Roads to Resilience

Enabling ‘Review and Adapt’

Organisations need to review adverse events and near- misses that occur, learn from the experience and adapt the organisational processes and structure accordingly. A culture of structured learning is required based on independent review of what has occurred or is emerging and a strong desire to constantly improve organisational performance. This same approach is applied to the lessons that can be learned from pursuing business opportunities. Managers need to consider how each of the enablers of resilience, people and culture ; business structure ; strategy, tactics and operations ; and leadership and governance can be enhanced to include structured review and adapt activities. At the case study organisations, learning is an absolute priority, so that it often becomes one of the core values of the organisation. At IHG, under the heading ‘Aim Higher’, the desired behaviours include: “We put our hearts into learning new things” and “We always look for ways to improve” 3 . Thus learning is an integral part of the culture and extensive training programmes for all types of risk management also ensure learning: “ [We have] developed numerous risk management training products available to our hotels and directed at both leadership roles and front-line staff” (SVP Head of Global Risk Management, IHG). Several of the case study organisations (such as Jaguar Land Rover, Zurich Insurance and AIG) have experienced difficult times. However, these organisations have learned from these circumstances and adapted their approaches, not just to risk management and resilience, but also to how they conduct their business. For example, Jaguar Land Rover today draws on the lessons learned when the organisation suffered from poor financial performance. Now its risk professionals and subject matter experts collect extensive data on market trends and ask questions to understand the business impacts of changes in market conditions. This also serves to enhance customer satisfaction and reinforce the importance of the relationships and networks principle. A typical question at Jaguar Land Rover is: “Assume we lose 10 per cent of volume, what are we going to do?” Such questions and previous experience drive the organisation’s response. For example, it has reallocated vehicles manufactured for one market to another one where People and culture

they could be sold faster. There is a strong emphasis on identifying and learning from market trigger points, which are reported on a monthly basis to the executive committee. This learning and flexibility is embedded within all aspects of the processes of the organisation. The goal of the Olympic Delivery Agency (ODA) was the construction of venues and infrastructure for the 2012 Summer Olympic and Paralympic Games. As the organisation was created with a limited and relatively short lifespan, it might be thought that there would not be much learning possible in such a timeframe. However, from the beginning, ODA focused on learning. This started with the analysis of the successes and problems encountered at previous Games (including Sydney, Athens and Beijing). Once the construction programme started in the UK for the Olympic Games 2012, there was a keen focus on capturing learning from the most advanced projects. For example: “The Stadium project began, say, on ‘Day one’ and the Aquatics Centre project kicked in at ‘Day one hundred and one’, so we were learning how to do things in the Stadium, which we would then reproduce within the other projects” (Chief Risk Officer, ODA). This approach to learning from experience also meant that “we recorded opportunities alongside risks, certainly at a project level and a programme level … mainly opportunities to save money or to save time” (Chief Risk Officer, ODA) 4 . At Drax, constantly learning how to run the plant more safely and efficiently is viewed as essential: “We’ve got to have the ability to learn, we need to be asking, enquiring, learning from others, there is generally someone at Drax who has performed this task or a similar task before: what issues have they had? Learn from them” (Generation Manager, Drax). It is recognised that “the second trait of all successful safety organisations is that you look for broader learning, which is what we try to do every week with the ‘Safety Pack’ … we’re looking at any incidents that have happened across the site and we’re looking for broader learning” (Engineering and Safety Manager, Drax). In addition to learning from within the organisation, Drax constantly looks outside: “We do work with the universities [and] … our guys have spent a lot of time going over to various places … [for example] , Scandinavia, where they’ve got a very good history of working with biomass … learning, and engineers talking to each other and sharing ideas” (Head of Risk and Corporate Finance, Drax). A key issue at the power station is that much cleaning, maintenance and construction work is carried out by 4 This is another example of how resilience enables organisations to better deal with both the negative side of risk and the positive side (seizing opportunities).

3 The IHG case study in Appendix A includes a full definition of behaviours.

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Section 6: Resilience Principle No 5: ‘Review and Adapt’