Dr. Danielle Logue and Dr. Melissa Edwards from the University of Technology, Sydney, here offer you their advice on why you should consider appointing a Chief Resilience Officer in 2017 while focusing in particular on key functions of a Chief Resilience Officer.
The New C-Suite Addition: the Chief Resilience Officer
Thriving during turbulent and uncertain times will be a top concern for business in 2017.
Seismic upheavals in international politics and trade relations point to more market turbulence – an added challenge for businesses already operating in a resource-constrained world and juggling the needs of multiple stakeholders.
Enter ‘resilience’, the management buzzword that’s likely to take over from sustainability and innovation in 2017.
Expect to see the emergence of the Chief Resilience Officer in the C-suite this year, as businesses catch up with a trend that has taken hold in the public sector over the past two years.
The Meaning of Resilience
Resilience, meaning the ability and flexibility to respond to difficulties, combines risk management, innovation and sustainability to enable organizations to be agile and adaptive in complex and dynamic operating environments.
Because it combines both an established risk management focus and an outward looking innovation and sustainability focus, it’s likely to be a ‘stickier’ position than Chief Sustainability Officer or Chief Innovation Officer have been.
Chief Resilience Officers have already gained legitimacy in public institutions, driven by the Rockefeller Foundation’s 100 Resilient Cities program, with cities around the world, including Boston in the US and Medellin in Colombia, creating this position.
So what is a Chief Resilience Officer and why is investing in one beneficial for businesses?
Academic David Chandler has described three major understandings of resilience for international development and policy that we argue translate into different roles for a Chief Resilience Officer.
1: Resilience as surviving
Firstly, and consistent with Oxford dictionary definitions a resilient business can ‘bounce back’ and recover quickly from difficulties.
The organization is ‘tough’ and ‘elastic’ characterized by the ability to ‘spring back into shape’ even after experiencing seismic shocks. Through this approach the Chief Resilience Officer subsumes the risk compliance role but at a more strategic level.
A Chief Resilience Officer buffers the business against external threats – the consulting firm PWC have envisaged the role as more strategic Chief Compliance Officer.
The key functions of a corporate Chief Resilience Officer would be to:
- Avoid reliance on non-renewable and scarce resources and eliminate toxicity from production
- Ensure diversity and variety in product lines and services, or sources of supplies.
- Sense external threats
- Lead coping and recovery strategies
- Develop disaster and crises management plans
- Build performance through mutual trust and responsibility between levels and across departments within the organization through open feedback loops
- Connect to risk departments (chief risk officers and construction of risk management) and sustainability
2: Resilience as Growth
A second and alternative approach is autopoietic rather than homeostatic. That is, the business is understood as being dynamically embedded in and evolving with changes within the social-economic and ecological systems that condition the operating environment.
A Chief Resilience Officer must help the business ‘bounce back’ from shocks, but also internalize growth and development strategies so the business can evolve and adapt to the dynamic and interconnected environment.
Businesses are embedded within interconnected systems and resilience is built in to the organization through processes that enable continual self-transformation.
Beyond survival, the approach is to “bounce back better”, where ‘antifragile’ (Taleb 2012) businesses will benefit from volatility, uncertainty and surprise.
Key functions of the Chief Resilience Officer:
- Sensing and probing the external environment and ‘future-proofing’
- Adapting the organization
- Orchestrating collaboration, trust and reciprocity across departments and units
- Encouraging a culture of openness and learning ‘failures’
- Build in ‘circularity’ in product and service design. Substitute non-renewable materials and resources with regenerative alternatives
- Developing inter-organizational collaborations and partnerships across supply networks and with competitors
- Enabling learning and change within the organization
3: Resilience as Thriving
An alternative framing of resilience rejects the status quo, as businesses exist in processes of consistent transformation. Being resilient is about being relationally aware in real time about how the business is functioning in the broader interconnected system – politically, culturally, socially, and economically – and having an understanding of wicked problems.
Resilient businesses generate new ways of organizing and innovating by collaborating and co-creating with people and entities affected by and benefiting from their activities. They ‘complexify’, rather than simplify.
Key functions of the Chief Resilience Officer:
- Implement organizational practices that draw on the ‘wisdom of the crowd’ through hackathons, involving stakeholders in problem solving and innovation
- Determine opportunities through possibilities rather than probabilities
- Enable co-emergence in production and consumption through continuous probing and sensing the environment by iteration, experimentation and improvisation
- Optimize flows of information, people, materials and energy to be restorative regenerative within biospheric limits
- Ensure wellbeing and full potential of people through just, inclusive and equitable practices
- Foster a thriving culture in the tension between creativity and innovation that empowers people to self-organize and act rapidly as conditions change
- Open and monitor positive and negative feedback loops within and outside the business
- Question the core purpose of the business in fulfilling a societal need with a meaningful value proposition
It is possible that resilience might be another fad. But resilience offers possibilities for transformation to a more progressive way of organizing. A thriving approach could deliver the promise of sustainable development and open innovation by reconceptualizing risks as being opportunities for progressive economic development.
For this, the Chief Resilience Officer function needs to move beyond survival mode with an ambitious agenda for transformational change.
Can businesses be open to such possibility, when they sense a more dynamic and risky operating environment?
As a first step managers need to pose questions such as “Where are we going? What are the consequences? Is this desirable?” rather than staying in the comfort of “what is the risk, and how can we avoid it?”