Finding Balance in Your Safety Space: Managing SMS in a Pandemic State
Leading our companies through the disruption of a pandemic is not an easy task, even for the nimblest organizations. One lesson of the COVID-19 crisis is appreciating its speed and varying direction; the pandemic obeys no speed limits nor reports its course. When the pandemic erupted, even the most historically stable industries have had to change. More agile organizations are increasing their speed of decision making, while improving productivity, using technology and data in new ways, and accelerating their scope and scale of innovation.[i] These organizations are “failing fast” in efforts to quickly learn from their mistakes, and then applying newly acquired knowledge to deliver positive results in record time.
COVID-19’s duration is also stretching an organization’s business resiliency. The speed, ability, and efficiency of individuals, teams, and organizations to bounce back from disruption is a clear indication of their current operating savvy. With new COVID-19 outbreaks and related business disruptions, economists are compelled to draw deeper and wider “W-shape” recovery charts - putting ever-increased demands on companies’ financial management of assets, workforce, infrastructure, to maintain their current business strategies. The longer the delay in a finding a cure for the current virus, the more pressure will be placed on operating agility, resiliency. More “W’s” would be drawn across the economic forecast lines.
There is a natural dynamic business tension between agility and resilience. It takes great effort to build business flexibility to adapt and stay ahead, while continually improving abilities to quickly recover after disruptions. This can be a quite challenging as these two business forces oppose each other; in many cases, causing an organization to spread its planning and focus in conflicting directions.
Taking an SMS perspective, the dynamic business tensions described above can be applied to Reason’s Safety space model of active Risk Management. Organizational agility traits can be associated with elements of business production, while resiliency traits can be associated with elements of business protection. If leadership fails to balance agility and resilience within their strategic planning, their operating risk margins may be too thin to enable effective strategy execution and/or maintain their operating objectives.
Safety Space from a Systems Perspective
A study of excellent companies shows that building adequate safety space requires both an employee performance and organizational management approach. A company that has adequate infrastructure and design but lacks poor employee development, tends to be resistant to change and may not be nimble enough to survive. In comparison, a company which employs exceptionally clever people but who are not organized, nor utilized effectively, tends to be costly, reactive, and dysfunctional.
A successful safety culture fosters belief and promotes behaviors that rely on treating the entire organization as a system of interdependent operations. It continually develops and promotes its core competencies, strategic objectives, action plans, work systems, and workforce needs. During major disturbances and unpleasant interruptions, the management of strategy, vision, and mission are not dropped. They are changed frequently, tested, and reshaped around core competencies, developed abilities, and uniquely modified work systems.
Designing ample safety space amid efforts to drive speed, agility, and resilience.
Speed and Agility (Refining abilities of production) - Senior partners at McKinsey & Company have recently captured key traits of agile companies who have begun to frame the “new normal” of a post-pandemic return.[ii] Developing organizational speed traits includes a process of 1) Rethinking ways of working, 2) Re-imagining organizational structure, and 3) Reshaping talent. These organizations are also realizing that the majority of speed and agility needs to be derived from frontline employees who are taking on more responsibility for execution, action, decision making, and collaboration. Senior Leaders also recognize that these strategies will accentuate their tenet of creating a living culture of risk and safety management.
Resiliency (Upping abilities of protection) - Similar resilient leadership insights have recently collected by senior staff at Deloitte Touche Tohmatsu Limited (DTTL)[iii]. Their corporate resiliency model is based on key phases of crisis management and business disruption, 1) Respond, 2) Recover, and 3) Thrive and identify six functional areas most at risk during a crisis. Each of these cases must be considered and developed concurrently to strengthen corporate resiliency.
SMS Safety Space (Creating ability to “get along in the C-Suite”) – Safety leadership should utilize enterprise and venture risk management plans to create ample Safety Space for simultaneous execution of agile and resilient strategies. The following SMS risk mitigation table, models sample SMS strategies that can create effective Safety Space for timely execution of corporate speed, agility, and resiliency deployment strategies:
Safety Leadership Table:Creating Safety Space in the Current COVID-19 Business Environment (click on table to enlarge)
Note. The content within this table is listed for informational and comparative references only. The content is noncommercial. The Speed and Agility elements are from McKinsey & Company et al. (June 2020); the Resiliency elements are from Deloitte Touche Tohmatsu Limited (DTTL) et al. (March 2020). The SMS strategy elements are compiled by the author and contain general information only; they are not, by means of this posting, rendering any professional advice or services. Before making any decision or taking action that might affect your company’s finances or business, you should consult your corporate leadership, board, and other qualified advisors.
[i] DeSmet, A, Pacthood,D, Relyea, C, Sternfels, B, Ready, Set, Go: Reinventing the organization for speed in the post-Covid-19 era, McKinsey & Company Global Edition Services, June 2020, pp 2-8
[ii] Ibid. i
[iii] Punit Renjen, The heart of resilient leadership: Responding to COVID-19: A guide for senior executives, Deloitte Insights, March 16, 2020