Inderscience Publishers

Organisational resilience and health of business systems

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Resilience in organisations is requisite for success and survival and a lack of it can lead to catastrophic organisational failures or bankruptcies in today's turbulent and uncertain environment. The paper outlines an investigation to relate organisational resilience (ORes) to its business 'health' between 1989 and 2009, in terms of economic viability. The results are manifold viz. conceptualisation of business 'health' and ORes and, subsequent, operationalisation of the relationship through empirical findings. Financial statements (1989 to 2009) of 20 textile, clothing and fashion (TCF)–related companies in Sweden are analysed to draw necessary conclusions. The study uses the Altman's Z–score as an indicator of business 'health' which includes discriminant ratios related to both short–term and long–term goals of a firm. Furthermore, the Z–score transition profile helps the company to judge its business 'health' and ORes, amidst crisis, and analyse further the underpinning attributes. This can be a helpful tool for companies to benchmark themselves to its competitors. Further research would help to find what differentiates the successful firm from the failing ones.

Keywords: organisational resilience, Altman, Z–score, business health, recovery, textile industry, clothing industry, apparel industry, garment industry, economic crisis, turnaround, economic viability, fashion industry, Sweden, benchmarking, business systems

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