Organizational resilience: Sustained institutional effectiveness among smaller,private,non-profit US higher education institutions experiencing organizational decline

Abstract

BACKGROUND: Recent changes in the United States (US) economy have radically disrupted revenue generation among many institutions within higher education within the US. Chief among these disruptions has been fallout associated with the financial crisis of 2008-2009, which triggered a change in the US higher education environment from a period of relative munificence to a prolonged period of scarcity. The hardest hit by this disruption have been smaller, less wealthy institutions which tend to lack the necessary reserves to financially weather the economic storm. Interestingly, a review of institutional effectiveness among these institutions revealed that while many are struggling, some institutions have found ways to not only successfully cope with the impact of declining revenue, but have been able to capitalize on the disruption and thrive.

OBJECTIVE: Organizational response is an important factor in successfully coping with conditions of organizational decline. The study examined the impacts of organizational response on institutional effectiveness among higher education institutions experiencing organizational decline. The study’s research question asked why some US higher educational institutions are more resilient at coping with organizational decline than other institutions operating within the same segment of the higher education sector. More specifically, what role does organizational resilience have in helping smaller, private non-profit institutions cope and remain effective during organizational decline?

PARTICIPANTS: A total of 141 US smaller, private non-profit higher educational institutions participated in the study; specifically, the study included responses from participant institutions’ key administrators.

METHODS: 60-item survey evaluated administrator responses corresponding to organizational response and institutional effectiveness. Factor analysis was used to specify the underlying structures of rigidity response, resilience response, and institutional effectiveness. Multiple regression analysis was used to examine the direct and interaction effects between organizational decline, organizational rigidity response, organizational resilience response, and institutional effectiveness, controlling for age of institution and level of endowment.

RESULTS: The study validated previous threat-rigidity response findings that organizational decline alone does not adversely impact institutional effectiveness. The direct effect of Goal-Directed Solution Seeking and Role Dependency organizational resilience factors had a positive, significant correlation with the Student Personal Development institutional effectiveness factor. The interactive effect of Goal-Directed Solution Seeking organizational resilience factor during organizational decline had a positive, significant correlation with the Professional Development and Quality of Faculty institutional effectiveness factor. The interactive effect of Avoidance during organizational decline had a positive, significant correlation with the Faculty and Administrator Employment Satisfaction institutional effectiveness factor. The interactive effect of Diminished Innovation, Morale, and Leader Credibility rigidity response factor and Avoidance organizational resilience factor during organizational decline had a positive, significant correlation with the Professional Development and Quality of Faculty institutional effectiveness factor. Lastly, the interactive effect of Increased Scapegoating of Leaders, Interest group Activities, and Conflict rigidity response factor and Avoidance organizational resilience factor during organizational decline had a positive, significant correlation with the Faculty and Administrator Employment Satisfaction institutional effectiveness factor.

CONCLUSIONS: Factors of organizational resilience were found to have a positive effect among smaller, private non-profit higher educational institutions associated with this study toward sustaining institutional effectiveness during organizational decline. Specifically, the organizational resilience factors of Goal-Directed Solution Seeking (i.e., mission-driven solutions) and Avoidance (i.e., skepticism toward new ideas) play a significant, collaborative role among smaller, private non-profit higher educational institutions when it comes to sustaining institutional effectiveness during organizational decline.

Keywords

Organizational response organization resilience threat-rigidity response organizational effectiveness

1 Introduction

Environmental change over the last decade has not been kind to institutions of higher education within the United States (US). A Bain and Company report on the financial health of 1,692 public and private colleges reported a growing liquidity crisis facing the entire sector of institutions [1]. Specifically, the report stated that “approximately one-third of all colleges and universities have financial statements that are significantly weaker than they were several years ago” [1]. The report relied on equity and expense ratios [2].

According to the report, institutional financial health was a measure of “whether their expense ratios increased or their equity ratios decreased” [2]. The report classified institutions based on the amount of change experienced with these two measures. For instance, the report noted that institutions with greater than 5% change were assigned the harshest risk ranking; institutions with 5-0% change received a modest risk ranking; and institutions that did not experience change were classified as good or low risk ranking. Overall, the study concluded that college and university balance sheets and income statements showed that “institutions have more liabilities, higher debt service, and increasing expenses without the revenue or cash reserves to back them up” [1].

