Flexible Strategies in VUCA Markets

273 Pages·2018·4.89 MB·English

by  Sanjay Dhir

Flexible Systems Management
Editors
Sanjay Dhir · Sushil
Flexible
Strategies
in VUCA
Markets
Flexible Systems Management
Series editor
Sushil
Department of Management Studies
Indian Institute of Technology Delhi
New Delhi, Delhi
India
Editorial Board
Gerhard Chroust, Institute for Telekooperation, Johannes Kepler University Linz,
Austria
Julia Connell, University of Newcastle, Newcastle, NSW, Australia
Stuart Evans, Integrated Innovation Institute, Carnegie Mellon University, USA
Takao Fujiwara, Toyohashi University of Technology, Toyohashi, Aichi, Japan
Mike C. Jackson OBE, University of Hull, UK
Rashmi Jain, Montclair State University, Montclair, NJ, USA
Ramaraj Palanisamy, St. Francis Xavier University, Antigonish, NS, Canada
Edward A. Stohr, Stevens Institute of Technology, NJ, USA
The main objective of this series on Flexible Systems Management is to provide a
rich collection of research as well as practice based contributions, from different
contexts, thatcanserve asreferencematerial inthis upcomingarea. Some ofthese
books will be published in association with ‘Global Institute of Flexible Systems
Management’. It will help in cross-fertilizing ideas from different perspectives of
flexibility so as to consolidate and enrich the paradigm of flexible systems
management. The audience for the volumes under this series includes researchers,
management students/teachers, and practitioners interested in exploring various
facets offlexibility research and practice. The series features five types of books:
(cid:129) Postconferencevolumescontainingpeerreviewedhighqualityresearchpapers
aroundathemeandclusteredinsub-themesthatcanactasgoodreferencematerial.
(cid:129) Contributed thematic volumes based on invited papers from leading profes-
sionals,fromacademiaaswellpracticingworld,containingstateoftheartonan
emerging theme.
(cid:129) Research monographs based on research work making a comprehensive con-
tribution to the body of knowledge.
(cid:129) Booksbasedonnovelframeworksandmethodologiescoveringnewdevelopments
thatarewelltestedandreadyforwiderapplicationinresearchaswellaspractice.
(cid:129) Business practices and case based books documenting flexibility practices,
strategies, and systems in real life organizations.
The series covers multiple perspectives of flexible systems management; some
leading ones, inter alia, are:
(cid:129) Holistic management of organizational paradoxes with systemic flexibility:
including various connotations such as ambidexterity, adaptability, responsive-
ness, openness,customization,localization, agility,vitality, sustainability,etc.
(cid:129) Business agility infused by new information and communication technologies:
including volatile and virtual business, developments in information and com-
munication technologies generating IT agility such as cloud computing, social
networking, knowledge based systems, search technologies, mobile transac-
tions, business continuity, disaster recovery, etc.
(cid:129) Managing innovation, strategic change and risk: including strategic change,
confluence of continuity and change, strategic flexibility, strategy execution,
innovation in products/services, processes, management practices, and strate-
gies, business dynamics, business uncertainty and associated risk, etc.
(cid:129) Flexibility in various operations for achieving business excellence: including
organizational flexibility, financial flexibility, manufacturing flexibility, infor-
mation systems flexibility, marketing flexibility, operational and supply chain
flexibility,technologymanagementflexibility,flexibilityinbusinessexcellence/
maturitymodels,etc.
