Building Organizational Resilience: Insights from Carlsberg’s Leadership
In an era marked by rapid change and uncertainty, resilience has emerged as a critical component for business success. According to recent findings by the World Economic Forum (WEF) and McKinsey, a staggering 84 percent of companies acknowledge that they are not adequately prepared for the evolving trends and uncertainties facing the global market.
Carlsberg’s Time-Tested Resilience
As one of the world’s longstanding beverage companies, Carlsberg has recognized resilience as a fundamental principle since its inception 178 years ago. Jacob Aarup-Andersen, the CEO, highlights that unforeseen events often pose the greatest threats, necessitating an organization’s ability to analyze, adapt, recover, and grow stronger.
The interconnected nature of today’s challenges, including geopolitical tensions and climate change, puts organizations like Carlsberg under significant pressure. Since the outbreak of the war in Ukraine, Carlsberg faced drastic operational changes that required swift adaptation.
Three Pillars of Resilience at Carlsberg
Aarup-Andersen identifies three critical areas in which Carlsberg embeds resilience:
- Enterprise Structure: Building structural resilience during stable periods enables the company to respond to shocks effectively. This includes ongoing capacity building and empowering decision-making at all levels of the organization.
- Cultural Resilience: A culture of trust and openness is crucial for early detection of potential crises. Aarup-Andersen emphasizes the importance of leaders gaining diverse experiences to enhance their resilience.
- Strategic Optionality: Preparing for various outcomes enables Carlsberg to diversify its product and geographic portfolios, aligning with customer trends and mitigating risks associated with market shifts.
Navigating Market Dynamics
Market dynamics, such as changing consumer preferences towards wellness products, pose major risks. Aarup-Andersen notes that a diversified brand portfolio enables Carlsberg to meet different consumer needs and withstand economic fluctuations, as seen in their recent acquisition of Britvic, a British beverage company.
Geopolitical Resilience Amid Crisis
The decision to sell Carlsberg’s Russian operations following the invasion of Ukraine illustrates a decisive approach to managing risk. Rather than retreating, the company made significant investments in Ukraine to capitalize on opportunities and maintain business continuity, showcasing both adaptability and commitment to long-term value creation.
Investing in Digital Resilience
In today’s digital landscape, resilience extends beyond traditional security measures. Carlsberg focuses on safeguarding customer data and enhancing organizational agility through upgraded cloud security measures and a centralized AI center of excellence aimed at ethical and effective use of technology.
Operational Resilience and Climate Adaptation
To combat disruptions caused by climate change, Carlsberg has implemented sustainable sourcing practices and innovative agricultural strategies to strengthen their supply chains. Collaborations with local farmers in regions like Laos demonstrate their commitment to building resilience through localized initiatives.
Lessons in Resilience
Aarup-Andersen suggests that the potential outcomes of risks are often broader than initially anticipated, urging organizations to establish structures for early detection and rapid escalation. Embedding resilience into corporate culture and decision-making processes is essential for future success.