1.1 Coping with downgraded credit rating

An inability of institutions to grow revenue prompted Moody’s Investors Services in 2009 to issue a negative outlook on specific segments of the US higher educational sector, downgrading the credit rating of 22 colleges and universities [3]. Moody indicated that revenue streams would most likely never flow as they did before the 2008 economic downturn, recommending that higher educational institutions make fundamental shifts in operations and strategic thinking about the future [4, 5].

Moody also noted that one-third of struggling institutions will “decline outright this year at a rate that fails to keep pace with inflation,” suggesting that even though the US economy has begun to show signs of recovery, many higher educational institutions are still experiencing declines in tuition revenue [2]. Specifically, Moody reported that 18% of private and 15% of public institutions “project outright declines in their net revenue” [1]. Moody also noted that “tuition pressures and modest enrollment declines ... were concentrated in colleges that are small, draws students from a narrow demographical and geographic pool, and are less-selective in admissions,” citing such institutions as Alabama A&M, Wellesley College, and Morehouse College [1].

In 2013, Moody revised its original negative outlook to include the entire US higher education sector, including even the most elite institutions within the sector [6, 7]. In similar fashion, Standards & Poor’s Rating Service began downgrading credit ratings on numerous US higher education institutions, including such schools as Amherst College, Tulane University, and Yeshiva University [8]. The impact of these negative outlooks on the higher education sector has resulted in “lower credit ratings and higherborrowing costs,” making recovery even more difficult for many US institutions [9].

1.2 Coping with declining student enrollment

Compounding constraints produced by the 2008 economic downturn, many segments of the higher education sector have also experienced drops in student enrollment [10, 11]. Early reports of student enrollment declines have ranged from 5.9% to 11% decreases in four-year colleges, even as high as 20% decrease in student enrollment in community colleges [12, 13].

The hardest hit by declining student enrollment has been smaller, private non-profit institutions that rely heavily on revenue generated by student tuition [3 , 15]. Many smaller institutions are responding to the drop in student enrollment by discounting tuition, reducing the number of academic programs, even replacing leadership in hopes of achieving turnaround [16]. However, despite tuition reductions, many of these institutions are simply not able to overcome the loss in revenue, forcing some to close their doors. Examples include Atlantic Union College, a 129-year old college located in South Lancaster, Massachusetts when closed in 2011 and Chester College of New England, which closed in 2012 [17]. Most recent has been Sweet Briar College, which initially reported it would close at the end of 2015 due to declining student enrollment in the all-women’s liberal arts college; however, efforts made by alumnae have, for the time being, enabled to college to forego closure [18, 19].

1.3 Coping with disruptions of internal resources

At a minimum, the fallout associated with the changing US higher education environment has forced many smaller colleges to shift their strategic focus from growth to coping with decline. Environmental changes affecting this segment have led to profound disruptions in the availability and flow of resources needed to sustain operations. This has led to massive cutbacks [3 , 15]. Examples of institutional cutbacks included severe budget and program cuts, faculty and staff layoffs, increased tuition discounting efforts, and increased reliance on reserve funds [19 –31].

Despite radical change, some smaller, private non-profit colleges have found ways to not only survive, but thrive by capitalizing on the opportunitiesassociated with change. For example, Dowling College, a 60-year old private college in Long Island, New York reported surplus in revenue associated with successful cost cutting measures [32]. Adrian College, a 155-year old college located north of Detroit, Michigan, broadened program offerings, expanded athletic programs, and increased tuition discounting leading to improved retention rate of existing students to 92% and increased incoming class size by 650 students in 2012, demonstrating resilience during challenging environmental change and decline [6, 33].

Based on these antecedents, the study’s research question asked: Why are some US higher educational institutions more resilient at coping with organizational decline than other institutions operating within the same segment of the higher education sector? More specifically, what role does organizational resilience have in assisting smaller, private non-profit institutions cope and remain effective during organizational decline?

