Overview
This article proposes a new approach to business strategy and risk management, referred to as ‘Presilience[1]’. Recent, unprecedented bushfires in Australia, the spread of the coronavirus, and the increased frequency and scale of climate related incidents (floods, storms, etc.), make it self-evident that a fundamental set of changes is occurring. The global stock market meltdown which is a feature of the spread of coronavirus reinforces the view that we need to respond better in the future to these unforeseen events. The article sets the scene for the Presilience concept, drawing attention to the changing global landscape and the volatility of the ‘new normal’. The authors then reflect on why the current risk management and response systems are too over engineered to be agile or flexible enough to meet these challenges.
The new Presilience approach shifts focus away from an emphasis on planning, procedures and systems and recovery, which are essentially established to avoid the mistakes of the past. The new focus is on the people who are managing and responding to risk, and Presilience is about enhancing their inherent skills and capabilities to be adaptable, flexible and agile in response and then building the systems to support them as opposed to making them fit into the system.
The other major difference between a traditional Resilience model and a 2020 Presilience model is that the outcome of a Resilience model is based on ‘recovery’ – in other words restoration of the situation to its state prior to the event. Presilience is about dealing with an incident to achieve a new agreed normal outcome. This new normal seeks to ‘better’ the situation. Presilience is much more than simply being reliable and ensuring business continuity in case a negative event happens, it’s about High Performance and outcomes that make us better than we were before. It’s about constant learning and adaption to seize opportunity, not simply recovering from a negative event.
Presilience challenges current conventional wisdom and thinking, but in seeking to prompt a debate, the authors are not criticising the leadership of the current systems, they were simply built for an era that has now been disrupted. The leaders and systems have served us well for many years, however the environment in which they operate is changing around them, and organisations are quite rightly intent on responding to community need. This paper is hopefully an opportunity for reflection away from the ‘firefighting’; and an opportunity to consider what should the approach for the future be, to deal with this impact of climate and societal change? It is suggested that a Presilience approach with its focus on people, skills and creation of a post incident/crisis new normal, may be a natural evolution of the risk management and response systems being used today.
The shifting global landscape
The world of risk management is changing, and even before the coronavirus outbreak we have noted a changing risk landscape. At a societal level, the shift in the global business environment due the birth of the internet and smartphone technology, increased globalisation and AI has changed our societal landscape forever. In fact, we are now in an era referred to as the 4th industrial revolution (4IR). The personalised nature of the coronavirus response, including the concept of self-isolation, has drawn attention to a fundamental principle of Presilience – which is that Presilience is in our DNA.
As humans we are born ‘risk aware’, with a fear (risk awareness) of loud noises and a fear of falling. We proceed through life managing risk in a very personal and individual way, as every human being on the planet makes daily risk-based decisions about life. Since prehistoric man, humans have come together as tribes. Within this tribal structure and hierarchy, risk is managed at a more strategic level – through rules and conventions about the management of major risk, such as the way the tribe manages risks from fire, transport, security threats and for property protection. Tribal rules are imposed through decree, systems, procedures and laws. The 20th and 21st century has seen a dominance of the tribal systems of risk management through more and more emphasis on a ‘one size fits all’ approach, reducing the role of personal initiative and decision making about risk, and imposing rigid and inflexible systems.
These rules and conventions have become part of the DNA of society until more recent times, when a number of factors have had a huge impact on the way we live. In short, our established personal and collective risk management models are facing huge disruption. Coronavirus has challenged all existing models of response, the virus has required government to shift responsibility to the individuals and their family, the concept of self-isolation has been established, a ritual of frequent personal risk assessment ( through hand washing and other personal measures) has been embedded, and the community has accepted that they need to get better at managing their own very personal and individual risk exposure.
The disruptive environment requires us to embrace the rapid changes within the environment by looking deeper into the effect that psychology has in this disruptive landscape and developing new models of risk and leadership in the changing world. In the old world, making sense of probabilities and frequencies (in a quantitative way) was a key part of risk assessment, yet in recent years the frequency of so called ‘once in a lifetime ‘ events has self-evidently accelerated, and the impact of both the events and the increased frequency is challenging society.
We need two core skills sets; Resilience and perseverance. Resilience is defined as “An ability to recover from or adjust easily to misfortune or change” and Perseverance is defined as “The continued effort to do or achieve something despite difficulties, failure, or opposition.”. The concept of Presilience is that we are born with this ability to adjust to change of misfortune, to bounce back (Resilience), but we also need to understand, develop, practice and deploy these skills in different ways depending on the circumstances and this process of daily exercising of our core skills in this are requires perseverance. The two concepts combined are at the core of the concept of Presilience.
It’s a VUCA world now
The world we live in is VUCA, an acronym originally used by the American Military. It stands for Volatile, Uncertain, Complex and Ambiguous. It was the response of the US Army War College to the collapse of the USSR in the early 1990s. Suddenly, there was no longer the only enemy, resulting in new ways of seeing and reacting. A VUCA world requires an organisation’s leadership and strategies to come under scrutiny; it is no longer a case of finding the one way or the management tool: standards give way to individuality and problem solving. At one level this is a new way to approach risk – but in reality, we are simply rebalancing the risk management roles from a tribal dominant role (roles, systems, procedures) to a more personalised and individual risk management approach. We often call this dynamic risk equilibrium (DRE).
