COVID-19 Sparks New Perspective on Risk Management and Organizational Agility
Businesses worldwide have been forced to adapt to unprecedented crises, with COVID-19 serving as a stark reminder of the importance of preparedness. Companies that once deemed certain processes 'bureaucratic' and capabilities 'dormant' or 'redundant' found them crucial for survival. This shift has sparked a new perspective on risk management and organisational agility.
Traditional risk management processes, once considered overly cautious, proved vital during the pandemic. These processes ensured business continuity by keeping organisations alert and ready to activate dormant capabilities when needed.
Companies like Heckler & Koch and PRECOPLAT exemplify this. They maintained 'warm' qualification and data states, allowing them to swiftly scale production without loss of time during the COVID-19 crisis. Instead of preserving all dormant capabilities blindly, organisations should map which ones tend to activate together during disruption. This way, they can recognise and leverage existing capabilities that suddenly become relevant.
The COVID-19 pandemic also highlighted the advantage of maintaining 'excessive' infrastructure and 'redundant' supply chains. Companies that had these in place found them essential for survival during disruptions. Similarly, some humans carried genetic variants that made them resistant to COVID-19, which were once considered 'useless' or 'biological junk'. These ancient adaptations to long-forgotten pathogens became life-saving advantages when the virus emerged.
The pandemic has underscored the importance of maintaining organisational peripheral vision and 'useless' diversity. Companies that can recognise and adapt to shifting market conditions, and preserve capabilities and infrastructure that might seem 'redundant' in normal times, will be better equipped to navigate future disruptions. This shift in perspective demands new questions about competitive strategy, challenging businesses to rethink their approach to efficiency and preparedness.
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