April 24, 2025
Managing Partner
Resilience has become a strategic necessity for organizations grappling with escalating tariff tensions and other global disruptions. It requires a proactive shift from mere risk management to broader, forward-looking approaches.
Senior executives at leading companies increasingly commit to shifting from a purely defensive risk management approach to a proactive stance rooted in strategic resilience. Resilience has become a crucial prerequisite for corporate performance. Escalating tariff tensions and other trade disruptions have exposed economies' susceptibility to sudden demand shifts and highlighted the fragility of global supply chains. Generative AI, rising cyber threats, persistent inflation, and intensifying environmental concerns place businesses under mounting pressure. This pace of change often makes upheavals hard to predict, even as they grow in severity and frequency. Organizations across all sectors, therefore, recognize the urgent need to plan for the unexpected and strengthen their response capabilities.
Leaders saw how their contingency plans, in some cases, provided a vital buffer, while in other cases, they fell short. Worldwide trade frictions and concurrent disruptions actively challenge businesses. Although companies did not fully anticipate their scope, these disruptions rigorously test existing systems and safeguards under demanding conditions, such as those experienced during COVID-19. Many now admit that a more forward-looking model that weaves resilience into every layer of strategy will be essential for navigating tomorrow's disruptions.
Santiago & Company recently conducted a comprehensive survey exploring how tariff uncertainties and global market volatility influence corporate resilience. Over 250 senior executives, risk managers, and insurance professionals responded from diverse industry sectors and countries. Their insights reveal the rising prominence of resilience in strategic planning, operations, and risk management.
Executives acknowledged that past risk strategies often revolved around a narrow set of clearly defined threats, mainly financial. Many now view resilience in broader, more integrated terms, allowing them to embed it into their long-term strategy to manage a more dynamic business climate. Many respondents consider their organizations well-positioned to build and maintain resilience, partly because persistent external pressures have expanded the risk function's scope. Over half reported that intensifying trade tensions, accompanied by other large-scale disruptions, have substantially elevated the priority of risk and resilience in their companies.
Still, many leaders point to ample room for improvement in supply chain design and operational agility. Several organizations that once focused almost exclusively on a supplier's financial soundness are shifting to a holistic evaluation, which can include geographic footprints and compliance exposures. These adjustments reflect a growing realization: defensive, crisis-driven risk management must evolve into an ongoing discipline that continually prepares businesses for looming shocks.
Waves of trade and economic turbulence often lay bare hidden vulnerabilities and the need for rapid, decisive action. Senior executives repeatedly confront disruptions in vital operations, ranging from labor shortages and logistics backlogs to volatile commodity prices. In the face of these obstacles, some companies have embraced advanced analytics to scrutinize and stabilize their supply chains, investing in predictive maintenance or next-generation monitoring systems that preempt potential shutdowns. Many organizations want to integrate Generative AI directly into these risk management strategies. Others have introduced creative shipping strategies, such as shifting to alternative modes of transport or chartering their vessels to secure reliable distribution channels. However, this isn't without risk, as the rise of customs fraud, including tariff evasion through undervaluation, misclassification, or origin fraud, poses significant legal and financial challenges for businesses navigating these complex trade environments.
Meanwhile, cybersecurity threats have surged in an environment where data and network protection are paramount but run secondary to operational needs. To counter these risks, businesses have bolstered their defenses by hiring specialized experts, acquiring cybersecurity firms, or deploying stronger security architectures, such as zero-trust. The shift to more decentralized or technology-enabled processes demands highly visible data-driven infrastructures that can withstand attacks or unforeseen breakdowns.
Although many firms show ingenuity in responding to immediate crises, few adopt the comprehensive strategic mindset needed to anticipate the next major event. Leaders who treat resilience as a core capability and not just a temporary measure are more likely to pivot effectively when conditions turn unfavorable.
A truly proactive model reaches beyond basic protective tactics. It spans end-to-end preparedness, from flexible balance sheets to nimble technology systems, from robust supply networks to adaptable workforce models. To build this approach into long-term strategic decisions, organizations need cross-functional capabilities, strong crisis-response planning, and a willingness to make resilience an everyday pursuit rather than a one-off fix.
Two capabilities underpin a successful resilience strategy: foresight skills and crisis preparedness. Foresight involves gathering relevant data, developing realistic scenarios, and identifying vulnerabilities well before a crisis. Once those weak spots are apparent, organizations can design and rehearse comprehensive response plans. These capabilities can create a competitive advantage in volatile conditions, from shoring up finances to establishing backup suppliers.
Companies must balance short- and long-term financial objectives, maintaining sufficient liquidity and capital strength to ride out sudden revenue drops or credit shocks. Leading organizations often pair disciplined balance sheet management with value-driven growth, ensuring they retain the financial headroom to pursue new opportunities when competitors fall behind.
