Purpose This study aims to explore how managerial contextual factors influence incumbent firms' technology choice in betting on inferior technology trajectories when facing complementary assets discontinuity – a contingency that has not been widely explored in previous research. Based on a qualitative case study, this study specifically examines why Sharp Corporation (a major Japanese solar PV company) chose to bet on amorphous silicon thin-film solar cell technology in the early 2000s, despite the rising dominance of crystalline silicon (c-Si) solar cells. Design/methodology/approach This study utilized an inductive approach to examine the triggers underlying an incumbent firm’s strategic adaptation to complementary assets discontinuity. Data were collected from a wide range of sources, including: (1) company archives, business magazines, newspaper reports, technical handbooks and historical books, (2) archival interview data from business magazines and newspapers and (3) semi-structured interviews with industry experts. Findings The key findings revealed a “resource deployment trap,” where decisions to increase the overall portfolio of multiple products (in this case liquid crystal displays and thin-film solar cells) led to management decisions betting on technologies with lower technical performance. Originality/value This study makes two specific contributions. First, the findings provide an illustrative framework that reveals triggers potentially crucial in explaining incumbent firms’ adaptation strategy, thus answering the call for more investigation into the drivers and mechanisms of incumbent firms’ adaptation strategy following complementary assets discontinuity. Second, while prior research has argued that synergies based on resource redeployment could be a key mechanism in response to complementary assets discontinuity (Cozzolino and Verona, 2022), this study offers new empirical insights by revealing a “resource redeployment trap,” where the pursuit of synergies may lead to suboptimal technological choices toward inferior options.
Purpose Research on corporate spin-offs has examined various factors contributing to the success of spin-off firms. However, how these firms manage their political environment remains largely unexplored. This study integrates the literature on corporate political strategy and corporate spin-offs to investigate the conditions under which spin-off firms engage in political strategy. Drawing on insights from both domains and grounded in resource dependence theory, the authors propose that capital intensity and research and development (R&D) intensity increase the likelihood of political engagement among spin-off firms. The authors also propose that organizational slack strengthens this relationship. Design/methodology/approach Using a sample of 205 corporate spin-offs from 2012 to 2022, the authors obtain data on these firms' lobbying expenditures and campaign contributions. Their financial information is retrieved from the COMPUSTAT database. The authors estimate the generalized least squares regression model. Findings The results demonstrate that capital intensity and R&D intensity are positively related to spin-off firms' engagement in corporate political strategy. Furthermore, the results also show that organizational slack strengthens the positive relationship between R&D intensity and spin-off firms' engagement in corporate political strategy. Originality/value This study offers new insights into how corporate spin-offs navigate their political environment as they pursue strategic and operational independence from their parent firms. The authors introduce corporate political strategy as a novel factor to understand the success of spin-offs in their external environments. Practically, for executives of spin-offs, the findings underscore that success after separation depends as much on managing external dependencies as on optimizing internal resources. Corporate political strategy can help spin-offs reduce uncertainty, gain legitimacy and secure access to valuable resources.
Purpose This study examines whether corporate governance mechanisms constitute necessary conditions for achieving innovation efficiency in the healthcare industry. Building on the view that boards are not merely control bodies but strategic resources that enable the implementation of complex innovation strategies, the study investigates which governance attributes must be present for efficient innovation to be feasible at all. Design/methodology/approach We apply necessary condition analysis (NCA) to assess whether board size, board independence, board gender diversity, board tenure and CEO duality represent necessary conditions for innovation efficiency, defined as the conversion of R&D investments into patented innovation outputs. NCA is suited to this purpose because it identifies minimum governance thresholds required for strategy execution rather than estimating average effects. Ceiling line estimation, permutation tests and bottleneck analysis are employed. Findings The results identify board independence as the only robust necessary condition for high innovation efficiency. Firms with low levels of independent directors are unable to reach higher innovation efficiency, regardless of their R&D intensity. Board size, gender diversity and board tenure exhibit weaker necessity patterns that do not withstand permutation testing, while CEO duality shows no necessity relationship. Bottleneck analysis reveals sharply increasing minimum thresholds for board independence as innovation efficiency rises. Originality/value This study advances corporate governance and innovation research by introducing necessity logic into the analysis of board mechanisms, reconceptualising innovation efficiency as a governance-relevant outcome and empirically demonstrating that board independence operates as a non-compensatory prerequisite rather than an average-effect driver.
