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Article

An Organizational Framework for Microenterprises to Face Exogenous Shocks: A Viable System Approach

by
Denny Suarez Ambriz
1,
Jacqueline Y. Sánchez-Garcia
1,2,* and
Juan E. Núñez-Ríos
1,2
1
Facultad de Ciencias Económicas y Empresariales, Universidad Panamericana, Álvaro del Portillo 49, Zapopan 45010, Jalisco, Mexico
2
Networks and Systems Thinking Research Group, Zapopan 45010, Jalisco, Mexico
*
Author to whom correspondence should be addressed.
Adm. Sci. 2024, 14(12), 315; https://doi.org/10.3390/admsci14120315
Submission received: 23 September 2024 / Revised: 9 November 2024 / Accepted: 21 November 2024 / Published: 26 November 2024

Abstract

:
This study examines how integrating the critical components of entrepreneurial orientation (EO) can improve the adaptability of microenterprises by applying the Viable System Model (VSM). Given the crucial role of microenterprises in job creation, entrepreneurship promotion, and social cohesion, the need for approaches that ensure their success in turbulent environments is highlighted. We applied Social Network Analysis (SNA) to analyze a co-occurrence network to identify critical EO factors relevant to microenterprises and to understand how authors relate them to the structure of the VSM using a Californian microenterprise as a conceptual model. These factors include innovation, autonomy, control implementation, market orientation, and change management, organized into the five functions of the VSM. The results suggest that this conceptual framework strengthens organizational responsiveness in disruptive environments, promoting internal cohesion and more informed decision-making. Although the specific characteristics of each microenterprise require adjusting the VSM to their particular needs, this study provides a solid basis for applying the key elements of EO in the VSM, underscoring the need for further research to adapt this approach to different contexts to improve organizational agility in the face of exogenous shocks.

1. Introduction

Microenterprises represent most businesses in the United States. According to the U.S. Small Business Administration (SBA 2015), these organizations are distinguished from small and medium-sized enterprises (SMEs) primarily by the number of employees and annual revenues (OECD 2023). A microenterprise typically has fewer than 10 employees and generates less than USD 250,000 in revenue, while SMEs have fewer than 500 employees and generate less than USD 6 million in sales (SBA 2024).
These microenterprises play a key role in creating jobs and fostering entrepreneurship and innovation, contributing significantly to social cohesion and poverty reduction (AEO 2024). However, they face unique challenges that threaten their sustainability and growth, such as a lack of resources, less formal management structures, and greater vulnerability to market shocks (Cascio 2019).
In the current business landscape, characterized by volatility and exogenous shocks such as the 2008 financial crisis and the COVID-19 pandemic, microenterprises need to adapt their organizational structures to survive (Taleb 2007; Selsky and McCann 2012). As market conditions and social dynamics evolve rapidly (Layton and Domegan 2021), many microenterprises lack the tools and strategies to mitigate the impact of those exogenous shocks, increasing the risk of organizational failure. According to the SBA (2024), only 67.6% of new businesses survive more than two years, and this percentage decreases over time, highlighting the urgency of implementing effective adaptive strategies.
Entrepreneurial orientation (EO) has been identified as a key strategy for improving the responsiveness of microenterprises to disruptive environments (Scheidgen et al. 2024). EO includes key components such as innovation, proactivity, autonomy, and the ability to manage change (Covin and Slevin 1988), factors that are critical for microenterprises seeking to adapt to external shocks and take advantage of emerging opportunities. However, these firms need an organizational framework that allows them to institutionalize these elements and effectively manage environmental changes, and among the tools to address this challenge is the Viable System Model (VSM), which, according to Beer (1984), allows the design of solid and sustainable organizational systems that would make it easier for microenterprises to integrate EO principles into their daily operations.
In this paper, we seek to understand how the principles or structure of the model proposed by Beer (1984) can be linked with the theoretical components of EO to improve the responsiveness of microenterprises to external disruptions (Ansoff et al. 2019). Based on the above, we used Social Network Analysis (SNA) to identify conceptual aspects or factors of EO that can be employed to strengthen the adaptive capacity of this type of organization. The results were then used to relate them to VSM functions using a microenterprise operating in the Salinas Valley, California. As reflected in the ideas of Núñez-Ríos et al. (2023), adopting this type of approach makes it possible to suggest courses of action or changes in the organizational culture considering the characteristics and configuration of an organization, which can foster cohesion, improve consensus, and orient operational efforts among different levels. Based on the above, we believe that linking the SO with the five functions of the VSM could provide a conceptual framework that helps decision-makers manage resources and orient them toward efficiency without neglecting the impacts that the environment may generate (Dimitriadis 2021; Kim et al. 2024).
This conceptual framework establishes a foundation for organizational restructuring in microenterprises. However, given the inherent diversity of microenterprises, it is essential to consider their specific particularities when applying this approach. This raises the need to perform further research and fine-tune the framework to the unique characteristics of each microenterprise, which underscores the importance of tailoring solutions to different types of businesses and sectors (Wang et al. 2024). Although microenterprises play a crucial role in local and national economies, their vulnerability to external shocks requires the adoption of customized and sustainable organizational strategies. This study provides a framework for understanding how microenterprises can address disruptive environments, aligning with the need for organizational resilience outlined by the current literature (Chakrabarti 2015).

