Resilience and Adaptation of the SME Sector in an Emerging Economy: An Explanatory and Empirical Research

Resilience and Adaptation of the SME Sector in an Emerging Economy: An Explanatory and Empirical Research

José G. Vargas-Hernández, Muhammad Mahboob Ali
Copyright: © 2021 |Pages: 19
DOI: 10.4018/JBE.300328
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Abstract

This paper aims to analyze the implications of innovative adaptation in strategic organizational resilience in SMEs. It is assumed that organizational resilience has a strategic role designed and implemented to promote organizational community resilience, adaptive innovation, and achieve success after a disaster. The method employed is based on the reflective and analytical review of the theoretical and empirical literature to clarify the relevant topics about the innovation in strategic organizational resilience. It is concluded that innovative adaptation and engineering resilience strategies promote organizational resilience as the capability to self-renew through innovation.
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Introduction

Organizational resilience has gained increasing importance especially among small and medium enterprises (SMEs). Organizations can develop contingency plans to mitigate crises and administrative risks. Moignard (2021) argued the importance of survival in the face of challenges, which have three main belongings in mutual: Resilience in the face of adversity; Innovation in the face of new challenges; Adaptation in responding to long term change. During the COVID 19 pandemic, some organizations especially medium and small enterprises lost while knowledge and skill-based organizations did well. felt hard to bear the problems while those SMEs which are digitized, they did apparently well. Adaptation in organizational resilience is defined as the change in significant organizational attributes, as in basic business strategy and organizational structures to respond to environmental change (Levinthal,1994, p. 171). Resilience is defined as an organizational ability and operational and strategic capabilities using different research methods, focused on specific problems in different contexts and work as an accumulation of vulnerability, coping capacity and strategies in an organizational context (Ismail et al. 2011, Wedawattaa et al. 2010).

The organizational resilience capability is an essential quality developed to realize competitive advantage through the strategic use of resources and capabilities aimed to strategically challenge and cope adverse events and conditions and avoid resource collapse (Manfield, & Newey, 2015). Resilience is the outcome of various mechanisms for family and non-family as equifinality, considered as the ability of organizations to align strategies in competitive advantages (Acquaah et al. 2011). Organizational resilience is a strategic initiative to change operations and increase competitiveness (Sheffi and Rice 2005). Recent approaches on organizational resilience focus on strategies as a source (Reinmoeller and van Baardwijk, 2005; Carmeli, &Markman, 2011) or processes (Alesi, 2008; Crichton et al. 2009; Ates and Bititci 2011; Demmer et al. 2011). Resources available and strategy have an impact on development of organizational resilience capability to maintain across a range of operating conditions. Organizations operating at the edge develop capabilities of resilience and exploration, amongst others and pursue strategies of turnover and external search (Marcus, & Nichols 1999).

Strategic organizational resilience is a form of strategic responsiveness (Burnard and Bhamra, 2011) achieved through the development and adjustments of new and existing resources in response to the unstable economic conditions (Suire, & Vicente, 2014). Heuristics as a capability contributing to resilience navigates in the uncertain context of information processing and decision making towards enhancing strategies and the improvement of performance (Gigerenzer & Gaissmaier, 2011; Bingham & Eisenhardt, 2011; Eisenhardt, Furr, & Bingham, 2010). Organizational resilience is the sum of partial strategic and operational activities (Ismail et al. 2011; Välikangas and Romme, 2012). The dimensions of resilience are operational as the bounce back following a disaster and strategic resilience aiming to turn threats (Välikangas & Romme 2012).Organizational resilience is being achieved through the alignment of the strategic and operational levels of the organization, such as manufacturing and competitive strategies (Acquaah et al. 2011) and finding the balance between expansive strategies and governance issues Carmeli, & Markman 2011), growing and capitalizing upon market trends and at the same time meeting the market demands (Ismail et al. 2011).

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