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Introduction
Natural disasters pose unpredictable and significant threats to the incumbency and continuity of enterprises, thus directly affecting their ability to offer products and services to customers.
As such, for entrepreneurs to ensure the continuity, sustainability, and future success of their businesses, they must be resilient. However, resilience is a latent characteristic, since it is not possible to evaluate the “resilience potential” of an entrepreneurial firm until it displays a resilient response to a disruptive event (Linnenluecke, 2017). In the firm context, this paper adopts the organizational resilience view, which is a “firm’s ability to effectively absorb, develop situation-specific responses to, and ultimately engage in transformative activities to capitalize on disruptive surprises that potentially threaten organization survival” (Lengnick-Hall et al., 2011, p. 244). However, whether and how organizations can demonstrate resilience in response to environmental shocks and their capacities that lead to that resilience are still debated in the business and management resilience literature (Linnenluecke, 2017). As empirical research suggests, responding to adverse events depends on the entrepreneurs’ ability to reorganize (Comfort, 1994) or mobilize (Yang and Hsieh, 2013) resources and capabilities. Further, Lengnick-Hall and Beck (2005) argue that resilience capacity is a multidimensional construct based on three organizational components: cognitive (i.e. sense-making, ideological identity), behavioral (i.e. varied action inventory, functional habits), and contextual capabilities (i.e. social capital, network of external resources). Adding to this debate, the authors propose adopting dynamic capabilities (DCs) (Teece et al., 1997), defined as the capacities of an organization to purposefully create, extend, or modify its resource base (Helfat and Peteraf, 2009), similar to a lens through which the cognitive and behavioral capabilities that trigger organizational resilience from an entrepreneurial perspective are studied. Besides, to further contribute to the study of organizational resilience as a formative construct, this study draws on the social capital theory (Dubini and Aldrich, 1991) to also include contextual capabilities (Lengnick-Hall and Beck, 2005). This enables us to conceptualize the capability to cultivate relationships based on trust and reciprocation, with individuals that can help when needed, particularly when a natural disaster happens.
In other words, this paper investigates retail entrepreneurs’ ability to react to natural disasters (i.e. an earthquake) and display resilience, by analyzing its formative elements (i.e. different types of DCs, as well...