Understanding the elements of organizational resilience can help to explain why some organizations succeed while others fail when faced with change, small or large. Organizations necessarily operate within set parameters to achieve continuity of operations. When unexpected change and crisis challenge these set parameters, organizations are forced to adapt to the new environment or fail.
Let’s explore two resilience examples: Lego and Microsoft. These are organizations that demonstrate the key elements that cultivate organizational resilience: vision, innovation, a growth mindset, adaptability, and conscious leadership.
Resilience Example 1: Lego
Founded in Denmark in 1932, The LEGO Group (“LEGO”) supplies ample fodder for a master class on resilience. What the following summary demonstrates is not a company that never makes a mistake. In fact, LEGO failed badly—nearly catastrophically. But the company embodies the elements of organizational resilience that have allowed it to continue to correct, grow, and thrive.
Vision, Innovation
Founded by Ole Kirk Kristiansen, Lego originally sold wooden toys. When the plastics industry came of age in World War II, Kristiansen came up with the idea for plastic bricks. At the time, the idea of making toys from plastics was novel; many even thought it was ill-conceived. He told his skeptical sons, “Can’t you see that if we do this right, we can sell these bricks all over the world?” In 1946, he ordered his first plastic molding machine. And the rest is history.
Vision
In 1957, Kjeld Kirk Kristiansen assumed the helm of the LEGO Group. He set a clear vision for the company: “Our products must exist on children’s own terms. …What the future LEGO products do in the heads of tomorrow’s children is important.”
Growth Mindset, Adaptability
In 1960, a fire destroyed the company’s wooden toy warehouse. Instead of becoming mired in catastrophic thinking or sentimentality, the company looked to the future. It realized that the original wooden toys were a thing of the past and chose to interpret this as an opportunity to stop producing them.
Problem Solving, Vision
By the mid-1960s, the LEGO factory was hosting 20,000 visitors a year, who were coming to see their exhibit of LEGO models. In 1968, unable to cope with the volume of visitors—and envisioning opportunity—the company built the first LEGOLAND® family park in Billund, Denmark. In 2019, revenue from LEGOLAND parks worldwide reached approximately $820 million. (As a side note, in 2020, that number plummeted to approximately $279 million, affected like many others by the coronavirus.)
Rebounding from Failure, Conscious Leadership, People-First
Fast forward to 2003. LEGO’s future looks bleak. The company was $800 million in debt and on the verge of bankruptcy. A new CEO was brought on named Jorgen Vig Knudstorp. By 2005, the company began to climb out of debt. In 2021, the company reported a net profit of DKK 13.3 billion (roughly $1.85 billion).
In interviews with Google Zeitgeist (2011) and Meet the Boss (2014), Knudstrop attributes the root of LEGO’s near-demise to the company losing sight of its “essence” (i.e., the plastic building blocks). He believes this was the result of an overly aggressive expansion play. Similarly, in an interview with Bloomberg, LEGO’s President Soren Torp Laursen (2004-2016) admitted that by the early 2000s, LEGO had stopped listening to its customers.
Under Knudstrop’s helm, the company refocused its efforts from expansion-for-the-sake-of-expansion to a more deliberate strategy that focused on customer feedback. Customers wanted increased digitization, so LEGO gave them robust online communities and platform games (e.g., LEGO Star Wars for Wii and Xbox). Customers wanted role-playing games, so LEGO gave them such options as LEGO Friends and LEGO Dungeons.
In March of 2022, The LEGO Group announced: “Revenue for the year [2021] grew 27 percent versus 2020…and consumer sales grew 22 percent, outpacing the toy industry and driving market share growth globally and in largest markets.”
Resilience Example 2: Microsoft
Innovation, Adaptability, Flexibility
With 180,000+ employees in over 100 countries around the world, the coronavirus pandemic presented Microsoft with a particularly complex logistical challenge. After requiring employees to work remotely due to the pandemic, Microsoft’s next goal was to set a timeline for employees to return to work. But the company realized quickly that it was in uncharted territory and could not predict exactly what the future would hold. Instead, it decided to take a deliberately flexible approach.
Microsoft outlined six stages to hybrid work: 1. Closed, 2. Mandatory work from home, 3. Work from home is strongly encouraged, 4. Soft open, 5. Open with restrictions, and 6. Open. The stages are not tied to specific timeframes and deadlines. Instead, every Microsoft campus is anchored to one of those six stages and can be re-anchored as necessary. This allows each campus to react nimbly as local health conditions or government guidance dictate. Microsoft campuses are assigned to one of the six stages based on a readiness assessment and examination of data-driven criteria—such as government regulations and local health trends—and each stage has prescribed policies associated with it.
People-First, Conscious Leadership
Microsoft employs a “listening system,” which includes regular employee surveys and polls, to navigate what they call the Hybrid Paradox and the Great Reshuffle (see sidebars). While other companies continue to enforce return-to-work mandates, Microsoft has accepted that hybrid work is here to stay indefinitely. In fact, the company calls it the “next great disruption” to the world of work.
In May of 2021, Microsoft outlined key updates to its operating models and approach to people, workspaces, and processes that it would need to focus on to accommodate the new hybrid reality:
- People
- As the tie that binds in today’s global workplace, the implementation of world-class technologies is essential to enable synchronous and asynchronous work.
- Creating opportunities for continuous learning and knowledge sharing through personalized training and credentialing are key to innovation and engagement.
- Employee well-being is more important than ever and must be central to every move forward.
- Places
- Microsoft’s approach prioritizes employee safety. This includes an app that lets employees self-attest to their health and well-being and enables employers to monitor and control occupancy.
- The company is re-engineering its physical spaces to optimize mixed-reality scenarios using smart cameras, state-of-the-art audio, and integration of social cues (emojis and reactions).
- Processes
- Microsoft anticipates that processes will change in every area of the business and identifies security as the top priority.
Microsoft punctuated the announcements surrounding their approach to the new world of work with the following statement: “We will continue to evolve our approach to flexibility over time as we learn more.” This disclaimer recognizes that the hybrid approach is a work in progress, and it sets an expectation that additional changes may lie ahead.
Does Your Organization Need Help with Resilience and Change Management?
Change isn’t always easy and knowing where to start can be confounding! GSX helps organizations develop innovative talent management and human capital strategies using multiple forms of credentialing and learning solutions. We work with your organization to build and maintain agility and resiliency in your workforce through a fully customizable methodology, advanced readiness tools, and critical analytics that addresses your need to focus on the change concerns of today and tomorrow.
If your organization is struggling to adapt to change in the workplace, Global Skills X-Change can help! Contact us today!