Bouncing Back: The Business Benefits Of Building Resilience

In business, as in life, there is no such thing as a journey unmarked by setbacks, hurdles and unexpected events. However, it is how a business copes with these stressors that will ultimately dictate its ability not only to survive, but also to thrive in a changing environment.

In 2000, educational sociologists Ricardo D. Stanton-Salazar and S.U. Spina neatly defined resilience as: “A set of inner resources, social competencies, and cultural strategies that permit individuals to not only survive, but recover, or even thrive after stressful events, but also to draw from the experience to enhance subsequent functioning.”

Yet the importance of resilience -- commonly described as the ability to bounce back after adversity -- is often underestimated, both on an organizational and an individual level. Think of Eastman Kodak Co. (OTCMKTS: EKDKQ) as one example -- once a behemoth of its sector, now virtually extinct -- thanks to its inability to bounce back from the advent of digital photography.

Or Steve Jobs, the former head of Apple (Nasdaq: AAPL), who was famously fired from his own company, but later returned to stage one of the greatest business come backs of all time. After all, what is business success but the ability to rise above adversity and successfully adapt in the face of challenging or threatening circumstances?

When The Going Gets Tough

As Ernest Hemingway said in his novel “A Farewell to Arms”: “The world breaks everyone and afterward many are strong at the broken places.”

Martial arts experts know this from experience -- a broken hand, once healed, is an even stronger weapon for the next big fight. Likewise, resilient organizations and people are those who have encountered stressful events, learned from them, and can draw on the strength of their past experience to inform their future behavior.

Resilience is increasingly likely to become a key issue for employers, particularly as the younger generation moves into the workforce.

Unlike their parents, many of those aged between 18 and 25 have not had to struggle, and they have had less chance to experiment and fail than any generation in history. At the simplest level, Google is there to answer any question, online cheats can be found for any video game and YouTube is packed full of instructional videos to help solve any problem from how to tie a bow-tie to putting a new SIM card in a smartphone.

Ready access to (admittedly convenient) tools such as these have meant that the young are less used to the process of problem-solving and have been cushioned from trial-and-error learning to a large degree. In most cases, they have also grown up in a time of prosperity and peace, in the absence of challenging circumstances that might otherwise have allowed them to experience failure and develop resilience.

Research shows some, however, will start with a natural advantage. It seems that people born with higher neuropeptide Y (NPY), a neurotransmitter in the brain that regulates stress responses, tend to be more psychologically resilient and resistant to breaking down in high-pressure situations. However, all is not lost for those who didn’t win the NPY genetic lottery: A study of U.S. Army soldiers showed that members of the Special Forces who had been trained to be resilient had significantly higher NPY levels than typical soldiers.

Building Organizational Resilience

So how can businesses help their employees develop the resilience and skills they’ll need to persevere in the face of future challenges? Just as a parent may teach a child to ride a bicycle by holding the bike steady, and then gradually letting go, so too can business help employees learn to face new challenges (or get back on that bike after a fall, to continue the analogy).

Whether adult or child, at one end of spectrum the individual needs to feel cared for and appreciated. It’s all about creating a supportive environment. At the other end of the spectrum, the individual needs to have autonomy over their actions and decisions. And it’s the balance between the two that really matters.

Wrapping a child in cotton wool or protecting an employee from the possibility of failure does not help them develop their skills in any meaningful way. At the other end of the scale, setting an impossible challenge without any support only teaches an individual to expect failure.

In the ideal world, when individuals experience adversity, they also experience individual and environmental protective factors that act as a buffer to that adversity.

With enough of these protective factors in place, individuals will be able to adapt to adversity without experiencing a significant disruption to their life. Resilient individuals primarily remain within a comfort zone or at “homeostasis,” where they seem to weather life’s difficulties without much disruption. In addition, in the process of overcoming adversity, individuals may gain more skills and greater strength.

Employers looking to promote resiliency amongst their workforce can help by increasing connections between staff, setting clear and consistent boundaries and providing access to skills development. At the same time, employers need to provide a caring and supportive workplace, set and communicate high expectations and provide opportunities for meaningful participation.

By exposing workers to challenge, equipping them with the skills and tools they need and not shaming failure, employers can do much to foster resilience. That said, there is also much to be said for engineering artificial opportunities for failure. Only by facing adversity, is it possible to develop strategies for handling it -- something to think about when hiring a 23-year-old with little life experience.

For resilient individuals and organizations, a setback is not seen as the end of the world -- it is acknowledged and experienced as a learning opportunity, and a chance to do better next time. And that is something every successful business and individual understands.

Darren Hanson is an associate professor in the Department of Management and Organization at the National University of Singapore Business School. This column was produced in collaboration with the school’s Think Business portal (thinkbusiness.nus.edu).