Corporate Crisis and Sustainable Reorganization: Evidence from Bankrupt Austrian SMEs

Abstract

Bankruptcy and failure continue to affect small and medium‐sized enterprises (SMEs) worldwide. Since bankruptcies are costly and disruptive, it seems useful to identify factors and resources that are essential for SMEs to overcome a crisis and to reorganize in a way that leads to a sustainable and lasting renewal. By drawing on longitudinal data, we identified essential elements of sustainable reorganization of bankrupt SMEs in Austria that ensure long‐term survival and competitiveness. The results of our study show that the pivotal factor in turnaround is repositioning, which is characterized by a unique selling proposition combined with some kind of innovation and change, and integration into networks.

Additional information

Notes on contributors

Stefan Mayr

Stefan Mayr is assistant professor at Johannes Kepler University Linz, Institute of Management Control & Consulting.

Christine Mitter

Christine Mitter is professor of Management Accounting and Finance at Salzburg University of Applied Sciences.

Andrea Aichmayr

Andrea Aichmayr is staff member at Johannes Kepler University Linz, Institute of Management Control & Consulting.