A microfoundations’ approach to understanding the effects of external and internal crises on job insecurity and performance

Purpose This study aims to examine how external and internal crises affect job insecurity and performance. It focuses on how organizational decline shapes behavioral responses in teams, particularly within more conservative higher education institutions (HEIs). Design/methodology/approach The analysis draws on survey data from 505 faculty members at privately funded HEIs in Brazil. Grounded in a microfoundations of strategy perspective, the study investigates the interplay between external crises (e.g. environmental shocks) and internal crises (e.g. threat rigidity), and their combined effects on job insecurity and self-assessed performance. Findings The findings highlight two central dynamics: organizational responses consistent with threat rigidity in the face of abrupt environmental change and the role of job insecurity in reducing individual performance. The study also clarifies how these elements interact, deepening understanding of crisis dynamics in the HEI context. Originality/value This research contributes to the literature on organizational decline by shifting from macro-level analyses to a microfoundational focus on how external and internal crises affect individual behavior. It offers a grounded understanding into the behavioral consequences of crises within the HEI sector.