle down” approach to resilience can prove quite effective. “Leaders need to embrace a resilience mindset,” Sternfels told participants. “If it doesn’t start at the top, it isn’t going to happen.”

What does that look like in practice? As the white paper recommends, “Appointing a person responsible for resilience with a transversal view of the organization is key. This does not necessarily imply creating a new position but ensuring a senior leader has a comprehensive view of relevant resilience efforts.”

Importantly, though, everyone across an organization must be supported in developing resilience.

When the team behind the research looked for common traits among the most resilient entities, one common thing they found was their ability to find a balance between short-term, reactive actions and longer-term, bold moves.

“The pioneers play offense and defense at the same time,” Sternfels explained. “It’s not just about buffering for shock, it’s the ability to make bold bets and move forward when you’re in volatile times.”

He had some practical advice for organizations looking to do this: “Literally draw a line down the middle of a page and say, OK, how much of our resourcing, whether it is capital or people, are going to buffer, defend, and shore ourselves up, and how much are going to the bold plays that will actually take us to a different spot going forward? And does it look unbalanced?”

Entities that excel when it comes to resiliency have shown they are able to walk the walk, not just talk the talk, Sternfels pointed out. “You can’t just say resiliency is an imperative, you have to convert it to an agenda.”

That starts with building a framework to measure how resilient an entity is today — something the World Economic Forum and McKinsey & Company did at last year’s Annual Meeting. That can then be used to measure progress over time.

“You have to take that framework and embed it in your decision-making process. So rather than being reactive, you can start to proactively scenario plan,” Sternfels noted. “Then measure over time, to figure out, am I getting better or not?”

The session ‘Resilience: What It Means and What to Do About It ’ was moderated by Børge Brende, President, World Economic Forum, with the following participants:

Mohammed Al-Jadaan, Minister of Finance, Ministry of Finance of Saudi Arabia

Nonkululeko Nyembezi, Chairman, The Standard Bank Group Limited

Odile Françoise Renaud-BassoPresident, European Bank for Reconstruction and Development

Bob Sternfels, Global Managing Partner, McKinsey & Company, Inc.

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