2 Organizational decline and the traditional response to decline

A review of management literature over the last 20 years revealed a sparse amount of empirical research on organizational decline targeting US higher education institutions [34]. However, the US financial crisis of 2008 and economic recovery have stimulated new interest in organizational decline. Organizational decline arises when environmental change leads to restricted availability of internal resources, which in turn, increases pressure to make cut backs in efforts to cope and sustain operations [35]. It has been defined as “shrinkage of some visible size dimension which is crucial to organizational survival, such as workforce, market share, asset, or profit” [36]. Organizational decline has also been linked to failures to adequately “anticipate, recognize, avoid, neutralize or adapt to external or internal pressures that threaten the organization’s long-term survival” [37].

The traditional response for coping with organizational decline has been influenced by the threat-rigidity hypothesis [38]. The threat-rigidity hypothesis suggests that environmental changes are perceived as threats and are more difficult to control [38, 40]. Because organizational decline is perceived as a threat, it creates uncertainty, stress, anxiety, and feelings of crisis, which biases organizational response toward an efficiency perspective [41]. The threat-rigidity cycle, shown in Fig. 1, illustrates the cycle of how environmental change is perceived as a threat to the organization, which results in efficiency-focused, rigidity response: i.e., restriction in information and constriction in control. Under radical, discontinuous change situations, rigidity response intensifies the sense of organizational threat [38]. Operationally, during threat situations, organizations tend to “become rigid, hunker down, and become turf-protective ... they react first with conservative, across-the-board directives” [41].

The traditional view of organizational response to decline assumes that US higher educational institutions are often ill-equipped to adequately cope with the radical environmental change generally associated with organizational decline, and adopt a threat-rigid perspective [38 , 44]. Organizational responses among US higher education institutions experiencing organizational decline tend to rely on cutback management techniques, including downsizing, budget and program cuts, and tuition hikes [45, 46]. The threat-rigid response among US higher educational institutions experiencing organizational decline has been routinely investigated in the management literature during the late 1970s through middle 1990s. However, less known about are organizational responses that views radical, discontinuous environmental change as an opportunity to be exploited with an aim of sustained competitive advantage.

3 Organizational resilience

Resilience has been defined as a “dynamic process of successful adaptation to adversity revealed through the lens of developmental psychology” [50]. Within the context of organizational resilience, it describes the organization’s ability of “ … continuously anticipating and adjusting to deep, secular trends that can permanently impair the earning power of a core business … it is about having the capacity to change before the case for change becomesdesperately obvious” [50]. Although not necessarily new to the management literature, organizational resilience has emerged over the last decade as a vibrant and practical way for organizations to more effectively cope and persist through disruptive change [47 –49]. Resilient organizations are able to anticipate change, adapt internal processes, and learn from their coping experience [48].

Organizational resilience is the two-fold ability to absorb environmental change and crisis without significant loss of organizational effectiveness; while also being able to remain adaptive during crisis situations [51]. Specifically, organizational resilience enables “successful exploitation of competitive bases (i.e., speed, flexibility, innovation proactivity, quality and profitability), through the integration of recognizable resources and best practices in a knowledge-rich environment to provide customer-driven products and services in a fast changing market environment” [52]. Organizational resilience also characterizes fle-xibility of response to radical environmental change events without adversely affecting customer services [53], business relationships [54], supply chain operations [55], and workforce performance [56].

3.1 Dimensions of organizational resilience

Organizational resilience has been defined as six dimensions of organizational response behaviors [57]. The first dimension is goal-directed solution seeking, which suggests that resilient organizations enjoy improvising and working collaboratively on solving challenging organizational challenges. Embodied in goal-directed solution seeking is the idea that resilient organizations are able to repurpose existing resources toward new strategic outcomes. The second dimension of avoidance proposes that resilient organizations tend to view new situations skeptically, and immediate reaction to changing conditions should be avoided.

