Managerial Strategies for Organisational Resilience in SME Sector

Abstract

The current marketplace is constantly evolving, challenging for business leaders and various market turbulences have occurred recently which has impacted all economic and business sectors. Organisational resilience refers to a company’s capacity to successfully bounce back to the normal situation after economic shocks. Resilient firms can also integrate and improve strategies efficiently to manage disruptive occurrences. However, applying right strategies necessitate a diverse set of resources, and enterprises might become more resource-dependent in times of economic crisis. Strategic agility and dynamic capability encompass an organisation’s capacity to build and rapidly deploy flexible, nimble, and dynamic resources. Strategic agility and organisational resilience operate together to adapt to changing conditions, re-energize. Firms with resilience capacity can traverse several types of SA and adapt successfully to changing situations. Consequently, strengthening OR, particularly in the SME sector, is critical, as they are the most susceptible firms, characterized by dynamism and frequently a lack of resources. Therefore, leaders of SMEs have to strategize strategic agility, dynamic capability and strategic orientation properly to foster organisational resilience. The purpose of this study is to examine the effect of strategic agility, dynamic capability, strategic orientation on organisational resilience. Accordingly, raw data was collected from 440 SME leaders using quantitative techniques and the findings of the study revealed that Strategic agility and strategic orientation have a significant effect in fostering organisational resilience in SME sector in Sri Lanka. Findings further highlight that strategic sensitivity has a bigger role in fostering resiliency. The findings suggest that strategic agility plays an important role in fostering proactive organisational resilience, while strategic orientation plays a prominent role in developing reactive organisational resilience. In addition, both proactive and reactive organisational resilience significantly support to foster firm resilience. Therefore, SME leaders need to identify enablers of organisational resilience in line with firm characteristics and economic uncertainty of the market.