It is the paradox of resilience that the very things that make us strong also can prevent us from being nimble during a crisis. The COVID-19 pandemic has exposed the weaknesses of how we have been doing business. If we look at businesses like nested Russian dolls, one system embedded inside another, we find clues to where change is needed if we are going to come back stronger from this crisis.
The first and smallest system is the employee. The lack of no-deductible health care, low-minimum wages and long commutes created a vulnerable workforce that didn’t have the minimum savings needed to cover household expenses for two months. It also meant that entire industries were vulnerable to workers becoming sick because they had no paid sick leave.
These are not individual problems. They reflect business practices that have given us cheap food and furnishings, but left us with little resilience when there is a natural disaster or economic crisis (or both).
The next system is the business itself. The most resilient corporations are those that plan for sustainability months before it is needed. They were already considering ways to let workers work from home or had diversified their supply chains to avoid dependency on a single supplier in a single country.
Large international businesses, like Unilever, have been emphasizing sustainability and adaptation as they sell soap and food around the world. According to Alan Jope, Unilever CEO, that drive to protect people, profits and the planet made them quick to respond to the crisis, sending their workers home in mid-March and looking at what they could do globally to prevent the pandemic from getting worse.
Resilient businesses are those that have redundancies built into their production. Much like aircraft that have fail-safe systems layer upon layer, small businesses need to anticipate what could happen during an economic crisis. Distilleries that are producing hand sanitizer and grocery stores that are offering delivery are showing the resilience that is necessary during a crisis. These practices are possibly new business models that will keep them afloat in the future.
Businesses also operate in a physical environment. Whether workers are building steel towers or programming code in office spaces, changes to workplace structure are going to make businesses more sustainable during a crisis. Online meeting applications that were once thought too risky for daily corporate communication have suddenly been adopted by even the most technologically phobic individuals. Changes like these shouldn’t be forgotten when we find a vaccine for COVID-19.
Lastly, businesses are part of social and political systems. Two-party political deadlock, taxation rules that consolidate wealth, xenophobia that chokes the flow of human capital and unnecessary international conflict have exacerbated our supply chains, turning our global economy into a “buy local” hippy commune that has little resilience when shortages begin. Where I live on the East Coast, we say that a high tide raises all boats. At a time when we needed global cooperation, political rhetoric was instead divisive and trade was stalled.
When individual systems are too attached to one way of doing business, they may look resilient, and even profitable. But, they won’t be able to withstand a disruption as great as a public health crisis. To make industry more resilient and productive, we need to start what resilience scientists refer to as “new regimes of behavior.” That will mean changing from immediate economic gain to considering the long-term social benefits of changing each system that makes a business more resilient. The good news is that resilience is possible.
Michael Ungar, Ph.D., is a family therapist and Canada research chair in child, family and community resilience at Dalhousie University. His latest best-selling book is “Change Your World: The Science of Resilience” and the “True Path to Success.” More about Dr. Ungar is at www.michaelungar.com.