Employee Resilience Dynamics in SMEs under Environmental Turbulence: A Conservation of Resources Theory Approach

Abstract

Workplaces are prone to challenges and adversities, and employees are evident to be the significant players in facing and overcoming challenges. Resilient employees cope with challenges and as a significant organizational resource they can contribute to survival and prosperity of organization. SMEs are deemed more vulnerable during a crisis due to limited resources and for sustaining in uncertain business environment SMEs should develop employee resilience. Conservation of Resource (COR) theory is a motivational-stress theory which holds that people strive to obtain, retain, and protect things they value, and threat to resources triggers stress and motivates behaviors to defend and accumulate them.  Literature about employee resilience highlights the role of authentic leader, perceived organizational support, and organizational identification in fostering employee resilience, while there is environmental turbulence that can interfere in employee resilience development, whereas employee resilience is associated with employee performance. This is a concept paper that analyzes employee resilience of SME employees in the lens of COR theory, in which authentic leadership is a social resource that results in a organizational resource i.e. perceived organizational support, which contributes in personal resource i.e. organizational identification, which results in employee resilience as another personal resource. Environmental turbulence is a primary source of stress because it threatens employee resilience, organizational identification and external resources, but employee resilience influence employees to bounce back and result in employee performance. The model will provide theoretical framework for empirical research, which will help in improving human resource practices and policies.