PurposeA global pandemic, broken supply chains, workforce constraints, technological advancements in artificial intelligence, etc. illustrate the continual threats that SMEs face. Extending the dynamic capability concepts of sensing, seizing and transforming, this research investigates practices by which SMEs successfully adapt over time.Design/methodology/approachA comparative case study method was employed using a purposive sample of SMEs, consisting of three American firms and one Canadian firm.FindingsThree sets of organizational practices, termed adaptive practices, that underlie dynamic capabilities for successful adaptation were identified: (1) continuous learning and process improvement, (2) leveraging reciprocal relationships and (3) communicating effectively.Research limitations/implicationsThe selected cases are from two countries in North America. Using a qualitative, inductive process, the authors are able to identify patterns of actions within various organizations; however, they are not able to establish causality.Practical implicationsThis study provides practical guidance for leaders to take action to improve their SME's dynamic capabilities for adaptation through creating coherent bundles of specified adaptive practices.Social implicationsBetter understanding of how SMEs successfully adapt to high uncertainty and business viability threats can result in multidimensional (e.g. financial, emotional) and multi-level (individual, family, community), positive outcomes for societal stakeholders.Originality/valueThe findings of this study build on the literature of dynamic capabilities and organizational practices and provide a practical foundation for effective adaptation, labeled as adaptive practices.
PurposeApproximately half of all new businesses fail within the first five years of operation. This study was undertaken to understand the behavior of small business (SB) leaders, including their decision-making processes and adaptive leadership practices that enable their organizations to survive during periods of general crisis and intense competition.Design/methodology/approachIn order to understand the lived experiences of our research participants, a constructivist grounded theory approach was used. Thirty-two CEOs and leaders from fifteen organizations were interviewed.FindingsIt was determined that successful SB leaders avoid organizational complacency by being continuous learners, who are agile and flexible in determining appropriate management strategies. Additionally, they leverage time management processes, build strong and productive relationship networks and create positive family-oriented workplace cultures to increase their odds of survival.Research limitations/implicationsThis qualitative study was limited to interviews, observations and analysis of organizational archetypes; therefore, the authors can establish a pattern in behavior but cannot make a causality claim.Practical implicationsThe findings provide SB leaders with effective concepts, practices and strategies from members of their peer group, which they can test, refine and implement.Social implicationsThe impact of business failures is often devastating financially and emotionally for the families and employees involved. Learning methods for strategic adaptation that may help avoid business closures could provide a positive societal contribution.Originality/valueThere is little empirical research about how SBs strategically adapt during challenging periods. This study helps fill that gap and provides an understanding of how SB leaders adapt to continuous challenges, create value and remain competitive in difficult business environments.
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