Small and Medium-Sized Enterprise (SME) Resilience

This chapter aims to set the framework for the book’s topic: resilience in and for SMEs. To do so, the chapter starts broadly. It introduces the concept of resilience and its different forms before giving a brief overview of the current body of knowledge regarding the research on resilience. Thus, this chapter opens the door for the subsequent chapters presented in this book and is intended to further a reader’s understanding of resilience and resilience in SMEs.

The Covid-19 pandemic had devastating effects on small and medium businesses (SME). The immediate shock, uncertainty, varying restrictions, and the risk to life disoriented the small and medium industries. In the last 4–5 years, we’ve seen small and medium businesses worldwide gradually return to their former state. Digital transformation is one of the tools used in this comeback effort. This topic has been the subject of several conceptual, empirical, and review studies. However, no systematic review has been conducted that examines digital transformation enablers and how digital transformation can lead to organizational resilience. This study aims to fill the gap. I conducted this systematic review following the PRISMA guidelines. On the basis of the 37 studies that met the inclusion criteria, I identified two clusters of enablers (strategic orientations, capabilities, and capacities) as well as six mediating strategies (frugal innovation, organizational agility, strategic agile process, dynamic strategic planning, social entrepreneurship and competitive intelligence, and sustainable business processes) of digital transformation on SME resilience. A consolidated conceptual model was developed based on the findings of this review. Scholars will be able to use these results to understand the knowledge boundary and develop effective strategies for promoting the resilience of SME’s.

Due to their limited resources, small- and medium-sized enterprises (SMEs) often employ less formalized management control systems compared with larger enterprises. However, SMEs can greatly benefit from management control systems. For instance, such systems can generally support the professionalization and growth of SMEs but can also foster SMEs in developing organizational resilience. The present chapter focuses on the latter aspect and provides an integrative review of existing research on how management control systems can help SMEs develop resilience. We map the existing literature on this topic by drawing on the five types of management control systems classified by Malmi and Brown (Manag Account Res 19(4):287–300, 2008) and the three dimensions of organizational resilience proposed by Duchek (Bus Res 13(1):215–246, 2020). Our results show various ways in which SMEs can benefit from management control systems when aiming to increase their resilience. At the same time, we also highlight that additional research is needed to understand more fully the contribution that management control systems make to SMEs’ resilience.

Small- and medium-sized enterprises (SMEs) are widely recognized as particularly vulnerable to external shocks’ impacts. In this book chapter, we investigate the potential role of enterprise risk management (ERM) and corporate governance (CG) mechanisms as facilitators for business interruption insurance (BI) in SMEs. Our research aims to demonstrate how SMEs equipped with advanced ERM practices and robust CG structures may better comprehend the significance of business interruption insurance and its effectiveness during crises such as the COVID-19 pandemic. By analysing survey results from a large sample of SMEs operating in Poland and Germany, we explore the relationship between ERM and CG sophistication and their influence on SMEs’ perceptions of business disruptions caused by the COVID-19 crisis. The findings reveal that SMEs with higher ERM and CG maturity levels exhibit a clearer understanding of the implications of COVID-19-related interruptions and are more inclined to adapt their business interruption insurance policies accordingly to mitigate crisis effects. Our research proposes a comprehensive framework that offers valuable insights for consultants seeking to enhance ERM and BI practices in SMEs. By promoting a deeper integration of ERM and CG mechanisms, SMEs can develop a more proactive approach to managing risks and responding effectively to unexpected disruptions, thereby strengthening their resilience in future crises. This chapter contributes to the growing body of knowledge on risk management and insurance practices in SMEs, providing practical recommendations for SME owners, policymakers, and consultants to foster a risk-aware culture and secure the continuity of SMEs in times of crisis.

The authors of this study aimed to investigate the issue of resilience in family firms during times of crisis. They recognize that a crisis can impact not only the business itself but also the family dynamics within the firm. To be resilient, addressing and managing both aspects is crucial.

Resilience in this context refers to the ability of family firms to adapt, recover, and thrive in the face of adversity. The authors emphasise that resilience involves navigating and responding to multiple events that may arise from various sources, including the external environment, the business operations, or the internal family dynamics. This complexity adds to the challenges and demands of family firms to be resilient. The study adopts a qualitative approach, employing case studies of German and Swedish family firms to gain deeper insights into this topic. By examining real-life examples, the authors seek to provide empirical evidence and a nuanced understanding of how family firms experience and cope with crises.

