Fostering sustainability: reinventing SME strategy in the new normal

Abstract

Purpose

This paper aims to deliberate the significant impacts caused by the COVID-19 pandemic on small and medium enterprises (SMEs). It also discusses SMEs’ practical approaches to capitalise on the renewed opportunity in the new normal by expanding their businesses regionally and globally. This paper also discusses the tactical and strategic interventions SMEs need to take to charge forward.

Design/methodology/approach

The resource-based view of the firm (Barney, 1991) is used to explain how SMEs develop a sustainable competitive advantage in the new normal. The resource-based view focuses on the link between strategy and firm internal resources. Drawing from the resource-based view of the firm, internal analysis of the resources that are regarded as sources of competitive advantage controlled by the SMEs is imperative in today’s business environment. Based on the resource-based view theory, this paper focuses on reinventing SME’s strategies in the new normal to foster sustainability.

Findings

Post-COVID-19 pandemic, SMEs must essentially be dynamic, forward-looking and transformational in capturing the regional and global markets’ opportunities. They need to sharpen their internal competencies and realign their effective business strategy in seizing the vast opportunities in the international markets.

Practical implications

How SMEs respond to COVID-19 has important implications for subsequent performance in the new normal. This study focuses on the different potential SMEs’ reactions to COVID-19 and how their strategy affects SMEs performance and fosters sustainability in the new normal.

Social implications

The sustainability of SMEs is critical for the nation’s socio-economy. This study offers a holistic view of how SMEs respond to their challenges and help them choose the right business options.

Originality/value

This paper’s contents are solidly based on accumulated evidence, observation and critical arguments on the impacts caused by the COVID-19 pandemic that caused numerous challenges faced by the SMEs, with a specific focus on SMEs operating in Malaysia.

Citation

Hu, M.K. and Kee, D.M.H. (2022), "Fostering sustainability: reinventing SME strategy in the new normal", Foresight, Vol. 24 No. 3/4, pp. 301-318. https://doi.org/10.1108/FS-03-2021-0080