An argument can be made that the most resilient company in world history is likely one you’ve never heard of. It’s Kongō Gumi Co., Ltd., a Japanese construction company that got its start in 578 A.D. and continued operating for more than 1,400 years. Strikingly, leadership in the company always stayed in the Kongō family. We’re talking for 40 generations.
Over that extraordinary timespan, Kongō Gumi became synonymous with temple and shrine construction and restoration. It withstood feudal (and world) wars, natural disasters, economic crises and more.
Despite these disruptions, the company endured. Thrived even. If you believe its last CEO, Masakazu Kongō, the reason for its success isn’t complicated. “People always ask me, ‘What’s the secret?’ But there really isn’t anything in particular. All we did was concentrate on our core business.”
“Sticking to the basics” may have ensured prosperity and growth in previous centuries. But for leaders looking to achieve resilience today, the playbook has changed.
Winds of change
Until the 1980s, success for CEOs meant having a vision for their companies’ growth, a healthy appetite for risk and an entrepreneurial spirit. Leaders were less likely to be judged on their ability to navigate turbulence or build resilient enterprises. Why? Because in earlier days, companies operated in an environment of relative stability. Massive disruptions to their business models were scarce.
Today’s world is different. Every leader across industries faces disruption on a massive scale. It’s unrelenting. And it’s only accelerating. The Accenture
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Yet, a handful of leaders are meeting disruption head-on. They look at disruption not as an obstacle, but as a catalyst for change and growth. It is from these individuals that we learn what resilience means. And why it is so necessary today.
The traits of resilience
Our latest analysis of more than 1,600 companies found only 15% of companies across industries are able to achieve and sustain long-term profitable growth. This sobering statistic highlights the chasm between those who thrive amid disruption and those who falter. But what sets these resilient few apart? The answer lies in a balanced focus on three dimensions of resilience.
1. They understand that financial discipline is a cornerstone of resilience. When disruptions are the norm, agile financial strategies are paramount. Leaders are able to rethink their financial approaches and embrace flexible budgeting, capital allocation and risk management. They know that robust financial discipline isn’t just about safeguarding their assets; it’s about unlocking the potential for growth, even (and especially) amid uncertainty.
2. They consider a strong digital core to be the nerve center of adaptability. As technology permeates every facet of business, building a strong digital core is non-negotiable. Cloud, data analytics and, most recently, generative AI are critical enablers of informed decisions and optimized operations. The resilient 15% use robust digital infrastructures to stay ahead of disruption. And they harness data-driven insights to maintain a strategic advantage over time.
3. They balance a core set of business capabilities to bring resilience to life. Building resilience is a holistic endeavor. It requires an appreciation of—and investments in—a balanced set of capabilities across various dimensions of business. These include cultivating talent, nurturing customer relationships, enhancing sales strategies, optimizing supply chains and operations, and embracing sustainability as a business imperative. Leaders adopt a multifaceted approach to ensure that no area of their business lags behind.
Executives who lead with a balanced appreciation of all three dimensions of resilience strategically position and empower their companies to continuously adapt. They can take decisive actions that enable them to not only grow profitably, but also emerge from disruption stronger than before.
A new playbook for a new era of business
We now know what resilience requires. By taking a page from the playbook of the 15%, any leader can learn to manage through hard times and emerge stronger. That’s true for younger software, life sciences and high tech companies, which were born into a global state of constant change. For them, adapting by balancing their investments is second nature.
But it’s also true for companies in other sectors such as utilities, energy and natural resources, which come from a legacy of stability. When a national oil and gas company sought to develop new lines of business and meet its sustainability targets faster, it found it needed a workforce capable of decentralized decision-making and using predictive data-driven tools. Through a gamified learning platform, the company promoted digital fluency from the CEO down to the teams on the ground. The reskilling and upskilling initiative is fostering a culture of agility and adaptability, which will make the company more resilient in the face of uncertainties.
Leaders to watch
It is unimaginable to think the world will ever see another Kongō Gumi. Disruptions are just too pervasive to allow a company to dominate an industry for 1,400 years. But there certainly are and will be leaders that warrant our admiration. When I think about the companies to keep an eye on, I ask which ones have managed through hard times and have still proven successful? Which have thrived through chaos? Which have achieved resilience and sustained profitable growth through periods of disruption?
My Accenture colleague Jack Azagury put a finer point on what to look for with today’s businesses when he said, “Despite the concern of disruption, most companies are doubling down on investing in their digital core as a foundational element to total enterprise reinvention. The industry leaders to watch will be the companies that set a new performance frontier, breaking down siloes inside and outside their companies and putting talent strategy and people at the heart of their reinvention.” I agree. They are the ones we will—and should—learn from for years to come.
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