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Project titleLearning from the COVID-19 pandemic: strategic behavior of small- and medium-sized enterprises in the time of crisis

AffiliationFederal State Budgetary Educational Institution of Higher Education "Saint-Petersburg State University",

Research area 08 - HUMANITIES AND SOCIAL SCIENCES, 08-157 - Economics of entrepreneurship, organization and management of enterprises

Keywordssmall- and medium-sized enterprises, entrepreneurial firms, entrepreneurship, pandemic, COVID-19, crisis, strategy, strategic behavior, innovations, sustainability, entrepreneurial resources, leadership

Annotation
The COVID-19 pandemic is unprecedented in terms of its impact on society, business and the economy. Small and medium-sized enterprises (SMEs) were susceptible to negative effects of the coronavirus crisis, due to significant restrictions imposed on their activities in order to reduce the frequency of social contacts and contain the spread of the virus. Additionally, the ongoing epidemic is leaving an imprint on consumer behavior and is poised to change the way that firms engage with their stakeholders. As a result, in addition to seeking government support, SMEs are forced to look for new models of strategic behavior aimed at maintaining their competitiveness in a difficult external environment as well as to find and leverage new entrepreneurial opportunities that often arise during crises. This study is devoted to identifying the most effective patterns of SMEs’ strategic behavior in times of crises, taking into account a number of aspects of the organizations’ external and internal environment. The project will be implemented within a framework that includes three main research directions, corresponding to different levels of analysis: 1) Firm level study of the different aspects of SMEs’ strategic behavior of their relationship with firm performance; 2) Macro-level investigation to identify macro-environment factors that can have a formative influence on business strategies during crises; 3) Individual level study to identify the role of leaders and their personal characteristics in the process of developing and implementing strategy to deal with the consequences of crises that SMEs face. This comprehensive study is relevant and important because it will inform others about how best to develop the entrepreneurial sector, which is the most important factor shaping a country's economic well-being. Additionally, due to the increased complexity of business conditions caused by COVID-19, which may affect both the supply and demand side over the long term, it is more important than ever to determine the basis for stable development and formation of SMEs’ competitive advantage. The scientific novelty of this research agenda, its tasks, and results can be summarized by considering the project’s unique ability to: - clarify the concept of strategic behaviour of entrepreneurial firms in the context of the new business environment caused by the COVID-19 pandemic; - develop theoretical models of the relationship between the innovativeness of the company, agile approaches to resource management, focus on sustainable development, as well as the personality traits of an entrepreneur with the results of business in a crisis; - develop theory of entrepreneurship in the context of the increased uncertainty of the external environment and the need to respond to modern global challenges; - develop an integrated approach to assessing the factors that influence a company's stability amid adverse environmental conditions, taking into account the organizational, individual and macro levels of analysis; - determine the factors that can influence not only the overall level of firm performance in crises, but also its variability; - identify and assess national and global trends in the development of entrepreneurial activity during and after the COVID-19 pandemic.

Expected results
The anticipated main results of the project include the following: 1. Develop a suitable methodology for comprehensively studying the strategic behaviour of small and medium-sized enterprises during crises, taking into account several levels of analysis. The proposed methodology can be further used to conduct new research on entrepreneurship and develop scientific knowledge in this area. 2. Identify the key aspects of SMEs’ strategic behaviour in unfavourable environmental conditions. Specifically, the project will uncover the theoretical and empirical justification of factors that aid SMEs in increasing their performance as well as aid them in enhancing their sustainability efforts in times of crises. These results will contribute to the development of both national and international research on entrepreneurship by clarifying the mechanisms that SMEs leverage to respond to crisis situations, as well as how they effectively adapt to changes in the business environment. 3. Identify macro-environmental factors that create conditions that help companies cope with the consequences of crises in effective ways. These results can be used to create and adapt programs to support small businesses during periods of crisis, taking into account the specifics of the economic context and market conditions. Furthermore, the practical significance of the project lies in the development of recommendations for managers of small and medium-sized enterprises that can be used to determine strategies for business development during and after the COVID-19 crisis, as well as crises in general, in order to maintain high levels of resilience to environmental influences. Moreover, the results of the project include publications, presentations at conferences and research meetings planned for the years 2021-2024: 1. Publication/acceptance for publication of at least 8 papers in top-tier academic journals indexed in Scopus or Web of Science databases (or an equivalent with a focus on journals included in the first quartile (Q1) by the impact factor JCR Science Edition or JCR Social Sciences Edition, by SJR). 2. Publication/acceptance for publication of at least 3 research papers in a top-tier academic journal indexed in the RSCI database. 3. Preparation of at least 9 conference papers for presentation at the leading international conferences (of the scope and level of Academy of Management, Strategic Management Society, Research in Entrepreneurship and Small Business conferences). 4. Conducting at least 3 research seminars to discuss the results of the research project. The research team executing the project will include young scientists and doctoral students from leading international research and educational institutions. The members of the research team have experience cooperating internationally to implement research projects as well as publish research results in high-ranking international journals. Thus, international cooperation and the relevant experience of the research team members are critical to ensuring the completion of the project and that its anticipated results will meet international standards for academic research.

