New study reveals that most durable firms respond and adapt rapidly to change
Resilient companies do not depend solely on processes or compliance; they create an environment where everyone is risk-aware and barriers between senior managers and their staff are reduced to a minimum. That is one of the main findings of ‘Roads to Resilience’, a report being produced by Cranfield Business School on behalf of risk management association Airmic.
Researchers investigated eight companies that have either managed to ride crises successfully or have avoided them altogether. They found that the most durable firms are those that can respond rapidly and effectively to changing circumstances.
In order to do so, businesses should create a culture where all staff are risk-aware and feel able to pass on their knowledge and views, both positive and negative, to senior management.
‘Roads to Resilience’ follows another Airmic report, ‘Roads to Ruin’, which investigated the factors behind corporate failure. Published in 2011, the first research identified ‘risk glass ceilings’ as a recurrent problem, where vital information known elsewhere in the organisation never reached senior management or the board.
By contrast, ‘Roads to Resilience’ finds that the glass ceiling is absent in successful companies, and staff communicate easily with those at the top, acting as their radar. To achieve this, senior managers need to engage with their staff, earning respect by listening and experiencing what it is like to work in the company.
Cranfield Business School’s Dr Stephen Carver said: “At Jaguar Land Rover, senior executives spent half their time walking the shop floor, instead of sat in front of their computers in ‘ivory tower’ offices.
“There has to be strong trust and people have to respect and be respectful of the people leading them.”
Airmic chief executive John Hurrell said: “The key message in this report is that culture enables resilience, and that culture comes from the top.
“Board members need to lead the way, not by lecturing their people but through example and connecting with them, by being approachable and willing to listen.
Airmic has published the main findings in an executive briefing ahead of the full report, which will come out later this summer. It is based mainly on interviews with executives at eight companies: American International Group (AIG); Drax Power Station; InterContinental Hotels Group; Jaguar Land Rover; Olympic Delivery Authority; The Technology Partnership; Virgin Atlantic, and Zurich.
No comments yet