More information about this series at http://www.springer.com/series/10780
Sanjay Dhir Sushil
(cid:129)
Editors
Flexible Strategies in VUCA
Markets
123
Editors
SanjayDhir Sushil
Indian Institute of Technology Delhi Indian Institute of Technology Delhi
NewDelhi, Delhi, India NewDelhi, Delhi, India
ISSN 2199-8493 ISSN 2199-8507 (electronic)
Flexible Systems Management
ISBN978-981-10-8925-1 ISBN978-981-10-8926-8 (eBook)
https://doi.org/10.1007/978-981-10-8926-8
LibraryofCongressControlNumber:2018939930
©SpringerNatureSingaporePteLtd.2018
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Preface
Volatility, uncertainty, complexity, and ambiguity (VUCA) strategies were intro-
duced by the US Army War College to define the result of the cold war that was
characterized by more volatile, uncertain, complex, and ambiguous multilateral
world (Kinsinger and Walch 2012). Across many industries, a rising tide of
volatility,uncertainty,andbusinesscomplexityisstirringmarketsandchangingthe
nature of competition (Doheny et al. 2012). Corporate firms are not being run as
usual. CEOs are dealing with immense VUCA in their decision-making process
(GehrkeandClaes2017).StrategicflexibilityinVUCAmarketsisacompulsionfor
businessleaders forsustaining theadvantageinmarketandattainingaclearvision
amidstthechaos(Sushil2017).Businessleaderswhostayfocusedandareawareof
external volatility as the prevalent characteristic will be the winners. Business
leaders will lose if they are not flexible in this VUCA world and lock themselves
intofixedpositions(Horneyetal.2010).Globalizationhascreatedopportunitieson
theonehandasithasintroducedthreatsontheother.Thestubbornglobalrecession
has blunted repeated bursts of optimism for the return to a path of prosperity
(Bennett and Lemoine 2014). The global challenge of digesting technological
advancements that impact industry, as well as the consequences of demographic
shifts in the workforce, has enhanced the competitive pressure on the leaders and
strategic flexibility, and thus becomes utmost essential and necessary for firms to
succeed in this new normal (Horney and O’Shea 2015). Recognizing and then
addressing the myriad factors that can threaten organizational performance is not
gettinganyeasier(Lawrence2013).ItisaVUCAworld,afterall.Inthisscenario,
companieshavebeenobligedtopreparetheirstructures,cultures,andmanagement
methods to compete in this volatile, uncertain, complex, and ambiguous environ-
ment we have had to live in.
The chapters in this book were selected from papers presented at the
“International Conference on Strategies inVolatile andUncertain Environment for
EmergingMarkets”heldatIndianInstituteofTechnologyDelhiduringJuly14–15,
2017.Theconferenceaimedtoencouragediscussionsaboutresearchandstrategies
foraddressinguncertaintyandtheopportunitiescreatedbychangesintheemerging
markets. We invited empirical/conceptual/working research papers and also case
v
vi Preface
studies/modelsfortheconference.Theconferencewasabletoattractcontributions
from top universities and institutions across the world and India. The conference
received 245 research papers from various countries. Research papers were sub-
jectedtostringent peerreview.Withanacceptancerateof52%,finally128papers
were presented at the conference that were again reviewed and organized in the
formofthiseditedvolume.Thisvolumeisintendedtoserveasavaluablereference
material in the area offlexibility in VUCA markets. The selected chapters cover a
variety of issues concerning the theme of VUCA markets and are organized into
following four parts:
I. Innovation in VUCA Markets
II. People and Processes in VUCA Markets
III. Financial Management in VUCA Markets
IV. Leadership and Strategies in VUCA Markets
Part I on the topic of innovation in VUCA markets incorporates five chapters.
Chapter 1 isby Kumbhatand Sushil and is titled Development Stages and Scaling
Issues of Startups. The chapter has proposed a development model with multiple
dimensions for early-stage start-ups. The comprehensively presented framework
enables quantitative identification of development stages. Also, the framework
spots imbalance in particular development dimensions and puts forward remedies
for the same. Chapter 2 in this part is Flourishing Innovation Through
Organizational Initiatives: An Analytical Study by Chaubey and Sahoo. The link
between organizational initiative and innovation with respect to competitiveness is
explored in this chapter for the automobile industry. Mediation by employee
creativity has been integrated and a conceptual model developed to have a
methodologicalapproachtowardorganizationalinnovation.Theresultssubstantiate
theroleofinitiativesforcreativeengagementandsustaininginheavycompetition.
