SMEs’ resilience and cross-industry innovation before and after a crisis

Abstract

Industry crises regularly threaten the existence of small- and medium-sized enterprises (SMEs) and place demands on their resilience while simultaneously providing opportunities for cross-industry innovation (CII). The current literature on CII has not examined how SMEs engaged in CII during a crisis. Using in-depth interviews conducted prior to the oil crisis in 2014 and at the end of the crisis in 2018, we evaluate how the disposition of nine SMEs towards CII contributes to their resilience. We show that CII capabilities strategy and mindset promote absorptive and adaptive resilience. Further, the longitudinal aspect highlights the mismatch between CII opportunities identified during prosperity and SMEs’ ability to realise these opportunities during a crisis. This is often rooted in the challenges of understanding the industry structure of the new CII segment. Successful CII is positive for SMEs’ resilience, and policy initiatives should strive to bridge industries, providing transparency for SMEs pursuing CII.