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. 2023;61(1):23-58.
doi: 10.1007/s11187-022-00689-4. Epub 2022 Oct 6.

Different response paths to organizational resilience

Dean A Shepherd  1 , Trenton A Williams  2
Affiliations

Different response paths to organizational resilience

Dean A Shepherd et al. Small Bus Econ (Dordr). 2023.

Abstract

An essential yet understudied aspect of organizational responses to an environmental shock is how managers interpret and respond to their new environments and address post-shock environmental challenges. The post-shock managerial response process can be intense and highly consequential as actors often must challenge the status quo in a compressed period. Decisions are frequently "life or death" in terms of organizational survival. This study analyzed data on resilient organizations' responses to the COVID-19 crisis and offered a model of organizational response paths to resilience. Our grounded theorizing offers three primary contributions: (1) we add richness to the distinction between organizations that are resilient or not by highlighting different response paths within the organizational-resilience category; (2) we complement the notion of post-adversity growth by explaining how organizations grow during adversity; (3) we move beyond explanations of resilience based on differences in organizations' resource endowments and instead provide new insights into different paths to resilience based on differences in how organizations interpret and respond to the same adverse event.

Keywords: Adaptation; Adversity; Decision-making; Entrepreneurship; Organizational resilience.

Plain language summary

There are different ways organizations make the most out of a surprising challenge to enhance performance, adjust, and pivot for new opportunities. The COVID-19 pandemic has challenged organizations in different ways—some experienced near-exponential increases in demand, whereas others saw their entire business evaporate overnight. Despite a continuum in the severity of these challenges, they require resilience. But how does resilience happen in organizations? Our study examines different responses to a challenge that, while originating from the same adverse event (COVID-19 pandemic), impacted organizations and their decision making differently. We find three patterns of responses that provide options for how organizations might approach challenges based on the impact they experience. First, some organizations fell into sudden, exponential demand—requiring simple decision-making rules to make incremental changes to support rapid scaling. Second, other organizations faced operational challenges and found ways to repurpose existing structures to maintain business operations. Finally, some organizations appraised their situation as an imminent threat to organizational survival, requiring rapid, wholesale changes to the business model in the form of pivots. Thus, the principal implication of this study is that organizations have different experiences from the same precipitating event, and they should ensure they align firm decision making, strategic initiatives, and operational activities to best promote resilience.

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Figures

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Fig. 1
Data structure
Fig. 2
Fig. 2
Model of organizational resilience responses to an adverse event
See this image and copyright information in PMC

References

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