2. Literature Review

This section presents an overview of EO, with a focus on its application in microenterprises. It considers exogenous shocks, disruptive environments, and the integration of the VSM as a structural framework for organizational sustainability. This analysis seeks to provide a critical review of the existing literature and highlight the importance of EO and the VSM in enhancing the adaptability of microenterprises.
EO is widely acknowledged as a strategic approach that helps companies compete in uncertain environments through innovation, proactivity, and risk-taking (Miller 1983; Covin and Slevin 1988). The traditional literature has conceptualized EO as a key strategy that drives the ability of firms to identify opportunities and take calculated risks in a context of high uncertainty (Lumpkin and Dess 1996). In particular, Rauch and Frese (2008) emphasized that EO is not only concerned with individual entrepreneurial behaviors but also a systemic approach that influences organizational decisions.
Authors such as Wales et al. (2015) have expanded the concept of EO by highlighting the importance of a holistic organizational mindset that involves all levels of the firm. This perspective suggests that OE is not only relevant in large firms but also critical for microenterprises, which must adopt these principles to remain competitive in changing and volatile environments. Thus, autonomy, competitive aggressiveness, and market orientation have also been identified as complementary dimensions of EO that facilitate survival and growth in disruptive environments (Lumpkin and Dess 1996; Ruokonen and Saarenketo 2009).
The increasing number of exogenous shocks, such as the September 11 attacks, the 2008 financial crisis, and the COVID-19 pandemic, has led to companies facing extremely volatile and unpredictable environments (Taleb 2007). These exogenous shocks create disruptive environments in which companies must adapt quickly or face the risk of collapse. These events have revealed that organizations need to be agile and resilient to survive in a world that is increasingly interconnected and vulnerable to unexpected crises.
Covin and Slevin (1988) propose EO as a critical strategy for managing these disturbances, as it allows companies to adopt a proactive attitude toward change, manage risks, and take advantage of opportunities through innovation. In this regard, Gavetti (2012) stresses that proactivity is particularly critical in uncertain environments, where companies must anticipate changes before they occur. Moreover, moderate and calculated risk-taking allows microenterprises to commit resources to uncertain but potentially valuable projects without exposing themselves to extreme dangers (Chen et al. 2012). However, the ability of microenterprises to apply these EO principles is often limited by their size and lack of resources, underscoring the need for a framework that institutionalizes these practices.
In addition to adaptive capacity, organizational sustainability has been the subject of interest in management research, especially with regard to the ability of firms to survive and thrive in the long term in disruptive environments. Organizational sustainability involves not only economic viability but also the ability of firms to adapt and respond proactively to changes in their environment (Chakrabarti 2015). For microenterprises, which often lack the infrastructure and resources to implement strategic change, OE can provide a valuable framework for developing resilience and sustainability strategies (Wales et al. 2015).
In the context of exogenous shocks, OE helps to foster continuous innovation, maintaining a competitive position by introducing new products and services that respond to changing market demands. Similarly, proactivity and market orientation facilitate a faster response to emerging opportunities, which can be crucial in times of crisis (Rauch and Frese 2008). However, long-term sustainability also requires an organizational framework that enables the integration of these principles at all levels of the company, which brings us to the relevance of the VSM.
The VSM, developed by Stafford Beer (1985), provides a systemic approach to structuring organizations to continuously adapt to changing circumstances. The model suggests that organizations should operate as viable systems, capable of self-organizing, self-regulating, and responding effectively to external changes. By providing a flexible and adaptive framework, the VSM enables companies to manage both their internal complexity and environmental changes.
The integration of EO with the VSM provides an opportunity for microenterprises to institutionalize innovation, proactivity, and risk-taking capabilities into their organizational structure. Rather than relying exclusively on ad hoc or individual decisions, the VSM allows these capabilities to be distributed throughout the organization, which improves strategic coherence and facilitates better decision-making in times of uncertainty (Beer 1985). In this way, microenterprises can not only survive exogenous shocks but also thrive by adopting an organizational structure that promotes resilience and long-term sustainability (Dimitriadis 2021).
This combination is relevant in exogenous or disruptive shocks, where firms must be agile enough to change course quickly and take advantage of emerging opportunities. The literature suggests that the combination of entrepreneurial strategies and viable structures can enhance organizational resilience, allowing microenterprises to not only survive unexpected crises but also thrive through continuous innovation and proactive adaptation (Kim et al. 2024).

3. Methodology

The survival challenges of microenterprises are shaped by an intricate environment, demanding the integration of a holistic perspective. Considering the above, the systemic approach appropriately addresses a social system’s constituents and supplementary factors (Jones 2018) without neglecting existing associations, structures, and functions. From a research perspective, systems thinking seeks to effectively study complex and dynamic systems (Bala et al. 2017) while providing a framework for change (Zokaei 2011) in complex organizations. Through this approach, this work seeks to develop a broad perspective of EO and microenterprises based on the academic production of scientific articles related to SME institutionalization.
From the perspective of Yang et al. (2017), SNA can be used from a systemic perspective, as it allows the study of a system at different levels: (a) Micro: it allows the analysis of individual elements within a system (network), such as keywords or authors, using measures of degree centrality, closeness, interrelation, and importance; (b) Meso: the interest is in identifying sub-networks and analyzing the interactions of nodes in the more extensive network by detecting communities and analyzing cohesion and subgroup density; (c) Macro: the system is observed as a whole, and patterns and structural properties are explored on a total scale. Measures include, for example, density, diameter, connected components, and degree of clustering. Based on the above, we used SNA to analyze a co-occurrence network to understand how authors relate key terms when studying EO and its implementations related to outcomes in institutionalization in firms (Borgatti et al. 2009).
