SMEs, like other organizations, are subject to risk and change in an uncertain environment today more than ever with the economic effects of the COVID-19 pandemic. That is why this study aims to analyze resilience at a strategic level in organizations and the factors that make up organizational resilience. The analysis starts from the assumption that SMEs need to implement a cultural change to respond to crises and disruptions. From a strategic perspective, the chapter provides the concept of organizational resilience, the elements that make it up, and identifies the necessary actions to carry out more flexible and progressive strategies. The study concludes that SMEs require a cultural change, where the main objective is the creation of innovative and creative environments to face crises, through an adaptation and response system based on strategies that consider the resources and capacities of each productive unit.
TopIntroduction
The world is experiencing changes in all areas - cultural, economic, geopolitical, social, technological, among others - which increase for some countries the possibilities of growth, while they generate new economic scenarios that can be exploited. However, the situation described above does not impact in the same way for all countries, especially for developing countries. Rather, in some cases it aggravates pre-existing problems of poverty, unemployment, underemployment, violence, etc. and if to that are added the crises experienced worldwide in recent decades:
The 1937 recession during the recovery from the Great Depression, characterized by a contraction in the money supply caused by the policies of the Federal Reserve and the Treasury Department by contractionary fiscal policies, which included reduced public spending and increased tax collection through tax revenue from citizens (Ocampo, Stallings, Belloso & Frenkel, 2017).
The 1945 recession was a direct result of the post-war period, a conflict that involved more than 70 countries and caused great damage to the world economy, especially in Europe and the United States (Rapoport & Brenta, 2010).
In 1975 another recession arose called the recession of the 70s, considered as a period of economic stagnation, derived from a combination of recession and high inflation and an oil crisis that took place in 1973 and the collapse of the management system Bretton Woods international economy with the famous “Nixon Shock”. It consisted of the implementation of changes to the economic and foreign relations policies of the United States government in 1971, under the mandate of then-President Richard Nixon, which included ending the convertibility of the dollar to gold.
Another crisis of great magnitude was the one that arose in late 2008 and early 2009, the collapse of the United States real estate market due to the financial crisis and the subprime mortgage crisis (Jaramillo & Jaramillo, 2016).
The most current crisis is the health crisis that began in the city of Wuhan, China, at the end of 2019, generated by the COVID-19 virus, which has an important impact worldwide, by hitting the productive and business structure. And although it is very difficult to predict the intensity and duration of the current crisis, it is possible to identify some of its specificities.
As can be seen, the crises described above are global phenomena that affect all the countries of the world, although the impact is different in each region. However, all of them are characterized by slow economic growth, less dynamism in international trade, and changes in consumption and production patterns.
In a scenario like the one presented, it is usual for many people to think about creating small and medium-sized enterprises (SMEs). In addition to being of great importance for the productive fabric, because on a global scale according to figures from the International Council for Small Enterprises, SMEs represent between 96 and 99 percent of all formal companies and generate between 60 and 70 percent of employment, while contributing close to 50 percent of GDP (Romero, 2006), that is why they cannot be left out of this process.
Unfortunately, the COVID-19 pandemic since 2020 is having a very profound impact on the economy and society. ECLAC estimated that by the end of 2020 2.7 million companies, equivalent to 19% of all companies in the region, closed. In the case of microenterprises, this percentage reached 21%. And although the concept of resilience has gained importance in the study of organizations for a few decades, it is necessary to review from a strategic perspective the approach to organizational resilience, to face the challenges posed by the effects of COVID-19 for the SMEs. In addition to other obstacles that SMEs face such as disorder, disasters, catastrophes, possible failures, cycle of decline or collapse, among others.
Thus, the following question arises, what are the key elements for the development of organizational resilience at a strategic level? And from a strategic perspective, what actions are necessary for SMEs to develop in a resilient way? The previous two questions are essential to understand what the actions are that SMEs should take in the face of crises and disruptions.