- Module: Entrepreneurship
- Skill: Entrepreneurial Resilience
- Publisher: SAGE Publications, Inc.
- Publication year: 2023
- Online pub date:
- Keywords: early warning systems, entrepreneurs, entrepreneurship, firms, innovation, knowledge management, organizations, publications, resilience, teams
Online ISBN: 9781071908426Copyright: © 2023 SAGE Publications Ltd
Business Resilience can be defined as the ability of an organization to adapt to unplanned disruptions and yet maintain business operations (Hedner et al., 2011). While doing so, it is critical to safeguard all its assets, people, and brand. In the context of the entrepreneurial world, the operative word is adaptability. There are no two more important abilities to hone than adaptability and the ability to continue business as usual.
Starting a new venture is a risky business. Over 70% of start-ups fail within the first year, and the numbers remain high until about the fifth year. Each year of survival in itself is considered an achievement (Fisher et al., 2016). The difficulty is that whilst the overall threat to a new venture is known to be high, it is difficult to predict the specific threat that will disrupt your entrepreneurial venture.
Severe disruptions where the only two options are adapt and survive or perish can have positive outcomes (Coutu, 2002). However, these dire situations act as a catalyst for firms to become more efficient and resilient. It is in times of adaption that entrepreneurs push the boundaries of their firm’s abilities and thereby achieve excellence (Garrett & Zettel, 2021). At some level, this approach is well-known in sports or military training, but in the case of an entrepreneur, resilience translates to the fulfillment of a dream, and the lack of resilience could mean the demise of a dream. Most entrepreneurs possess strong abilities to dream about a futuristic vision, and this vision gives rise to building resilience through purpose within their teams to adapt and survive.
So, what is business resilience? Is it just a set of reactive actions based on some negative stimulus from internal or external sources? Is it a set of codified workflows that a firm needs in times of crisis or disruption? Or is it an intrinsic cultural mindset of the entrepreneur and team members to be able to identify, absorb, and adapt and or thwart disruptions?
The answer is a combination of all of these. Business resilience is the ability to identify, absorb, adapt, thwart, and learn from disruptions both internal and external. The business organization also needs to build intrinsic culture to identify warning signs, communicate, share, and build capabilities to address the disruptions. The expectation is that with each experience, a team learns to codify its learning to ensure the next occurrence is identified and addressed before it turns into an existential crisis.
The typical misconception is that disruptions are external. As an entrepreneurial organization, disruptions of any kind can destabilize operations and spell danger for the organization’s survival. Hence, the entrepreneur typically needs to build strong sensors to identify warning signals that indicate potential threats along the value chain. This is an acquired skill and is almost mission critical for any entrepreneur to hone and perfect. The caveat, of course, is that however much one sharpens this skill, entrepreneurs will continue to experience disruptions and be challenged by them. We believe that the vision and dream of the entrepreneur should be clear so that even if there is a disruption, the ability to keep the firm heading in the direction of its goals will remain unaltered.