According to Donthu et al. (2021), several literature review approaches exist, such as bibliometric analysis, meta-analysis, and systematic review. In this regard, Mengist et al. (2020) indicated that PRISMA (Preferred Reporting Items for Systematic Reviews and Meta-Analyses) and SALSA (Search, Appraisal, Synthesis, and Analysis) are the most frequently used techniques. However, in this article, we chose to use SNA because the objective of the literature review was to map the relationships between articles and keywords and then identify subgroups. In this sense, considering the ideas of Núñez-Ríos and Sánchez-García (2024), SNA is chosen over PRISMA and SALSA because the former offers a robust process for visualizing and analyzing relational data using matrix algebra, and thus, it is able to identify grouping patterns. Based on the above, Figure 1 shows the literature review process.
Selection: We used Scopus to search for publications on EO in microenterprises because it covers a wide range of topics and prioritizes high-quality publications through a rigorous review process:
  • Keyword definition: The keyword analysis protocol focused on the contexts of EO, microenterprises, and the VSM.
  • Search strategy: The following combinations were used to search titles, abstracts, and keywords: “entrepreneurial orientation factors and microbusiness performance” ((“entrepreneurial orientation AND factors” OR “entrepreneurial orientation dimensions” OR “entrepreneurial orientation AND factors” OR “entrepreneurial orientation factors” OR “entrepreneurial orientation AND innovation” OR “microbusiness entrepreneurial orientation”) AND (TITLE-ABS-KEY (“entrepreneurial AND orientation”) AND TITLE-ABS-KEY (“system AND thinking”) OR TITLE-ABS-KEY (“problem AND structuring AND methods”) OR TITLE-ABS-KEY (“cybernetics”) OR TITLE-ABS-KEY (“viable AND system AND model”) OR TITLE-ABS-KEY (“microbusiness”) AND TITLE-ABS-KEY (“exogenous shocks” OR “environmental disruptions” AND “organizational adaptation”))). The search focused on identifying the application of strategic factors of systems science, especially organizational cybernetics, to problems linked to the survival and institutionalization of microenterprises. In addition, the search strategy integrated the systems thinking ideas of Sánchez-García et al. (2020) and Romero-García et al. (2019).
  • Inclusion criteria: publications with a systemic approach considering EO dimensions and their effects on SME performance, including investigations from around the world.
  • Set period and published language: Our search strategy in SCOPUS yielded articles from 1984 to May 2024 published in English.
  • After an initial examination of publication density pertinent to the research objectives, articles discussing aspects of non-business fundamentals were omitted, as these elements did not directly pertain to our examination of microenterprise survival from an organizational viewpoint.
Extraction: Of the 242 articles in the database, 21 did not contain keywords, so excluding them resulted in 221 publications with 1164 keywords.
SNA: The following is a brief description of the steps used to implement the SNA:
  • Network Analysis: The analysis starts with a bipartite adjacency matrix A with dimensions m × n , where m is the number of articles, and n is the number of keywords.
  • A relationship exists if an item i contains a keyword j, which is expressed as A i j = 1 and 0 otherwise.
  • The bipartite network is transformed into a one-mode network to generate the co-occurrence network ( W ) . The product of A T × A is calculated, and W i j indicates when particular words co-occur.
  • Based on W , we define G = ( V , E ) , an undirected graph in which V is the number of vertices or codewords and E is the set of relations.
  • Identification of EO factors: With the fast-greedy algorithm (Kolaczyk and Csárdi 2014), it is considered that each word starts in C i = { i } , and iterations lead to clustering to merge pairs of communities C i and C j to maximize the modularity Q . The recognized communities answer several critical questions related to OE and its application in microenterprises to cope with exogenous shocks:
    1. What key themes and concepts have been studied in the literature about EO and its impact on microenterprises?
    2. What are the main critical factors affecting microenterprises, and how do they relate to EO?
    3. Applicability of VSM: How can the identified EO factors be implemented through the VSM in a microenterprise context?
  • It is worth mentioning that the SNA was implemented using the igraph package (Kolaczyk and Csárdi 2014) for R (Version 2024.09.1+394).
Within systems theory, the VSM has been perceived as the ideal archetype and is known as a robust theoretical model (Cardoso Castro and Espinosa 2019), having been authenticated (Núñez-Ríos et al. 2020) after undergoing and passing various tests (Hildbrand and Bodhanya 2015; Bossmann et al. 2016). Following the model-based management concepts of cybernetics (Schwaninger 2015), previous publications have also utilized structural analysis to quantitatively demonstrate the VSM’s appropriateness (Schwaninger and Ríos 2008; Sánchez-García et al. 2020). In addition, its design allows for the diagnosis, design, and implementation of processes, identifying present disadvantages and absent essential strategic factors for adaptability and survival in unstable markets (Gharajedaghi 2011). As a systems feature, the recursive nature of the VSM capitalizes on constant repetitions for a structuralist perspective, enabling viable operations.
This investigation will provide a brief synopsis of its main functions to further explain how the VSM and its components can be implemented. For example, in Table 1, the five subsystems of the VSM are identified and assigned specific essential functions for the system to function properly.
The VSM functions’ descriptions lead to identifying and comprehending regulated relationships with the environment in which any individual system operates. In Figure 2, the VSM organization and fundamental elements are represented along with their respective links to the environment and each other. For example, the image on the left side represents an organization (circle) along with its management (rectangle) operating in a specific environment (amoeboid). The second illustration represents the same organization but separated into components to display their links, with the arrows representing management input, regulation, and component output flow. The third illustration reveals the system’s “complexity unfolding”, demonstrating the development of the VSM through a recursive organizational structure, where specific levels identify environments and the operating organizational unit. A further close-up examines the environment, the organization, its management, and existing relationships.
Consequently, the VSM assumes the role of linking various actors at different levels of the reiterative process, promoting microenterprise survival through institutionalization. The proposed design considers the elements delineated within the thematic communities identified by the SNA. To obtain useful results, the proposed methodology of Espejo and Kuropatwa (2011) was utilized, focusing on relationship assessments within the enterprise and environmental agents. This calls for revealing the VSM entanglement by identifying the relationships between various recursion levels in a microenterprise. Similarly, a diagram is utilized to represent the actors, components, and their respective organizational responsibilities, such as coordination functions (S1), management (S2), auditing (S3), intelligence (S4), and strategic planning or governance (S5).
Building upon the ideas presented, the procedures for constructing the VSM for this investigation can be condensed as follows:
  • Identify the purpose and recursive structure, also known as the unfolding complexity.
  • Analyze the current business setting and provide institutionalization recommendations grounded in SNA.
  • Distinguish the functions, critical activities, and essential SNA information requirements.

