An effectual approach to executing dynamic capabilities under unexpected uncertainty

Abstract

This study investigates how business-to-business (B2B) firms navigate contexts of unexpected uncertainty. Building on the theories of effectuation and dynamic capabilities, the study develops a model that highlights how effectual decision-making logic is manifested in the activities B2B firms employ to sense and seize new opportunities and threats and transform existing business operations. The qualitative data were collected in two phases (before and after the COVID-19 outbreak) and consisted of 24 interviews with 13 B2B firms. The findings demonstrate a strong reliance on managers' effectual decision-making in situations of unexpected uncertainty and provide a set of key activities that help managers to respond to such situations in a rapid and agile manner.