Purpose The objective of this study is to propose a conceptual framework that presenting stages for a digital transformation from the integration digital leadership and digital dynamic capabilities. Design/methodology/approach To achieve this, the research conducted a systematic literature review, collecting 80 publications related to digital leadership, dynamic capabilities and digital transformation. Findings The results highlight that the three dimensions of digital dynamic capabilities enable a clear and progressive understanding of the stages an organization must go through to achieve digital maturity. Moreover, by integrating human, technical and strategic competencies through a digital leader, it becomes possible to develop and maintain dynamic capabilities that drive digital Transformation. Originality/value This research contributes to advancing the theoretical understanding of digital leadership and digital dynamic capabilities within the context of Digital Transformation, while also offering a practical stage for managers and leaders to align organizational capabilities, digital culture and technological innovation in addressing industry challenges.
Purpose Drawing on psychological contract theory, this study examines how organizational recessionary actions influence employee performance through psychological contract breach, and further investigates the moderating role of supervisor bottom-line mentality on the relationship between psychological contract breach and performance.Design/methodology/approach Data were collected through a time-lagged survey of 250 full-time employees in Pakistan and analyzed using partial least squares structural equation modeling.Findings Results reveal that psychological contract breach mediates the relationship between organizational recessionary actions and employee performance. Moreover, bottom-line mentality significantly moderates the relationship between psychological contract breach and performance.Originality/value This study contributes by identifying psychological contract breach as a mechanism through which organizational recessionary actions influence employee performance and by highlighting supervisor bottom-line mentality as a boundary condition on the psychological contract breach-performance relationship in austerity contexts.
Purpose This study provides a critical synthesis of the ESG literature by conceptualizing ESG orientation as a boundary-spanning organizational capability, rather than solely as a disclosure or compliance outcome. The analysis demonstrates that ESG orientation emerges from the interplay of multi-level drivers (micro, meso and macro) and serves as a central mechanism for translating institutional and stakeholder pressures into substantive sustainability practices, while reconfiguring organizational boundaries through expansion, integration, translation and contraction. Design/methodology/approach A systematic literature review (SLR) was conducted following PRISMA 2020 guidelines, using the Scopus database and focusing on English-language, peer-reviewed business and management journals. From 2,065 records, 84 articles were selected through iterative screening. Qualitative coding identified patterns in drivers, boundary dynamics and ESG outcomes, enabling theory-based conceptual integration. Findings ESG orientation functions as a boundary-spanning capability shaped by multi-level drivers, reconfiguring organizational boundaries to facilitate knowledge transfer, stakeholder collaboration and governance alignment. This transition enables firms to progress from symbolic to substantive ESG practices, resulting in financial, operational, innovation, competitive and legitimacy outcomes, contingent on the authenticity of implementation and organizational capabilities. Research limitations/implications The review is limited to Scopus-indexed, English-language studies and employs a conceptual synthesis without empirical triangulation, which restricts generalizability. Future research should incorporate empirical, multi-level and context-sensitive methodologies. Practical implications This study provides actionable insights for organizations seeking to implement ESG more effectively. ESG should be embedded as a strategic capability across core business processes rather than treated as a compliance or reporting function. Leadership plays a critical role in translating external ESG pressures into internal strategic intent through resource allocation, governance structures, and performance systems. Firms should also develop boundary-spanning mechanisms, such as cross-functional coordination and stakeholder collaboration, to facilitate knowledge transfer, innovation and legitimacy building. To avoid symbolic adoption, it is important to get multi-level drivers to work together. Performance evaluation should include both process-based and non-financial indicators as well as traditional financial metrics. Social implications This study highlights the broader societal role of organizations as active agents in sustainability transformation. By emphasizing ESG as a boundary-spanning capability, it underscores the importance of stakeholder integration and cross-sector collaboration in addressing complex environmental and social challenges. The findings suggest that authentic ESG practices can reduce greenwashing, enhance transparency, and strengthen institutional trust. For policymakers, the study implies that regulatory pressure alone is insufficient and should be complemented by initiatives that support capability development and collaborative sustainability ecosystems, particularly in emerging economies where institutional frameworks are still evolving. Originality/value This study advances ESG research by moving beyond static, disclosure-based approaches to provide a process-oriented, capability-driven explanation of ESG implementation. By integrating multi-level drivers with boundary dynamics, the study elucidates how ESG commitments are translated into substantive practices and outcomes and contributes a theory-building SLR that clarifies how boundary reconfiguration facilitates organizational integration and sustainability transformation.