4. Results

After processing the results of the SCOPUS data, two types of networks were developed and examined. Figure 3 shows the first: a two-mode network composed of 242 SCOPUS articles and 1164 different keywords. The pink nodes represent the keywords, while the green nodes represent the articles. Of the 242 articles, 21 had no keywords, so excluding them resulted in 221 publications in the network. This first overview allowed the identification of keywords applied in EO papers; entrepreneurial orientation has 103 instances, and entrepreneurship has 39 (not considered). The aspects that stood out were performance (78), innovation (40), market orientation (38), and sustainability orientation (17).
The first network obtained in the SNA analysis, as shown in Figure 3, documents research that has evaluated EO as a unidimensional construct (from the interaction of its factors, EO emerges) and multidimensional (the factors of proactivity, risk-taking, market orientation, and innovation can exist independently). These approaches have been applied to different types of organizations. However, there is a clear opportunity to focus specifically on microenterprises and how EO can help these organizations adapt to exogenous shocks and changing environments. The following is a description of the four main areas that stand out in the study of EO:
  • Performance: EO has been studied mainly for its influence on business performance, considering three dimensions: individual, team, and organizational (Covin and Slevin 1988; Rauch and Frese 2008). Research shows that EO can improve the company’s ability to adapt, be proactive, and innovate, which are essential characteristics in a volatile and competitive environment. Studies by Anderson and Eshima (2013), as well as Saeed, Yousafzai, and Engelen et al. (2014), highlight the relevance of organizational structure in maximizing the impact of OE on performance. This is particularly important for micro-firms, which often operate with limited resources and more informal structures than large firms.
  • Innovation: This is one of the fundamental dimensions of EO and is associated with a firm’s ability to generate new ideas, products, or services that enable it to adapt to changing market demands. Hult et al. (2004) and Rhee et al. (2010) suggest that, while EO focuses on entrepreneurial attitudes, innovativeness is directly related to result-oriented behavior, which is crucial for the success of microenterprises in disruptive contexts. In this sense, proactivity and initiative within EO foster the ability of microenterprises to take advantage of emerging opportunities and mitigate risks (Najar and Dhaouadi 2020; Shahzad et al. 2022).
  • Market orientation: This has been studied from two main perspectives: exploration and exploitation. Exploration focuses on a thorough knowledge of the customer and the competition. According to Slater and Narver (1995), it is essential to collect and analyze detailed information on market needs and competitors’ activities to adjust business strategies effectively. Conversely, exploitation involves the generation, dissemination, and response to market information throughout the organization (Hervé et al. 2020; Caemmerer and Hynes 2022). This process is critical for strategic adaptation and reaction to market dynamics, emphasizing how information is used to make decisions that promote sustainable competitive advantages.
  • Sustainability orientation: This emerges as a critical component in this effort, involving companies adopting practices and strategies that ensure their future, considering not only economic performance but also social and environmental impacts. There are different approaches to studying this relationship. For example, some authors conclude that EO is a precursor to sustainability orientation, and that companies will strengthen their strategic commitment to sustainability as they consolidate their entrepreneurial commitment (Lumpkin and Dess 1996; Wales et al. 2015). Other authors such as Rodriguez Cano et al. (2004), Lopes de Sousa Jabbour et al. (2020) and Rodrigues et al. (2021) see a convergence of two dimensions, where sustainability practices are integrated into business strategies, thus impacting business performance. Thus, the company gains relevance in social aspects such as corporate social responsibility (CSR) (Silva et al. 2021; Arend 2024), green innovation (Rodriguez Cano et al. 2004), environmentally friendly technologies (Raju et al. 2011), operational efficiency by reducing waste, and improvements in both economic and non-economic performance (Elkington 1997), which influences value creation.
Afterward, this network was converted into one network of co-keywords: in the process of converting a two-mode network into a single-mode network (Borgatti et al. 2013), the keywords were maintained as the focus of this investigation.
One of the main benefits of this transformation is the identification of patterns and knowledge areas related to the research of microenterprises and the utilization of systemic tools and thinking to allow microenterprises to reach full potential. This was achieved by identifying links connecting two or more keywords used in publications and increasing the connection strength when the same keywords were used in the existing literature. Consequently, various keywords were recognized as having solid connections, as they had higher usage across publications, and other keywords with minimal use were not as connected. Utilizing this logic, the dataset was reviewed, and keywords with two links were removed, resulting in keywords displaying proximity to each other, forming a variety of communities.
Figure 4 displays the results of this SNA methodology, highlighting seven communities that assumed the survival, institutionalization, and EO of microenterprises. To identify these communities, the “fastgreedy” algorithm was utilized to form agglomerative hierarchical clusters, also known as communities (Kolaczyk and Csárdi 2014). In this second network, four isolated communities were identified as not having any connection with the other keywords, allowing their interpretation as keywords used in specific articles. From the connected keywords, the seven main communities contained 85% of the concepts, and through keyword approximation and a focus on substructure cohesion, the detection of edges of knowledge was facilitated.
Considering these findings, to fully comprehend the different characteristics of this investigation, Table 2 summarizes, in detail, the observations of the keywords constituting the seven largest communities with the highest relevance. Table 2 was arranged by using the network as a foundation for deeper exploration and analyzing keyword searches in each article to determine their influence. Please note that the colors in this table correspond to the color scheme utilized in Figure 4.
Drawing on prior facts, most of the literature was linked to the improved performance of SMEs. This finding highlights the need for a special focus on micro-organizations, a perspective that considers the limited resources, underdeveloped capabilities, and difficulties in adopting information and communication technology, among other growth constraints (Gherhes et al. 2020), all while sharing the same goal as the outstanding industry competitors. Following this context, the application of systems science and systems thinking to address the high failure rate of microenterprises is uncommon. Considering the information that enabled the SNA methodology and after analyzing the factors making up the communities, it was observed that each cluster, or community, fits within at least one VSM subsystem. Within each community, various EO factors and dimensions were linked. This viewpoint permits the delegation of action items within families, ensuring the sorting and categorization of tasks to be fulfilled. Table 3 represents such categorization for the food service microenterprise referenced initially.
Integrating the EO framework with the VSM offers an approach to improving the viability and adaptability of microenterprises, especially in the face of exogenous shocks. From the SNA of the literature, the seven key EO communities correspond with the five systems of the VSM. The seven communities are the framework for understanding how microenterprises can incorporate EO into their strategies and operations, enabling them to adapt to exogenous shocks and improve their organizational performance. Each community is presented below by coupling its descriptions with the five systems of the VSM.
The innovation and adaptability set is related to System 4. These elements enable the organization’s ability to adapt to future changes in the environment and develop strategies accordingly. A microenterprise’s ability to adapt quickly to market changes and take advantage of emerging opportunities requires an efficient allocation of resources and, in some cases, the outsourcing of specific competencies.
Innovation is a core element of EO, enabling microenterprises to remain competitive and respond proactively to environmental shocks. System 4 acts as the organization’s eyes and ears, scanning the external environment for opportunities and threats. By considering innovation as part of System 4, microenterprises can improve their strategic intelligence, not only by generating new ideas but also by implementing them effectively to create value.
Autonomy and self-regulation are necessary for the independent functioning of the components of an organization, as long as they do not diverge from the overall objectives. This community reflects how the EO fosters independent strategic decision-making, allowing an agile response to volatile environments. The operating units, i.e., the primary activities of the organization, are encompassed in System 1. In a microenterprise, these units are closely connected and may involve merging functions due to staff shortages. Therefore, forming autonomy in these units empowers employees to make decisions that improve efficiency and responsiveness. System 2 is responsible for coordination and harmony between operating units. Self-regulation within and among these units minimizes conflicts and redundancies, which is critical in resource-constrained microenterprises.
Sustainability and the environment are considered indispensable for the long-term growth of microenterprises. Given the new trends, the sustainability and environment community considers aspects linked to the company’s viability. It, therefore, considers aspects that help organizations fulfill their social responsibilities while focusing on operational efficiency and economic value creation, such as eco-innovation and adopting environmentally friendly technologies.
The VSM’s System 5 defines the organization’s identity, policies, and governance principles. By incorporating sustainability into their core values and policies, microbusinesses can comply with regulations and meet growing consumer demand for environmentally responsible companies, impacting their reputation.
Market orientation in this community reflects how microenterprises can systematically innovate by staying informed about market changes, both locally and globally. Market exploration involves identifying new growth opportunities, while exploitation maximizes existing resources.
Market orientation also fosters the creation of competitive advantages through diversification and the adoption of disruptive technologies. System 4 captures and processes information from the environment to support strategic decision-making, while System 3* functions as an audit mechanism that provides feedback on operational performance. By integrating EO into these systems, microenterprises can respond more to market needs and adjust their operations accordingly.
Organizational change is constant in microenterprises, especially in disruptive environments. This community explores how microbusinesses can foster employee autonomy to solve problems or improve processes without complete dependence on management. Transformational leadership is key to fostering a risk–reward mentality that drives innovation.
In addition, acceptance of new technologies and business marketing strategies is essential for ensuring a sustainable long-term orientation. System 3 oversees internal control and resource management, while System 5 sets long-term strategic objectives and oversees the company’s overall direction. Microenterprises can integrate change management practices to navigate smooth transitions and align changes with strategic objectives.
Effective resource management is a critical component of organizational adaptation for microenterprises. This community discusses how microenterprises can identify and effectively use their internal and external resources to adapt to the changing environment. This may include business training, technical skills development, and digital orientation.
System 3 is responsible for effectively utilizing resources to achieve organizational objectives. By focusing on efficient resource management, microenterprises can optimize operations, reduce waste, and allocate resources to initiatives that drive innovation and growth.
Finally, the organizational dynamic relies on effective interaction between the different parts of the company, ensuring smooth collaboration and communication. This community points to the importance of a strong organizational culture and effective leadership, which guide the organization toward a long-term approach to business development. Fostering greater motivation and performance through leadership can drive active employee participation. This community is linked to the coordination function of the VSM, ensuring appropriate interaction and collaboration between the various parts of the organizational system. EO influences organizational dynamics by promoting innovation, risk-taking, and proactivity throughout the company.
It is worth noting that the flexibility of the proposed framework allows for consideration of the particularities of microenterprises integrated into different industries or economic sectors. For example, a microenterprise in the technology sector may focus on rapid innovation and the adoption of new technologies. In contrast, a microenterprise in the agricultural sector may focus on sustainable practices and adaptation to climate change. By considering the unique characteristics of their industry, microenterprises can customize the strategies and practices recommended by the framework to maximize their effectiveness and relevance. This allows them to more effectively address exogenous shocks and take advantage of emerging opportunities, ensuring successful implementation that enhances their viability and responsiveness.

