Tuesday, August 22, 2006

‘Survival of the adaptive’ is the mantra for today’s complex, uncertain business world

Much of the organizational thinking about crisis management has focused on reparation. Many companies, for example, have created risk management teams to develop detailed contingency plans for responding to a pandemic. This is necessary but not sufficient.

In the complex and uncertain environment of a sustained, evolving crisis, the most robust organizations will not be those that simply have plans in place but those that have continuous sensing and response capabilities. As Darwin noted, the most adaptive species are the fittest. Consider these two organizations. Which one would fare better in a sustained crisis, such as a pandemic?

Organization 1
  • Hierarchical
  • Centralized leadership
  • Tightly coupled (greater interdependence among parts)
  • Concentrated workforce
  • Specialists
  • Policy- and procedure-driven
Organization 2

  • Networked
  • Distributed leadership
  • Loosely coupled (less interdependence)
  • Dispersed workforce
  • Cross-trained generalists
  • Guided by simple yet flexible rules
Organization 2 is clearly better positioned to respond to evolving, unpredictable threats. We know from complexity theory that following a few basic crisis response principles is more effective than having a detailed a priori plan in place. In fires, for instance, it’s been shown that a single rule – walk slowly towards the exit – saves more lives than complicated escape plans do.

For complete IIPM article click here

Source:- IIPM Editorial, 2006

Editor:- Prof. Arindam Chaudhuri