Purpose Acquisitions and strategic alliances are alternative governance choices for managers. Despite a vast body of literature on the topic that has used different theoretical lenses, we lack a comprehensive synthesis of literature. Accordingly, the purpose of this article is to synthesize the extant literature on choosing between acquisitions and alliances, develop a synthesizing conceptual framework from the analysis of empirical findings, and offer important future research avenues. Design/methodology/approach We conducted a comprehensive review of the acquisition versus alliance literature to compare the empirical findings systematically. The insights drawn from the selected articles were then integrated into a unifying framework. Findings The review demonstrated while there is considerable body of research examine the choice between acquisitions and alliances, there is paucity of research examining the performance implications those. Originality/value This literature review presents an integrative framework that organizes empirical studies on alliance versus acquisition decisions and highlights promising avenues for future research.
Purpose Prior research on corporate venture capital (CVC) has primarily examined whether and how intensively firms invest, while paying limited attention to how firms determine the exploratory orientation of their CVC portfolios and how such decisions are shaped by competitive dynamics. Drawing on vicarious learning theory, this study investigates how competitors' explorative CVC investments influence a focal firm's explorative CVC strategy and when imitation gives way to strategic differentiation. Design/methodology/approach Using panel data from 1,485 Chinese listed firms from 2007 to 2021, we measure explorative CVC investments based on textual similarity between parent firms and portfolio ventures. Competitive relationships are identified through text-based business-scope similarity. Hypotheses are tested using two-way fixed-effects models. Findings Results reveal an inverted U-shaped relationship between competitors' explorative CVC investments and a focal firm's exploratory investment orientation. Firms initially converge with competitors' exploratory strategies due to informational and legitimacy benefits but diverge as exploratory intensity increases and imitation costs rise. Technological advancement weakens the imitation effect, while variation in competitors' investment tendencies shows limited moderation. The nonlinear pattern is strongest in industries undergoing technological change. Originality/value This study advances CVC research by shifting attention from investment intensity to portfolio orientation and highlighting competitive learning as a driver of exploratory investment. It also contributes to competitive dynamics and vicarious learning research by showing that firms' responses to competitors' exploratory investments are bounded and non-monotonic, involving a dynamic interplay between imitation and differentiation.
Purpose This study develops a configurational typology of resource allocation strategies in new ventures and examines how each type is associated with founder traits, organizational characteristics, and firm growth. Design/methodology/approach Using data from early-stage ventures in Korea’s high-tech manufacturing sector, we conduct a cluster analysis to identify distinct strategy types. We then use ANOVA and cross-tabulation to examine how founder traits and organizational characteristics differ across these types, and apply robust regression models to assess the associations between these strategy types and firm growth. Findings The analysis yields three major insights. First, cluster analysis identifies five distinct and statistically significant resource allocation typologies — R&D-Oriented, Broadly Allocated, Production-Focused, Marketing-Focused, and Management-Focused. Second, these typologies are systematically shaped by founder traits and organizational characteristics, indicating that early strategic behavior is imprinted by founding conditions. Third, although performance differences across configurations are not statistically significant, R&D-oriented ventures exhibit relatively stronger descriptive performance patterns. Research limitations/implications This study contributes to configurational theorizing within the resource-based view (RBV) by introducing a multidimensional typology that moves beyond the traditional broad-versus-focused dichotomy. By integrating insights from RBV, Organizational Imprinting Theory, and Upper Echelons Theory, the findings highlight how strategic typologies emerge from the interplay between resource decisions and founding-level attributes. While the sample focuses on Korea's high-tech manufacturing ventures, the typological framework provides a basis for comparative studies across sectors and regions. Practical implications Practically, this typology offers a diagnostic tool for entrepreneurs to assess strategic alignment across different resource allocation configurations. Social implications Policymakers and investors may also apply this framework to identify ventures with coherent internal configurations and develop tailored support programs aligned with each firm's strategic profile. Originality/value This study advances configurational strategy research by developing an empirically grounded typology of resource allocation strategies in new ventures based on observed capability-level investment patterns. Rather than relying on dichotomous classifications, it captures multidimensional configurations across R&D, production, marketing, and management. By linking these configurations to founder traits and organizational characteristics, the study integrates the Resource-Based View with Upper Echelons and Organizational Imprinting theories. The findings offer a diagnostic, non-causal framework for understanding strategic heterogeneity in early-stage ventures and provide a foundation for comparative research across contexts.