The third dimension is critical understanding that corresponds to sense-making of the crisis situation confronting the organization. The fourth dimension is role dependence, which corresponds to cross-functionality among key administrators; an ability of administrators to perform effectively in other administrative positions. The fifth dimension is source-reliance, which suggests that administrators seek out numerous sources of information to more comprehensively understand the crisis situation confronting the organization. The final dimension is resource access, which proposes that resilient organizations are able to overcome constraints to information and restricted resources associated with the crisis. Each of the organizational resilience dimensions provides potentially new insights into an alternative view for responding to organizational decline.

Resilient organizations have these dimensions embedded in their administrative routine and are better equipped to cope and respond to changing environmental conditions that contribute to organizational decline [58 –61]. Specifically, these dimensions enable resilient organizations to absorb environmental shock, jolts, and setbacks without adverse impact to performance [50]. Additionally, since changing environmental conditions are not viewed as threats to be avoided, resilient organizations are optimistic toward change and capitalize on opportunities that arise from changing conditions [51 , 62]. Therefore, resilient organizations are more capable to anticipate change; there is an increased reliance on systems that facilitate disruption prevention and early detection, including the ability for a coordinated response among organizational members enabling quicker organizational response when disruptive change occurs [49]. Within the rapidly changing US higher educational sector, resilient institutions would be better prepared to cope and respond to radical change over threat-rigid institutions, possibly explaining the differences between failing and thriving institutional effectiveness.

4 Method

4.1 Participants

The study focused on self-reported responses from key college administrators (e.g., President, Vice President, Provost, etc.) from 141 smaller, private non-profit US higher educational institutions with fewer than 5,000 students who receive Title IV federal student financial aid funding were analyzed in the study. Limiting participants to college administrators was consistent with previous studies of the impact of organizational decline and higher educational research [67, 73]. The population was also limited to undergraduate-only US higher education institutions, as revenue generated from graduate programs have been shown to bolster revenue during organizational decline [64]. Institutions were selected using 2007–2012 institutional final-release data gathered from the Integrated Postsecondary Education Data System (IPEDS) national database, which was available from the National Statistics for Educational Statistics website.

4.2 Measures

Table 1 displays the twenty-eight direct and interactive measures analyzed in the study. These variables include organizational decline, institutional effectiveness, organizational response, organizational response interactions, organizational decline and organizational response interactions. The study also used two control variables of institutional age and institutional endowment.

A 60-item, 7-point scaled questionnaire was used to collect institutional administrator responses. Organizational rigidity included test items derived from Cameron, Whetten, and Kim’s threat-rigidity response model toward decline [67]. Organizational resilience included test items derived from Mallak’s instrument of organizational resilience [68]. Institutional effectiveness included test items derived from Cameron’s Nine Dimensions of Organizational Effectiveness instrument [70].

4.2.1 Organizational decline measure

The Organizational decline (OD) measure consisted of percentage change among sample institutions in revenue over a six-year period of time, ranging from 2007 to 2012. The IPEDS database was used to obtain institutional 2007–2012 revenue data. Institutional revenue data were adjusted for inflation using 2007 as reference.

4.2.2 Organizational response measures

Organizational response was measured using two separate measures: i.e., Organizational rigidity (RIG) and resilience (RES) response measures. Identification of the organizational response measures underlying structures relied on factor analysis, and used a correlational critical factor value of 0.60 or greater to identify significant loading for each factor [69].

4.2.2.1 Organizational rigidity measure

The organizational rigidity response measure reflected two summed scales derived from principal (exploratory) axis factor analysis of the study’s institutional sample responses using orthogonal (i.e., Varimax) rotation. Table 2 displays the results of analysis for the organizational rigidity response factors and summed scale labels. Specifically, the two factor labels used to denote organizational rigidity response summed scales were (1) Diminished innovation, morale, and leader credibility (RIG1) and (2) Increased scapegoating of leaders, interest group activities, and conflict (RIG2).

4.2.2.2 Organizational resilience measure

The organizational resilience response measure reflected three summed scales derived from principal (exploratory) axis factor analysis of the study’s institutional sample responses using orthogonal (i.e., Varimax) rotation. Table 3 displays the results of analysis for the organizational resilience response factors and summed scale labels. The three factor labels used to denote organizational resilience response summed scales were (1) Goal-directed solution seeking (RES1), (2) Avoidance (RES2), and Role dependency (RES3).