The findings of this research have significant relevance for multiple stakeholders. Firstly, family business owners and leaders can benefit from insights into the challenges they may face during crises and the strategies they can employ to enhance resilience. Understanding the interplay between family and business dynamics is crucial for effective crisis management.

Additionally, policymakers and advisors working with family firms can gain valuable knowledge from this study. By recognizing the unique challenges these firms face during crises, they can develop targeted support mechanisms and resources to assist them in building resilience.

Overall, this research sheds light on the complex nature of crisis resilience in family firms and contributes to the existing body of knowledge in this field. It provides practical implications and recommendations for family firms, policymakers, and advisors, ultimately aiming to enhance the long-term sustainability and success of family businesses in the face of adversity.

Notwithstanding the importance of crisis management for all types of companies, assessing the success of these measures and their contribution to the overall company performance is a challenge, especially for small- and medium-sized enterprises (SMEs). Forward-looking organizations know that a sole focus on crisis management is insufficient, and they know the importance of knowledge management and entrepreneurial orientation for maintaining sustainable business success. This chapter examines the role of knowledge management and entrepreneurial orientation in improving SME resilience. For this purpose, a structural equation model is developed that allows a measurable and comparable assessment of the importance of crisis management and the two supporting management functions. The effectiveness of the model is tested using a sample of 284 SMEs. By combining crisis management with knowledge management and entrepreneurial orientation, this study offers a new perspective on factors contributing to successful resilience in SMEs. The findings provide valuable insights for improving crisis management practices and promoting SME resilience and sustainability in the face of increasing crises.

In highly volatile and uncertain times, organizations are increasingly facing adversities and unexpected events that threaten their functioning and long-term existence. This urgently calls for organizations to emphasize on their resilience, which holds in particular for SMEs. Therefore, it is necessary to have a solid understanding of the concept of organizational resilience – how it is defined, by which variables it is determined, and how it can be assessed, maintained, and improved over time.

Consequently, this chapter firstly derives a process-oriented definition for organizational resilience as the ability of an organization to anticipate, cope, and adapt to challenging conditions (e.g., crisis, shock, or other adverse events) with the aim to withstand or bounce back and emerge from them strengthened and more resourceful. Consequently, organizational resilience is specified by three determinants: resilience resources, resilience organization, and resilience capabilities.

To reach the aim of reducing greenhouse gas emissions and stopping global warming, a range of regulations have been enacted by the European Commission within the last years which set challenges for companies and have an impact on the reporting of their economic activities. The regulations are also addressed to financial institutions which lead to a stronger focus on sustainability issues. Consequently, sustainability issues will become more and more important for the availability of capital. Even SMEs that might not be addressed by the EU regulations are well advised to know the requirements and standards on reporting sustainable activities to maintain their chances to have access to bank finance. This is what is meant by sustainable financial resilience in the context of this article. It means the proactive and reactive adaptability and flexibility of companies to the challenges of sustainability and the associated impact on access to finance. This article highlights the most relevant regulations that may have an impact on SMEs and presents a checklist for practitioners to handle the discussed requirements to become resilient in the context of sustainability and the access to finance.

This chapter explores the potential of gamification and serious games in fostering resilience within small and medium-sized enterprises (SMEs). Resilience, defined as the ability to adapt, persist, and transform in the face of challenges, is crucial for SMEs to thrive in today’s dynamic business landscape. By embracing gamification, SMEs can unlock new avenues for growth, innovation, and sustainable success. An overview of organizational resilience and its significance for SMEs is followed by a discussion of serious games and gamification and their supporting of learning, skill development, and behavior change. A conceptual framework emphasizes the importance of aligning gamification with organizational goals and context and outlines a phased approach for its design and implementation. Key stakeholders, including business groups, concept groups, domain groups, and trades groups, are identified, underscoring their role in designing tailored gamified solutions. The chapter also addresses challenges and limitations, such as employee heterogeneity and data security, that SMEs may encounter when implementing gamification. Moreover, it emphasizes the need for further exploration, research, and practical applications of gamification and serious games in enhancing SME resilience. Overall, this chapter provides valuable insights and guidance for SME leaders, trainers, and professionals seeking to leverage gamification for building resilient organizations.