5. A Conceptual Model Based on a Microenterprise

This section presents an example of how a micro food company located in California, USA, can apply the critical factors identified through SNA, structured within the five functions of the VSM. The microenterprise faces common challenges in the food sector, including adaptability to demand fluctuations, the need for product innovation, and the need to improve operational sustainability, all within a competitive and disruptive business environment. By integrating EO principles into the VSM, the microenterprise can improve its ability to cope with exogenous shocks and ensure its long-term viability.
The micro food company under study is a family-owned business founded in 2001 in the Salinas Valley, California, an agricultural region with strong food production. The company has focused on selling prepared foods for local consumption, with a staff of less than ten employees. Although it has survived for over two decades, it faces challenges related to innovation, managing limited resources, and adapting to changing consumer trends, particularly the growing demand for healthier and more sustainable food products. The regulatory environment in California also imposes stringent environmental and food safety regulations, increasing pressure on microenterprises to adopt sustainable practices.
The following explains how the critical factors of OE can be structured into the five functions of the VSM to improve the organizational responsiveness and adaptability of microenterprises to disruptive environments (Figure 5).

6. Discussion

The California micro food enterprise study has demonstrated that applying the critical factors of EO, structured through the VSM, can significantly improve the adaptability and sustainability of these organizations in the face of exogenous shocks. Through the integration of product innovation practices, effective resource management, and organizational adaptability, the microenterprise was able to address operational challenges related to fluctuations in demand, changes in regulatory standards, and the growing need for sustainability in the food sector. Adopting a sustainability strategy and implementing autonomous management practices in different areas of the company, such as production and sales, allowed for greater flexibility and responsiveness, strengthening its position in an increasingly competitive and changing market.
Microenterprises, which account for 97.7% of all enterprises (OECD 2023), are distinct from SMEs, although they are often grouped with them in academic studies. Microenterprises typically have fewer than ten employees, receive less investment, and are led by an owner-manager entrepreneur. This lack of resources, specialized structures, and the presence of unique challenges in their management mean that they require specific approaches that differ from those applied to SMEs. This research highlights the need to treat them differently, addressing their particular needs in terms of organizational adaptation.
Using SNA, 224 factors related to EO were identified and then grouped into seven interconnected communities. These communities represent different critical dimensions, such as innovation, adaptability, sustainability, and resource management, which are essential for coping with exogenous shocks. The findings suggest that the integration of these factors within the five VSM functions provides a robust structure for microenterprises to implement OE more effectively.
From a practical perspective, this research provides input for microenterprises by enabling a proactive approach to addressing their organizational challenges. By implementing OE through the VSM, microenterprises can improve their ability to innovate, adapt quickly to exogenous shocks, and sustain their growth over the long term. A key finding is the centrality of organizational leadership in microenterprises: without clear direction, these firms tend to fail due to low employee morale and a lack of structured innovation (Lumpkin and Dess 1996). This study reinforces the importance of business leaders in fostering a culture of adaptability and proactivity.
An important finding is that EO is not a one-size-fits-all formula for all microenterprises. Not all the factors will be equally applicable or effective in each context, so it is clear that EO should not be used as a one-dimensional construct for this type of enterprise. Microenterprise entrepreneurs must be open-minded and flexible in adapting the critical factors of EO to the specific circumstances of their industry and market (Covin and Slevin 1988). This customized approach is crucial for developing a strategy that responds to the particular needs of each microenterprise, allowing them to take advantage of opportunities and mitigate risks more effectively.
However, like all research, this study has limitations. The main limitation lies in the exclusive use of the SCOPUS database, which could have excluded relevant studies from other sources, restricting the scope of the analysis. In addition, the use of SNA may have generated complex visualizations that make it difficult to clearly identify all patterns (Borgatti et al. 2013). These limitations affect the generalizability of the results outside the microenterprise setting. However, the focus on microenterprises ensures that there are no biases from studies on large or multinational companies, maintaining the relevance of the findings for these types of organizations.
This research provides important implications for microenterprises seeking to improve their probability of survival through EO-based organizational transformation. Microenterprises adopting the strategies proposed here will increase their capacity for innovation and sustainability and contribute to regional economic development and community resilience, creating jobs and strengthening marginalized communities (Chakrabarti 2015; Rodrigues et al. 2021; Shahzad et al. 2022). The benefits of implementing OE through VSM extend beyond the firm, positively impacting the local environment and regional economies and reinforcing the relevance of these findings in a global context marked by disruptions.

