Shipping companies’ resilience: the influence of modularity and response diversity

The notion of organisational resilience provides a way to conceptualise desirable organisational performance when a shipping company is confronted by unexpected and unforeseen disruptions to its business. Due to uncertainty and surprise created by complex interactions among entities that constitute a shipping company and its environment, it may be difficult to foresee, and therefore prepare the company to withstand, all types of possible disruptions. Literature pertaining to complex adaptive systems (CAS) suggests that the extent of modularity and response diversity present in a system may influence the scale of impact of disruption on the system. However, there is paucity of empirical evidence to suggest how, and if, the concepts of modularity and response diversity can be applied to shipping companies. Based upon 30 interviews of senior managers of shipping companies operating in Australia, this study suggests that shipping companies with less modularity are more vulnerable to disruptions than those with greater modularity. Similarly, a high response diversity means that a shipping company has more choices in the way it responds to a disruption - potentially avoiding or limiting the impact. However, both modularity and response diversity are contextual; that is, a shipping company may exhibit different levels of modularity and response diversity under different circumstances.