The Resilience Framework (eBook)

Stefan Tengblad is Professor of Business Administration at the University of Skövde, Sweden. He has written and edited various books and articles on managerial work, leadership, and followership. Among his edited books are The Work of Managers and The Art of Science. He is the leader of the research specialisation centre Enterprises for the Future at the University of Skövde.Margareta Oudhuis is Professor in Work Science at the University of Borås, Sweden. As a researcher in organization, she has written books and articles on management models, leadership and work organization as well as on culture and the characteristics of enterprises in the Borås region of Sweden. She is a member of the research collaboration Enterprises for the Future between the University of Skövde and the University of Borås.

Foreword 6
Preface and Acknowledgements 12
Contents 14
Editors and Contributors 16
List of Figures 17
List of Tables 18
Abstract 19
Introduction and Development of the Organizational Resilience Framework 20
1 Organization Resilience: What Makes Companies and Organizations Sustainable? 21
Abstract 21
1.1 Introduction 22
1.2 The Skandia Case: How Expansion with a Focus on Shareholder Returns Can Jeopardize Organizational Resilience 23
1.3 The Concept of Organizational Resilience 26
1.4 The Resilience Concept: Origin and Development 26
1.5 Previous Definitions of Organizational Resilience 27
1.6 Theoretical Inspiration for the Book 29
1.7 Negative Aspects of the Resilience Concept 29
1.8 The Aims of the Book 30
1.9 Financial, Technical and Social Resources for Resilience 31
1.10 Arrangement of the Chapters 32
1.10.1 Part One: Introduction and Development of the Organizational Resilience Framework 32
1.10.2 Part Two: Applying the Organizational Resilience Framework 32
1.10.3 Part Three: Examining and Deepening the Resilience Factors 32
1.10.4 Part Four: Conclusions 33
1.11 The Authors and Their Common Research Interests 34
1.12 Discussion Questions 34
2 Organizational Resilience: Theoretical Framework 36
Abstract 36
2.1 The Evolutionary Approach: Explaining Change 36
2.1.1 Planned and Unplanned Change 39
2.1.2 Complexity and Predictability in Evolutionary Change 40
2.1.3 Organizational Control and Complexity 41
2.1.4 Organizational Innovation and Serendipity 42
2.2 Three Central Processes in the Evolutionary Approach: Variation, Selection and Retention 43
2.2.1 Variation 43
2.2.2 Selection 44
2.2.3 Retention 44
2.3 Using Variation, Selection and Retention Strategically 46
2.3.1 Variation 46
2.3.2 Selection 46
2.3.3 Retention 46
2.4 Disturbances and Crises: A Part of Organizational Reality 47
2.4.1 Positive Aspects of Disturbances and Crises 48
2.5 Sustainability and Organizational Resilience 50
2.6 Resilience as High Reliability and Risk Management 51
2.6.1 Risk Management the Safety-I, Safety-II Model 52
2.7 Conclusions: A Capability-Oriented Model for Organizational Resilience 54
2.8 Discussion Questions 55
3 A Resource-Based Model of Organizational Resilience 56
Abstract 56
3.1 Financial Resources 57
3.1.1 Ability to Pay (Liquid Assets) 57
3.1.2 Creditworthiness (Financial Balance) 58
3.1.3 Earnings Capacity (Cash Flow and Profitability) 58
3.1.4 Financial Contracts and Economic Rights 59
3.1.5 Intangible Assets (e.g., Patents and Goodwill) 59
3.2 Technical Resources 59
3.2.1 Products and Services 60
3.2.2 Production Technology and Work Organisation 60
3.2.3 Logistics and Supply Chains 61
3.2.4 Information Systems 61
3.2.5 Technical Know-How and Innovation 62
3.3 Social Resources 62
3.3.1 Followership and Relationships with Unions 63
3.3.2 Relationships with Customers 64
3.3.3 Relationships with Suppliers and Partners 64
3.3.4 Relationships with Owners and Financiers 65
3.3.5 Relationships with Other Stakeholders 65
