Building organisational resilience capability in small and medium‐sized enterprises: The role of high‐performance work systems

• Published date: 01 November 2023
• Author: Qin Zhou,Tinkuma Ejovi Edafioghor,Chia‐Huei Wu,Bob Doherty
• Date: 01 November 2023
• DOI: http://doi.org/10.1111/1748-8583.12479

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1Leeds University Business School, Leeds

University, Leeds, UK

2University of the West of England, Bristol, UK

3Department of Medical Research, China

Medical University Hospital, China Medical

University, Taichung, Taiwan

4School for Business and Society, University of

York, York, UK

Correspondence

Qin Zhou, Leeds University Business School,

Leeds University, Maurice Keyworth Building,

Woodhouse, Leeds LS2 9JT, UK.

Email: q.zhou2@leeds.ac.uk

Abstract

Although organisational resilience is crucial to small and

medium-sized enterprises (SMEs) in turbulent business envi-

ronments, research has yet to establish whether and how

human resource management (HRM) systems can help build

an SME's organisational resilience to influence firm perfor-

mance. Drawing on the perspective of HRM as an internal

capability builder and human capital resource theory, we

develop a model that depicts how high-performance work

systems (HPWSs) build organisational resilience capabilities

in the forms of bounce-back and bounce-forward resilience,

leading to firm performance. We test our model using data

from 1140 participants (including top management team

members, middle-level managers, and entry-level employees)

from 177 Nigerian SMEs. The structural equation modelling

results show that HPWSs contribute to bounce-back resil-

ience via human capital value but to bounce-forward resil-

ience via both human capital value and heterogeneity. We

also find that bounce-forward resilience is related to firm

performance but bounce-back resilience is not.

RESEARCH ARTICLE

Building organisational resilience capability in

small and medium-sized enterprises: The role of

high-performance work systems

Qin Zhou1 | Tinkuma Ejovi Edafioghor2 | Chia-Huei Wu1,3 | 

Bob Doherty4

DOI: 10.1111/1748-8583.12479

Received: 26 May 2021 Revised: 15 August 2022 Accepted: 28 September 2022

Abbreviations: BB, bounce-back resilience capability; BF, bounce-forward resilience capability; HCH, human capital heterogeneity; HCV, human capital

value; HPWSs, high-performance work systems; HR, human resources; HRM, human resource management; KSAOs, knowledge, skills, ability, and others;

SMEs, small and medium-sized enterprises; TMT, top management team.

This is an open access article under the terms of the Creative Commons Attribution-NonCommercial-NoDerivs License, which permits

use and distribution in any medium, provided the original work is properly cited, the use is non-commercial and no modifications or

adaptations are made.

© 2022 The Authors. Human Resource Management Journal published by John Wiley & Sons Ltd.

Hum Resour Manag J. 2023;33:806–827. wileyonlinelibrary.com/journal/hrmj

807

Much research has sought to understand organisational survival in an increasingly competitive environment character-

ised by technology discontinuities, changing customer preferences, and natural catastrophes. organisational resilience

capability, or a firm's ability ‘to cope with unanticipated dangers as they become manifest’ (Wildavsky, 1988, p. 70),

has emerged as a critical internal capability that organisations need to nurture if they are to survive and succeed in

the changing environment (Hillmann & Guenther, 2020; Linnenluecke, 2017; Williams et al., 2017). Research has

shown that organisations with higher resilience capability tend to refine and modify their resources and organisa-

tional processes (Christianson et al., 2009; Meyer, 1982), extend and modify existing products and services, identify

new customers and/or markets (Brueller et al., 2019), and facilitate product innovativeness (Akgün & Keskin, 2014).

In brief, resilient organisations can quickly recover from disruptive and adverse events and positively adjust to chal-

lenging business conditions (Roux-Dufort, 2007; Sutcliffe & Vogus, 2003; Williams et al., 2017). In tandem, in light

of human resource management's (HRM) emerging status as a strategic partner and its central role in building inter-

nal capability for strategy implementation (Barney & Wright, 1998), many scholars propose that HRM is critical to

building organisational resilience (Carvalho & Areal, 2016; Lengnick-Hall et al., 2011). Supporting this notion, empir-

ical research, based mainly on case studies, has shown that HR practices such as job security, employment relations

(Gittell et al., 2006), and staffing levels (Meyer, 1982) can contribute to organisational resilience.

Despite these efforts, there are two important limitations in the existing literature. First, prior research has

predominantly used retrospective case analysis revealing how resilience unfolds in specific events or organisational

contexts to identify influential factors. Notwithstanding that these findings are informative, the overreliance on the

ZHOU etal.

KEYWORDS

high-performance work systems, human capital heterogeneity,

human capital value, Organisational resilience, SMEs

Practitioner notes

What is currently known about the subject matter?

• Some human resource management practices can impact an organisation's ability to deal with and

recover from disruptive events.

• High-performance work systems (HPWSs) have been conceptually linked to organisational resilience.

What does this paper add?

• This study proposes a theoretical explanation of the processes through which HPWSs influence

organisational resilience capabilities, influencing firm performance in small and medium-sized

enterprises (SMEs). The findings from our study suggest that SMEs can use HPWSs to build bounce-back

resilience capability via cultivating human capital value and build bounce-forward resilience capability

via accumulating human capital value and heterogeneity. In turn, bounce-forward resilience contributes

to firm performance.

• This study differentiates between two types of organisational resilience capabilities (bounce-back and

bounce-forward resilience) by examining their antecedents and consequences.

Implications for practitioners:

• Organisations should differentiate between bounce-back and bounce-forward when diagnosing their

organisational resilience capabilities and develop interventions accordingly.

• Managers can maximise the benefits of HPWSs on organisational resilience capability and firm

performance in SMEs by focussing on the variety as well as the value of employees' knowledge and skills.