The Mediating effect of Organisational Resilience and Internal Preparedness on the Relationship Between External Vulnerabilities and Performance

Abstract

Organisations are often faced with sudden disruptions that demand new actions and responses in order to ensure business continuity. Some of the extreme disruptions can be a pandemic event, economic crisis, disasters or other uncertain events. The performance of an organisation is contingent on external and internal changes in the business environment. Having a resilient operational business process strengthens the stability of the organisation. It helps to manage the new events that arise due to uncertainties, gradually improving the performances of the business. Despite tremendous research by scholars on resilience in organisational resilience, it is only during recent years that more emphasis put on studying the resilience due to the increased occurrence of disasters and hazards, most of the events due to external factors (Hu et al. 2013) and others due to internal factors based on the vulnerabilities that exist in an organisation. This study focuses on the mediating effect of organisational resilience comprising resilient characteristics and capacities on performance under the influence of external vulnerabilities. The thesis employed a positivist philosophy and a quantitative deductive approach. The survey instruments were developed from previous literature and validated by scholars and industry experts. The sample frame is developed from a list of five major industrial sectors operating in the United Arab Emirates (UAE) that are registered with the Dubai Chamber of Commerce and Industry. The data were collected from 144 organisations using a self-administered online survey questionnaire and completed by senior managers in each firm. The confirmatory factor analysis indicated the validity and reliability of the measurement scales, and structural equation modelling techniques were used to test the research developed hypotheses. The findings show that organisational performance relates positively and significantly to factors (external and internal) with resilient characteristics and capacities. The relationships between factors (external and internal), resilient characteristics, resilient capacities, and firm performance were positive and significant. The mediation results highlight an indirect relationship between resilient characteristics and firm performance, and resilient capacities fully mediated this association. The study findings have managerial implications. The result informs managers of (major industrial sectors) to develop a framework to organisational resilient to disruptive factors to achieve performance in the business. The elements/variables such as the robustness and adaptive capability enhance the performance during the turbulent situations.