3.4 The Connections Among the Resources: An Example 66
3.5 External Factors for Resource Development 67
3.5.1 Natural Resources and Other Raw Materials 68
3.5.2 Labour 68
3.5.3 Economic Ecosystems 69
3.5.4 Transportation/Communication Networks 69
3.5.5 Social Capital 70
3.6 Resilience for (Fast) Adaptability 70
3.7 Discussion Questions 71
Applying the Organizational Resilience Framework 72
4 The Champion Company that Disappeared: A Resilience Resources Analysis of Circuit City 73
Abstract 73
4.1 Good to Great: A Handbook for Wanna-Be Top Executives 73
4.2 Circuit City—A Retailer’s Rise and Fall 77
4.3 A Resilience Analysis of Circuit City 78
4.3.1 Financial Resources 78
4.3.2 Technical Resources 81
4.3.3 Social Resources 82
4.4 Onoff—A Swedish Parallel to Circuit City 83
4.5 Conclusions 84
4.6 Discussion Questions 86
5 BP and Deepwater Horizon: A Catastrophe from a Resilience Perspective 87
Abstract 87
5.1 Organization Resilence as Disaster Management 87
5.2 The BP-Deepwater Horizon Oil Spill 90
5.3 The Aftermath of the Blow Out: Causes and Consequences 92
5.4 As the Gas Leakage Continued 94
5.5 BP After the Oil Spill and the Explosion 95
5.6 A Resilience Analysis 98
5.6.1 The Linkage Among Financial, Technical and Social Resources 99
5.7 Concluding Reflections: How to Handle Complex Risks 101
5.7.1 The Geological System Risk 101
5.7.2 The Technical System Risk 101
5.7.3 The Human System Risk 101
5.7.4 The Organizational System Risk 102
5.7.5 The Social System Risk 102
5.8 Discussion Questions 102
6 Resilient Leadership: Lessons from Three Legendary Business Leaders 104
Abstract 104
6.1 Resilient Leadership 104
6.2 Jacob Wallenberg and Stockholms Enskilda Bank 106
6.2.1 Financial Resilience Resources 108
6.2.2 Technical Resilience Resources 109
6.2.3 Social Resilience Resources 110
6.2.4 Concluding Words on Jacob Wallenberg and Stockholms Enskilda Bank 110
6.3 Jan Wallander and Svenska Handelsbanken 111
6.3.1 Financial Resilience Resources 112
6.3.2 Technical Resilience Resources 113
6.3.3 Social Resilience Resources 114
6.3.4 Concluding Words on Jan Wallander and Handelsbanken 115
6.4 Pehr G. Gyllenhammar and AB Volvo 116
6.4.1 Financial Resilience Resources 119
6.4.2 Technical Resilience Resources 119
6.4.3 Social Resilience Resources 120
6.4.4 Concluding Words on Pehr G. Gyllenhammar and AB Volvo 121
6.5 Final Reflections 122
6.6 Discussion Questions 123
Examining and Deepening the Resilience Factors 124
7 Financial Resilience: The Role of Financial Balance, Profitability, and Ownership 125
Abstract 125
7.1 The Model for Organizational Resilience: The Financial Resources 126
7.1.1 The Resource: Financial Balance 126
7.2 The Financial Square Model and Some Key Ratios 127
7.2.1 Financial Balance Key Ratios 127
7.2.2 Profitability Key Ratios 128
7.3 Volvo: A Company with Average Financial Resilience 128
7.3.1 The Volvo Group 128
7.4 Ericsson and H& M: Companies with Strong Financial Resilience
7.4.1 Ericsson 131
7.4.2 H& M
7.5 SAS, Swedbank, and Nordea: Companies with Weaker Financial Resilience 136
7.5.1 Scandinavian Airlines 136
7.5.2 Swedbank and Nordea 139
7.6 Concluding Reflections 143
7.7 Discussion Questions 144
8 Resilience in the Product-Delivery Supply Chain 146
Abstract 146
8.1 Introduction 146
8.2 Disruptions and Unexpected Events 147
8.3 Robustness and Flexibility 148
8.4 Lean and Six Sigma 150
8.5 Resilient Supply Chains 151
8.5.1 Risk Management Culture 152
8.5.2 Design and Innovation 154
8.5.3 Teamwork and Integrated Management 156
8.5.4 Spreading and Establishing the Company Vision, Goals, Values, and Processes 157
8.5.5 Agility 158
8.6 Conclusion: How to Achieve Supply Chain Resilience 158
8.7 Discussion Questions 159
9 Followership: An Important Social Resource for Organizational Resilience 160
Abstract 160
