I recently learned of a non-invasive biomarker that can not only provide insights into our overall health and stress levels but is also considered a measure of our biological age. Heart Rate Variability (HRV) is the beat-to-beat alterations in heart rate that evaluates the balancing act between our sympathetic nervous system (fight and flight) and our parasympathetic nervous system (rest and digest).
HRV is a measure that provides transparency of the state of the human autonomic nervous system and the various systemic body functions that are positively and negatively impacted by high and low HRV rates. Elite athletes have used HRV for years to be aware of and manage their optimal physical and mental performance condition and now HRV is readily available to the masses via health monitoring devices such as the Apple Watch Series 3.
Large and small entities such as publicly traded companies, governments, and universities all have various similar offsetting resilience and control systems such as the human autonomic nervous system. Each entity has many functional areas and processes that rely upon each other and also compete with each other for their mutual success. For example, a food company's ongoing pursuit of employee health and safety, and customer satisfaction and food safety, are offset by the need for Finance to generate a profit. The continuous human body fight/flight and rest/digest responses are like the complex multi-level risk and reward systems and decisions required to drive a public or private entity’s strategies, culture, and performance.
A key to success for both humans and entities is to have ongoing awareness and mindfulness via key measures and balancing routines that can then be acted upon and controlled to drive the desired outcomes. Awareness of how the timing between our heart beats provides insight into the synchronicity between our lungs, heart, brain, and most other organs in our bodies thus enabling us to take actions to improve our health. Successfully balancing objectives and applying key decisions related to operating with trust and integrity, taking risk vs. the potential rewards, driving short-term vs. long-term focus, incurring spending vs. profit, etc. determines performance and resilience levels.
In an entity, accountability and respectful two-way communication are critical for each functional area to fulfill its specific roles. Systems of measurable key performance indicators and checks and balances provide assurance that complex strategic and operational objectives can be achieved.
Merriam-Webster defines resilience as the capability of a strained body to recover its size and shape after deformation caused especially by compressive stress or an ability to recover from or adjust easily to misfortune or change. Just as human bodies continuously adjust and synchronize with each breath we take, entities must establish and manage similar robust systems to ensure organizational strategic and operational objectives are achieved.
A continuously and consistently managed effective internal control framework along with the ongoing organizational and functional area awareness, management, and communication of key risks across and throughout the enterprise are key components to achieving and maintaining organizational resilience. Most companies fail due to strategy execution. Ensuring continuous strategy and operational alignment are keys to success and internal control and enterprise risk management capabilities provide clear, objective, and measurable views of internal capabilities and competencies aligned with strategic risk appetites.
A strong system of internal controls governed by a framework such as the COSO Internal Control - Integrated Framework (2013) and a comprehensive risks and rewards framework such as the COSO Enterprise Risk Management - Integrating with Strategy and Performance (2017) - see Figure 5.1, can provide the various elements of the entity with the ongoing synchronicity of strategy, risk appetite, and capabilities necessary to succeed in our increasingly fast moving and complex world.