TITLE:
SME Strategic Management Practices during the COVID-19 Pandemic in Developing Countries: An Empirical Test of the Threat Rigidity Hypothesis
AUTHORS:
Belinda Miyanda Muyuni, Jackson Phiri
KEYWORDS:
SMEs, Threat Rigidity Hypothesis, Strategic Management, COVID-19 Pandemic, Zambia
JOURNAL NAME:
Open Journal of Business and Management,
Vol.12 No.1,
January
31,
2024
ABSTRACT: The study undertook to establish
the strategic management practices adopted by Zambian SMEs during the COVID-19
pandemic and how they affected their performance. To help with meeting the
foregoing objective, a pragmatic research approach which permits the use of
mixed methods research design was adopted. With quantitative data being of
primary focus, it successfully collected data from 333 SMEs who had been in
operation for at least 4 years at the time of the survey. With data on
strategic management practices and business performance collected using a
Likert scale questionnaire, they were initially
subjected to Exploratory Factor Analysis (EFA). EFA enabled the computation of factor scores, which are composite
indices that represented the
concepts of interest in as far as variable operationalization was concerned.
The results show that surveyed SMEs adopted
defensive strategic management practices in their attempt to navigate
through the challenges that were presented by the COVID-19 pandemic. The extent
to which surveyed SMEs were defensive was, however, moderate. On further
investigating whether SMEs were justified in their preferences for execution of
defensive strategic management actions as far as performance was concerned, the
study found mixed results. Particularly,
those who chose to scale down their operations were found to have
performed better than their counterparts who did not. On the contrary, those
that decided to restrict their scope of information search and processing had
poorer performance outcomes than those that opted to do the opposite. On the
basis of the foregoing, the study recommends a mix of offensive and defensive
strategic managements practices when SMEs are facing a crisis environment for
purposes of building resilience.