Looking back to the past
for the future: An entrepreneurial journey of Japanese small traditional inn
under COVID-19
Introduction
Crises/adversities affect all types of companies, but
companies cannot avoid the crises/adversities and are forced to respond to
them. In particular, the impact of crises/adversities on small and medium-sized
enterprises (SMEs), which have relatively scarce management resources (Woschke
et al. 2017), is immeasurable (Runyan 2006). However, there have been few
studies on how SMEs respond to crises/adversities (Herbane 2010; Runyan 2006),
although there have been some exceptional studies on natural disasters, especially
typhoon damage (Runyan 2006) and earthquake response (Smallbone et al. 2012).
We are now in the middle of the spread of COVID-19, which is raging globally,
and how SMEs are trying to overcome this situation is of interest to various
stakeholders surrounding SMEs.
Research
on how to overcome crises/adversities has been accumulated in the field of
entrepreneurship. The entrepreneurial process, in which entrepreneurs and
organizations try to bravely overcome such situations, has been explained using
concepts such as resilience (or resilience of entrepreneurship) and bricolage
response (Branicki et al. 2018; Bullough et al. 2014; Corner et al. 2017;
Gilbert-Saad et al. 2018; Senyard et al. 2012; Smallbone et al. 2012; Williams
et al. 2017). Many of these SMEs are in a situation of crises/adversities due
to the impact of COVID-19, and are called in question how to overcome this
situation. If it is possible for SMEs to overcome the situation through their entrepreneurial
process, the practices can be expected to bring important knowledge not only to
many other SMEs but also to policy makers.
Most
of the crises/adversities that have been examined in the field of
entrepreneurship are rather localized and require time to recover from, but
within a limited time span. However, crises/adversities vary widely (Doern et
al. 2019), and COVID-19 we are facing now has firstly a global pandemic, secondly
has a multifaceted impact as it requires people to limit their activities and
refrain from business activities, and thirdly, has a long-term, sustained
threat, which is different from previous crises/adversities.
This
paper describes how SMEs, as a field of entrepreneurship (Wiklund et al., 2011),
have tried to overcome the situation under COVID-19, keeping in mind the nature
of COVID-19, which is different from the crises/adversities that have been
mainly examined so far, from the perspective of the entrepreneurial process,
using a specific case of a SME and an entrepreneur. Through this process, it
will be revealed how SMEs have taken bricolage responses and how they have
demonstrated resilience, and why they have taken and demonstrated these
responses.
A
unique feature of this paper is that it describes the entrepreneurial process
in terms of an entrepreneurial journey (McMullen and Dimov 2013). COVID-19 has
been raging in many parts of the world since the beginning of 2020. The crises/adversities
of COVID-19 is still ongoing. This paper describes a specific case study of a
long-lived SME and entrepreneur in the accommodation industry in Japan. The
company was affected by COVID-19 expansion and had to close its business for a
few months, but although it later resumed its business, it had not completely
overcome COVID-19 situation. However, by describing in detail ga sequence of
eventsh (McMullen and Dimov 2013) over a period of time that a SME and an entrepreneur
have taken to overcome the actual impact of COVID-19, it will be revealed what
"events" were, and how and why they occurred.
Theoretical
Background
Entrepreneurial Resilience
The behaviors or attitudes of entrepreneurs who are
willing to face and confront situations such as crises/adversities is called gresilienceh
(Fredrickson and Tugade 2003). They are more specifically that entrepreneurs
anticipate, adjust, and respond to adversities (Williams et al. 2017). Here, ganticipateh
refers to what is likely to happen in the future and how to respond to it,
rather than to imagine it before it happens. While much of the research on
entrepreneurial resilience to date has focused on larger companies, even SMEs, which
are little considered to have crisis management(Herbane 2010; Runyan 2006), are
known to have exercised resilience and responded quickly to crises/adversities
(Branicki et al. 2018; Smallbone et al. 2012).
The
behaviors and attitudes of individual entrepreneurs have been found to be
important factors that led to the exercise of resilience in SMEs (Branicki et
al. 2018). They may have a strong and direct influence on the structure,
strategies, and outcomes of SMEs (Miller and Toulouse 1986). According to
Branicki et al. (2018) which qualitatively studied entrepreneurial resilience
in SMEs, the emotional and cognitive capacities of individual entrepreneurs are
important factors for SMEs to be resilient (Branicki et al. 2018). And, Branicki
et al.(2018) found not only that there is a link between individual
entrepreneurial factors and business organization, but also that firstly SMEs
have social connections, specifically family-like relationships with their
employees, which is also the organizational culture, secondly entrepreneurs are
reticent to planning and investment, instead have the value of autonomy and high
locus of control; and thirdly, even in uncertain situations, entrepreneurs feel
comfortable and they not only feel confident to be able to cope with
challenging events, but also take the opportunity, and fourthly, that they are gmuddling
throughh, are important for SMEs to be resilient (Branicki et al. 2018).