Chapter 3, Patent Landscape for Indian Biopharmaceutical Sector: A Strategic
Insight, by Lahiry and Rangarajan throws light on the patent landscape at the firm
level.Usageofavarietyofpatentindicatorsandmultiplefactor-basedanalysishas
resulted in a thorough understanding of the role of patents in shaping Indian
bio-pharmaceutical sector, the premise of this study. Chapter 4, Geographical
Clustering and Quality of Subsidiary Innovation in a Developing Economy, is an
effort to understand the impact of clustering on quality of subsidiary innovation,
particularly in a developing country like India. Written by Betaraya, Nasim and
Mukhopadhyay,itisbasedonthecomparisonofpatentdataoftwosemiconductor
design companies in India and reflects on clustering as a moderator in the impacts
of subsidiary age, internal network, and local knowledge spillover on innovation
quality. The last chapter of this part, Corporate Governance and Innovation, is
written by Sharma, Jhunjhunwala and Sharda. This chapter looks into the role of
corporate governance in encouraging R&D activities in firms. The presence of
independent directors was found to be pivotal in the decision-making of firm,
especially through their active participation in board meetings.
Preface vii
Part II, comprising of five chapters, contains discussions on the people and
processes in VUCA markets. The first of these, Disability Inclusion, identifies
factors which facilitate successful inclusion of disabled people. These insights, by
HeeraandMaini,arerelevantforstakeholdersdesigningeffectiveinclusionpolicies
for under-represented diverse workforce. The next chapter, Effective Policing in a
VUCAEnvironment:LessonsfromaDarkNetwork,interestinglyusesacasestudy
approach to identify the effective counter-strategies for Maoists. Rich insights by
Gupta and Gupta are provided about Maoists’ organizational design and peoples
practices which sustain them in a VUCA environment. This chapter, thus, makes
important contributions to theory and practice. Chapter 8, Effect of Gender on Job
Satisfaction Among Academicians, deals with whether the gender of academicians
affects the job satisfaction level of university academicians. The study by Sachar
has been conductedin public and privateuniversities andidentifies certain factors,
which,furtheranalyzed,revealhighersatisfactionamongfemaleteachers.Chapter9,
TrainerEngagementVersusTrainerTurnoverRatio,focusesonreductionoftrainer
turnoverratiointheIndiantraininginstitutes.Therootunderlyingcauseshavebeen
identified by Prasad, Sekar, Bharani and Vignesh, and various improvement mea-
sureswereevaluatedbyanaudit.Thestudythuscontributestoreducetheemployee
attrition rate in the technical training department, and the same can be horizontally
deployed to serve as standards for other institutions. The last chapter of the second
part, Supply Chain Strategies to Sustain Economic and Customer Uncertainties, is
written by Sinha and Dey. The chapter is purposed to establish a system dynamics
model for studying economic volatility and customer’s buying behavior impacts on
supply chain of passenger car firms. Supply chain managers can carry out policy
experimentation using this framework. The study also addresses the economic
instabilities coupled with changing customer preferences.
Part III deals with financial management in VUCA markets, and comprises of
fourchapters.Chapter11,ProbingTime-VaryingConditionalCorrelationBetween
CrudeOilandSensex,iswrittenbySiddiquiandGaur.Itstudiestheco-movement
ofcrudeoilpricesandvolatilityspilloveraffectonstockmarketandUSD–INRrate
of exchange. The Sensex is found to have a significant cross-volatility spillover
impact on USD/INR and other exchange rates. This study, due to its significant
practical implications, is particularly helpful for portfolio managers. Chapter 12 is
titled Corporate Strategies: Evidence from Indian Cross-Border Acquisitions and
authored by Jain, Kashiramka and Jain. The short-run performance of Indian firms
doing cross-border acquisitions is examined in this chapter. Significantly positive
butabnormalreturnsareindicated.Thisisamodestadditiontotheextantliterature
on cross-border acquisitions. Strategies for Formulating Financial Stability
Criterion to Face Challenge of Uncertainties into Energy Sector is Chap. 13 and
written byGhosh.Thefinancialstabilityofanelectricityutilitysystemisanalyzed
in a short- and long-term perspective by evaluating tier performance. The chapter
also reflects on the role of technology diffusion as a catalyst in restoring organi-
zations’stability.ThelastchapterofthispartisChap.14,ImpactofOpenOfferson
Shareholders’Wealth,writtenbyVermaandMittal.Thischapterhasfocusedon31
viii Preface
open offers announced in India during the period 2015–2017. Excessive abnormal
returns were found to occur in the phase post-announcement which reaffirms the
prior literature. The learning enables shareholders’ understanding of generating
significant returns.
