Sustainability and resilience go hand-in-hand. In a world facing climate change and resource scarcity, businesses that adopt sustainable practices are better positioned to manage risks. According to the 2023 Global Sustainability Report by McKinsey, companies that focus on sustainability outperform their peers by 21% in the long run.
Unilever, a pioneer in sustainable business practices, has committed to achieving net-zero carbon emissions across its supply chain by 2039. By implementing environmentally responsible practices, the company not only mitigates risks from climate change but also meets consumer demand for sustainable products, with 85% of consumers globally now preferring eco-friendly brands.
Social responsibility is another aspect of long-term resilience. A diverse and inclusive workforce has been shown to improve problem-solving and innovation. McKinsey’s 2023 Diversity Wins report found that companies with high gender and ethnic diversity on their executive teams were 36% more likely to outperform their peers financially. In a time where we are seeing DEI jobs eliminated, we need to look at these statistics. Embracing diversity also helps businesses better serve a global customer base, enhancing resilience in competitive markets.
Leadership Resilience and Decision-Making
Resilience must start at the top, with strong and adaptable leadership. A 2023 study by Harvard Business Review found that 64% of business leaders believe transparent, empathetic leadership is critical to building a resilient workforce. Leaders who are agile, decisive, proactive and communicative during crises can help steer their organizations through uncertainty. This doesn’t mean they do no have to make tough decisions or don’t find it challenging to do so.
Decentralized decision-making is another powerful way to foster resilience. Netflix, for example, encourages its employees to take ownership and make decisions, allowing the company to adapt rapidly to market changes. This decentralized model enables faster responses to disruptions, as decisions aren’t bottlenecked at the executive level. By allowing this it not only builds resilience in the company but also builds confidence and trust with their employees by empowering them to have a vested interest in the success (or failure) of the company.
This agility is critical when responding to consumer behavior shifts, such as those seen during the pandemic. Netflix's ability to quickly localize content and release new shows despite production delays helped it gain millions of new subscribers during the pandemic, demonstrating resilience in action. They’ve come a long way from making you wait to get a DVD in the mail. For those of you that are too young to go know what a DVD is, send me a message and I’ll educate you, or better yet google it.
Flexibility in Workforce Management
While the shift toward remote and hybrid work models had become a permanent feature for many companies, we are currently seeing this being rolled back. Approximately 90% of companies plan to implement return-to-office policies by the end of 2024 with some companies, like Amazon, are mandating a full 5-day return to the office starting in 2025. While organizations that are continuing to allow for flexibility are not only retaining but also attracting top talent and maintaining consistently even in the in the face of future changes. As for the companies that are not continuing to embrace flexible working, 80% of companies report losing talent due to their return-to-office policies. Fun fact, that you be shocked to hear, I was one of the original team members that piloted the remote work for Dell back in 2005. That is not a typo, I was 100% remote with a desktop sitting under my desk at home in 2005. It was successful then and continues to be today however the rules have changed significantly in the last year when it comes to being fully remote.
The focus on flexibility doesn’t end with remote work; cross-training employees for multiple roles has become a valuable practice for workforce resilience. Cross-training ensures that companies can maintain operations even when key employees are unavailable. A study by the Society for Human Resource Management (SHRM) found that 40% of employers plan to expand cross-training efforts to improve agility within their teams. This not only allows for employees to be able to step in when others aren’t available but also allows for different perspectives, asking the critical questions of why things are done a certain way and opens the door for improvement opportunities.
Measuring Resilience To maintain resilience as a long-term strategy, companies are increasingly turning to data and metrics. According to EY’s 2023 Business Resilience Index, 68% of executives believe that regular resilience assessments are crucial for long-term growth. Resilience metrics typically include factors like employee well-being, crisis recovery times, and operational flexibility.
Resilience audits, which examine a company’s crisis response and recovery capabilities, are becoming more widespread. These audits help organizations identify vulnerabilities and make necessary adjustments to their strategies.
Final Thoughts
When it comes to sustaining and measuring long term resilience, the most important to remember are employee retention, employee and customer NPS (net promotor scores). In a world that has become more fast paced, transactional, overridden with instant gratification and a “me” mentality, honest and genuine respect and relationships are still king. Remember Richard Branson’s famous words “Clients do not come first. Employees come first. If you take care of your employees, they will take care of the clients.”
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