The globalised “VUCA world” (volatility, uncertainty, complexity and ambiguity) with numerous crises over the last years and increasing complexity leads to a higher need for resilience also for leasing SMEs. In comparison to other industries, the German leasing industry is regulated through banking supervision. Therefore, the implementation of organisational resilience is subject to public investigations performed by the regulatory auditors. Regulative requirements focus mainly on governance and risk management aspects. The following article comes up with a comprehensive approach considering not only regulative requirements but also other important aspects such as operative and strategic risk management as well as corporate cultural aspects.

This chapter explores the concept of building resilience through workforce agility within SMEs, focusing on both the organizational and individual levels. It discusses the individual pillars of agility, including proactivity, flexibility and adaptability, resilience, learning agility, collaborative mindset, competence, self-motivation, and self-management. At the organizational level, the chapter examines the importance of agile leadership and organizational learning, existence of strategic agility principles and insurance of autonomy and empowerment, flexibility encouragement, technological competence enablement, and prioritization of employees’ engagement and well-being. The chapter acknowledges the challenges faced by SMEs but emphasizes the long-term benefits of investing in workforce agility. The chapter aims to equip SMEs with the knowledge necessary to build a resilient and agile workforce that can succeed in an uncertain business landscape.

COVID-19 pandemic caused a shift in organizations’ strategic behaviour, from identifying and mitigating specific risks to increasing business resilience. The object of this chapter is to investigate how Enterprise Risk Management (ERM) practices help increase small and medium-sized Italian dealerships strategic and operational resilience, through supporting them to tackle the challenges raised by the disruption and effectively safeguarding their organization’s operational performance. The research relies on in-depth interviews made to professionals of ten companies and on extant frameworks that inform the findings’ interpretation. The results show that, as defender-type firms, the companies investigated initially undervalued COVID-19 crisis effects on their business. Despite this, they transformed their business models to ensure their survival and adapted their risk management processes during and following the shock to build business resilience against future disruptions. The study offers brand new empirical evidence of ERM and resilience within SMEs and provides professionals with a self-assessment checklist on their resilience-building capability.

In the current dynamic and uncertain business environment, small- and medium-sized enterprises (SMEs) are struggling to enhance their ability to adapt and resist to the changes while pursuing their strategic objectives. In particular, projects are gaining a crucial role for companies’ success, as the main vehicles for managing change and creating innovation. Consequently, Project Risk Management (PRM) is a widely used approach to foster the effect of positive events opportunities while mitigating those related to negative ones, with the final aim of creating value and resilience. For these reasons, there is growing interest in PRM as a value generation process for multiple project stakeholders. This research presents a case study conducted in an SME based in Italy and operating in the information technology (IT) consulting sector, addressing the literature gaps about the creation of value through PRM. From an academic perspective, it provides an overview of the topic, proposing a framework for the analysis of the relationships between the characteristics of the context, the PRM system implemented, and the value generated. Moreover, it supports practitioners with a new measurement system for the value generated through PRM and with guidelines to enhance value generation and resilience.

This chapter aims to investigate the enablers of resource efficiency and leverage them as conditions that can serve as pathways for microenterprises in Estonia to offer green products and services. Based on the Flash Eurobarometer database, 188 Estonian microenterprises datasets are extracted and analysed using fuzzy-set qualitative comparative analysis (fsQCA). The findings reveal the existence of four distinct pathways, indicating that grants and subsidies, in addition to clearer regulations regarding the use of secondary raw materials, are key conditions that can stimulate the adoption of green products and services. To provide practical guidance for microenterprises and policymakers, within Estonia and beyond, a comprehensive list of recommendations is presented to consolidate the results.

This position paper explores the philosophical and ethical dimensions of resilience in Small and Medium-sized Enterprises (SMEs). Amid turbulent times, resilience has emerged as a potential core value for SMEs, thus necessitating a deeper understanding of its conceptualization. Resilience is a complex set of organizational qualities, akin to an intangible cultural mindset. This perspective advocates for embracing inherent fallibility and the uncertainty of the business environment. The paper further illustrates the role of philosophical inquiry in developing a mindset conducive to resilience and underscores the ethical implications of incorporating resilience into an organization’s ethos. Highlighting a gap in current research, it concludes with a call for more philosophical exploration of the concept of resilience in SMEs.

The aim of the final chapter is to conclude the book and its contents and, building on this, to propose a number of promising research avenues that will ideally contribute to the development of more resilient SMEs. The main contribution of this chapter is a list of research avenues that can be useful starting points for those interested in exploring and developing the topic. The suggestions are divided into general and specific topics and are intended to give interested persons at different levels a number of relevant starting points.