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Building Organisational Resilience

Building Organisational Resilience

Aboriginal & Torres Strait Islander organisations are constantly dealing with crises and organisational stress; more than most other not-for-profit organisations and commercial businesses.

At the edge of financial viability, they face funding pressure, changing Government policies, the weight of community expectations, and the pressure of “walking two worlds” in governance and management.

Many Aboriginal & Torres Strait Islander organisations operate in remote locations for constituents whose first language is not necessarily English, where finding and retaining capable staff is a constant struggle, let alone training local community members in the administrative, financial and management jobs.

It is not surprising then to hear that as an organisation, they struggle with resilience and sustainability.

A resilient organisation should be able to withstand shock, crisis, pressure, and stress, and bounce back quickly to effective performance levels. Many have developed characteristics that allow this to happen.

In over 35 years of working with and for Indigenous organisations, we have seen successfully resilient organisations develop what we call The Six Building Blocks of Organisational Resilience being:

  1. Leadership
  2. Governance
  3. Planning
  4. Human Capital
  5. Systems
  6. Financial Management

We have prepared a free Whitepaper called The Building Blocks of Organisational Resilience in which we have recorded our observations on how strong organisations develop these building blocks to develop their resilience.

Leadership

Leadership is the other side of the coin from management. The two need to co-exist.

While management is focused on the method and the "how", leadership is focused on the bigger picture and the "why".

One needs the other. Strong leadership will fail without the backup of managers who organise resources to get the work done. On the other hand, good management without inspiration is just mechanical and neither motivational nor inspirational.

In our work, we have found that in strong Indigenous organisations:

  • The organisation has access to a number of leaders from within the community, who serve on the Board of Directors at the same or different times
  • Leaders work toward a common goal for the community - even if they disagree about details and personal objectives
  • Community leaders are selfless
  • Leaders are good communicators who walk the talk
  • The leaders work with rather than against management

To learn more about how the building block of Leadership can be developed "in balance" with the other building blocks, you can get our free Whitepaper that explains how they all work together.

Governance

In the context of Indigenous organisations, Governance is both about how the Board of Directors work, as well as about how the organisation is governed in a holistic sense.

“How the organisation is governed” involves decision-making transparency, decision-implementation and how that involves a larger group to maintain legitimacy, and the overall model of whether the Board really represents the people and truly govern the activities of management.

Strong organisations understand the principle of governance as opposed to operational management - "eyes in, fingers out".

While the natural concern for “their” organisation is paramount, they have found a balance of remaining involved and influential without taking over or forcing operational management.

These are the characteristics of "good" governance we have observed:

  • Their governance uses "cultural-match" and blends legislated corporate governance rules with traditional and culturally appropriate ways of consensus and decision-making
  • They have reconciled issues of who holds power and how that power is exercised
  • There is a widely accepted dispute resolution process that is consistently applied and accepted
  • They work through the Board structure using "cultural-match" principles but always exercising separation of powers between Directors and management
  • They maintain strong formal structures that develop strong financial management and administration systems
  • They frequently evaluate and review strategy and policy

Planning

Resilient organisations are disciplined in their planning.

While often done with the participation of management, strategic planning is seen and practised as the responsibility of the Board of Directors.

They actively set the strategic direction of the organisation which is used to “instruct” management about what they want to achieve in the long term and challenges management to implement shorter-term tactical plans to get the organisation there.

In developing planning as a building block for resilience, strong organisations have been observed to:

  • Implement a disciplined planning cycle
  • Use the plan as a living document
  • Communicate the plan effectively throughout the community
  • Schedule regular reviews and new planning horizons
  • Prepare Risk Management Plans

Human Capital

Human capital is the asset of human resources – staff and other people in the community and network.

The management of human resources – the procedures of advertising for staff, selection, employment, reviewing, and ultimately removal – requires technical skill and should be managed with some assistance from human resources experts.

However, the treasuring and development of the asset of human capital is about developing and following policies that include executive development and succession planning, upskilling and career-path development, capacity building within the community, training and development, and instilling professionalism.

We have seen that resilient organisations with a foundation in strong Human Capital practice have the following characteristics:

  • Mutual respect is shown between their Boards, management, and workers
  • Selection of key personnel is based on character and personality as well as skill and experience
  • Non-community management staff are asked to mentor local staff
  • Succession planning mechanisms are in place
  • Human resource systems include regular reviews of performance and consideration of training and development and long-term career paths for all staff

The building block of Human Capital can be quantified, as can all the other building blocks so that you can check how your organisation is developing its strengths. Our free Whitepaper shows how this can be done.

Systems

The building block we call “Systems” includes formal, documented policies, protocols and procedures.

Policies are statements of directives that guide the conduct of members, Directors, management and staff of the corporation. Protocols are broad guidelines on what to do under certain non-standard circumstances. Procedures are detailed steps when dealing with specific parts of the organisation’s work.

In our work, we have found that resilient organisations don't really care about the technical definitions of policies, protocols and procedures, but they have recorded the key elements of “how we do this around here” in a way that is effective for them.

We have found from experience that resilient organisations have the following characteristics about systems: -

  • Their key policies and procedures are documents
  • Their systems are regularly reviewed and updated
  • Everyone receives training in the policies, procedures and systems so that they know how to use them
  • Their regular staff reviews include assessments of how people are using (or abusing) systems

Many organisations “grow” their systems as their operations themselves develop. This means many organisations face the situation where there are many processes that are inconsistent and undocumented.

This could be overwhelming.

We recommend taking time over developing key business systems. Work on the most urgent and important first. Then, schedule all the others over a period of 6 to 18 months.

Financial Management

Financial management is the process of planning, organising, directing, recording, monitoring and controlling all the financial activities and sub-systems of the organisation.

Best-practice financial management is not only about understanding, recording and reporting the numbers but also about planning, directing and controlling the financial activities.

While many organisations "delegate" this building block to finance staff and consultants, we have found that strong organisations do not abrogate their responsibilities in ensuring that they understand how the system works, in overseeing that it actually works as described, and in understanding the results in reports and outcomes.

Strong organisations:

  • Have financial information systems that provide timely and accurate information
  • Implement planning cycles that include financial forecasts and budgets
  • Are always aware of their cash and solvency positions
  • Sometimes ensure Directors and Managers receive financial training

In summary, while Aboriginal & Torres Strait Islander organisations face some serious challenges to their viability, it is possible to develop resiliency through the focus on the six building blocks that we have observed as the foundations of organisational resiliency.

It is important to be aware of these building blocks and how to develop them, as well as to measure the organisation's strengths in regard to them.

Our free Whitepaper called The Building Blocks of Organisational Resilience is available here, and provides a detailed explanation of each of these building blocks, as well as why they must be developed in balance, and also provides a scorecard so that you can measure your own strengths.

 

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