Purpose The literature on collaborative innovation for sustainability grand challenges is fragmented. This paper addresses this gap by providing a systematic, integrated, and critical review of the contemporary field. Design/methodology/approach A systematic literature review was conducted following Preferred Reporting Items for Systematic Reviews and Meta-Analyses (PRISMA) guidelines. The study synthesizes and critically analyzes 132 empirical papers (2021–2025) to map the field's forms, mechanisms, drivers, barriers, outcomes, methods, and theoretical underpinnings. Findings The synthesis reveals a shift toward digitally orchestrated ecosystems. Specifically, the study identifies three interdependent paradoxes driven by the complexity of sustainability: a governance paradox that balances algorithmic control with relational trust, a scale-and-impact paradox that reconciles local depth with systemic reach, and a participation paradox that balances inclusive legitimacy with efficiency. Research limitations/implications The review proposes a forward-looking research agenda to address the lack of longitudinal designs and the micro-macro divide. Practical implications The articulation of the three paradoxes offers actionable insights for practice and policy. It provides a realistic framework that helps leaders move beyond attempts to eliminate tensions and instead adopt ambidextrous strategies to manage the competing demands of control, participation, and scale. Originality/value This review provides a novel critical analysis rather than a descriptive inventory. The core theoretical contribution of this study lies in reconceptualizing the fragmented challenges of sustainability transitions as not isolated dilemmas. Instead, they are understood as three interdependent and persistent paradoxes: governance, scale, and participation. Collectively, these paradoxes form a self-reinforcing engine of tension that defines contemporary digitally orchestrated ecosystems.
Purpose This study examines why micro and small enterprises (MSMEs) continue to lag in adopting big data analytics (BDA) despite its widely recognized strategic value. Drawing on the unified theory of acceptance and use of technology (UTAUT), we analyze how performance expectancy, effort expectancy and facilitating conditions shape adoption intentions among 500 Brazilian business owners and managers in the retail sector, while accounting for the moderating roles of experience, task usefulness, and market competition. Design/methodology/approach A structured questionnaire was used in a telephone survey via an automated telephone center. The analysis, based on PLS-SEM, identifies the most relevant factors affecting the adoption of business data analytics tools. Similarly, a stepwise estimation strategy was implemented for assessing the direct effects of core UTAUT constructs and for evaluating the antecedents and interaction terms that significantly increase explained variance in IABDA. Findings Using PLS-SEM, the findings reveal a paradox: although performance expectancy strongly drives adoption intention, prior experience with data analytics reduces willingness to adopt, suggesting that familiarity may expose hidden implementation challenges rather than alleviate them. Contrary to dominant assumptions, effort expectancy does not significantly influence adoption decisions, indicating that perceived complexity is not a primary deterrent in this context. This suggests that resource constraints, such as budget constraints and the lack of specialized personnel, create barriers that hinder adoption despite prior familiarity with technology. Originality/value The study contributes to the literature by shifting the focus from structural barriers to cognitive and experiential mechanisms underlying technology adoption in MSEs. It highlights that adoption decisions are not solely driven by perceived benefits but are shaped by nuanced interpretations of feasibility, usefulness and prior experience. These insights offer important implications for policymakers and practitioners seeking to accelerate data-driven transformation in resource-constrained firms.
Purpose This study examines the direct effect of conscious leadership on organizational culture in small and medium-sized enterprises (SMEs) and tests whether higher purpose mediates this relationship, thereby advancing understanding of the micro-to-meso translation processes within conscious capitalism. Design/methodology/approach A cross-sectional survey of 115 Mexican SMEs was conducted. Data from senior executives were analyzed using partial least squares structural equation modeling (PLS SEM). Mediation was tested via bootstrapping with 5,000 resamples, and robustness checks addressed common method bias and predictive validity. Findings Conscious leadership has a strong direct effect on conscious culture (beta = 0.512, p < 0.001). Higher purpose partially mediates this relationship (indirect effect beta = 0.198, p = 0.007), revealing complementary behavioral and sensegiving pathways that together explain 55.1% of the variance in conscious culture. Practical implications SME leaders can embed higher purpose through purpose-based decision checklists, purpose-linked KPIs and stakeholder scorecards tracking safety, decent work and customer trust. Leadership development should train owner-managers as meaning makers skilled in sensegiving. At the policy level, existing SME training programs and public financing schemes could incorporate purpose-articulation modules at low cost, embedding ethical reflection into established support mechanisms without significant additional burdens. Originality/value Despite growing attention to conscious leadership and purpose, empirical research on how leaders shape culture in SMEs remains scarce - particularly in emerging economies such as Mexico, where strong founder imprinting and weaker formal institutionalization make leadership influence especially salient and observable. By theorizing and empirically testing higher purpose as a sensegiving mechanism, this study moves conscious capitalism toward greater explanatory rigor, offering a dual-pathway framework for cultivating ethical cultures through leadership enactment and purposeful institutionalization.