Accepting we live in a VUCA world is the critical first step towards ‘updating the operating system’ of how we view the conditions under which we make decisions, plan forward, manage risk, foster change and solve problems in the business world today. This reality is being well documented with many experts trying to forecast what the 4IR means for us., What we do know is that the emerging and current landscapes include:
From outdated approaches to a new model – from resilience to Presilience
The systems that were developed for a pre-VUCA world led to cumbersome practices that are over engineered. Over engineering is the concept of designing a process to have more features than necessary and is often done to increase safety and reduce risk – but in terms of trying to respond to crises and emergency, over engineering often leads to inaction, risk aversion and decision avoidance. In fact, at best it creates the illusion of control which, when the illusion is shattered, only makes the crisis worse. As a design philosophy, it is the opposite of the lean systems approach adopted by many successful businesses and it decreases the productivity of risk response, because of the need to build and maintain more features than most risk responses need. The word Resilience has been used to describe the traditional, highly engineered process and system of risk management, and this paper suggests that the current thinking around resilience is too traditional, too focused on process and insufficiently focused on the skills of the teams and leaders who need to respond quickly and decisively to manage risk and crisis and the associated systems they need to support them. The word Presilience is proposed as a new descriptor to ‘brand’ a new approach to managing risk.
Presilience – what is it?
Presilience is not about process – it’s about the ongoing application of the skills needed to more effectively respond to risk, whether it is opportunity or crises, incidents and emergencies. It is underpinned by strong situational awareness and led by people with strong;
These are the skills that time, and time again have been shown to be the key skills required to effectively manage major incidents and emergencies. We are all born with these skills, we use them every day and rather than trying to focus attention on more and more plans and processes – we should be focusing on the skills of deployment. Major wins don’t solely come from tactics – they come from good tactics and exceptional performance on the pitch. Presilience is about the players on the pitch. Excessive planning leads to confusion. Requiring a plan for any and every foreseeable event deceives us into thinking that all emergencies are foreseeable – they are not! What makes an event into a crisis or emergency is the lack of foreseeability, and yet we direct so much effort into planning and rehearsing response to the foreseeable alone. Although the existence of these mega plans gives us some comfort and reassurance, all the evidence is that realistically, they are of little real value.
Unless they are comprehensively tested and practised – and relevant to the incident we are dealing with. They create an illusion of control but in reality they may actually be wasting precious resources. For example, arguably the single biggest risk measure around coronavirus is not the closure of schools, events or borders – it is persevering with the personal risk measure of frequent hand washing.
At an individual level, the resilience model forces too much information into our brains without thinking about the capacity of our brain to absorb and use the information. The primary reason for this model is often linked to the increase in litigation and the resultant need for the double negative approach of ‘not getting it wrong’. However, we have seen that in some cases over planning actually creates more risk as people are judged after the fact for not implementing a plan that in reality was not applicable to the incident they were facing.
Resilience is therefore about a constant focus on plans, processes and procedures to avoid the mistakes of the past. Resilience is about a system of not making the mistakes of the past, which is highly valuable for easily predictable events. Resilience is a noun – a part of speech which refers to a person, place or thing – who will do what, where will something be done and what ‘things are in a resilience plan’. Resilience is about the 20th century thinking and process, resulting in complicated bureaucracies that are often too slow to effectively meet the challenges and risks presented or seize opportunities as they evolve.
Presilience is about the people and problems of the 21st century – simple, intuitive and flexible – as a comparative example, it’s sort of like the landlines of the last century versus the smartphones of the 21st century. Presilience is a verb – a part of speech which indicates action – Presilience focuses on leaders and teams applying high level critical reasoning skills to the problem/risk in front of them, quickly developing a plan, making effective decisions within a simple framework and executing effective action through clear, effective and directive communication.
Presilience is about flexibility in responding to the risks of the future, and given the scale and pace of major events over recent months – driven by climate change and an increased global movement of people – we need to get better at responding to what is unfolding in front of us i.e. insight – not just concentrate on avoiding the mistakes of the past i.e. hindsight. Presilience promotes:
A resilience approach has served us well in the past, but perhaps the future should be less about prescriptive plans, processes and systems which can fetter discretion and decision making. – Could they be more about enabling people through building on our natural human skills of managing risk, and developing effective leaders and teams with high level command and control skills and then building the ‘smart and enabled ‘systems to support them?
Taking the best of the old but being brave enough to implement new models that adopt a Presilience approach and focus on balancing Managerialism with Adaptive Leadership is crucial for success in the modern business world. In fact, one of the biggest challenges is that many of the tools, systems and strategies we use to manage our organisations are based on the lessons learned from the 1st industrial revolution and date back to the 18th century.
Whilst there is no doubt that some things stay the same, our innovative ancestors could not have seen the need to empower employees based on 24/7 connectivity and the ability to work from anywhere are crucial inputs for successfully establishing a lineal manufacturing model. In the new world, in the information age, we cannot and should not ignore the vast amount of information available to us and a Presilience approach is also Risk Intelligent.
