Organisational Report

within the organization for the two separate strategies, and thirdly ‘contextual’ i.e. people make their own judgements about how to divide their time between conflicting demands for alignment and adaptability (Gibson and Birkinshaw, 2004). Contextual ambidexterity is achieved when people feel discipline, stretch, support, and trust (Ghoshal and Bartlett, 1994). Leadership can exacerbate or ameliorate the tensions in Organizational Resilience (Uhl-Bien, Marion and McKelvey, 2007). Effective leadership can enable “reinforcing, virtuous cycles” (Lewis and Smith, 2014). Leveraging these tensions by employing ‘both/and’ thinking (Farjoun, 2010) is a critical aspect of Organizational Resilience. Avoiding erosion Numerous high profile failures in retail, manufacturing, energy production, healthcare, public services and banking and other sectors have shown that failures tend to occur when preventative control, mindful action, performance optimization and adaptive innovation are eroded over time. Figure 5 shows the typical pattern of a failure.

Key learning point: Organizational Resilience requires preventative control, mindful action, performance optimization and adaptive innovation. Paradoxical thinking helps leaders shift beyond ‘either/or’ towards ‘both/ and’ outcomes.

PROGRESSIVE (Achieving results)

PERFORMANCE OPTIMIZATION Improving and exploiting

ADAPTIVE INNOVATION Imagining and creating

ABILITY TO ANTICIPATE, PREPARE FOR, AND RESPOND AND ADAPT TO

CONSISTENCY (Goals, processes, routines)

FLEXIBILITY (Ideas, views, actions)

INCREMENTAL CHANGE AND SUDDEN DISRUPTIONS

Organizational Resilience is eroded

PREVENTATIVE CONTROL Monitoring and complying

MINDFUL ACTION Noticing and responding

DEFENSIVE (Protecting results)

Figure 5: The erosion of Organizational Resilience: sleepwalking into disaster

Performance optimization is eroded when organizations enjoy a long period of success resulting in the dismissal of the possibility of future failure (Hollnagel et al., 2006). A singular focus on short-term productivity gain has also proved detrimental to medium-term mission and sustainable performance as the primary goal. Over time organizations create the illusion that “failure can’t happen here” (Woods and Cook, 2002). Adaptive innovation is inhibited when the organization feels the threat of impending crisis. Organizations tend to control expenditure and resources and focus on the one thing they do well (e.g. their core product or service), known as a threat-rigidity effect (Staw, Sanderlands and Dutton, 1981). By implication, the range of options open to the organization narrows and it becomes progressively more difficult to

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Organizational Resilience | BSI and Cranfield School of Management