7. Conclusions

This study has revealed how applying critical factors of EO, structured through the VSM, could significantly improve the ability of a micro food enterprise in California to respond effectively to changes in the face of exogenous shocks. The analysis confirmed the initial proposition that integrating EO into microenterprises, using a systems approach such as the VSM, can enhance their ability to survive and thrive in highly disruptive environments. The results highlight the importance of factors such as innovation, organizational autonomy, and sustainability in improving the organizational performance and long-term viability of microenterprises.
In relation to previous studies, the findings reinforce the existing literature on the importance of OE as a multidimensional construct that enhances organizational adaptation (Lumpkin and Dess 1996; Covin and Slevin 1988). However, this study provides a differentiated perspective by focusing exclusively on microenterprises, highlighting how their specific characteristics—smaller organizational structure and limited resources—require a more flexible and customized OE approach. This analysis aligns with studies that highlight the importance of organizational leadership in microenterprises but also suggests that integrating OE through a systemic approach can increase the effectiveness of strategic and operational decisions.
Using SNA provided a useful basis for identifying key patterns to interpret complex data. This analysis sought to answer two questions: What key issues and concepts have been studied in the literature related to EO and its impact on microenterprises? What are the main critical factors affecting microenterprises, and how do they relate to EO? The analysis revealed that concepts such as innovation, adaptability, autonomy, and sustainability are the themes most frequently associated with EO, highlighting their direct impact on microenterprise performance. In addition, critical factors such as market responsiveness, resource management, and organizational coherence were identified as essential for the integration of EO into microenterprises, especially in contexts of high volatility. These findings reinforce the relevance of customizing EO strategies to address the particularities of each microenterprise, underscoring the need for more research in this area.
The empirical implications of these findings provide a framework for action to enhance innovation and sustainability through a structured application of EO in volatile environments. This approach helps microenterprises survive in their early years and facilitates their growth and ability to contribute to regional economic development. At the theoretical level, this research expands knowledge on the application of OE in microenterprises and proposes a methodology that can be applied in other sectors and regions.
Despite the relevant findings, this study has some limitations. The main limitation is the exclusive reliance on the SCOPUS database, which may have limited the inclusion of other relevant research published in other sources. As an additional limitation, the use of SNA, although useful, could result in an incomplete view of certain interrelationships. The conceptual model of a company located in California limits the geographic scope of the results, which could reduce the findings’ applicability and generalizability to other contexts or industrial sectors. These limitations could have influenced the interpretation and generalization of the results.
For future research, exploring how EO factors interact with different types of microenterprises in varied sectors would be valuable. In addition, the analysis can be enriched by integrating data from other sources and using additional quantitative methods that can more accurately measure the impact of OE on organizational performance over time. It would also be interesting to investigate how artificial intelligence and other emerging technologies could help microenterprises more efficiently implement EO strategies across the five VSM systems.

Author Contributions

Conceptualization, D.S.A.; methodology, J.Y.S.-G. and J.E.N.-R.; software, J.E.N.-R.; validation, D.S.A. and J.Y.S.-G.; formal analysis, J.E.N.-R.; investigation, D.S.A.; writing—original draft preparation, D.S.A.; writing—review and editing, J.Y.S.-G.; visualization, J.E.N.-R. All authors have read and agreed to the published version of the manuscript.

Funding

This research received no external funding.

Institutional Review Board Statement

Not applicable.

Informed Consent Statement

Not applicable.

Data Availability Statement

No new data were created or analyzed in this study. Data sharing is not applicable to this article.

Conflicts of Interest

The authors declare no conflicts of interest.

