The new resilience industrial complex needs a reality check
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Our Neanderthal ancestors had a sixth sense about sabre-toothed cats. Their bodies developed finely honed fight-or-flight signals. They crafted spears for hunting and self-defence and passed on their genes to propagate the species. These days, there is a whole industrial complex focused on resilience that used to be instinctual. Countless books and blogs exist asking parents raise kids who can take a knock. Advice abounds on how to bounce back—or ‘bounce forward’ McKinsey and the World Economic Forum have teamed up to help CEOs survive “a fragmenting global order." The UK government has proposed a UK Resilience Academy as part of a strategy document on national resilience. This framework includes a new head of resilience, an annual statement to parliament on risk and resilience, expert advisory groups, local forums and public surveys. The goal is to “anticipate, assess, prevent, mitigate, respond to, and recover from known, unknown, direct indirect and emerging civil contingency risks."
It would be churlish to dismiss these efforts as either performative or futile in a world with bigger risks than sabre-tooths. You want your company’s cyber defences to withstand ransomware attacks. You want pilots trained to deal with wild weather and kids who aren’t so sheltered that they crumble at their first failure. You want your government ready for floods, wars and cataclysm. But the problem with this Resilience Industrial Complex is that like a lot of buzz words, it’s a label we can attach to almost anything. Resilience is not about bolt-ons but real trade-offs that are often obscured.
On paper, the UK is next-level on resilience planning. It has a net-zero and an energy security strategy. There’s a supply chain resilience framework and a security risk assessment tool. A national exercise programme exists to test emergency procedures. The Treasury maintains an orange book to help London manage technological, economic, legal and other risks. There’s an integrated review to address state threats in an interconnected world. The government also keeps a national risks register that plots the probability of a risk happening relative to its likely damage.
Attentive observers will note that even with such wall-to-wall resilience strategies, there have been misses. Industrial action and volcanic eruptions were considered more likely than a pandemic in the 2020 risk register. There was indeed a pandemic plan: Four years before covid, the UK government was advised to stockpile personal protective equipment and set up a contact-tracing system to activate in the event of a coronavirus outbreak. But the plan envisaged a flu-like bug, not something deadlier, and resources were thought better spent elsewhere. Mispricing risk happens more than we think. The UK’s 2021 integrated review of defence and foreign policy, with its ‘Indo-Pacific tilt’ is now being rewritten in light of Russia’s invasion of Ukraine. And even with foresight, governments don’t always act. A House of Lords panel warned eight months before the withdrawal from Afghanistan that US policy would lead to disastrous consequences for the country.
The most resilient companies have the health to pivot if necessary. If they have resilience strategies, there are also regular audits of plans. Of course, there’s a whole industry to tell CEOs exactly how to do that. McKinsey’s output on the subject is itself a resilience test. Sure, high performers adopt ‘agile’ processes and practice ‘deliberate calm.’ But they mainly do the day-to-day stuff very well. Governments should too.
The ultimate planners are the Swiss, with their nuclear bunkers complete with composting toilets. But resilience planning in government is a political choice. It involves allocation of resources, including attention. But the political rewards of averting a crisis are often negligible. Without high-level responsibility and audits, political or bureaucratic inertia gets in the way.
The UK framework suggests an earnest effort, but little urgency. London will make communications on risk “more relevant and easily accessible" by 2030. No senior cabinet official is in charge. Only by 2025 will government “clarify rules and responsibility" for each risk and “introduce an annual statement to parliament". If Prime Minister Rishi Sunak wants to own the strategy, he should put his imprimatur on it.
Real resilience comes from getting the basics right. We cannot afford mismanagement. Britain’s emergency services crisis stems partly from a poorly funded social care system. Similarly, the biggest threats facing the UK are in plain sight: anaemic economic growth, low rates of savings and investment, unreliable public services and regional inequities. It’s sensible to plan for future emergencies. But a grand strategy can too often provide a false sense of security and the mistaken impression that the biggest threats are far away.
Therese Raphael is a columnist for Bloomberg Opinion covering health care and British politics.
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