On May 24, 2012, the non-profit Sustainable Silicon Valley and its partners gathered at West Summit 2012, with hundreds of others, to explore interlocking themes: Global Trade, Regional Resilience, and Climate Volatility. The Summit featured high-caliber speakers and sponsors from corporations, governmental agencies, NGOs and educational institutions.
I was part of a panel entitled, “Leadership and Vision to Achieve Regional Resiliency,” which focused on the twin challenges facing cities — sustainability and resiliency. We honed in on best practices gleaned to date and how leaders can catalyze the deep transformation necessary to build a sustainable future. We all agreed that perhaps one of the most important lessons learned is that there are two complementary and interconnected tracks of work: one focused on sustainability, the other on resilience.
Why the emphasis on resilience? In a world characterized by uncertainty and change, most leaders (in business, government, the independent sector) keep their focus on near-term goals against which they can demonstrate success: quarterly earnings, target numbers for acquisition of new customers, reductions in costs, winning the next election. It’s awfully hard to meet your cost-cutting numbers while investing in expensive new infrastructure for smart energy or other resources, even if the return to investors or taxpayers has a positive net present value over a reasonable time horizon.
For example, if you accept the premise that climate change is real, will continue to get worse, and is incurring present costs of extreme weather events and variability, then there’s one natural conclusion: forward-looking executives and leaders should work to make investments today which help protect against tomorrow’s losses (or maybe even take advantage of a short-sighted competitor’s losses).
Many working in this field begin by assuming that there’s a risk of extreme weather events occurring – some of which will have an impact on operations over the course of the next few years. It could be severe floods in Thailand that interrupt critical supplies of hard disk drives, impacting a range of industries. It could be extreme wildfires in Arizona that threaten manufacturing facilities. It could be changes to the water supply that make water hard to obtain or too warm for cooling nuclear reactors or for other essential purposes. It could be extremely hot weather that leads to increased deaths of old and infirm people and excessive demands for cooling energy from the electrical system. All of these have actually happened.
Planning for business continuity in a world of increasing climate volatility and uncertainty is now making it possible for visionary leaders to invest in such things as smart micro-grid technology, which enables business parks, office buildings, or universities, to operate independently of the larger electricity grid in the event of a significant interruption to service. These investments pay off when there’s a shortage of critically needed water or power supplies to carry out energy production, data center cooling, manufacturing, delivery of health care services, or other essential activities.
It takes courage for leaders to look clearly into the future and then make it possible for their company or their region needs to invest in solutions that deliver in a world challenged by complexity and harsh conditions. When the financial case includes the value of business continuity it puts a price on the risk of catastrophic losses, as well as the savings from efficiency. That’s when leaders are best able to convince others that their investment strategy is the most prudent over time. The business case needs to include all relevant factors (costs, risks, savings, new business opportunities, and the cost of failing to act in time.)
Having made the investment in systems that secure business continuity, they will be able to continue to operate and prosper. Cities and regions that follow this approach will be better able to withstand and recover from unexpected (and sometimes catastrophic) events.
To learn more about resilience, please review The Resilient Society and Architecting Resilience Perspectives from Public Sector Leaders.