Discussion paper

DP15987 Management practices and resilience to shocks: Evidence from COVID-19

Do organizational practices help or hinder the firm's capacity to adapt to a changing environment? We use the spread of COVID-19 in Italy, the first Western country hit by the pandemic, to investigate the role of structured management practices in responding to a large shock. We find a sizable, positive effect of structured management practices on firm performance: a one-standard deviation increase in the management score reduces the drop in year-ahead expected sales by 30 percent. Evidence points to the fact that firms with more structured practices were more likely to implement a comprehensive set of changes, such as demand, supply chain and labor management, including more intense use of remote work.

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Citation

Schivardi, F, A Linarello and A Lamorgese (eds) (2022), “DP15987 Management practices and resilience to shocks: Evidence from COVID-19”, CEPR Press Discussion Paper No. 15987. https://cepr.org/publications/dp15987-0