4.2.3 Institutional effectiveness measures

The institutional effectiveness measure reflected three summed scales derived from principal (exploratory) axis factor analysis of the study’s institutional sample responses using orthogonal (i.e., Varimax) rotation. Table 4 displays the results of analysis for the institutional effectiveness factors and summed scale labels. Three factor labels used to denote institutional effectiveness response summed scales were (1) Faculty and administration employment satisfaction (IE1), (2) Student personal development (IE2), and (3) Professional development and quality of faculty (IE3).

4.2.4 Control measures

Two controls were included in the study; i.e., institutional age and level of endowment. Institutional age was included to control for the potentially adverse impact that institutional age (e.g., liability of newness) has on institutional effectiveness [66]. The institutional age control variable was scaled as a single, continuous value of the institution’s age from year of initial founding to 2012. Institutional age data was obtained from a review of institutions’ historical sources (e.g., institutional website, course catalogs, etc.). The sample mean institutional age was 112.4 years (n = 141). Endowment was also controlled for due to the potential impact that slack resources have to curtail the adverse impact that organizational decline has on institutional effectiveness [65]. Endowment was measured in dollars at the end of 2012 as specified in the IPEDS database for each institution in the study.

4.3 Statistical analyses

The study used multivariate regression analysis to analyze the study’s nine direct and interactive effects. In each case, it was hypothesized that the independent variable(s) had a significant correlation to the designated dependent variable; i.e., p-value less than 0.05. The analysis framework showing the direct and interaction effects analyzed in the study is presented in Fig. 2.

Table 5 displays the five direct and three interaction effects analyzed in the study by effect, independent variable(s), and dependent variable(s) analyzed. The study was approved by the Institutional Review Board at a mid-sized, private university located in the southern United States; informed consent was obtained from all participants.

5 Results

5.1 Means, standard deviations, and correlations

Table 6 displays the means, standard deviations, and correlations for each of the variables examined in the study. A review of bivariate correlations revealed only three variables with correlations exceeding +/–0.50 (i.e., r = – 0.542, r = – 0.517, & r = 0.548), which were deemed a potentially moderate-level of multicollinearity. However, Tolerance and Variance Inflation Factor (VIF) scores obtained during regression analysis indicated no issues of multicollinearity.

5.2 Direct and interaction effect results on institutional effectiveness

The direct 1, 4, and 5 and interaction 1–3 effect results produced mixed results. Direct 1 result indicated that organizational decline (OD) did not significantly impact any of the institutional effectiveness (IE) summed scale measures. Direct 4 result showed that rigidity response – specifically diminished innovation, morale, and leader credibility (RIG1) – had a significant negative correlation with professional development and quality of faculty (IE3) (β= –0.325, p = 0.003). Direct 5 result indicated that resilience response–specifically, goal-directed solution seeking (RES1) – had a significant positive correlation with student professional development (IE2) institutional effectiveness summed scale (β= 0.228, p = 0.041). The role dependency (RES3) resilience response also had a positive significant on student professional development (IE3) institutional effectiveness summed scale (β= 0.203, p = 0.034).

Interaction 1 result revealed that organizational decline (OD) and diminished innovation, morale, and leader credibility (RIG1) rigidity response interaction had a significant positive correlation with student professional development (IE3) institutional effectiveness summed scale (β= 0.218, p = 0.049). Interaction 2 results showed that organizational decline (OD) and goal-directed seeking solutions (RES1) resilience response interaction had a significant positive correlation with student professional development (IE3) institutional effectiveness summed scale (β= 0.290, p = 0.022). The avoidance (RES3) resilience response also had a significant positive correlation with faculty and administrator employment satisfaction (IE1) institutional effectiveness summed scale (β= 0.231, p = 0.030). Interaction 3 produced no significant effects.