Nonprofits facing federal funding cutbacks and shifts in grant availability must similarly prioritize operational resilience. These organizations must diversify revenue streams, optimize resource allocation, and strengthen governance to sustain their missions amid fiscal uncertainty. By adopting the same agile strategies corporations use, such as forging new partnerships, leveraging technology for efficiency, and enhancing donor engagement, nonprofits can build the adaptability needed to navigate a rapidly changing economic and regulatory landscape.
Organizations withstand interruptions by maintaining robust production capacity and ensuring supply chain flexibility while upholding uncompromising standards of quality and service. They cultivate strong, trust-based relationships with reliable vendors, diversify procurement sources, and implement strategic inventory management to mitigate risks from minor disruptions or large-scale crises. By proactively preparing for challenges such as sudden tariff hikes, geopolitical tensions, customs fraud, or shifts in federal funding, these organizations build resilient ecosystems capable of adapting to volatile conditions. Advanced forecasting tools, real-time supply chain visibility, and contingency planning enable them to pivot swiftly, ensuring continuity of operations and customer satisfaction even under significant strain.
Leading organizations integrate innovative practices and technologies into their supply chain and production strategies to refine and enhance resilience. They leverage data analytics to optimize sourcing decisions, monitor supplier performance, and anticipate demand fluctuations, reducing vulnerabilities to external shocks. Collaborative partnerships with vendors foster shared risk management, enabling rapid responses to disruptions like natural disasters or regulatory changes. Additionally, these firms invest in modular production systems and flexible manufacturing processes, allowing them to scale operations or shift product lines as needed.
By embedding sustainability principles such as ethical sourcing and waste reduction, they align with evolving regulatory and consumer expectations, enhancing long-term viability. This comprehensive approach transforms supply chains into strategic assets, empowering organizations to navigate uncertainty, maintain competitive advantage, and deliver consistent value in a complex global landscape.
Firms that invest in secure, flexible IT infrastructure thwart cyberattacks and seamlessly adapt to evolving market demands and technological advancements. High-quality data practices, stringent regulatory compliance, and the ability to execute complex IT projects at scale, on time, and within budget distinguish truly resilient organizations.
Integrating generative AI and autonomous agents amplifies this resilience by automating routine tasks, enhancing decision-making through predictive analytics, and enabling rapid prototyping of innovative solutions. These technologies empower firms to anticipate market shifts, optimize resource allocation, and deliver personalized customer experiences at unprecedented speed. Resilient organizations maintain robust backup systems, advanced disaster recovery protocols, and AI-driven threat detection to safeguard internal operations and customer-facing services, ensuring continuity even under severe disruptions.
Moreover, the strategic deployment of generative AI and autonomous agents fosters a culture of continuous improvement and adaptability. These tools enable organizations to process vast datasets, uncovering insights that drive operational efficiency and competitive differentiation. For instance, AI agents can autonomously monitor supply chain vulnerabilities, adjust workflows to mitigate risks or generate dynamic pricing models to counter inflationary pressures. By embedding these capabilities within a scalable IT ecosystem, firms can pivot swiftly in response to regulatory changes, geopolitical uncertainties, or technological breakthroughs.
Resilient organizations actively sustain their edge by prioritizing workforce upskilling. They equip teams to collaborate effectively with AI systems. Additionally, they invest in ethical AI frameworks to uphold trust and ensure compliance. This holistic approach transforms IT infrastructure into a proactive engine of resilience, positioning firms to thrive in an increasingly volatile global landscape.
Competitive advantage increasingly depends on attracting, retaining, and empowering top talent, particularly in high-demand fields such as data analytics, cybersecurity, and artificial intelligence. Leading organizations cultivate diverse and skilled workplaces that foster agile decision-making, continuous learning, and cross-functional collaboration. By implementing robust succession planning, fair and bias-free hiring practices, and transparent promotion pathways, these companies build dynamic teams capable of adapting to rapidly shifting market conditions.
Additionally, they invest in comprehensive employee development programs, including mentorship, upskilling initiatives, and access to cutting-edge tools, ensuring their workforce remains at the forefront of industry trends. This commitment to talent excellence drives innovation and strengthens organizational resilience, enabling firms to navigate disruptions confidently.
Beyond recruitment and retention, resilient organizations prioritize a culture of empowerment and accountability to sustain their competitive edge. They actively foster environments that seek diverse perspectives and reward meritocracy, driving faster problem-solving and more innovative solutions. Flexible work arrangements, performance-based incentives, and clear career progression frameworks enhance employee engagement and loyalty, reducing turnover in critical roles.