Bricolage Response
The first action taken by entrepreneurs in crises/adversities
is bricolage (Senyard et al. 2009), and the bricolage response is the response
to the crises/adversities (Gilbert-Saad et al. 2018; Senyard et al. 2012;
Williams et al. 2017). 2017). Lévi-Strauss (1966) described a bricoleur as
someone who uses "whatever is at hand," while bricolage means using
"whatever is at hand" in some cases. This concept of bricolage has
been used at individual entrepreneur and organizational levels in the research
field of business and management (Baker et al., 2003; Witell et al., 2017), and
more attention are paid to the capabilities of individual entrepreneurs or
organizations. Capabilities are processes, such as knowledge, skills,
abilities, and routines that facilitate access to and operation of management resources
(Teece et al. 1997).
Bricolage
has been paid attention recently in the research field of entrepreneurship.
Bricolage is embedded in a series of entrepreneurial process to create unique
opportunities and higher value for customers (Vanevenhoven et al. 2011), and in
this process, strategic combination of existing resources takes place (Baker
and Nelson 2005; Garud and Karnøe 2003) through the search for new resources
(Duymedjian and Rüling 2010: Sarasvathy 2009) for creating new business
opportunities. Here, internal resources are combined or linked to a variety of
external resources through networks, which is called "network
bricolage" (Baker 2007), and these networks include a variety of
relationships with business partners and communities, as well as relationships
in finance including government support, and it is pointed out the importance
of capabilities that can leverage these relationships (Kuckertz et al. 2020).
It has also been pointed out that capabilities demonstrating bricolage include,
in addition to links to external resources, firstly, saving resources, secondly,
handling available resources, and thirdly, recombining resources improvingly (Baker
and Nelson 2005; Moorman and Miner 1998a). However, it is pointed out that
because bricolage depends on a particular worldview, nature and organization of
knowledge, and on the existence of repertoires that have been built up over
time, and therefore constitutes a capability that is deeply embedded in the
organization, bricolage cannot be improvised (Duymedjian and Rüling 2010) and
bricolage response can also occur as part of even carefully pre-planned
processes (Baker et al. 2003; Baker and Nelson 2005; Miner et al. 2001).
Analytical Perspective
Looking at situations such as crises/adversities in
relation to entrepreneurial resilience, how entrepreneurs try to face crises/adversities,
and their feelings about the current and future state of themselves, their business
organizations, and their businesses, are important in demonstrating resilience.
However, there are factors that contribute to the demonstration of resilience:
the individual attributes of the entrepreneur and the organizational attributes
of the company. Assuming SMEs, the individual entrepreneur's attributes are
likely to influence the business organization, and the individual's attributes
can have an impact on their growth as a company (Delmar and Wiklund 2008;
Wiklund et al. 2007). However, with few exceptions (Branicki et al. 2018),
specific examination of how individual and organizational factors are related
to the demonstration of resilience is just beginning.
In
addition, the process of demonstrating resilience in entrepreneurs and business
organizations can be informed by the bricolage response taken as one response in
crises/adversities. In these situations, the improvisational aspect are tended
to focus on, but it has been pointed out that the bricolage response can be
taken as not only a improvisation, but also a pre-planned (Baker et al. 2003; Baker
2007; Moorman and Miner 1998a). In the context of crises/adversities, it is
important to understand how bricolage responses are taken and then developed
through the entrepreneurial process (Shepherd 2020), and what entrepreneurships
are like (Wiklund et al. 2011).
In
the following, a specific case of bricolage responses of a SME that lead to
resilience through the entrepreneurship process will be described. Bricolage
responses in crises/adversities are sometimes seen as "actions" in
response to them. However, depending on the type of crises/adversities, the
bricolage response may persistently be taken a period of time in the situation.
In this way, when crises/adversity persists, the entrepreneurial process must
be viewed within a period of time. Therefore, in this paper, from the
perspective of the entrepreneurial "journey" focusing on the temporal
flow (McMullen and Dimov 2013), it will be examined how responses through the
entrepreneurial process are taken in the temporal flow under crises/adversities
through a long-living Japanese inn, located in Kyoto City, Kyoto Prefecture,
Japan.
Research
Setting
Status of COVID-19
Infection in Japan and Kyoto Prefecture
In Japan, the first report of COVID-19 by the
government (Ministry of Health, Labor and Welfare)[1] was issued
on 6 January 2020. The second report was issued on 7 January, the third on 10 January,
and the fourth on 14 January. On 16 January, the first case in Japan was reported
in Kanagawa Prefecture. The fifth report was issued on 20 January, and
"Outbreak of pneumonia related to a new type of coronavirus" was
reported 22 January. On 29 January, the plan of Japanese returning from
overseas on chartered flights was announced. And on 5 February, an infected
person was confirmed on board a cruise ship calling at the port of Yokohama,
and on 20 February, the deaths of two patients on board were reported.
