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Managing Uncertainty: Firm Strategy and Structure

Special issue call for papers from Journal of Asia Business Studies

The submission portal for this special issue will open July 1, 2020.

Special Issue Editors:

Dr. Asda Chintakananda
NIDA Business School, Bangkok, Thailand
Email: [email protected]

Dr. Sanjay Kumar Singh
College of Business, Abu Dhabi University, Abu Dhabi, UAE
Email: [email protected]

Dr. David McIntyre
School of Business, Providence College, Rhode Island, USA
Email: [email protected]

Introduction
In recent years, the Asian region has attracted attention from scholars and practitioners due to its emerging status in the global economy. According to the International Monetary Fund (IMF), the Asian economy has experienced a high growth rate of five to ten percent over the past decade. Moreover, with Asia accounting for about sixty percent of the world’s population, the region will continue to be major force in the world economy. Yet firms operating in Asia face uncertainty on several fronts. For example, on the economic front, firms face fluctuations in their local currency, exchange rate volatility, evolving consumer trends, as well as spillover effects from other regions such as the US-Chinese trade war and Brexit (Cuervo-Cazurra, Gaur, Singh, 2019; Jebran, 2018). On the political front, firms face domestic political unrest, anti-government demonstrations, unstable governments, geopolitical tensions, fluctuating electoral prefectures, and uncertain electoral outcomes (Duanmu, 2014; Zhou & Poppo, 2010). On the social front, firms face ethnic and religious conflicts, continued poverty and rising income inequality, and lack of justice and human rights issues (Cuervo-Cazurra, DOz & Gaur, 2020; Doh, 2013). In addition to external uncertainty, firms operating in Asia also experience internal uncertainty on several fronts such as behavioral uncertainty with partners and task uncertainty within the firm (Kumar, Gaur, Zhan & Luo, 2019; Srinivasan, Mukherjee & Gaur, 2011) to name a few.

Such uncertainties can result in higher operating expenses, increased time commitment, and increased managerial burden, which in turn, may lead to a destabilizing effect on firms’ strategy, structure, and operations (Zhou & Poppo, 2010). Furthermore, such effects are likely to be more severe for Asian firms than multinationals in Asia, as Asian firms are particularly vulnerable given their dependence on foreign trade under a less developed market infrastructure (Gaur, Ma, & Ding, 2018).

Existing literature suggests that firms may respond to such uncertainty through deferral of actions and new capability development.  For instance, real options theory posits that economic uncertainty may force firms to defer or cut back their investments until the uncertainty subsides (Ragozzino, Reuer & Trigeorgis, 2016). Research on platforms suggest that how firms respond to uncertainty depends on the strength of network effects in the market (Chintakananda & McIntyre, 2014; McIntyre & Srinivasan, 2017). Relatedly, based on signaling theory literature Mukherjee, Makarius, and Stevens (2018) argue that under conditions of uncertainty, Asian firms utilize reputation as a social-approval resource to generate economic rents.

Transaction cost economics suggests that firms may rely on non-market strategies in order to help buffer their operations against the impact of political uncertainty (Doh, Lawton, Rajwani, 2012; Pattnaik, Lu & Gaur, 2019). Entrepreneurship research suggests that the ability of firms to capture and appropriate rent under uncertain conditions is contingent on how the firm’s entrepreneurial skills and organize their firms (Alvarez & Barney, 2005; Teece & Leih, 2016). Finally, literature on offshoring suggests that firms reorganize their internal resources and dynamic capabilities when faced with uncertainty (Mukherjee, Gaur, & Datta, 2013; Mukherjee, Lahiri, Ash, & Gaur, 2019).

Despite the existing literature, the majority of research on uncertainty focuses on the consequences of uncertainty, rather than how firms may actively plan for such uncertainty. In addition, several studies also suggest that the dynamics of uncertainty may not pertain to firms operating in Asia due its unique economic and political infrastructure, as well as its cultural practices and customs (Cuervo-Cazurra & Genc, 2008; Tan & Chintakananda, 2016). Indeed, Scalera, Mukherjee, and Piscitello (2018) show that when faced with idiosyncratic uncertainties, Chinese and Indian MNEs demonstrate differential behavior in their cross-border acquisition strategies. All this has heightened the need to understand how firms in Asia make decisions under uncertain conditions and cope with such decisions. Therefore, the aims of this special issue are to focus on: (1) The conceptualization of how local and multinational firms in Asia can proactively manage uncertainty through their strategy and structure; and (2) theorization concerning the types of activities that can be conducted to manage uncertainty.

Potential topics for the special issue
Papers should preferably investigate how firms are impacted by uncertain conditions, and/or how firms proactively manage uncertain conditions through their strategy, structure, and operations. We offer a few examples below to provide a sense of what this special issue seeks to address. These examples are illustrative and are not intended to be a set boundaries of topics for the special issue:

  • The mechanisms of uncertainty on country risk, firm strategy, structure, and operations,
  • How firms’ use non market strategies such as lobbying and bribery to manage the impact of uncertainty on their operations
  • The effect of different types of uncertainty on Asian firms’ membership and relationship in economic clusters (e.g., keiretsu, chaebol)
  • The differences between Asian managers and Western managers in observing and planning for uncertainty
  • The effect of national culture (i.e. uncertainty avoidance) on firms’ usage of real options with in coping with uncertain conditions
  • The kinds of market strategies that firms adopt in order to reduce the impact of evolving and uncertain consumer trends
  • The differences between SMEs, family firms, and multinationals in their reaction to, and ability to plan for and adapt to various uncertain conditions
  • The impact of the rise of technological platforms as well as technological uncertainty on firms’ strategic planning process
  • How uncertain conditions influence firms’ development and acquisition of capabilities and intellectual properties
  • The spillover of the effects of uncertain market conditions from one country to another country, as well as firms’ reaction and preventive measures
  • How different types of uncertainty impact firms’ geographic and product diversification strategies and outcomes
  • The impact of uncertainty on social networks between firms (i.e., dependence, social ties, and reciprocal relations)
  • How firms engage external stakeholders, such as politicians and regulators, to mitigate the impact of various sources of uncertainty
  • How managers perceive and respond to risk vs uncertainty through opportunity discovery and entrepreneurial judgement

