The knowledge to best understand all components of an organisation’s strategic resilience will come from the people within an organisation. However, identifying, accessing and communicating the levers of strategic resilience is rarely straightforward. To unlock this knowledge, an organisation needs to undertake a structured and formal strategic resilience review. This should include a cross-section of informed employees from across the business to develop recommendations and decide how best to act on the findings, in consultation with senior leadership.
KPMG’s approach to strategic resilience reviews uses realistic strategic scenarios to help participants understand the tangible implications and not get lost in the theoretical.
The approach, which takes 8-10 weeks, helps businesses to:
- Develop strategic scenarios (facilitated by trained practitioners) to test certain planning parameters, using the strategic scenarios to underpin assumptions of resilience.
- Quantify estimated implications on order book (volume and price) and cost base. Thinking in kilometres, not millimetres – the review needs to avoid detailed nuances and focus on key themes and impacts that differ from the current assumptions built into business planning.
- Assess the risks and implications of the different scenarios across defined components of strategic resilience, thinking beyond business-as-usual responses to achieve the best outcomes for the business.
- Develop options for actions and mitigations that form a strategic action plan, prioritising the most critical actions (based on value and complexity) and agree how these actions will be implemented. In doing so, they need to make decisions based on what’s best for the business, not what’s best for individual business units or functions.
A strategic resilience review is not a one-off exercise. Monitoring and responding to changes is an ongoing process. It should form an integral part of the business strategy and the business planning process. The review could take the organisation in any number of directions, according to the specific risks and opportunities it faces, from defining a new risk management strategy all the way to an enterprise-wide transformation.
When determining these steps, leaders need to consider what actions the organisation should take to promote and prosper from its preferred future, deter but prepare for alternative positive futures, and prevent and prepare for negative potential futures.
The transition from scenario to action is the most important and hardest step of the strategic resilience review. This is why organisations need to follow a structured process to provide an evidence base for decision-making.
To understand more about how we can help you, please contact our Enterprise Transformation team.