As
COVID-19 infection spread in Japan in March, the government issued the first
emergency declaration against New Influenza on 7 April 2020, and requested
citizens to refrain from free movement and businesses to close their businesses
in seven prefectures[2]. On 16
April, six more prefectures[3],
including Kyoto Prefecture, were added to the list because they were expanding
in the same manner as the seven prefectures designated earlier. The
government's declaration of a state of emergency was fully lifted on 25 May as
the number of new infections decreased. But in July and November, the number of
new infections increased in Japan, COVID-19 is now once again raging, and the
spread of the infection is unstoppable. In this way, COVID-19 situation in
Japan is having a lasting impact, and the content is changing day by day.
@Although the above is the
situation for Japan as a whole, the spread of the infection varies depending on
the regional and temporal contexts (and furthermore, the nature of the impact
also varies depending on the industry and other business realities). The
spatial context refers to the geographical space where the crises/adversities
occurred. The temporal context refers to the situations leading up to the crises
or when the crises/adversities were faced. COVID-19 involves the spread of the infection,
but the context varies greatly depending on where (space) and when (temporal)
the situation took place.
The
SME as a case in this paper is located in Kyoto City, Kyoto Prefecture. The
first case of COVID-19 in Kyoto Prefecture was a woman who had stayed in China,
and was reported on 30 January. In March, the number of new infections in Kyoto
Prefecture gradually increased. The total number of newly infections in Osaka
Prefecture, which is next to Kyoto Prefecture, exceeded 100 by 28 February. Although
the number of newly infections in Kyoto Prefecture was relatively small, there
was concern about the spread of infection within the area where people come and
go relatively frequently. The Kyoto City Board of Education announced on 28 February
that all schools in Kyoto City would be temporarily closed from 5 March until 24
March (later, closed additionally from April 10 to May 6)[4].
The
spread of COVID-19 in Kyoto City became more serious when a group of students
from a university in Kyoto City, were infected with COVID-19 after returning
from a trip to Europe in early March. On 29 March, Kyoto City announced the
fact (the 27th to 30th cases, 4 students). These students also participated in
graduation celebrations and other events, and returned home to other regions,
causing the infection to spread over a wider area (11 prefectures). The number
of new infections in Japan increased rapidly from March 2020 (especially at the
end of the year), and Kyoto Prefecture took its own emergency measures on 17
April after the government declared a state of emergency and they were lifted
on 21 May 21, earlier than the government's lifting of the state of emergency.
Similar to the situation in Japan, the number of newly infections in Kyoto
Prefecture tended to increase in July and November 2020.
Research Method
The crises/adversities situations assumed in this
paper are uncertain and complex. The recognition of crises/adversities and the
creation of business opportunities in such situations depend largely on the
interpretation of the situation of individual entrepreneurs and business
organizations (Garud and Giuliani 2013). Therefore, the entrepreneurial process
under such situations has a unique context, and in order to unravel the
entrepreneurial process in a more concrete way, it is necessary to fit a
research approach that is appropriate for it (Blumberg et al. 2005; Gehman et
al. 2018). Therefore, in this paper, we adopt a narrative approach as our
research method (Berglund 2007; Garud and Giuliani 2013; Johansson 2004).
Specifically, a specific entrepreneur will be focused on, it will be conducted
interviews with the entrepreneur, collected data from the interviews, and
interpreted the meanings from the data.
This
interpretive approach has been adopted in several studies that assume a
situation of crises/adversities, not only in the fields of business and
management, but also in the fields of SMEs and entrepreneurship (Doern 2016;
Herbane 2010). Research approaches such as the narrative approach adopted in
this paper can provide a more concrete description of how "a sequence of
events" (McMullen and Dimov 2013) seen throughout the entrepreneurial
process unfolds over time (Corner et al. . 2017; Johansson 2004), hopefully
rediscovering things that were previously undiscovered or not considered to be
that important.
Case Selection
In this paper, Watazen Ryokan (inn) (hereinafter
referred to as Watazen), a long-living SME located in Kyoto City, will be taken
as the case. Similar to hotels, ryokan (inn) is a lodging business that
provides a place to stay and food, and is classified as a service business in
the Japanese industry classification.
Watazen
was established in 1830 (Edo period) (the company was reorganized as a limited
company in 1956), and has a history of 190 years as of December 2020. The
number of employees, including part-timers, is 40, making it a SME by law[5]. It
has 27 guest rooms, all of which are Japanese-style rooms. About half of the
annual number of guests are students on school excursions. School excursions
are one of the special activities conducted by Japanese schools in which groups
of students stay overnight, and are "activities that enable students to
broaden their knowledge and experience, become familiar with nature and
culture, and gain desirable experience of group life and public morality in a
different living environmenth. Plans and standards for implementation are to be
determined by the boards of education of local governments.
In
order to find SMEs that are willing to overcome the COVID-19 situation, a
questionnaire survey using Google Forms was conducted between 4 May and 24 May
2020. The survey was based on the situation one month after the declaration of
a state of emergency by the Japanese government, and 364 responses were
received from all over Japan. In the survey, several questions based on
previous studies were set, it was found that 44 responses met all of four pointed
out by Branicki et al. (2018), which are important in taking bricolage response
in crises/adversities. Watazen is one of these 44 responses.