Interaction 4 revealed that organizational decline (OD), diminished innovation, morale, and leader credibility (RIG1) rigidity response, and avoidance (RES2) resilience interaction had a significant positive correlation with student professional development (IE3) institutional effectiveness summed scale (β= 0.200, p = 0.030). The organizational decline (OD), increased scapegoating of leaders and interest group (RIG2) rigidity response, and avoidance (RES2) resilience response interaction had a significant positive correlation with faculty and administrator employment satisfaction (IE1) institutional effectiveness summed scale (β= 0.242, p = 0.021). Model fit was significant for IE2 (F = 1.71, p < 0.05) and IE3 (F = 2.24, p < 0.01) institutional effectiveness summed scales.

5.3 Direct effect results of organizational decline on organizational response

Tables 7 and 8 display the direct effect results of organizational decline on organizational responses; i.e., Direct 2 and 3. Table 8 shows direct 2 result showed that organizational decline (OD) had no significant correlation to either rigidity response (RIG1 or RIG2). Table 8 shows direct 3 result showed that organizational decline (OD) had a significant negative correlation with role dependency (RES3) (β= 0.2.99, p = 0.011); however, model fit was not significant and this result should be viewed with skepticism.

5.4 Summary of findings

Table 9 displays a summary of the significant direct and interactive effect findings. Direct effect analysis revealed that rigidity response (RIG1) had a significant negative impact on institutional effectiveness (i.e., Direct 4 results); while resilience response had a significant, positive impact on institutional effectiveness (i.e., Direct 5 results). Interaction effect analysis showed that resilience response combined with organizational decline had a significant, positive impact on institutional effectiveness (i.e., Interaction 1, 2, & 3). Interestingly, resilience response had a positive influence on institutional effectiveness regardless of organizational decline consideration. Perhaps even more interesting, the interactive effect of organizational decline and rigidity response (i.e., Interaction 1 results) had a significant, positive influence on institutional effectiveness, which was opposite with the absence of organizational decline (i.e., Direct 4 results).

6 Discussion

The goal of the study was to discover why some US higher educational institutions appear to be more resilient at coping with organizational decline than other institutions operating within the same segment of the higher education sector. More specifically, what role does organizational resilience have in assisting smaller, private non-profit institutions to cope and remain effective during organizational decline? The dysfunctional effects of threat-rigidity response on institutional effectiveness among institutionsexperiencing organizational decline have been previously examined in the literature [67, 73]. What has not been examined is organizational response that contributes to sustained institutional effectiveness during organizational decline. Therefore, the study focused primarily on the effects that organizational resilience response had on sustaining institutional effectiveness during organizational decline.

6.1 Threat-rigidity response

Study findings related to the direct effect of organizational decline on institutional effectiveness (i.e., Direct 1) were consistent with previous research findings. Specifically, organizational decline, by itself, does not significantly affect institutional effectiveness [67, 73]. However, prior findings that threat-rigidity response negatively moderated institutional effectiveness were not entirely supported in this study [73]. Specifically, the interaction between organizational decline (OD) and the rigidity response of diminished innovation, morale, and leader credibility (RIG1) had a significant, positive correlation with the institutional effectiveness measure of professional development and quality of faculty (IE3) (i.e., Interaction 1). Contrasting Direct 4 and Interaction 1 results suggests that in the absence of organizational decline, the threat-rigidity response negatively moderate institutional effectiveness; however, when organizational decline is present, the moderation effect reverses.

A possible reason for the apparent contradictory findings may correspond to differences in how institutions interpret and communicate organizational decline conditions to its institutional members. Under the traditional perspective of threat-rigidity response, administrators tend to hunker-down, become turf-protective, constrict communications, and adopt efficiency-focused responses to organizational decline conditions [42]. In these instances, institutional members’ perceive institutional actions defensively; whereas if the organizational decline condition was communicated differently (e.g., as an opportunity or rallying call to meet the challenge), perhaps even institutional threat-rigidity responses (e.g., diminished efforts toward innovation) might be interpreted as positive, even necessary, responses for dealing with organizational decline.

6.2 Resilience response

The study also found that organizational decline (i.e., Direct 3) had a significant positive correlation on role dependency (RES3). Role dependency suggests that administrative team members within resilient organizations are able to perform other team member’s roles, and interchange responsibilities during times of crisis [57]. This suggests that as the institution becomes increasingly aware of decline conditions, there is an increased concern for the importance of in-dividual team roles and their specific contributions to-ward effective response to the crisis situation [57, 58].