Annotation of the results obtained in 2021
This research project is devoted to a comprehensive evaluation of different strategic behavior modes implemented by small and medium-sized enterprises (SMEs) during the COVID-19 crisis as well as to analysis of various factors able to shape development of SMEs in dynamic external environment. The project is implemented within a framework that includes three main research directions, corresponding to different levels of analysis: 1) Firm level study of the different aspects of SMEs’ strategic behavior of their relationship with firm performance; 2) Macro-level investigation to identify macro-environment factors that can have a formative influence on business strategies during crises; 3) Individual level study to identify the role of leaders and their personal characteristics in the process of developing and implementing strategy to deal with the consequences of crises that SMEs face. At the first stage of the project implementation, literature review on several relevant topics was conducted, such as (1) innovative ambidexterity and organizational resilience; (2) “flexible” approaches to the resource management; (3) SMEs’ sustainability orientation; (4) influence of CEO personal traits on firm performance; (5) gig and sharing economy, entrepreneurship and development of small and medium firms; (6) response of countries and regional governments to catastrophic events (including COVID-19 pandemic). In addition, theoretical models and research hypotheses were developed on a number of topics outlined above, and the empirical testing was carried out. As a result, at the first stage of the project implementation, two articles were published/accepted for publication in high-ranking journals indexed by WoS/Scopus and RSCI: 1) Bogatyreva K., Verkhovskaya O., Makarov Yu. (2021). A springboard for entrepreneurs? Gig and sharing economy and entrepreneurship in Russia. Journal of Entrepreneurship in Emerging Economies, ahead-of-print. https://doi.org/10.1108/JEEE-03-2021-0128. The journal is indexed in Scopus Q1 in Economics, Econometrics and Finance (miscellaneous) (2020). Impact factor SJR (2020) = 0,645. Scopus Cite Score (2020) = 3,6. URL: https://www.emerald.com/insight/content/doi/10.1108/JEEE-03-2021-0128/full/html The link to the news about the publication at the website of Graduate School of Management, St. Petersburg University: https://gsom.spbu.ru/all_news/event2022-01-17/ 2) Smara R. (2022). Innovation in times of crisis: A systematic literature review and future research directions. Vestnik of Saint Petersburg University. Management, forthcoming. Indexed in RSCI, 2-year impact factor (2020) = 1,152. In addition, three more manuscripts were prepared and submitted for consideration to leading international journals indexed by Scopus/WoS and included in the first quartile. The research team members presented seven papers in order to discuss the interim results of the project at five international conferences. 1) Two conference papers: Bogatyreva K. “Who is John Galt? From rational egoism to social responsibility through entrepreneurial passion” and Smara R., Bogatyreva K., Laskovaia A. “Balancing in crisis? Exploring the impact of innovative ambidexterity on SMEs’ performance during COVID-19 pandemic” were presented at the 8th International GSOM Emerging Markets Conference 2021, October 4-12 2021, St. Petersburg, online. 2) Two conference papers: Bogatyreva K. “Who is John Galt? From rational egoism to social responsibility through entrepreneurial passion” and Smara R., Bogatyreva K., Laskovaia A. “Balancing in crisis? Exploring the impact of innovative ambidexterity on SMEs’ performance during COVID-19 pandemic” were presented at USASBE 2022 (United States Association for Small Business and Entrepreneurship), January 5-9 2022, hybrid. 3) A conference paper: Smara R., Bogatyreva K., Laskovaia A. “Innovative ambidexterity and technological uncertainty: Performance implications for SMEs during COVID-19 crisis” was presented at ACERE 2022 (Australian Center for Entrepreneurship Research), February 8-11 2022, hybrid. 4) A conference paper: White J., Borgholthaus, C., Gupta V.K. “We are part of the same team: The influence of governor discretion on post COVID-19 small business openings” was presented at Small Business Institute 46th Annual Academic Conference, February 25-26 2022, online. The paper has won the “Best theoretical paper award”. 5) A conference paper: Keplinger K., Van Wagoner H.F. “Opening the black box of CEOs: The influence of leader’s personality on firm performance during COVID-19” was presented at the Anniversary Conference of the German Academic Association of Business Research, March, 8-11 2022, online. As a part of the first stage of the project implementation organized a round table “Entrepreneurship and SMEs’ strategic behavior at the time of crisis” was organized and a research seminar for graduate students and researchers from St Petersburg University to discuss the preliminary results of the project was conducted.