Purpose This paper introduces the concept of dynamic resource capabilities (DRCs) to explain how adaptive capacity can emerge from the structural and informational properties embedded within firms' resource architectures. Design/methodology/approach Drawing on the resource-based view, knowledge-based theory and evolutionary economics, the study develops a conceptual framework that reconceptualizes resources as active structural conditions shaping organizational adaptation. The framework identifies three mechanisms - resource cognition, resource complementarity and resource renewal capital - that together form DRCs. Findings The analysis suggests that adaptive capacity can arise not only from managerial agency but also from the configuration and interaction of resources within the firm. These mechanisms enable the recombination and renewal of resources, thereby supporting strategic renewal and sustained competitive advantage in dynamic environments. Originality/value The study extends the micro-foundations of dynamic capabilities by shifting attention from managerial-centric explanations of adaptation to the structural dynamics embedded within the resource architecture of the firm.
Purpose This conceptual paper looks at the influence of external drivers, regulatory pressure, competitive pressure, normative pressure and customer green demand on the adoption of eco-innovation. It further synthesizes the literature and makes a logical argument for the moderating role of organizational ambidexterity in these relationships. Design/methodology/approach The study is grounded in a dual-theoretical framework integrating institutional theory and the dynamic capabilities view. Institutional theory explains why external pressures compel firms towards eco-innovation, while the dynamic capabilities view elucidates how internal capabilities, specifically organizational ambidexterity, condition these responses. A systematic review of the existing literature is used to develop a set of testable propositions. Findings A conceptual paper proposes that all four external drivers have a positive influence on eco-innovation adoption. However, the strength of these relationships is not uniform and is significantly contingent upon a firm’s level of organizational ambidexterity. Firms that can simultaneously exploit existing operational efficiencies and explore new, sustainable practices (i.e. ambidextrous firms) are posited to be more effective at translating external pressures into substantive and strategic eco-innovation, moving beyond mere symbolic compliance. Originality/value This paper makes a distinct contribution by integrating Institutional Theory and the Dynamic Capabilities View to offer a more holistic explanation of eco-innovation adoption in an under-researched context. It moves beyond a direct-effects model by theorizing the crucial boundary condition of organizational ambidexterity. For practitioners, it underscores the importance of developing internal dynamic capabilities to navigate the complex landscape of external sustainability pressures effectively.
Purpose This study aims to identify and analyze the governance capabilities that enable organizations to strategically oversee algorithmic decision systems. The research examines how different governance mechanisms interact and influence each other within organizational settings. Design/methodology/approach A multi-stage research design was adopted. First, a systematic literature review was conducted to identify governance mechanisms associated with algorithmic decision systems. Second, an empirical survey was used to operationalize these mechanisms and validate their underlying structure using exploratory factor analysis (EFA). Finally, the fuzzy DEMATEL method was applied to examine the causal relationships among the validated governance capabilities and to distinguish between driving and dependent governance factors. Findings The results reveal that algorithmic governance operates through a set of interrelated organizational capabilities. Strategic oversight mechanisms, particularly board-level AI risk monitoring and AI governance committees, are key drivers of other governance practices. Procedural assurance mechanisms, such as algorithmic impact assessments and ethics-based auditing, play central roles in operationalizing governance oversight, while transparency, human oversight and organizational learning mechanisms function as dependent governance capabilities. Practical implications The findings provide guidance for managers seeking to design effective governance structures for algorithmic decision systems by emphasizing the importance of strategic oversight and institutional governance frameworks. Originality/value The study contributes by conceptualizing algorithmic governance as a sequenced capability system and empirically uncovering its causal structure.
Purpose This study examines when ESG communication enhances firm value and when its valuation effect weakens under different industry conditions.Design/methodology/approach We use textual analysis of 50,563 quarterly earnings call transcripts from 1,577 US firms to measure ESG communication and estimate fixed-effects models with industry competition, growth and turbulence as moderators.Findings ESG communication is positively associated with firm value on average, but this relationship weakens in highly competitive and high-growth industries, with heterogeneous effects across ESG dimensions.Originality/value This study extends prior ESG-firm value research by showing how investors interpret ESG communication and that its valuation consequences depend on industry competition, growth and turbulence.
