Dealing with black swans: How DigitalOps can build agility and resilience

“The inability to predict outliers implies the inability to predict the course of history." – Nassim Nicholas Taleb, author of The Black Swan: The Impact of the Highly Improbable

A black swan is a rare event with major consequences. The outbreak of war, the dot-com bubble bursting in 2000, the Fukushima nuclear accident and today's Coronavirus pandemic are just a few examples. As history has shown, black swan events have significant social, economic, and/or environmental impact.

Of course, no one knows what the future holds. Therefore, dealing with a black swan event is less about expecting the unexpected, and more about your ability to respond.

This is where Digital Operations – more commonly known as DigitalOps – can help.

When a crisis strikes, it's not the strongest nor the most intelligent species that survives; instead, it's those that are most able to adapt.

DigitalOps – built on flexible and intelligent processes – help enterprises adapt to the most trying of times. They seamlessly blend people, processes, and technologies to better orchestrate systems and resources to consistently deliver your brand experience.

For example, if you're a manufacturer under pressure from a black swan event, DigitalOps can help you understand how to optimize your supply chain in a timely manner. They can also help you better predict market demand and adjust production schedules, or even show you how to drive greater process efficiency in periods when top-line growth will be challenging.

Ultimately, DigitalOps help enterprises improve agility and resilience – essential characteristics for surviving in this ever-changing world.

Let's look at some other ways that DigitalOps can boost agility and resilience:

• Improved operational efficiency: When dealing with a black swan event, businesses must still deliver products and services in a cost-effective manner without compromising on quality. DigitalOps – and processes powered by intelligent automation – come into their own here.
• Better management of working capital: DigitalOps give businesses better visibility and control of their working capital. As a result, they can act proactively to address issues and respond appropriately to changing market conditions.
• Effective risk management: DigitalOps can seamlessly connect even the most complex supply chains. Whether business leaders need to increase or decrease production, they can mitigate supplier risks and create robust contingency plans when backed by DigitalOps.
• More flexible operations: Resilience and flexibility go hand in hand. DigitalOps enable businesses to take a flexible approach to operational costs to support more consistent earnings and unlock the capital needed for unexpected investments.
• Increased market agility: As markets change, customer expectations change. DigitalOps prepare businesses to diversify and adapt as necessary across their customer acquisition and retention strategies.

But remember, DigitalOps must be backed by a digital-first mindset. Leaders with this mindset will be successful in creating cultures that support employee empowerment, immediate action, and continuous learning – an essential foundation for agility and resilience.

In an ideal world, your business will change before change is forced upon it. Think of a hurricane – the best time to plan for the storm is when the sun is shining and the breeze is mild.

Unfortunately, we don't live in an ideal world. Many business leaders are planning for storms while they're also weathering them. The good news is: It's never too late to act and any action is better than inaction.

In closing, as Taleb says, “In economic life and history, just about everything of consequence comes from black swans; ordinary events have paltry effects in the long term." Therefore, while helping your company handle a black swan event, DigitalOps set the stage for longer term gains too – an improved market position and competitive advantage.

Read more about digital transformation at Genpact.