Study findings also revealed that students benefitted most from the direct effect (i.e., Direct 5) of organizational resilience (i.e., goal-directed solution seeking & role dependency). This is perhaps the most important finding in the study, particularly to higher educational institutions and their mission to educate and prepare students for future employment. Faculty and administrative staff members benefited most from the interactive effect (i.e., Interaction 2) of organizational resilience (i.e., goal-directed solution seeking & avoidance) during organizational decline conditions. This finding suggests that resilient higher educational institutions, when confronted with organizational decline, recognize the importance of their institutional members’ satisfaction, which has been found to contribute to resilience and turnaround[74, 75].

Organizational resilience has been empirically linked to improved employee relations during crisis conditions [49, 74]. The specific organizational resilience scale noted was avoidance, which represented the strategic choice to use slack financial reserves during a crisis, instead of relying on employee layoffs to preserve relational reserves, which was found to contribute to organizational resilience. Resilient organizations value and protect their relational reserves by strategically avoiding employee layoffs as a short-term fix for losses related to crisis situations such as organizational decline. Interestingly, Interaction 2 results validated the positive relational reserve effect; specifically, when organizational decline and avoidance interacted, faculty and administrators experienced increased satisfaction (i.e., IE1). Interaction 3 results also supported the use of avoidance by the significant, positive influence it had when interacting with rigidity response and organizational decline; i.e., faculty and administrators also experienced increased satisfaction (i.e., IE1), as well as increased professional development and quality of faculty (i.e., IE3).

6.3 Organizational resilience as an alternate response for coping with organizational decline

Currently, the US higher education sector is undergoing unprecedented change occurring at an ever-increasing rate [76, 78]. The rate of change is occurring faster than some institutions are able to keep up; especially smaller, private non-profit US institutions of higher education that are dependent on student enrollment to produce revenue. Unlike state-supported universities, smaller, private non-profit institutions must find new ways to cope with radical change and decline if they are to survive. Therefore, they need a more effective alternate to response to crisis and organizational decline if they are to survive and keep their doors open for the students they serve.

Based on findings from this study, organizational resilience provides administrators with an alternate approach in struggling to deal with the fallout associated with organizational decline. Specifically, study findings suggest that smaller, private non-profit US higher educational institutions confronted with organizational decline should rely on the organizational resilience response factors of Goal-Directed Solution Seeking and Avoidance. Goal-Directed Solution Seeking suggests that administrative team members enjoy improvising solutions to problems and consider multiple solution possibilities. Team goals guide individual goals, and team members understand each other’s team roles [57]. Working in tandem with Goal-Directed Solution Seeking is the Avoidance organizational resilience factor. Avoidance constrains the free-wheeling problem-solving process creating during Goal-Directed Solution Seeking. Specifically, it provides guidance and restraint to administrators’ decision-making process, which is of critical importance when the institution is confronted with crisis situations associate with organizational decline, including reduced concern for innovation, low employee morale, dropping leader credibility, increased scapegoating of leaders, heightened interest group awareness and increased conflict—all of which affect administrator decision making [41 , 73]. Avoidance enables administrators to keep the institution’s mission in mind when evaluating coping solutions, preventing hasty, knee-jerk reaction to multiple competing stakeholder interests that arise during organizational decline.

A recommended follow-up study would be to investigate faculty member and student perceptions of the role that organizational resilience factors play in sustaining institutional effectiveness during organizational decline. The present study findings provide only part of the story on the role that organizational resilience plays among US smaller, private non-profit higher education institutions sustain institutional effectiveness with organizational decline. By examining the perceptions of other key stakeholders (such as students, faculty members, even board members), more could be learned about the role that the factors of organizational resilience play in helping higher educational institutions more successfully cope with organizational decline and sustain institutional effectiveness.

Conflict of interest

The author has no conflict of interest to report.

Footnotes

Acknowledgments

I wish to express my appreciation to all institutional administrators who participated in the study.

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