Paper Development Workshop
The Editors of Journal of Asia Business Studies and the Guest Editors of the Special Issue plan to organize a Paper Development Workshop for this special issue in order to help submitting authors further develop their papers.  We will invite the authors of papers to submit their proposals to this Paper Development Workshop. Authors will be given the opportunity to present their paper/ideas, and receive comments from the Editors, Guest Editors, and workshop participants. This will help the authors in developing and refining their ideas to its full potential. The Paper Development Workshop will be held at NIDA Business School, Bangkok, Thailand on 10 January 2020. For those interested in attending, please send your inquiries to the Guest Editors at [email protected]

Submission Process and Deadlines
All manuscripts will be reviewed as a cohort for this Special Issue (SI). Manuscripts must be submitted by July 30, 2020 at https://mc.manuscriptcentral.com/jnlabs. All submissions will go through the JABS regular double-blind review process and follow the standard norms and processes. For more information about this Call for Papers, please contact the SI Editors.

Important Deadlines:
Paper submission: July 1 – July 30, 2020
Tentative publication date: Third quarter of 2021

References
Alvarez, S. A., & Barney, J. B. 2005. How do entrepreneurs organize firms under conditions of uncertainty? Journal of management, 31(5), 776-793.

Chintakananda, A., & McIntyre, D. P. 2014. Market entry in the presence of network effects: a real options perspective. Journal of Management, 40(6), 1535-1557.

Cuervo-Cazurra, Doz & Gaur, 2020. Skepticism of globalization and global strategy. Global Strategy Journal, forthcoming.

Cuervo-Cazurra, A., Gaur, A., & Singh, D. 2019. Pro-market institutions and global strategy: The pendulum of pro-market reforms and reversals. Journal of International Business Studies, 50(4), 598-632.

Cuervo-Cazurra, A., & Genc, M. 2008. Transforming disadvantages into advantages: developing-country MNEs in the least developed countries. Journal of international business studies, 39(6), 957-979.

Doh, J. P. 2013. Foreword to the special issue. The Journal of Corporate Citizenship, (50), 4-6.

Doh, J. P., Lawton, T. C., & Rajwani, T. 2012. Advancing nonmarket strategy research: Institutional perspectives in a changing world. Academy of Management Perspectives, 26(3), 22-39.

Duanmu, J. L. 2014. State-owned MNCs and host country expropriation risk: The role of home state soft power and economic gunboat diplomacy. Journal of International Business Studies, 45(8), 1044-1060.

Gaur, A. S., Ma, X., & Ding, Z. 2018. Home country supportiveness/ unfavorableness and Outward Foreign Direct Investment from China. Journal of International Business Studies, 49(3): 324-345.

Jebran, K. 2018. Volatility spillover between stock and foreign exchange market of China: evidence from subprime Asian financial crisis. Journal of Asia Business Studies, 12(2), 220-232.

Kumar, V., Gaur, A., Zhan, W., & Luo, Y. 2018. Co-evolution of MNCs and local competitors in emerging markets. International Business Review.

McIntyre, D. P., & Srinivasan, A. 2017. Networks, platforms, and strategy: Emerging views and next steps. Strategic Management Journal, 38(1), 141-160.

Mukherjee, D., Gaur, A. S., & Datta, A. (2013). Creating value through offshore outsourcing: An integrative framework. Journal of International Management, 19(4), 377-389.

Mukherjee, D., Makarius, E. E., & Stevens, C. E. (2018). Business group reputation and affiliates’ internationalization strategies. Journal of World Business, 53(2), 93-103.

Mukherjee, D., Lahiri, S., Ash, S. R., & Gaur, A. S. (2019). Search motives, local embeddedness, and knowledge outcomes in offshoring. Journal of Business Research. 103, 365-375.

Pattnaik, C., Lu, Q., & Gaur, A. S. 2018. Group affiliation and entry barriers: The dark side of business groups in emerging markets. Journal of Business Ethics, 153(4), 1051-1066.

Ragozzino, R., Reuer, J. J., & Trigeorgis, L. 2016. Real options in strategy and finance: Current gaps and future linkages. Academy of Management Perspectives, 30(4), 428-440.

Srinivasan, M., Mukherjee, D., & Gaur, A. S. 2011. Buyer–supplier partnership quality and supply chain performance: Moderating role of risks, and environmental uncertainty. European Management Journal, 29(4), 260-271.

Tan, B. R., & Chintakananda, A. 2016. The effects of home country political and legal institutions on firms' geographic diversification performance. Global Strategy Journal, 6(2), 105-123.

Teece, D., & Leih, S. 2016. Uncertainty, innovation, and dynamic capabilities: An introduction. California Management Review, 58(4), 5-12.

Zhou, K. Z., & Poppo, L. 2010. Exchange hazards, relational reliability, and contracts in China: The contingent role of legal enforceability. Journal of International Business Studies, 41(5), 861-881.