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Figure 1. Literature analysis process using SNA. Source: Developed by the authors.
Figure 1. Literature analysis process using SNA. Source: Developed by the authors.
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Figure 2. Fundamental VSM elements. Source: (Núñez-Ríos et al. 2020).
Figure 2. Fundamental VSM elements. Source: (Núñez-Ríos et al. 2020).
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Figure 3. Two-mode network.
Figure 3. Two-mode network.
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Figure 4. One-mode network of keywords (co-keyword network).
Figure 4. One-mode network of keywords (co-keyword network).
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Figure 5. The VSM for a food service microenterprise.
Figure 5. The VSM for a food service microenterprise.
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Table 1. Subsystems of the Viable System Model.
Table 1. Subsystems of the Viable System Model.
FunctionObjective
S1This subsystem supervises the daily operational activities and essential tasks for the functioning of the organization. As the first line of the organization, it focuses on the basic functions of production and customer service.
S2This subsystem focuses on coordination, enabling communication throughout the organization and ensuring the effective flow of information between operational and administrative departments. The greatest strength of S2 is the synchronization, conflict resolution, and culture of collaboration it brings to members and various departments.
S3Subsystem 3 focuses on the control and supervision of the performance of S1, ensuring alignment between operations and the organization’s standards and objectives. It encompasses goal setting, performance metric analysis, and a proactive approach to corrective actions for a stable and effective system. S3*
S4The fourth subsystem is intelligence, responsible for collecting, evaluating, and disseminating relevant information for the organization. It is imperative that S4 monitor the external environment for threats and opportunities while gathering internal data for informed decision-making, ensuring a smooth adaptation to strategic changes.
S5Subsystem 5 manages organizational policy, setting the overall direction, objectives, and strategy. It is responsible for defining policies, allocating resources, and carrying out long-term strategic planning while establishing the framework followed by the remaining subsystems to ensure that broader objectives are met.
Source: Based on Beer (1984).
Table 2. Communities base on co-keyword network.
Table 2. Communities base on co-keyword network.
LabelNodesDescription
Innovation and adaptability
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47This community emphasizes innovation and adaptation in supervisory roles within dynamic contexts—focusing on identifying strategic factors in business operations and making necessary adjustments in response to emerging trends (Kusa et al. 2021). Successful adaptations require business leadership that promotes rapid responses to changing circumstances through entrepreneurial intensity, which is based on focusing and acting around emerging opportunities (Sumiati 2020). Meeting increased demand requires efficient resource management, including the proper allocation of available resources. When the necessary resources are not available, human resource outsourcing can be used to acquire the necessary skills (Irwin et al. 2018). Successful adaptations entail an entrepreneurial leadership that encourages quick responses to changing circumstances via an entrepreneurial intensity resting on focus and action surrounding arising opportunities. An increase in demand calls for proper resource management (Shahzad et al. 2022) with the efficient and effective allocation of resources, and when unavailable, human resource outsourcing can acquire the desired skills. Strategic modifications are executed via a responsive market that facilitates competitive advantages. The decision involves risk-taking (Mothibi et al. 2024) in the forms of strategic marketing (Quinton et al. 2018), information communication technology (Baldegger et al. 2021), and alliance formation (Talebi et al. 2015).
Autonomy and self-regulation
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34This community focuses on the challenges faced by organizations and how exploration activities lead to consequences (Seet et al. 2021), from which decisions for strategic renewal (Klammer et al. 2017) promote the idea that the components of an organization must have the capacity to operate independently; however, it is always aligned with the goals and needs of the organization. In the organizational self-regulation of SMEs, several fundamental factors arise: an orientation toward the Internet for the development of marketing tools for sustained competitiveness; financial literacy for informed decision-making and improving the likelihood of access to financing; and product innovation to develop and introduce innovative products in line with social entrepreneurship initiatives (De Ruysscher et al. 2017) to address current challenges.
Sustainability and environment
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23The works linked in this group integrate ethical and sustainable principles into the innovation process with efforts to advance and instill the sustainable development (Silva et al. 2021) of ecological innovation and efficiency (Ahmed et al. 2020) to meet the present needs without compromising future generations. Working in conjunction, an innovation ecosystem (Yang and Yan 2019) generates a positive reinforcement effect between innovative activities and the market through collaboration, knowledge sharing, and ethical considerations. In return, green EO positively influences economic performance (Muangmee et al. 2021), evolving into sustainable business practices (Lopes de Sousa Jabbour et al. 2020) that consider their environmental and societal impacts. Such sustainable achievements are facilitated by instrumental contributions from visionary leadership (Dung and Giang 2022), ensuring operating principles, such as total quality management (Chienwattanasook and Jermsittiparsert 2019), align and satisfy proposed sustainability targets.
Market orientation
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27The KWs in this group cover factors that foster systematic innovation through open-minded perspectives and awareness of the peripheral region (Manninen 2021), where market encroachment or expansion is initially observed. To gain competitive intelligence (Mohsin et al. 2015), information internationalization (Yoo et al. 2019) is utilized to expand systems and technologies when adapting to diverse marketplaces and their environments while simultaneously being exposed to tolerable levels of managerial risk (Shi et al. 2022) in decision-making. Results from this diversification are reflected through the development of a market and technology innovation orientation (Sarreal and Reyes 2019), which works along a growth orientation (Sayal and Banerjee 2022) that prioritizes expansion and development through the incorporation of disruptive factors, such as digital entrepreneurship (Hervé et al. 2020) and other development programs (Abbade et al. 2014).
Organizational dynamic
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38Effective interaction between the parts of the enterprise is crucial. Exchange and interaction between the parts of the organization must be ensured through effective collaboration and communication that contribute to the viability of the enterprise. This KW series brings together publications focusing on the complex and changing patterns of social interactions, connections, and authority within an organization. An empowering organizational culture (Gurtoo 2009), along with an effective leadership style made up of industry knowledge (Navakitkanok et al. 2020) and insider perspectives (Dabić et al. 2021), can guide an organization through the development of a long-term orientation (Shaher and Ali 2020). Embedded in the culture are power and influence (Olorunshola and Odeyemi 2023) that foster a comfortable working environment that takes into consideration empathy and individual team member roles (Ramoglou et al. 2023). In return, high employee engagement (Frank et al. 2005; Yadav and Kumar 2022) nurtures motivation, enabling performance-increasing entrepreneurial behavior (Kusa et al. 2021).
Organizational change management
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32New initiatives at different organizational levels support the promotion of employee autonomy to solve problems or improve processes without waiting for instructions. The nodes in this cluster relate to an organizational culture (Deslatte et al. 2021) open to transformational leadership (Yildirim and Saygin 2011) through an active awareness of the general external environment (Elshourbagy and Dinana 2018) and the effects of its public policies (Olorunshola and Odeyemi 2023) on the business ecosystem. Part of addressing ongoing changes is the evolution from a loss-averse mindset to a risk–reward approach (Deslatte et al. 2021), encouraging a strong innovation orientation (Nawi et al. 2020) and embracing technology acceptance (Acheampong et al. 2014) and its critical role in developing a sustainable strategic orientation (Muhammad Auwal et al. 2020). The effects encompass a customer orientation (Tajeddini et al. 2013; Rasmussen and Nybakk 2016) that integrates business marketing dimensions (Astuti et al. 2017), including customer relationship management systems (Hynes and Caemmerer 2017).
Efficient resource management
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43The publications in this area relate to critical success factors (Hassan et al. 2021) that must be identified and adapted as needed by organizations. Strategic management theories, including the resource-based view of the firm (Zhang et al. 2013; Khan et al. 2021), consider available internal resources and capabilities when adjusting to a changing landscape. When faced with scarce resources, organizations must invest in proper entrepreneurship training (Al-Awlaqi et al. 2021), including technical courses (Singh et al. 2014) and competencies (Satalkina et al. 2022) that bring out and develop the individual EO (Apfel and Herbes 2021). Gained insights shape the behaviors and structures of markets through marketization (Mautner 2005) and a digital orientation (Quinton et al. 2018; Navakitkanok et al. 2020) to align strategies and practices with disruptive technologies. Through this process, a learning orientation triggers a reorganization (Farkas 2016; Navakitkanok et al. 2020; Mayr et al. 2022), promoting continuous learning and improvements in organizational behavior (Baldegger et al. 2021).
Source: Developed by the authors based on the results of the one-mode network of keywords (co-keyword network).
Table 3. Microenterprise units: VSM systems, roles, and functions+.
Table 3. Microenterprise units: VSM systems, roles, and functions+.
SystemEO FactPerformed byFunctional Description
System 1
Operation
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Autonomy and self-regulationProduction areaQuality control: meeting or exceeding labor expectations (raw material inspections, proper storage practices, hygiene standards, proper cooking procedures, portion controls, temperature monitoring, allergen controls)