Publications

1. Bogatyreva K., Verkhovskaya O., Makarov Yu. A springboard for entrepreneurs? Gig & sharing economy and entrepreneurship in Russia Journal of Entrepreneurship in Emerging Economies, 15 (4), 698-726 (year - 2021) https://doi.org/10.1108/JEEE-03-2021-0128

2. Smara R. Innovation in times of crisis: A systematic literature review and future research directions Вестник СПбГУ. Менеджмент, 21 (3), 429–471 (year - 2022) https://doi.org/10.21638/11701/spbu08.2022.305

Annotation of the results obtained in 2022
This research project is devoted to a comprehensive evaluation of different strategic behavior modes implemented by small and medium-sized enterprises (SMEs) during the COVID-19 crisis as well as to analysis of various factors able to shape development of SMEs in dynamic external environment. The project is implemented within a framework that includes three main research directions, corresponding to different levels of analysis: 1) Firm level study of the different aspects of SMEs’ strategic behavior of their relationship with firm performance; 2) Macro-level investigation to identify macro-environment factors that can have a formative influence on business strategies during crises; 3) Individual level study to identify the role of leaders and their personal characteristics in the process of developing and implementing strategy to deal with the consequences of crises that SMEs face. At the second stage of the project implementation, literature review on several relevant topics was conducted, such as 1) digitalization of small and medium enterprises and their reliance on big data; 2) sustainable development of SMEs in the times of crisis; 3) innovative ambidexterity as an adaptation strategy to challenging environmental conditions; 4) business model adaptation by SMEs in crisis; 5) SMEs’ dynamic capabilities and their impact on firm performance; 6) effectuation as a decision making logic in crisis; 7) entrepreneurial opportunity recognition. ). In addition, theoretical models and research hypotheses were developed on a number of topics outlined above, and the empirical testing was carried out. As a result, at the second stage of the project implementation, four articles were published/accepted for publication in high-ranking journals indexed by WoS/Scopus and RSCI: 1) Smara R., Bogatyreva K., Laskovaia A., Van Wagoner H.F. (2022) “Does Striking a Balance Pay Off? Implications of Innovative Ambidexterity for SMEs during COVID-19 Crisis.” Journal of Entrepreneurship in Emerging Economies, ahead-of-print, https://doi.org/10.1108/JEEE-05-2022-0139. The journal is indexed in Scopus Q1 in Economics, Econometrics and Finance (miscellaneous) (2021). Impact factor SJR (2021) = 0.577. Scopus Cite Score (2021) = 4.6. 2) Borgholthaus, C.J., White, J.V., Markin E. & Gupta V. (2022) “Venture creation in the aftermath of COVID-19: The impact of US governor party affiliation and discretion”. Small Business Economics, ahead-of-print, https://doi.org/10.1007/s11187-022-00705-7. The journal is indexed in Scopus Q1 in Business, Management and Accounting (miscellaneous) и Economics and Econometrics (2021). Impact factor SJR (2021) = 2.630. Scopus Cite Score (2021) = 10.7. 3) Aray Yu., Bogatyreva K., Verkhovskaya O. (2023). “Sustainability orientation of entrepreneurs: From intentions to actions”. Russian Management Journal (accepted for publication). The journal is indexed in the RSCI and Web of Science Core Collection - Emerging Sources Citation Index. RSCI 2-year impact factor (2021) = 1.667. WoS JCR = 0.13 (2021). 