Towards a survival capabilities framework: Lessons from the Portuguese Textile and Clothing industry

Arash Rezazadeh (a.rezazadeh@eeg.uminho.pt) and Ana Carvalho (anac@eeg.uminho.pt)
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Arash Rezazadeh: School of Economics and Management and NIPE, University of Minho
Ana Carvalho: University of Minho: School of Economics and Management and NIPE

No 14/2018, NIPE Working Papers from NIPE - Universidade do Minho

Abstract: Influenced dramatically by the financial crisis and the European sovereign debt crisis, many European industries are now struggling with the new international division of labour that compels the shift of manufacturing to lower labour cost countries. These decisive global challenges underline the need to investigate why some firms can survive such crises while many others fail. Grounded in this narrative, ‘survival’ can be regarded as a period of the firm’s growth and change over time, where it faces a crisis and stiff competition. This view is different from the one that defines the concept of ‘business survival’ as the second stage of the firm’s lifespan, after birth and before success, where it has obtained certain customers having their demanded products or services delivered (Lewis & Churchill, 1983). Survival is of essential significance for the firm since a desirable performance over the surviving period enables eventual success, whilst a poor performance precipitates failure and shutdown (Bo , 2008; Korunka, Kessler, Frank, & Lueger, 2010; Naidoo, 2010). Although the literature is well developed on the structural determinants of firm survival, mostly related to firm age and size, less is known about certain internal capabilities the firm needs to develop in order to compensate for resource scarcity and financial restrictions caused by a crisis or other environmental disruptions. This reinforces the need to provide a more detailed clarification of the concept of ‘business survival’ and explore the capabilities that are vital to the survival of firms in times of struggle.

Date: 2018
New Economics Papers: this item is included in nep-bec, nep-cse and nep-sbm
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