During the COVID-19 crisis, small and medium-sized enterprises (SMEs) in developing markets, marred by significant institutional voids, grappled with a perennial lack of resources. This article seeks to understand how these SMEs activated their dynamic capabilities to manage business relationships during different phases of the crisis. Relying on the social exchange theory and drawing on semi-structured interviews with 42 business-to-business (B2B) SME owners in Nigeria, we examine the relational governance mechanisms of dynamic capabilities for SMEs during the COVID-19 crisis. Our findings reveal 12 relational governance mechanisms of dynamic capabilities of B2B SMEs. Furthermore, we disaggregate these 12 mechanisms into 34 relational governance micro-foundational components and demonstrate their relevance for B2B SMEs during different stages of the COVID-19 crisis in Nigeria.
his article seeks to understand how SMEs in developing markets, marred by significant institutional voids, activate their dynamic capabilities1 to manage business relationships during the five distinct phases of the COVID-19 crisis (pre-crisis normality, emergence, occurrence, aftermath, and post-crisis normality).2 A crisis is a sequence of events that have severe negative impacts if not properly managed (Pedersen, Ritter, & Di Benedetto, 2020). Undoubtedly, the COVID-19 pandemic negatively affected societies and businesses worldwide (see, e.g., Pedersen et al., 2020; Cortez & Johnston, 2020; Obal & Gao, 2020; Zafari, Biggemann, & Garry, 2020). In response, governments created new rules and regulations at pace, and health emergencies dwarfed economic considerations. Indeed, the International Monetary Fund (International Monetary Fund, 2020) notes that the COVID-19 pandemic might have negative and unpredictable consequences similar to - or worse - than the 2008/2009 global financial crisis. Such a crisis has short- and long-term implications for firms' operations, whether marketing, sales, or production-related (Cortez & Johnston, 2020). For businesses, the challenges brought about by the COVID-19 pandemic are unprecedented, difficult, confusing, and require the interdependence
6.1. Theoretical implications
This paper aimed to answer the following research questions: (i) What are the relational governance mechanisms that SMEs operating in markets with significant institutional voids use to activate their dynamic capabilities during a crisis? (ii) What are the micro-foundations of the relational governance mechanisms during the different phases of a crisis? Our findings provided insights into the capabilities that SMEs in developing countries need in order to collaborate and manage their relationships. We also shed light on the relative importance of these relational governance mechanisms and how they vary during different stages of a crisis. Our theoretical contribution to B2B marketing theory is thus threefold. The first contribution is towards the relatively nascent field of crisis management in B2B marketing (see calls for research by, e.g., Pedersen et al., 2020; Cortez & Johnston, 2020). This study generates new insights on relational governance mechanisms that enable dynamic capabilities for B2B SMEs and their business exchanges during the COVID-19 crisis. Specifically, we reveal 12 relational governance mechanisms and 34 micro-foundational components of relational governance mechanisms of B2B SMEs operating in a developing country with institutional voids during a crisis. While prior research (e.g., Chesbrough, 2020; Klein & Todesco, 2021) examined crisis management relying on unitary higher-level constructs, this paper offers a multi-stage view of crisis management. The second contribution to B2B marketing literature is that we detailed the micro-foundational components of relational governance mechanisms used during the different phases of crisis management.