The effect of environmental uncertainty caused by COVID-19 on structure and strategy change in organizations: Example of Mersin foreign trade organizations

This study examines the changes made by organizations on their structures and strategies in an environmental uncertainty that started with the Covid-19 pandemic. According to the contingency theory, the organization tries to survive by changing in order to adapt to the environment it is in. In this context, the organization affected by the environment will also be affected by the uncertainty of the environment. If the uncertainty in the environment is low, the mechanical structure and if the uncertainty is high, the organic structure will be the most suitable structures. In addition, environments with low uncertainty make it easier to keep costs under control because they are stagnant, and thus the cost leadership strategy is the most appropriate strategy for these environments. Conversely, in dynamic environments where uncertainty is high, with the view that creativity and innovation can put organizations ahead of the competition, the differentiation strategy is the most appropriate strategy for these environments. In the relationship between structure and strategy, cost leadership strategy is associated with organizations with a mechanical structure, while the strategy of differentiation is associated with organizations with an organic structure. In addition, when it comes to change in the organization, it is a widely accepted view that the organization first changes its strategy in accordance with the environment and then changes its structure in accordance with its strategy, that is, the structure follows the strategy. To assess whether the environmental uncertainty created by the Covid-19 pandemic has led to strategic and structural change as expressed in theory, 76 foreign trade companies, which are registered to Mersin Chamber of Commerce and Industry and are in the top 100 in the list of export transactions originating from Mersin port, with annual export sales of more than $10 million, were determined as the sample of the study. The primary data source was used in the study and the data were collected by the survey method. Simple linear and ordinal logistic regression analyzes were used in the analysis of the data obtained within the scope of the study. In addition, in order to interpret the results of the regression analyzes, qualitative interviews were conducted with the senior managers of 7 companies selected from the sample after the analyzes. According to the results of the study findings, while the increase in environmental uncertainty has a positive and significant relationship on the orientation of the organization to the differentiation strategy, it has no effect on the orientation to the cost leadership strategy. According to another result, there was a positive and significant effect on the orientation of the organization to the cost leadership strategy with structural change in the mechanical direction, while the structural change did not have a significant effect on the orientation to the differentiation strategy. Also, no significant effect of environmental uncertainty on structure change was observed. Finally, no significant relationship was found between the change in the strategy of the organization and the change in the mechanical direction of the organizational structure. According to the overall results of the study, it was observed that although the Covid-19 pandemic increased environmental uncertainty, the research sample did not undergo significant structural and strategic changes. However, organizations did not remain indifferent to change, tactically responded to change with temporary and instantaneous reactions, and did not realize sustainable permanent changes. The excessive increase in prices caused unexpected extraordinary profitability in the companies, and accordingly, the organizations stated that they did not see the change as necessary.