Watazen
was directly affected by COVID-19, which calls for restrictions on people's
behavior. Watazen experienced a sharp decline in customers from March 2020 and
refrained from business for about three months from 8 April to 10 July after
the declaration of the state of emergency, with no prospect of sales. However,
even under these situations, the entrepreneur have tried to overcome the
situation by implementing various responses. In this paper, only one SME case,
Watazen will be focused on not only because Watazen is an "extreme
case" (Pettigrew 1990) in which Watazen tried to do practices even though
it refrained from business like other inns under the COVID-19 situation, but
also because it is possible to explain the uniqueness of the organization
driven by an entrepreneur (Martin et al. 1983) by exploring the personal
stories of an entrepreneur who lead corporate organization and how the
entrepreneur have thought, judged, and acted (Cope and Watts 2000; Perren and
Ram 2004), and by focusing on individual cases,.
Collecting Data
The information sources used in this study are mainly
the data obtained from interviews conducted by the author with Ms. Masayo Ono
(hereinafter referred to as Ms. Ono), the young proprietress of Watazen, as
well as primary information such as direct e-mails and messages exchanged with
the Ms. Ono. In addition to primary information, secondary information such as
blogs on the company's website, official Facebook accounts, and newspaper
articles were also collected. The term "young proprietress" refers to
the successor of the proprietor, while "proprietress" refers to the
female manager who is responsible for internal activities such as serving
guests at the ryokan (inn). Although the president of Watazen is Ms. Ono's
father, Ms. Ono is practically the successor manager of Watazen, and she is
also in charge of external activities.
The
interview by the author was conducted with Ms. Ono (young proprietress of
Watazen) using Zoom on 12 August 2020. The interview lasted 95 minutes, from
11:00 to 12:35. The questions were about the timing of the impact of COVID-19
and the response to it, specifically from late February 2020, when the COVID-19
infection was spreading, until 10 July, when it reopened for business, and
about a series of events by the young proprietress, Ms. Ono. The interview was
designed in a semi-structured way so that the interviewee could tell the real
story. The interviews ware taped and transcribed later and asked to Ms. Ono to
check for any factual errors. After the interview, the author frequently
communicated with Ms. Ono individually, and exchanged messages to collect
information on various points that needed to be confirmed in depth. It may be
pointed out that the time for conducting the interviews was insufficient as a
main method of information collection. But it was very limited to have enough
time for interviews because the situation of COVID-19 was unprecedented and
changing day by day.
Watazen
has a blog on its website and an official Facebook account, where it posts not
only what it has been working on since before COVID-19, but also images of what
was going on at the time, with Ms. Ono and other staffs directly communicating
their impressions. This information can be found as "a sequence of events"
(McMullen and Dimov 2013) under the influence of COVID-19, and was also used to
examine the case study. In 2015, Watazen was selected as one of the eight inns
in Japan to participate in a model for improving productivity of inns and
hotels. So Watazen is well known in the industry and has been interviewed in
many media, including the popular press and business and industry newspapers. These
existing public sources of information were also utilized.
Findings
The fact finding derived from the case study are the
following five points. Their contents are summarized in the table.
Table 1. The major bricolage responses of Watazen
under COVID-19
First,
as the COVID-19 situation worsened, it was observed that for a certain period
of time before and after the time when the company refrained from business
operations due to the declaration of the state of emergency (7 April 2020), the
company continuously practiced multiple bricolage responses by exploring and
combining internal and external resources through networks. The three main responses
taken by Watazen were (1) gTerakoya[6]h
(late February 2020), (2a) lunch project or (2b) provision of lunch boxes
(March-April 2020), and (3) summer festival (early July 2020). (1) gTerakoyah:
As COVID-19 expands in Japan, by late February 2020, schools will be closed in
Kyoto, and in order to address the fact that a part-time female employee with
children is no longer able to work, Ms. Ono, an entrepreneur, took care of the
local children in rooms at Watazen and purchased vegetables from a friend's
grocery store (network), provided them an educational service about the food
loss issue while serving food cooked by the innfs chef. (2a) lunch project or (2b)
provision of lunch boxes (March-April 2020): In March 2020, COVID-19 expanded
to Kyoto, and there was a series of cancellations of customers, and eventually
in April, the government declared a state of emergency, making it impossible to
operate. In spite of the situation, the entrepreneur wanted to offer skills of
a chef to the local people, so they worked together with the local ryokan
(inns) (network) to provide lunches and bento boxes (also in June). When
carrying the lunch boxes, they wore stuffed panda costumes, which was
appreciated by the local people, especially the local children. (3) Summer
Festival: In early July, as a series of local events were cancelled, sales at
nearby souvenir shops were also sluggish. Craftsmen from nearby traditional
industries even came to Watazen to express their concern. Together with these
local people, an entrepreneur and staffs in Watazen discussed internally what they
could do for the local people, and not only did they provide handmade games
based on the ideas of employees and food prepared by a chef, but they also pre-planned
a concert by a saxophone player and a craft experience by craftsmen from
traditional industries (network). As can be seen from above, it was observed
that the bricolage responses taken under COVID-19 are not just one of the
responses taken when the SME was unable to operate, but a chain of practices
that continue to be taken over a certain period of time before and after that
point in time, demonstrating resilience.
