Tag Archive for: Resilience

A safe and merry Christmas to all!

The end of another year is almost upon us. Each one seems to go more quickly than the last and the business challenges seem to grow.

Despite what we hear and read about the economy being resilient and holding up reasonably well post the mining boom, our experience would suggest that it has been tough going in most industry sectors. Generally, it has been hard work to achieve revenue and profit targets in business to business markets and very few of these businesses are showing high levels of intrinsic growth.

What we are seeing at Gibsons is that the good businesses are recognising the need to take stock of their activities and adapt to the conditions. For many clients, things may be a bit tight, but they remain positive. Most of us have been through quiet times before and emerged back into the growth cycle stronger and more capable of taking advantage of new and emerging opportunities. If conditions are quiet right now, we know that the answer is to hang in there, trim back any excess, change whatever you need to change and look forward to a brighter future.

We would like to thank all our clients who we have worked with during the past year – it has been our pleasure and privilege. We trust also that you have found the snippets of information in our blog to be of interest and value.

We wish everyone a safe and merry Christmas and look forward with optimism to the New Year.


The Importance of Cultural Resilience in a Downturn

If there is one thing that companies learn in an economic downturn, it is the importance of resilience – the ability of an organisation to withstand shocks and remain sustainable under prolonged periods of duress.

The most resilient companies display the following characteristics:

  • A high level of staff engagement
  • A low level of cultural entropy
  • A vision of the future shared by all employees
  • A set of values shared by all employees
  • A focus on adaptability and innovation

Not only do these qualities create resilience, they also lead to internal cohesion, a key component in building a strong internal community that can drive the goals and performance of the organisation. The current economic climate shows us that organisations that are strong on the inside are also strong on the outside.

Being strong on the inside means having a values-driven culture, a highly aligned, cohesive and effective leadership team, a low level of cultural entropy, and a high level of staff engagement. It means effective human resource management practices / people management to develop your people and develop leadership.

Cultural entropy is the degree of dysfunction in an organisation. It is the amount of energy consumed in unproductive work and is therefore unavailable for useful work. Cultural entropy arises from the presence of limiting values such as bureaucracy, internal competition, blame and fire fighting rather than an environment of promoting positive values.

The experience of our business consultants shows that low levels of cultural entropy are accompanied by high levels of financial performance and high staff engagement. Companies with these attributes are able to grow their incomes significantly faster than companies with high entropy.

The following checklist of actions will help you to build your organisation’s resilience, support you in traversing economic downturns, and place you in a strong position for success when growth rates pick up.

This checklist is based on the core principles of a ‘values’ driven organisational culture. Each of the six items on the checklist represents a critical step in building a sustainable organisation.

How to build your organisation’s resilience:

Step One: Be clear on your direction. Re-energise your vision, mission and values to build internal cohesion.

Step Two: Communicate with staff and customers: confidence is important. Ensure everyone knows what you are doing to get through when times are tough.

Step Three: Focus on your core business. Get lean. Streamline your systems and processes to reduce costs and increase agility.

Step Four: Learn to adapt to a changing environment. Eliminate activities that don’t add value.

Step Five: Build strategic alliances. Align with your customers and suppliers to create mutually supportive and beneficial relationships.

Step Six: Keep the long term in mind. Ensure your short-term plans do not compromise your long-term viability.

It all sounds fairly basic, but remember that successful organisations – both in boom times and downturns – are generally those that harness positive energy to consistently do the basics well. That includes consistent and effective human resource practices that develop and support staff and leadership to build and maintain a culture of resilience in your business.