Accentuating the concept of management under uncertainty in the Uppsala internationalization process model, the purpose of this paper is to develop a model for describing how managers act while keeping uncertainty at an acceptable level.
The authors perform two empirical studies to underpin the model they construct. First, a survey of 309 chief executive officers and chief financial officers in large, publicly listed international firms in the Nordic region on managerial risk perceptions and, second, a case study of Volvo Car Corporation and its endeavors when developing new car models for the Chinese market on a new platform – a process characterized by unprecedented uncertainty.
The proposed model describing managers’ behavior under uncertainty contains elements such as adjusting/proceeding in small steps, reducing uncertainty via learning, building relationships with important parties in the environment to avoid unforeseen changes and re-dos (i.e. starting all over again) and, perhaps most important, acting despite uncertainty.
The paper highlights a central, though forgotten, concept of the Uppsala internationalization process model, i.e. management under uncertainty, and, thereby, opens a new path for research on how manager behave under the sway of uncertainty.
Vahlne, J.-E., Hamberg, M. and Schweizer, R. (2017), "Management under uncertainty – the unavoidable risk-taking", Multinational Business Review, Vol. 25 No. 2, pp. 91-109. https://doi.org/10.1108/MBR-03-2017-0015
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