Thelastpart,i.e.,PartIV,includeslastfivechaptersofthebookanddealswith
leadership and strategies in emerging markets. Chapter 15—Leadership Styles in
the VUCA World, Through the Eyes of Gen-Z—is written by Dabke. It studies the
leadership dynamics of Gen Y managers by assessing how emotional intelligence
and transformational leadership styles are linked. The results are from the per-
spective of Gen Z followers’ expectations. Chapter 16 is on Leadership in VUCA
Environment by Chawla and Lenka. It has studied two different leadership styles,
transformational and resonant, in terms of suitability for the higher education
institutes’ survival in VUCA world. The results indicate higher impact of resonant
leadershipandthecomparativedifferencesamongthetwostyles,whichcanbeused
byacademicianstoachievehigher forms ofleadership.Chapter 17,WhyDoSmall
Brands Decline? A Perspective on Indian Apparel Market, is by Arora and
Banerjee. The reasons driving decline of small brands in clothing segment is
reflected upon in this chapter. The reasons covered are diverse and range from
inappropriate marketing programs to quality and price issues. Relevant recom-
mendations are made for entrepreneurs and managers for enhanced understanding
of Indian branded apparel market. Chapter 18 is Non-tariff Barriers on
International Trade Flows in India by Kumar and Arora. The chapter determines
the linkage between non-tariff barriers and international trade barriers. Most of the
identified factors were found to have a positive influence on trade generation.
Hindrances to trade creation are also discussed, thus providing a holistic under-
standinginadditiontoitspracticalityduetobeing basedonprimarydata. Thelast
chapter of Part IV is Chap. 19, Employer Brand and Its External Perspective, by
SharmaandPrasad.Thischapterdealswithvariousdimensionsofemployerbrand
that attracts the potential employees in IT sector. The exploratory and conclusive
natureofresearchmakesarelevantadditiontotheexistingliterature.Eightclubbed
dimensionspresentedaddtotheunderstandingofemployerbrandinIndiancontext.
Insummary,thevariouschaptersinthisbookillustratetheconceptofVUCAin
the context of emerging markets. As many of the authors point out, concepts of
volatilityanduncertaintyhavelongbeenattheheartofmanyofthecoreparadigms
used in strategic management to understand competitive advantage as well as
flexibility in organizational boundaries. Increase in the levels and types of uncer-
tainty potentially has important implications for the durability offirm advantages,
thewayfirmslearnandadapt,approachesformanaginginnovationandknowledge,
and the attractiveness of different strategies and organizational models. The edited
book is intended to provide a conceptual framework of “flexibility in volatile,
uncertain, complex, and ambiguous markets” supported by research projects/case
applications and models in various related areas. Given the range of topics, con-
texts, and methods used to analyze the integration of flexibility across VUCA
markets,itisexpectedthatthisvolumewillbeausefuladditiontotheliteratureon
thetopicaswellasapracticalresourceforpractitioners.Ingeneral,itisanticipated
Preface ix
that this edited volume on Flexible Strategies in VUCA Markets will provide a
useful resource for a variety of audiences such as: management students and
researchers, practicing business managers, consultants, professional institutions,
and corporate organizations.
Finally, we would like to thank all of the authors and reviewers who helped to
bring this volume to a reality. In particular, we would like to thank Rejani Raghu,
Veethica Smriti, and Nakul Parameswar who effectively communicated with the
authors and reviewers as well as helped to format the final manuscript.
New Delhi, India Sanjay Dhir
Sushil
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