Second,
bricolage responses tend to be emphasized improvisation as its characteristic,
but Watazen took bricolage responses in both improvised and pre-planned ways in
the COVID-19 situation. The only improvisational response Watazen took under
COVID-19 was (1) "Terakoya" in the early stages of COVID-19's
expansion. Subsequent actions such as (2) lunch planning/provision of lunch
boxes and (3) summer festival were taken after pre-planned and prepared within
the organization. Thus, the bricolage responses observed in the case includes
improvised responses, but rather many pre-planned ones. The reason why Watazen
was able to plan these in advance and put them into practice even under
COVID-19 was because it had secured enough retained earnings to sustain its
operations even if it did not receive sales for at least six months, and also
because it was able to secure emergency loans from financial institutions as a
result of COVID-19 and additional loans in May when the situation became more serious,
and because it was accounted a half of the annual number of guests (school
excursions) were considered to be only postponed (and eventually cancelled).
gWhen
our business performance was not so good, we started by trying to keep at least
two months' worth of cash on hand, and since our tourism business was good, we
were able to keep at least six months' worth of cash on hand.h
gUnder
COVID-19, I borrowed another 100 million yen from A (name of the financial
institution). Actually, my main bank is B, and B asked me to borrow 30 million
yen, but that has stopped now.h
(The specific name of the financial institution remains anonymous by the
author.)
Third,
in the bricolage response that Watazen took under COVID-19, external networks were
utilized, but these external networks were not the everyday relationships for
an entrepreneur, but rather distant-relationships where there was little
contact before COVID-19. The situation brought together these distant-relationships
and an entrepreneur, leading to the discovery and creation of various business
opportunities. For example, (1) a Ms. Onofs attempt of gTerakoyah to provide an
educational service on the issue of food loss was triggered by contacting a
grocery store entrepreneur who was a friend of Ms. Ono from college. (2) Lunch
project was practiced jointly with the proprietresses of three inns which were
unable to open for business in the local area, and the mutual common desire of
the inns' entrepreneurs to do something led to the implementation of this
project. (3) Summer festival, when a craftsman from a traditional industry came
to Watazen to worry about the business, Ms. Ono heard that the craftsman was
good at workshops and she wanted to plan something together with the craftsman.
When the saxophonist was exploring for an opportunity to perform after his
concert was cancelled, Mr. Ono connected with the saxophonist through a friend
while she was considering planning a summer festival, which led to practice
summer festival project.
gI
called my friend who works at a grocery store and asked him what was going on
in the market, and he said that since school lunches are no longer offered,
there is a surplus of vegetables at the central market, which leads to food
loss. I'll buy the vegetables and our chef will cook with them, and we'll be
able to teach the children about the problem of food loss, while also providing
them with food education.h
gWe
have been connected with these inns for a long time, but I don't think we've
ever done anything together. I always thought that Watazen doing things on our
own is not interesting, so we want to involve others. In fact, we did a lunch
project with three inns in the neighborhood, including ours. It was like a
lunch stroll each other.h
gAlthough
a saxophonist who had no more work because all his concerts had been canceled,
I knew him through my friend and asked him if he could play at the summer
festival, then he approved.h
Fourth,
whether improvised or pre-planned, Watazenfs bricolage responses were driven by
the entrepreneur's desire to ensure that Watazenfs employees would continue to
work vigorously for the company. For example, (1) "Terakoya" was
created so that local women with children could continue to work due to the
closure of schools because of COVID-19, but the direct impetus for implementing
gTerakoyah came from a consultation with a part-time female employee who was
unable to come to work. Since about half of Watazenfs annual guests are
students on school excursions, a certain number of female employees must be
secured, and their main job is to work at the front desk in the early morning,
they arise a problem that they cannot continue working and leave the company
after they get married and have children. This has been a problem for female
employees for some time. In addition, (2b) the provision of bento lunches,
which was implemented after the declaration of the state of emergency, was
undertaken to alleviate the anxiety that employees might have due to the
absence of work, although they have time during the holidays. During the period
when they were requested to stay at home due to the expansion of COVID-19, they
took turns coming to work, but only once a week. Even though they only worked
once a week, some of them arrived late, in some cases forgot to go to work, and
even got sick and missed work. Ms. Ono believed that these employees might not
be able to work elsewhere when Watazen was no longer able to hire them, so Ms.