To support long-term adaptability, these firms integrate talent strategies with broader business objectives, aligning workforce capabilities with emerging opportunities in global markets. By fostering psychological safety and encouraging calculated risk-taking, they empower employees to experiment and iterate, driving organizational agility. This holistic approach to talent management transforms human capital into a strategic asset, positioning companies to thrive amid economic volatility, technological disruption, and evolving customer expectations.
Institutions must align their actions and public commitments with deeply held values. Growing stakeholder scrutiny spanning employees, customers, regulators, investors, and social advocates puts greater pressure on organizations to uphold a clear sense of purpose. Companies that manage this effectively can maintain trust even when external disruptions arise.
Finally, sustainable resilience demands models that adapt swiftly to shifts in customer preferences, competitive landscapes, technological breakthroughs, or regulatory changes. Entrepreneurs in established firms and start-ups can gain an edge by experimenting with flexible offerings and pivoting fast in response to market signals. During periods of crisis or transition, adaptive business models often separate thriving organizations from those left behind.
By adopting a broader lens on risk and resilience, organizations shift from hunting for today's vulnerabilities to envisioning how they will respond to tomorrow's upheavals. This holistic approach transforms resilience from a compliance-driven checkbox into a dynamic source of advantage. Scenario-based planning, for instance, enables leaders to test their company's strategies against extreme but plausible trade disruptions, regulatory shifts, or macroeconomic downturns. Such simulation highlights immediate gaps and opens executives' eyes to new opportunities, spurring strategic innovations that may prove critical in times of turbulence.
Despite the steady drumbeat of crises, many organizations struggle to construct genuine strategic resilience. One hurdle is reconciling short-term value creation with the investment required to embed redundancy or extra flexibility in operations. Another challenge stems from institutional forgetfulness: leaders often treat resilience as a passing imperative after one crisis fades, only to be blindsided when the next appears in an entirely different form.
Siloed management also undermines efforts to build resilience. Isolated risk assessments rarely suffice in an era where a tariff dispute can simultaneously ripple across financial, operational, and technological domains. Moreover, many companies have yet to develop consistent, quantitative resilience measures. Without clear metrics, budgets for resilience initiatives are vulnerable to cuts, and risk managers may struggle to communicate the full return on these programs.
Finally, resilience leadership demands a creative, open-minded approach that looks beyond established best practices. Managers typically earn promotions for pattern recognition and error avoidance. However, responding effectively to complex, fast-evolving crises requires breaking from routine and continuously testing new ideas. Defensive postures and silo-based thinking can impede a timely pivot to seize advantage in a rapidly changing environment.
Businesses in many sectors have learned to navigate upheavals, emerge stronger, and gain a competitive edge during trying times. Those who measure their resilience systematically, surveying potential weaknesses in finances, operations, technology, talent, and brand reputation, stand a better chance of safeguarding ongoing performance. Leaders then pick specific disruptions to model, drilling into probable first-, second-, and third-order effects rather than relying on slow-moving or narrow planning procedures.
Risk functions thrive when fully integrated with strategic decision-making, which means stepping out of an administrative or governance-only role. Effective collaboration demands an emphasis on scenarios, stress testing, and rigorous quantitative and qualitative analysis. It also calls for sharper risk governance models and transparent reporting so all stakeholders can monitor emerging threats in real-time.
Organizations that succeed in building first-line capabilities and those that reside directly within business units are more agile when trouble strikes. Training teams to identify and address vulnerabilities and equipping them with early-warning systems reduces the reaction time from days to hours. Boards can help by reviewing resilience metrics; even crowdsourcing ideas at different levels can provide a more holistic view of looming risks.
History repeatedly shows that crises expose fragile processes and unprepared organizations. Yet these same disruptions can spark transformative thinking and lay the groundwork for the next wave of competitive growth. In times of turmoil, long-term success depends on adaptability and decisiveness. Strategic resilience, strengthened by an inclusive and forward-looking culture, is the bedrock for firms determined to survive unpredictable shocks and emerge even stronger on the other side.
Heightened trade disputes and global uncertainties demand more than short-term fixes and reactive risk measures. Organizations that embed resilience throughout their strategy, operations, and culture will thrive amid ongoing volatility and position themselves for enduring success.
Nonprofits can dramatically amplify their impact by adopting a high-performance mindset that blends strategic planning, operational efficiency, and transformative leadership. This article offers a roadmap for harnessing best practices to turn mission-driven initiatives into market-ready outcomes.
Santiago & Company research reveals that portfolio refreshment drives 3.5% higher shareholder returns. Active portfolio management, not just cost-cutting or market conditions, is decisive in long-term corporate success.
Demand for oil products is set to peak and decline, yet aggressive cost transformations and targeted use of AI offer refiners a path to thrive. Discover how leading companies are redefining their operating models and leveraging advanced digital tools to stay competitive in a shrinking market.
