Entrepreneurs are not strangers to adversity. Making effective decisions in the face of adversity can be particularly challenging for entrepreneurs due to the inherent complexity and uncertainty of the entrepreneurial environment. Metaphorically speaking, when an entrepreneur is driving down a selected path and realizes that s/he is going the wrong direction, there are three basic decisions that can be made, other than quitting altogether. First, the entrepreneur can persist in the original direction and may even speed up. Second, s/he can slow down or stop, hoping to minimize the damage. Third, the entrepreneur may watch for signs, scan the landscape, or consult a map and then change direction. The first two options are portrayals of the oft-studied biases: escalation of commitment (Staw, 1976) and threat rigidity (Staw, Sandelands, & Dutton, 1981). The third option characterizes resilience. Resilience is “the capacity for adaptability, positive functioning, or competence following chronic stress or prolonged trauma” (Sutcliffe & Vogus, 2003). Though successful entrepreneurs are often depicted as resilient there has been little research about the cognitive processes that enable resilience in the face of adversity.
Holland, Daniel V.
"RESPONDING TO ADVERSITY: A METACOGNITIVE APPROACH TO RESILIENCE (SUMMARY),"
Frontiers of Entrepreneurship Research: Vol. 26
, Article 4.
Available at: http://digitalknowledge.babson.edu/fer/vol26/iss8/4