Purpose This study aims to examine how target stakeholder networks, specifically alliances, venture capital backing and public ownership, shape the duration of the acquisition closing process. We focus on why some acquisitions take longer to close by highlighting the stakeholder complexity embedded in target firms. Design/methodology/approach Drawing on time compression diseconomies (TCD) theory, we develop hypotheses linking target stakeholder networks to closing delays and test them using a sample of USA biotechnology and pharmaceutical acquisitions. We employ Poisson regression models to examine how different forms of target stakeholder complexity influence time to close and whether prior ties between acquirers and targets moderate these relationships. Findings The results show that targets with more extensive stakeholder networks take significantly longer to close. Alliances, venture capital backing and public ownership each increase time to close by amplifying coordination demands, information-processing burdens and negotiation complexity. Prior ties between acquirers and targets mitigate some of these delays, suggesting that relational familiarity can reduce uncertainty and coordination frictions during the closing period. Originality/value This study advances mergers and acquisitions (M&A) research by examining acquisition closing time as a strategically meaningful outcome rather than a purely administrative delay. By extending TCD theory to the acquisition closing period, we identify target-side stakeholder complexity as a key driver of closing delays and show how prior relationships can offset time compression costs. In doing so, we offer a process-oriented perspective on M&A execution and demonstrate the value of TCD for understanding time-sensitive strategic transactions.
Purpose This study investigates how technological capabilities and green organizational culture influence firms’ sustainable performance using green knowledge management as a conversion mechanism in the context of Ethiopian industrial parks. It also examines the conditional role of government support in the relationship between technological capabilities and sustainable performance. Design/methodology/approach A quantitative cross-sectional survey was conducted among 331 managerial-level employees of firms operating in selected Ethiopian industrial parks. Structural equation modeling was employed to test the proposed relationships and evaluate mediating and moderating effects. Findings The results support the positive and significant effects of technological capabilities and green organizational culture on sustainable performance. Green knowledge management significantly mediates these relationships, indicating its central role in translating technological and cultural capabilities into sustainable outcomes. Government support, while positively associated, shows an insignificant moderating effect on the link between technological capabilities and sustainable performance. Research limitations/implications This study contributes to the literature by empirically integrating the resource-based view, knowledge-based view, and dynamic capability theory to explain the mechanisms through which green knowledge management fosters sustainability. The cross-sectional design limits causal inference, suggesting opportunities for longitudinal research. Originality/value This research advances the understanding of the interplay between technological capabilities, organizational culture, and sustainability by clarifying the mediating role of green knowledge management and assessing the contextual influence of government support in a low-income economy.
Purpose This study examines how actors engage in strategic sensemaking when institutional ambiguity persists rather than diminishes over time. While strategic management research typically assumes that strategic action occurs in environments that remain sufficiently interpretable for future-oriented judgment and sensemaking research often treats ambiguity as a temporary disruption requiring interpretive resolution, less is known about how strategic action is sustained when institutional signals remain fragmented, contradictory, and persistently ambiguous. This study addresses this gap by examining strategic sensemaking in a context of digitally mediated investment participation in Sri Lanka. Design/methodology/approach The study adopts a qualitative interpretive research design based on semi-structured interviews with ten individuals who participated in online pyramid schemes in Sri Lanka during a period of economic instability and fragmented regulatory oversight. Interviews were conducted primarily in Sinhala, translated into English, and analyzed using an inductive, process-oriented thematic approach to examine evolving interpretive patterns and strategic sensemaking processes. Findings The findings show that strategic action under persistent institutional ambiguity is sustained through four interconnected interpretive mechanisms: legitimacy construction, actionable plausibility maintenance, adaptive ambiguity management, and temporal recalibration. Rather than resolving ambiguity, actors rely on social trust, symbolic legitimacy cues, experiential validation, selective interpretation and iterative temporal adjustment to sustain future-oriented action in the absence of stable institutional certainty. Originality/value This study extends strategic management scholarship by showing that strategic action may emerge even when institutional environments remain persistently ambiguous rather than sufficiently interpretable. It contributes to sensemaking theory by shifting attention from episodic ambiguity toward ambiguity as a structurally embedded condition, and extends institutional void research by explaining how fragmented institutional environments reshape the interpretive foundations of strategic judgment.