Ono thought she had to take care of them on their own. Therefore, she wanted
them to feel the joy of working. This reveals the entrepreneur's inclusive attitude
to management, by preventing the sudden loss of jobs during crises/adversities,
which would leave some employees at a loss with no other place to work.
gThe
moment I got the information that school would soon be closed, one of my
part-time workers told me that she couldn't come to work because her child's
school was closed. I thought there must be a lot of mothers like that in local
society, so I decided to take care of children and did it.h
gI
think this accommodation industry is very unique, but since we deal with school
excursions, there are restrictions such as only women staff are allowed on the
floor with female students. This was not the case before. When women come to
work here after their graduations, they quit when they get married. The reason
is that check-in and check-out are morning and evening jobs, and those are the times
when mothers are needed the most at home. So even if they get married and
continue to work, they tend to quit when they have children. Even if I wanted
to switch to daytime work, there are only a few posts available.h
gThere
are a certain number of members who are very worried about us, and I think that
if they lose their jobs with us, they'll be in trouble. I am very worried about
those people. We need to protect those "easy-going" people who
probably won't be able to survive if they quit us.h
Fifth,
under COVID-19, the main customers to whom Watazen provides services have changed.
Specifically, about half of Watazen's annual guests were students on school
excursions, but as the effects of COVID-19 became more serious and school
excursions were postponed (or even cancelled), Watazen shifted to providing
services to local people. (1) Terakoya, (2) Lunch/Bento, and (3) Summer
Festival, which they were taken under COVID-19, all target local people
(children). Particularly, (2b) lunches were brought by children dressed in
panda costumes, because Ms. Ono wanted to make local children, who were feeling
stressed during the self-restraint period, happy to see a panda.
"Everyone
was under a lot of stress during the self-restraint period, so when they went
to the park and saw the pandas, I wanted them to forget about their personal
lives and their stress, even if just for a moment. I felt that what we were
doing, which seemed like a ridiculous thing to do from other people, was making
people so happy.h
Ms.
Ono said above because when the state of emergency was declared due to the
expansion of COVID-19 and new bookings were stopped, Mr. Ono realized that the
large number of school excursions he had accepted was not something to be taken
for granted.h
gThe
fact that we now have the time to do this makes us all realize that those busy
days were not the norm, but truly 'thankful daysf. And I think it's a chance
for us to start doing more detailed hospitality, which we wanted to do before
but couldn't.h (https://bizhint.jp/report/417086)
In
addition, Ms. Ono is grateful for the cooperation of the local community in
hosting the school excursion students, and believes that he must repay the
community for their support. Ms. Ono came to this conclusion because of her
experience with the "Tempura Night" project, which she had made on
regularly once a year since 2015. In "Tempura Night," the chef fried
tempura right in front of the customers and offered them freshly at a low
price. Initially, this had been a project aimed at foreign tourists, but most
of the customers who came to Watazen were Japanese, and some were university
students living nearby. Seeing how happy the local people were with the
inexpensive tempura provided by their own chef, she changed her mind and thought
that if she could give back to the local community by providing food, she did
not need to attract many customers, but rather, she needed to steadily put this
into practice. She decided to start by doing things close to home, such as
greetings and posting, so that she could have contact with the local people.
gWhen I was talking to
employees about compassion, such as standing up for the feelings of others when
something happens, I wondered how much I could stand up for the feelings of
others, and then I wondered what the neighbors and local people thought about Watazen.
We have a lot of school excursions, and when they pass by Watazen, the excited
students are always making a lot of noise. The neighbors were always smiling
and greeting me, but I suddenly realized that the local people really helped me
out on a daily basis. So I started posting and talking to people in local area
and asking local people if they would be interested in doing something like
this when I greeted them.h
Discussion: COVID-19
as a part of ejourneyf of entrepreneurial process
gEverydayh Entrepreuring
The entrepreneurial process in crises/adversities
situations focuses on a series of responses to describe how the entrepreneur
tries to overcome the situation. For example, responses to crises/adversities
targeting SMEs, such as typhoon damage (Runyan 2006) and earthquake response
(Smallbone et al. 2012), also describe how they overcome the situation.
However, crises/adversities vary widely (Doern et al. 2019), and in cases such
as COVID-19, where the crises/adversity are uncertain and persistent, multiple
bricolage responses can be taken continuously over a period of time to adapt to
the current situation and to demonstrate resilience. The bricolage responses
were improvised in the early stages of COVID-19's expansion, but since then,
they have been pre-planned. In other words, the bricolage responses that could
be taken were not necessarily uniform, and could change depending on the types
of crises/adversities.
In
addition, the bricolage responses taken under such situations is considered to
include elements of the entrepreneurial process that can be called proactive and
innovative (Kreiser and Davis 2010). In fact, Watazen's improvisation of "Terakoya"
in the early stages of COVID-19's expansion and the summer festival were the
first attempts for entrepreneurs and business organizations. However, in
contrast to the Terakoya and the summer festival, the lunches and bento
lunches, which were pre-planned and practiced as a bricolage responses, are
"everyday" (Welter et al. 2016) that are an extension of the
provision of food.