9.1 Hard and Soft in Manufacturing 160
9.2 Workers’ Commitment to Results—Followership and Culture 161
9.3 Conditions for the Development of Medarbetarskap/Followership 163
9.4 Organizational Resilience at a Factory in the Automotive Industry 165
9.4.1 The Brand as a Threatened Financial Resource 165
9.4.2 The Risk with Technical Resources at an Engineering Company 167
9.4.3 The Floby Spirit: Culture as a Social Resource 167
9.4.4 Followership at the Core of Social Resources at the Factory 168
9.5 Can Organizational Resilience Be Sustained? 171
9.6 Concluding Reflections 173
9.7 Discussion Questions 174
10 Followership for Organizational Resilience in Health care 176
Abstract 176
10.1 Working with Standardized Processes and Flexible Procedures 176
10.2 Followership 179
10.2.1 Organizational Resilience and Followership 180
10.3 Resilience in an Organization with High Reliability 181
10.4 Two Case Studies: Standardization Versus Flexibility 182
10.4.1 Preoccupation with Failure 183
10.4.2 Reluctance to Simplify 183
10.4.3 Sensitivity to Operations 184
10.4.4 Commitment to Resilience 185
10.4.5 Deference to Expertise 186
10.5 Analysis: Followership and Organizational Resilience 187
10.5.1 Followers’ Ability to Improve 188
10.5.2 Followers’ Ability to Cooperate 188
10.5.3 Followers’ Ability to Learn 189
10.6 Conclusions: Followership and Organizational Resilience 190
10.6.1 Practical Implications 191
10.7 Discussion Questions 192
11 Organizational Resilience and Stagnation at a Fashion Company 193
Abstract 193
11.1 Organizational Stagnation and Renewal 193
11.2 The Fashion Company—From Stagnation to Renewal and Growth 196
11.2.1 Leadership and Followership 198
11.2.2 Organization 199
11.2.3 Trustful Relationships as a Social Resilience Resource 201
11.3 From Stagnation to Viability 204
11.4 Conclusions 206
11.5 Discussion Questions 207
12 Business Clusters and Organizational Resilience 208
Abstract 208
12.1 Organizational Challenges 208
12.2 Business Clusters 210
12.2.1 The Ability to Discover and Manage Threats to Business Activities 210
12.2.2 Company Domain, Main Focus and Internal Order 212
12.3 Resilience in Individual Companies 213
12.3.1 Algots 214
12.3.2 Mölnlycke AB 216
12.3.3 JC Jeans Company 216
12.4 Analysis: Resilience in Business Clusters 218
12.5 Conclusions 222
12.6 Discussion Questions 222
13 Regional Resilience 224
Abstract 224
13.1 Studying Regional Resilience 225
13.2 Regional Values and Attitudes: The Influence of History 227
13.3 Flint, Michigan, and Other North American Cities 228
13.4 The Borås Region: Resilience from Regional History 231
13.5 The Textile Crisis in Sweden 232
13.6 Crisis Management in the Borås Region 233
13.7 Industry Customization and Development 233
13.8 Public Investments 234
13.9 Regional Mobilization of Resources 235
13.10 A Summary of the Development in the Borås Region 236
13.11 General Lessons 238
13.12 Discussion Questions 239
Conclusions 241
14 Conclusions: The Resilience Framework Summarized 242
Abstract 242
14.1 Introduction 242
14.2 Theoretical Contributions of the Book 243
14.3 Seven General Conclusions 244
14.3.1 Factors that Create Organizational Resilience Are Changeable and Varied 246
14.3.2 Organizational Resilience Is Created Through Holistic Management of Resources and Capacities 247
14.3.3 Organizational Resilience Is Created by Interactions with Others 248
14.3.4 Value Is Created by Economies of Scale, Standardization, and Flexibility 249
14.3.5 The Importance of Organizing for High Reliability 252
14.3.6 The Importance of Local Business Conditions 253
14.3.7 Resilience Is Created by Combining Reliability, Efficiency, and Change Capacity 254
14.4 Final Thoughts 255
14.5 Discussion Questions 256
References 258
Annual Reports 273
Quarter Report 273
Articles (From the Newspaper’s Home Pages) 273