Risk Leadership: Beyond Resilience
I have long described the aim of Enterprise Risk Management to be to develop an Adaptive and Resilient organisation (check out my RMP Healthcheck). In recent times the concept of Organisational Resilience has become popular, in particular for those in government and the owners and operators of critical infrastructure. Both concepts, in my opinion, have similar aims, drivers, benefits and barriers and are about nurturing a successful organisation for decades and even centuries to come.
Below I show a continuum on which organisations can operate in face of uncertainty using both Enterprise Risk (my terms) and Organisational Resilience language published in Organisational Resilience: Position Paper for Critical Infrastructure, Resilience Expert Advisory Group, Australian Government (2011):-
Vulnerable Transitioning Adaptive Resilient
Decline Survive Bounce Back Bounce Forward
What I would like to do is expand on the concept of resilience and suggest to you there is a place “beyond resilience” that we as risk professionals should be driving our organisations towards.
Soon after 2012, the Australian Government released a research paper entitled CEO Perspectives on Organisational Resilience. It refers to organisations as being “effective at business as usual” or, if more advanced, having the “ability to change and adapt” and if they are great they “shape the environment” in which they operate. Bring in some other recent business concepts around Disruptive Innovation (Maxwell Wessel and Clayton M. Christensen, Harvard Business Review) and Antifragile: Things That Gain From Disorder, the latest book by Nassim Taleb, (author of The Black Swan) and you get more than a little feeling that true Risk Leadership is about helping to drive our organisations beyond resilience.
True Risk Leadership is about developing risk maturity to the extent that higher and higher risk is seen as an opportunity to take competitive advantage through the management of risk. In “C-Suite Speak” it is the ability to embrace uncertainty to drive market-forming change.