Young Ideas to Improve Organizational Resilience in Turbulent and Changing Environments

Young Ideas to Improve Organizational Resilience in Turbulent and Changing Environments

Diego R. Toubes (University of Vigo, Spain), Noelia Araújo-Vila (University of Vigo, Spain) and Arthur Filipe de Araújo (Lusófona do Porto University, Portugal)
DOI: 10.4018/978-1-7998-4552-2.ch001

Abstract

To survive and remain competitive in a constantly changing environment, companies need to develop adaptive capabilities, that is, to become more resilient. Some authors argue that including young employees in the company's decision-making process contributes to enhance their organizational resilience. The present study aims to further investigate this assumption through a case study approach. To this end, 18 Generation Z Business Administration students form several European countries were familiarized with the processes of a luxury goods company and requested to propose solutions to five real challenges that affect the segment. In the presented solutions, they showed potential to enhance each of the dimensions of resilience according to the main conceptualizations of the subject. The findings suggest that companies should invest in attracting, training, and empowering young talents to make decisions in order to enhance their resilience capacity. Future studies should further investigate the topic through explanatory approaches in order to reach a more reliable understanding.
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Introduction

Change is the defining element of current business reality. Organizations operate in increasingly dynamic global markets, and their interconnected nature leads to inequalities and risky spatial dynamics (Fischbacher-Smith & Smith, 2015). In these turbulent periods, organizations experience disruptions that present several threats to their long-term survival (Burnard & Bhamra, 2011). In this context, traditional strategic planning models, characterized by market predictability, which were perfectly adequate in a not so distant past, are no longer effective. Instead, companies must continually strive to adapt their strategies to different requirements, intense competition and rapid changes in consumers’ tastes. Therefore, flexibility and continuous adaptation are the key elements for successfully achieving organizational objectives (Hamel & Välikangas, 2003), that is, to survive and prosper in a changing and unpredictable environment.

Lengnick-Hall and Beck (2016) argue that resilience capacity favors companies’ agility and ability to recognize the need for adapting to changing environmental conditions. In the context of engineering, for instance, a system’s resilience can be enhanced by increasing its ability to quickly adapt to new situations that might arise (Dalziell & McManus, 2004). Under disruptive conditions and drastic changes, resilient organizations manage to maintain positive adjustments (Dahles & Susilowati, 2015; Sutcliffe & Vogus, 2003), which in turn, enable them to survive and achieve their objectives. However, developing agile business models that can adapt quickly in dynamic environments is a challenging task. On many occasions, companies’ formal structures and their employees’ refusal to change make them inflexible and unable to the take decisions on time (Smith, Binns, & Tushman, 2010). In these instances, companies are more likely to carry out poor strategies that are disconnected from reality, leading to equally poor results, which can potentially force them out of business.

The addressed contributions show that organizational resilience is essential to respond to the inevitable and continuous changes that characterize current business environments. In this context, it is important to know what make companies more resilient, so that managers can cultivate these traits in order to make their organizations more adaptable and competitive. Although the subject of resilience has received increasing academic attention since the early 2000’s (Hamel & Välikangas, 2003; Jamrog et al., 2006), the concept is normally seen as an outcome, which emerges when individuals and organizations perform well and manage to bounce back from disruptive situations (Duchek, 2014). Meanwhile, the process of organizational resilience – and most of all, the factors that contribute to it – are still largely unexplored. Several authors believe that resilience capacity is favored by having young employees in executive positions and including them in the company’s decision-making process. Boschma and Groen (2010), for instance, believe that the so-called neo-digital natives, or Generation Z, are not “programmed” to follow traditional managing methods, and therefore, are more open to changes and new ways of planning and executing strategies. In this context, empowering them to make strategic decisions may favor the adoption of counter-intuitive or unconventional measures, which in turn, might help develop the company’s resilience capacity. These arguments are in line with those from Hamel and Välikangas (2003) and Stoltz (2004), and imply that younger generations are better suited to provide intuitive solutions that are adequate to the current the business reality.

Key Terms in this Chapter

Business model: Specify the revenue generation mechanism(s) for the firm. Given the value proposition and the position of the firm within the value network, formulate the competitive strategy by which the innovating firm will gain and hold advantage over rivals in a market segment.

Dynamic Environments: Rapidly changing conditions that affect organizations, such as consumer tastes, technology, or laws and regulations. Managers must react quickly, and organizations must be flexible to respond. Strategic initiatives emerge in response to these changing factors

HENRYs: High-earners-not–rich-yet.

Organizational Resilience: Ability to survive a crisis, and thrive in a world of uncertainty. A resilient organization has the capacity to adapt potential disturbances emerging, and the ability to turn crises into a source of strategic opportunity.

Change Management: Process of continually renewing the direction, structure and capabilities of an organization to meet the ever-changing needs of external and internal customers.

Generation Z: Those individuals who were born in the decade following the widespread emergence of the World Wide Web, from the mid 1990s to the early 2000s.

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