Published in:
International Journal of Entrepreneurial Behavior & Research, 28 (2022) 7, Seite 1773-1799
Language:
English
DOI:
10.1108/ijebr-02-2022-0164
ISSN:
1355-2554
Origination:
Footnote:
Description:
PurposeAgainst the theoretical backdrop of the embeddedness and the resilience literatures, this paper investigates if and how SMEs' planning for adversity affects firms' performance.Design/methodology/approachThe paper develops hypotheses that investigate the link between the risk management of immigrant-led and native-led SMEs and their performance and draw on novel data from a survey on 900 immigrant- and 2,416 native-led SMEs in 5 European cities to test them.FindingsImmigrant-led SMEs are less likely to implement an adversity plan, especially when they are in an enclave sector. However, adversity planning is important to enhance the growth of immigrant-led businesses, even outside a crisis period, and it reduces the performance gap vis-à-vis native-led businesses. Inversely, the positive association between adversity planning and growth in the sample of native entrepreneurs is mainly driven by entrepreneurs who have experienced a severe crisis in the past.Originality/valueThis paper empirically uses planning for adversity as an anticipation stage of organizational resilience and tests it in the context of immigrant and native-led SMEs. Results support the theoretical reasoning that regularly scanning for threats and seeking information beyond the local community equips immigrant-led SMEs with a broader structural network which translates into new organizational capabilities. Furthermore, results contribute to the process-based view of resilience demonstrating that regularly planning for adversity builds a firm's resilience potential, though the effect is contingent on the nationality of the leaders.