In
addition, personal behaviors and attitudes are important when resilience is
demonstrated in SMEs, one of which has reticent planning and investment, and
the value of autonomy and high locus of control (Branicki et al. 2018). Even under
COVID-19, Watazen was able to reduce the potential vulnerabilities before COVID-19
became serious due to retained earnings, additional financing, and even
customer prospects (Williams et al. 2017), so an entrepreneur had the value of autonomy
and high locus of control (Branicki et al. 2018). What can be pointed out here,
however, is that even before the COVID-19 infections spread, Watazen had a consciousness
of securing enough retained earnings to last for a certain period of time when
the company's performance had deteriorated in the past. Thus the "everyday"
management attitude of entrepreneurs and organizations prior to crises/adversities
leads to entrepreneurs having the value of autonomy and a high locus of control
(Branicki et al. 2018).
In
this way, bricolage responses as responses appropriate to the situation at the
time, and responses that are "everyday" (Welter et al. 2016) and
"muddling through" (Branicki et al. 2018) in crises/adversities that
will be faced many times in the history of business development, resilience is
demonstrated from the accumulation of such responses. In other words, the
entrepreneurial process in crises/adversities is part of the everyday
entrepreneurial practices of entrepreneurs, described as a "journey".
Back to the Past (Review
the old)
In SMEs, it has been pointed out that for resilience
to be demonstrated in crises/adversities, there is an additional family-like
relationship with employees (Branicki et al. 2018). As the COVID-19 infections
spread, among bricolage responses taken by Watazen, the delivery of lunch boxes
and the summer festival led to a joy among employees who were anxious because
of the lack of work, and the practice of "Terakoya" to temporarily
take care of children was a desire to deal with the fact that schools were
closed and female part-timers could not come to work. This may be because there
was a family-like relationship between the entrepreneur and the employees at
Watazen.
However,
the real reason why Ms. Ono, the young proprietress of Watazen, took these
bricolage responses was because some of the employees had nowhere else to work
after leaving the company, and Ms. Ono felt that they had no choice but to do
something to keep these employees working for Watazen. The reason why they
decided to take care of children at the "Terakoya" was originally
because Ms. Ono wanted to deal with the problem of female employees not put down
roots at Watazen. In this way, the bricolage responses taken by SMEs in times
of crises/adversities stems from the fact that the entrepreneur have needed to
do something about the problems that SMEs have generally faced before. Although
being aware of these issues, the entrepreneur was too busy with their daily
operations to deal with them. However, when COVID-19 situation became more
serious, they refrained from doing business and their operations were
suspended.
Watazen
also served many to the local people when COVID-19 situation became serious and
its business was not conducted. This was because when the number of customers
decreased drastically during COVID-19, Ms. Ono thought back to the past when
many customers had come as "thankful days," and also felt grateful
for their cooperation of the local community by accepting many students on
school excursions, and wanted to make the local people happy by serving foods.
Furthermore, as COVID-19 became more serious, Ms. Ono wanted to work together
in some way with their friend, the grocer, and the proprietress of the local
inns, with whom they had had an estranged relationship, and this eventually led
to several bricolage responses by working together. In practicing bricolage
response, "network
bricolage" (Baker 2007) may be needed, which links the internal resources
of the company with external resources expressed as various relationships with
business partners and communities, and the accumulation of knowledge and
experience that contributes to this linkage. In addition to entrepreneurial
factors such as knowledge and experience accumulation (Duymedjian and Rüling
2010), capability (Kuckertz et al. 2020), and the availability of external
resources (Duymedjian and Rüling 2010), which contribute to the linkage, were
pointed out. However, the grocer's friend and the proprietress of the nearby
inn were resources that had not been used before and were not perceived as
valuable (Baker and Nelson 2005), but by making new connections, they created
new use values (Jack et al. 2010), and led to the creation of business
opportunities (Sarasvathy 2009). The important point here is the various
relationships centered on the entrepreneur. The grocery store has been a friend
of Ms. Ono since her university days, and she has been following her efforts
through SNS. The proprietress of an inn in the local area has been in contact
with her through a meeting. In these ways, the experience and knowledge that the
entrepreneur had before the crises/adversities, as well as the distance-relationship
with the entrepreneur, came back to the mind of entrepreneur under such situations,
and the entrepreneur could utilize them.
Conclusion
This paper focuses on SMEs as a field of
entrepreneurship in the context of COVID-19, which is different in nature from
previous crises/adversities, and describes the entrepreneurial process of how a
SME have tried to overcome the situation from the perspective of
"journey" with specific case of a SME. In the entrepreneurial processes
are described from the perspective of "journey", more diverse and
continuous bricolage responses are taken to overcome crises/adversities, and then
resilience is demonstrated in SMEs. This paper reveals two points. First, the
bricolage responses were "everyday" ones, an extension of what SMEs
had been doing before the crises/adversities, and the "everyday"
management attitude was the background that made them possible. Second, in crises/adversities,
the human resource challenges that the company had before the crises/adversities,
the experiences and knowledge of the entrepreneur or organization, and the distance-relationship
with the entrepreneur are rediscovered and utilized in a way that reflects on
the past. In other words, they leads to the practices of bricolage responses in
crises/adversities.
