Author and researcher Josh Kaufman writes in his book The Personal MBA
that because the world is a fundamentally uncertain place, your ability to change your strategy and tactics as conditions change can mean the difference between survival and failure.
Kaufman argues that resilience is an underrated quality in business: “Having the toughness and flexibility to handle anything that life throws at you is a major asset.”
For Kaufman, these are the seven qualities that make a business resilient:
1. Backup systems for all core processes
2. Flexible workers who can handle many responsibilities well
3. Low (preferably zero) outstanding debt
4. Low fixed costs, operating expenses, and overhead
5. Multiple independent products / industries / lines of business
6. No single points of failure
7. Substantial cash reserves for unexpected events
He admits that these aren’t the sexiest business practices. But when unexpected negative events happen, being sexy is less important.
Kaufman uses an analogy from the animal kingdom to illustrate the importance of resilience.
Turtles aren’t the sexiest creatures. They can’t fly. They can’t run fast. And they don’t have sharp teeth or claws.
But what turtles do have is a set of protective strategies. They can use camouflage, swim quickly, snap with their jaws, and if all else fails, retract into their shell and wait for the threat to pass.
Most other creatures are in trouble if they’re cornered by a predator, but turtles have a fighting chance. Turtles can also eat a variety of foods and go into hibernation during tough times. That’s why they live so long.
All of this makes turtles “the armored tanks of nature.”
On the other hand, tigers rely on their power and speed to chase down prey. When times are good, they thrive. But if prey becomes scarce, or if a tiger loses its ability to hunt effectively because of age or injury, death takes them mercilessly.
Kaufman acknowledges that resilience is never optimal if you evaluate your business solely on a measure like dollar throughput: how quickly you create a dollar of profit.
The flexibility that resilience brings comes at a cost.
Similarly, a turtle’s shell is heavy — it could certainly move faster without it. But giving up the shell, “would leave the turtle vulnerable in the moments when moving a little faster isn’t fast enough.”