October 25, 2023

Measuring and Assessing Operational Resilience 

In today’s world, businesses aren't measured just by success but also by their ability to weather storms and emerge stronger. The idea of operational resilience has taken centre stage in ...

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In today’s world, businesses aren’t measured just by success but also by their ability to weather storms and emerge stronger. The idea of operational resilience has taken centre stage in a world where technological advancement is occurring quickly and there is a web of global connections. It’s not just about surviving; it’s about anticipating, adapting, and bouncing back from disruptions that can end an organization.

So, what’s the secret? How do organizations make sure their resilience is adequate in the face of unforeseen challenges? That’s the journey we’re embarking on—exploring the tools, strategies, and essential insights that companies use to measure and assess their operational resilience. 

How to Measure and Assess Operational Resilience 

To measure and assess a company’s operational resilience, you must check the key performance indicators. These KPIs provide valuable insights into the organization’s resilience strategies and can help identify areas that may need improvement. Here are some key KPIs for operational resilience:

  • Recovery Time Objective (RTO): The time it takes to recover and resume normal operations after a disruption This can vary based on the criticality of different business processes.
  • Recovery Point Objective (RPO): The acceptable data loss during a disruption It indicates how much data an organization can afford to lose without significant consequences. 
  • Risk Assessment Effectiveness: The ability to accurately assess and prioritize risks to the organization’s operations This KPI measures the success of risk identification and evaluation processes. 
  • Business Impact Analysis (BIA) Quality: The accuracy and thoroughness of BIA, which assesses the impact of disruptions on various business processes and helps in setting priorities for recovery, 
  • Incident Response Time: The time it takes to respond to a disruption or incident A shorter response time is generally indicative of a more resilient organization. 
  • Testing and Exercise Frequency: How often does the organization conduct resilience tests, drills, and exercises. Regular testing is critical to ensuring preparedness. 
  • Resource Allocation Efficiency: How effectively resources (financial, human, and technological) are allocated to support operational resilience efforts This KPI can help assess cost-effectiveness. 
  • Regulatory Compliance: Measuring the organization’s compliance with relevant industry regulations and standards related to operational resilience
  • Third-Party Risk Management: Assessing the organization’s ability to manage and monitor risks associated with third-party vendors and suppliers

How to Improve Operational Resilience

1. Risk Assessment and Management:

  • Identify Threats and Vulnerabilities: Regularly assess potential risks and weaknesses that could affect the organization.
  • Prioritize Risks: Focus on the risks that are most likely to happen and could have the biggest impact on the operations.

2. Scenario Planning and Preparedness:

  • Imagine Potential Disruptions: Think about different situations that could disrupt the business, like natural disasters or cyberattacks.
  • Plan for Each Scenario: Create detailed plans for what you would do in each of these situations. These plans should spell out who does what and when.

3. Business Impact Analysis:

  • Understand Our Processes: Take a deep look at your business processes to figure out which ones are crucial to your operations.
  • Map Out Dependencies: Identify how these processes depend on each other and on other companies you work with. Knowing these relationships is essential for planning.

4. Diversify Suppliers and Partners:

  • Avoid Over-Reliance: Don’t put all your eggs in one basket when it comes to suppliers and partners. Spread your connections around to reduce the risk of disruptions.
  • Check for resilience: Make sure your suppliers and partners can handle unexpected issues as well. They must have plans in place too.

5. Invest in Technology and Infrastructure:

  • Stay Secure: Use strong and secure technology to protect your information and systems from cyber threats. This might include things like firewalls and encryption.
  • Prepare for the worst: Ensure that your essential infrastructure, like power and data systems, can keep running even if there are problems. This way, you are less likely to experience disruptions.

6. Employee Training and Awareness:

  • Educate Your Team: Train your employees so they know what to do if something goes wrong. This could be a power outage, a cyberattack, or any other issue.
  • Create a Prepared Culture: Encourage your staff to be vigilant and ready to take action in case of disruptions. 

Why Operational Resilience is Important:

Operational resilience is critically important for several reasons, reflecting the dynamic and complex nature of the modern business environment:

  • Business Continuity: Operational resilience ensures that essential business functions continue to operate during and after disruptions. This continuity is crucial for maintaining customer trust, meeting contractual obligations, and preserving revenue streams. 
  • Mitigation of Financial Losses: Resilient organizations are better equipped to minimize financial losses associated with disruptions. By identifying and mitigating risks, they can avoid or limit the impact of events that could otherwise lead to significant economic consequences.
  • Protection of Reputation: Maintaining operational resilience safeguards an organization’s reputation. Swift and effective responses to disruptions demonstrate reliability and responsibility, which are crucial for customer and stakeholder trust.
  • Regulatory Compliance: Many industries are subject to regulatory requirements that mandate operational resilience. Compliance with these regulations not only avoids legal repercussions but also fosters a culture of responsible business practices.
  • Adaptability to Change: Operational resilience allows organizations to adapt to evolving circumstances, whether they be technological advancements, changes in market conditions, or shifts in regulatory landscapes. This adaptability is essential for long-term sustainability and growth.
  • Supply Chain Stability: Resilience extends beyond an organization’s boundaries to include its supply chain. A resilient supply chain ensures the availability of goods and services, even in the face of disruptions, thereby maintaining consistent operations. 
  • Customer Confidence: Consistent and reliable operations instill confidence in customers. When disruptions occur, a resilient organization can communicate effectively, manage customer expectations, and demonstrate a commitment to overcoming challenges. 
  • Competitive Advantage: Operational resilience can be a source of competitive advantage. Organizations that can maintain operations during disruptions are better positioned in the market and could potentially gain market share as competitors struggle.


In wrapping up, think of operational resilience measurement as indispensable for companies steering through today’s unpredictable business terrain. The tools we’ve investigated, like risk assessment and scenario planning, help businesses avoid and handle disruptions effectively. Teamwork, clear governance, and a mindset of constant improvement highlight resilience as a joint endeavor. It’s not a one-time goal but a continuous process, ensuring quick, synchronized responses and nurturing a culture of adaptability and innovation. By embracing this spirit, organizations don’t just weather challenges; they flourish amidst uncertainties, ensuring lasting success on our ever-changing global stage. 

Our Resilience Management Platform, “AutoResilience“, is industry-leading and has four modules for Risk, Crisis, Business Continuity, and Cyber Resilience. Recognized by analysts like Gartner and Forrester, we’ve helped numerous banks globally reduce the impact of disruptions, ensure regulatory compliance, and safeguard reputation.

Risk should no longer be feared or avoided but instead should be utilized as a means to achieve strategic value and improve performance.