Efficiency: ensuring resources are utilized competently, minimizing waste, and maximizing output (standardized recipes and processes, prep work optimization, kitchen layout design, equipment utilization, batch cooking, cross-training staff, time management)
Continuous improvement: providing feedback and metrics to enhance operations (employee engagement and development, process innovations, waste reduction, energy conservation, tech integration)
Safety compliance: ensuring health and well-being of consumers and staff (hazard analysis and critical control points, sanitation procedures, allergen management, pest control, storage practices, safe equipment use, labeling and traceability)
Service and dining areaService excellence: friendly, attentive, and personalized (warm greetings, accommodating needs and preferences)
Product knowledge: well versed in offerings, cooking methods, and allergen information (menu-ingredient knowledge, preparation methods, specialty and signature items, nutritional information, new product introductions, food pairing recommendations)
Communication skills: clear and courteous words (positive language, active listening, empathy, emotional intelligence, verbal and nonverbal skills, conflict resolution, customer recovery, telephone and written, team dynamics and cross-cultural communication)
Problem resolution: handling complaints and dissatisfaction (de-escalate, empathize, offer solutions, resolve)
Table management: server etiquette and meeting consumer needs without intrusiveness (reservation handling, seating assignments, guest recognition, waitlist management, host and server communication, table tracking systems, upselling opportunities, conflict resolution, experience enhancement)
Attention to detail: accurate order-taking, attractive presentation, prompt service (completeness and accuracy check, hygiene and sanitation practices, allergens and dietary restrictions, quality control checks, customer interactions, inventory management, equipment maintenance)
Empathy and cultural sensitivity: empathy training (diverse dietary requirements, customs, and communication; implicit bias; active listening; personal boundaries; intercultural language and communication)
Cleanliness and Ambience: upholding standards in dining, restrooms, and customer service areas (sanitation procedures, cleaning schedules, food contact surfaces, pest control, waste management, emergency clean-up procedures, regular inspections and feedback)
Market orientationSalesUpselling and Cross-selling: enhancing customer experience and expanding their preferences (understanding needs, recommendations, add-ons and upgrades, highlighting value propositions, complimentary alternatives and substitutions, loyalty programs, gift cards, positive phrasing, suggestive and descriptive language, incentives and rewards)
Customer relationships: connecting with consumers via personalization for a loyal base (understanding customer needs, empathetic communication, trust establishment, conflict resolution and de-escalation, service mindset, personalized service, customer feedback and reviews, customer retention)
System 2
Coordination
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Autonomy and self-regulationSupervisorEfficiency: save time and resources (insider techniques, continuous learning and development, online training modules and simulations, cross-training, standardized training materials)
Quality control: employees receive accurate, consistent learning, resulting in effective performance (customer satisfaction, real-time feedback and skills assessments, training programs, observation-coaching, documentation and record-keeping)
Cost management: ensure effective use of raw materials and time (internal resources, cross-training, portion control)
Safety and compliance: informing and ensuring employee welfare (food safety training, personal protective equipment, emergency response, chemical handling, accident prevention, refresher training)
Environmental: striving to reduce carbon footprint by adopting eco-friendly practices (recycling and waste reduction, energy and water conservation, cleaning and disposal practices)
Menu knowledge: effective consumer communication (ingredient and preparation process expertise; portion size and plating; taste and flavor profiles; food and beverage pairing; seasonal dish, specials, and signature dish proficiency; cross-selling and upselling techniques; mock service and role-playing)
Equipment operation/maintenance: safe and efficient use of appliances and instruments (familiarization, safety procedures, operating instructions, cleaning/sanitating/maintenance schedule, troubleshooting, preventive maintenance, knife handling/sharpening, regulatory compliance standards)
Customer service: excellent service creates positive guest experiences (greeting patrons, effective communication, personalized service, handling customer suggestions-complaints, tableside manners, menu knowledge, time management, health and safety protocols, follow-up and thank you)
Cultural sensitivity and inclusion: respectful and considerate of diverse cultures, backgrounds, and identities (diversity training, bias awareness, language and communication training, religious observances, disability awareness and accessibility, conflict resolution)
Emergency response: employee and guest safety in situation emergencies (fire safety, first aid, evacuation procedures, emergency evacuation, chemical and hazardous materials, power outage, active shooter, documentation and record-keeping)
System 3
Control
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Organizational change managementChefPolicy: enforcing company policies and procedures related to food safety, hygiene standards, and operational protocols
Workflow mapping: staff scheduling, task assignments, and workflow management (employee performance, feedback, resolution of arising issues)
Emergency response: implementation of procedures to coordinate evacuation and ensure safety (fires, medical, security incidents)
Conflict resolution: self-regulation of staff to maintain harmonious work environment to uphold business reputation
Efficient resource managementStress management: to improve integration and decision-making under pressure (stress management, deep breathing exercises, calm and focused during busy periods)
Inventory management: inventory levels and controlling food costs (monitoring, placing orders, procedures to minimize waste, prevent shortages, overstocking)
Quality assurance: enforcing quality standards for food preparation, presentation, and service (regular inspections and compliance audits, company standards)
Product testing and sampling: to ensure that established standards and expectations are met (assess quality, consistency, and taste of offerings)
System 3*
Audit
Autonomy and self-regulation Chef and
Supervisor
Food safety monitoring: regular inspections of food handling (temperature control, storage, preparation, HACCP and FDA guidelines)
Sanitation and hygiene compliance (health regulations, equipment cleanliness, utensils, food preparation areas, personal hygiene practices)
Allergen management: item labels to prevent cross-contamination (peanuts, dairy, gluten, shellfish)
System 4
Intelligence
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Market orientationChef and
CEO—Manager
Forecasting and demand planning: to minimize waste, reduce stockouts, and meet customer demands (historical data, predictive analytics, seasonal trends, inventory optimization)
Menu optimization: data analysis to maximize profitability and customer satisfaction (menu optimization, pricing strategies, promotional activities, bestselling items, underperforming dishes, menu innovation, profit maximization)
Customer personalization: segmenting customers to reach target audiences and drive customer loyalty (demographics, purchasing behavior, preferences, promotions, menu recommendations)
Supply chain management: to help businesses optimize operations (supplier performance, procurement costs, supplier term negotiations, inventory levels, lead times, risk mitigation)
Operational efficiency: to identify process inefficiencies, staffing, and resource allocation (streamline operations, cost reduction, productivity enhancement)
Innovation and adaptabilityCEO—ManagerData collection and integration: obtaining data from various sources to create a comprehensive business view (point of sale, customer relationship management, inventory management, online reviews)
Data analysis and reporting: to inform strategic decisions (trends, patterns, insights, reports, dashboard visualization)
Performance monitoring: key performance indicators to identify improvement areas and track business goals progress (sales, revenue, profit margins, inventory levels)
Compliance and risk management: risk identification, compliance tracking methods, corrective action, implementation, and liability mitigation
Strategic planning and decision-making: to enable executives to make informed decisions based on data-driven insights (strategic planning initiatives, expansion opportunities, investment decisions)
System 5
Policy
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Organizational dynamic/
Organizational change management
Strategic direction: review of mission, vision, long-term objectives, and formulation of organizational strategies
Leadership: making decisions that impact the direction, growth, and success of the organization
Financial management: ensuring sustainability and profitability through financial planning, budgeting, and resource allocation
Business development: identifying opportunities for growth and expansion into new markets and partnerships
Operational Oversight: monitoring and evaluating departmental and functional area performance
Quality assurance: establishing and maintaining standards for continuous improvement and customer satisfaction
Human resource management: attracting, retaining, and developing talented employees through recruitment, training, and performance management
Risk management: identifying and mitigating operational, reputational, and financial risks
Sustainability and environmentCEO—ManagerStakeholder relations: creating and maintaining networks to build trust and organizational support
Regulatory compliance: compliance with laws, regulations, food safety standards, and labor practices
Learning culture: fostering a culture of continuous learning and responsiveness to market dynamics
Corporate social responsibility: commitment to social and environmental leadership through sustainable practices and community engagement
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MDPI and ACS Style

Suarez Ambriz, D.; Sánchez-Garcia, J.Y.; Núñez-Ríos, J.E. An Organizational Framework for Microenterprises to Face Exogenous Shocks: A Viable System Approach. Adm. Sci. 2024, 14, 315. https://doi.org/10.3390/admsci14120315

AMA Style

Suarez Ambriz D, Sánchez-Garcia JY, Núñez-Ríos JE. An Organizational Framework for Microenterprises to Face Exogenous Shocks: A Viable System Approach. Administrative Sciences. 2024; 14(12):315. https://doi.org/10.3390/admsci14120315

Chicago/Turabian Style

Suarez Ambriz, Denny, Jacqueline Y. Sánchez-Garcia, and Juan E. Núñez-Ríos. 2024. "An Organizational Framework for Microenterprises to Face Exogenous Shocks: A Viable System Approach" Administrative Sciences 14, no. 12: 315. https://doi.org/10.3390/admsci14120315

APA Style

Suarez Ambriz, D., Sánchez-Garcia, J. Y., & Núñez-Ríos, J. E. (2024). An Organizational Framework for Microenterprises to Face Exogenous Shocks: A Viable System Approach. Administrative Sciences, 14(12), 315. https://doi.org/10.3390/admsci14120315

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