The performance implications of strategic responses of SMEs to the covid-19 pandemic: Evidence from an African economy

ABSTRACT

How does the use of adaptive resilience (perseverance and retrenchment) as a strategic response influence the performance of SMEs during catastrophic events such as the COVID-19 pandemic? This study examines how adaptive resilience in the form of perseverance and retrenchment has influenced the performance of SMEs during the COVID-19 pandemic. We also investigate the indirect effects of adaptive resilience on performance through strategic renewal, and the conditional indirect effect of adaptive resilience on performance through strategic renewal at different levels of organizational slack. We use multi-source data from managers and owners of 249 SMEs in Ghana and analyze the data using the conditional process analysis software, PROCESS. The results demonstrate that there were no direct relationships between perseverance and performance or retrenchment and performance. We also find that strategic renewal mediates the relationships between both perseverance and retrenchment on performance. Moreover, we find a conditional indirect effect of both perseverance and retrenchment on performance, such that the indirect effect of both perseverance and retrenchment on performance through strategic renewal is high at higher levels of organizational slack. We discuss implication of the findings for theory and practice.

KEYWORDS:

• Adaptive resilience (perseverance and retrenchment)
• COVID-19
• performance
• organizational slack
• strategic renewal

Disclosure Statement

No potential conflict of interest was reported by the author(s).

Additional information

Notes on contributors

Suzzie Owiredua Aidoo

Suzzie Owiredua Aidoo is currently a researcher at the School of Business, Kwame Nkrumah University of Science and Technology (KNUST), Kumasi, Ghana. She is a practicing chartered risk manager, a member of the Chartered Insurance Institute (CII-UK) and the Africa Academy of Management (AFAM). Her research interests are in entrepreneurship, strategy, and sustainability.

Ahmed Agyapong

Ahmed Agyapong is Associate Professor of Strategic Management at the School of Business, and the Deputy Director for the Institute of Distance Learning (IDL), Kwame Nkrumah University of Science and Technology (KNUST), Kumasi, Ghana. He has published extensively in reputable journals, including the Africa Journal of Management and International Journal of Emerging Markets. His research interest focuses on entrepreneurship and family businesses, strategic management, and sustainability. He is a member of the Africa Academy of Management (AFAM), Academy of International Business (AIB), and the Academy of Management (AOM). He has previously served as Acting Dean of KNUST School of Business, and Head, Department of Marketing and Corporate Strategy.

Moses Acquaah

Moses Acquaah is Professor of Management and Head of the Department of Management at the University of North Carolina at Greensboro, NC, USA. His research interest includes strategic management, international business, entrepreneurship, and family business. His research has been published in internationally recognized journals such as Strategic Management Journal, Journal of Business Research, Human Relations and Africa Journal of Management.

Samuel Yaw Akomea

Samuel Yaw Akomea is a Senior Lecturer in Marketing and International Business at the Department of Marketing and Corporate Strategy, School of Business, Kwame Nkrumah University of Science and Technology (KNUST) Kumasi, Ghana. He teaches courses in International Business, Consulting, Marketing, Creativity and Innovation, and Innovative Entrepreneurship. He is currently the Head of KNUST’s Center for Business Development and the Manager of the Kumasi Business Incubator. He is also a legal practitioner and was called to the Ghana Bar in October 2006. He has been a member of the Academy of International Business since 2006.