4) Smara R., Bogatyreva K. (2023). “Moving to ambidextrous organization: A systematic literature review”. Vestnik of St. Petersburg State University. Management (accepted for publication). The journal is indexed in the RSCI, 2-year impact factor (2021) =1.522. In addition, seven other manuscripts were developed and submitted for consideration to leading international and national journals indexed by Scopus/WoS and RSCI. The research team members presented eight papers in order to discuss the interim results of the project at five international conferences. 1. Aray, Yu., Bogatyreva K. White J. “Linking sustainability orientation of SMEs to performance level and variability: The role of regional non-profit organizations”; Laskovaia A., Grigoryeva Yu., Bogatyreva K. “Effectuation strategy as a response to pandemic crisis: The case of manufacturing industry”, 9th International GSOM Emerging Markets Conference, October, 4-8, 2022, online. 2. Bogatyreva K. “Linking post-materialism to opportunity recognition: The role of entrepreneurial self-efficacy”, European International Business Academy (EIBA) Annual Meeting, December, 8-10, 2022, Oslo, Norway. 3. White J., Aray Yu., Bogatyreva K. “Linking sustainability orientation of SMEs to performance level and variability: The role of regional non-profit organizations”, Australian Center for Entrepreneurship Research Exchange (ACERE) Conference, February, 6-10, 2023, Brisbane, Australia. 4. White J., Aray Yu., Bogatyreva K. “Linking sustainability orientation of SMEs to performance level and variability: The role of regional non-profit organizations”, The 5th International Conference on Organization and Management (ICOM) 2023, February, 22-24, 2023, Abu Dhabi, UAE. 5. Verkhovskaya O. , Aray Yu., Bogatyreva K. “Sustainability orientation of entrepreneurs: From intentions to actions”; Laskovaia A., Grigorieva Yu. “Effectuation as crisis-coping strategy: textile industry during pandemic”; Bogatyreva K., Aray Y., White J. “Linking sustainability orientation of SMEs to performance level and variability: The role of regional non-profit organizations”, XXIV Yasin (April) International Academic Conference on Economic and Social Development, April, 4-14, 2023, Moscow, Russia. As a part of the second stage of the project implementation organized a round table “Entrepreneurship in Russia: 15 years of research” was organized, wherein the results of the project were presented as a part of long lasting entrepreneurship research tradition of St. Petersburg State University. In addition, a research seminar for graduate students and researchers to discuss the preliminary results of the project was conducted. Finally yet importantly, the research team has conducted a practice oriented session with entrepreneurs “SMEs: developmental strategies in the VUCA-world” at the annual student conference “Management of the future”.

Publications

1. Aray Yu., Bogatyreva K., Verkhovskaya O. Ориентация предпринимателей на устойчивое развитие: от намерений к действиям Российский журнал менеджмента, 21 (2), 143-163 (year - 2023) https://doi.org/10.21638/spbu18.2023.201

2. Borgholthaus C.J, White J.V.,Markin E., Gupta V.K. Venture creation in the aftermath of COVID‑19: The impact of US governor party affiliation and discretion Small Business Economics, 61, 655–674 (year - 2022) https://doi.org/10.1007/s11187-022-00705-7

3. Smara R., Bogatyreva K. Moving to ambidextrous organization: A systematic literature review Вестник Санкт-Петербургского университета. Менеджмент, 22 (2), 191–225 (year - 2023) https://doi.org/10.21638/11701/spbu08.2023.203

4. Smara R., Bogatyreva K., Laskovaia A., Van Wagoner H.F. Does striking a balance pay off? Implications of innovative ambidexterity for SMEs during COVID-19 crisis Journal of Entrepreneurship in Emerging Economies, принята к публикации (year - 2022) https://doi.org/10.1108/JEEE-05-2022-0139