In
general, "journey" brings a fun to experience the days away from the
everyday. When the journey is over, we return to our daily lives, but sometimes
we feel nostalgic as we remember the extraordinary world (experiences,
knowledge, encounters with people, etc.) we experienced in the past. The
entrepreneurial process of SMEs described as a "journey" may be
different from a typical "journey" in that while there are some
extraordinary experiences, most of them are geverydayh. However, entrepreneurial
journey and a general journey are common in that they recall experiences,
knowledge, and people encounters in the past, and these can be utilized in crises/adversities.
In Japan, there is a Chinese proverb, "Onko-Chishin," which means to
look back to the past and use the experience and knowledge gained to succeed or
fail in the future. By looking at the entrepreneurial process by SMEs in times
of crises/adversities as a "journey," the experiences, knowledge, and
relationships gained through every days and looking back on the past, not only
at the time of the crises/adversities, but also long before that time, can be
used to help SMEs in crises/adversities. This leads to the practices of
bricolage responses by SMEs and makes them resilient.
In
this paper, we examined the entrepreneurial process under COVID-19, where crises/adversities
persists. From the perspective from SMEs in a field of entrepreneurship (Wiklund
et al., 2011), this paper contributes to research in management,
entrepreneurship, and crisis management in that it examines the entrepreneurial
process in a case where crises/adversity are different from the previous local crises/adversities
with a somewhat limited time span (Doern et al., 2019), However, there are some
limitations of this paper. First, not only has COVID-19 not been completely
overcome, but because the research for this paper was conducted in the COVID-19
context, it does not provide enough information to explain "a sequence of
events" (McMullen and Dimov 2013). The situation of COVID-19 is changing
day by day, and it will be more difficult to get entrepreneurs to recall their
feelings as the days go by. Secondly, the narrative approach adopted in this
paper relies on the interpretation as a conversation, and is biased toward the
individual speaker and listener (Berglund 2007), which has certain limitations
as an analytical method. Third, although the entrepreneurial process has been
explained from the perspective of the entrepreneur, the perspectives of various
actors must also be taken into account in order to describe the interactions with
peers and residents in the local area (Steyaert and Katz 2004). Fourth, although
the case in this paper is a SME located in Kyoto, Japan, it is needed to
considered how the contexts of space, such as Japan (or Kyoto), and temporal,
such as the time of the study, will affect the implications of this paper
(Zahra et al. 2014). These are all challenges in the future.
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Table 1. The major bricolage responses of Watazen
under COVID-19
@ |
Late February 2020 |
March/April 2020 |
Early July 2020 |
Terakoya |
Lunch/Bent |
Summer Festival |
|
contents |
Eeducational services to local children about food
loss issues |
Efree and paid lunches to local people Efree and paid lunches to local people (wearing
costumes) |
EExperience traditional crafts, saxophone concerts,
and other events mainly for local people |
Improvised /Pre-Planned |
improvised |
pre-planned |
pre-planned |
Impacts of COVID-19 and opportunities |
ESchool closure EFemale part-timers will not be able to come to work
(poor retention of female employees) |
ERefrain from business due to declared emergency ETo relieve the stress of the local people with joy ETo relieve employees' anxiety about the lack of work |
ECancellation of local events such as festivals ETo create sales opportunities for nearby souvenir
shops ETo create a project with the people from the
traditional industries who came to worry about us. |
Internal resources |
ERooms EThe young landlady |
EEmployees |
ERooms@ EEmployees |
External resources (Network) |
EGrocery Store (a Friend) |
ENeighboring innsi3 innsj |
ETraditional Craftsman ESaxophonist |
Source: The author
[1] Press information in January 2020 by Ministry of Health, Labor and Welfare. Available at: www.mhlw.go.jp/stf/houdou/houdou_list_202001.html (accessed 14 December 2020)
[2] They are Tokyo Metropolitan area and Saitama, Chiba, Kanagawa, Osaka, Hyogo, and Fukuoka Prefectures.
[3] They are Hokkaido, Ibaraki, Ishikawa, Gifu, Aichi, and Kyoto Prefectures.
[4] On temporary closure of city schools to prevent the spread of the new coronavirus infection by The Kyoto City Board of Education. Available at www.city.kyoto.lg.jp/kyoiku/page/0000265824.html (accessed on 14 December 2020)
[5] The SMEs Basic Act, which defines SMEs in Japan, covers SMEs in service industry to have either a capital of 100 million yen or less or 100 employees or less.
[6] According to the Ministry of Education, Culture, Sports, Science and Technology in Japan, a terakoya is "a simple school where common children learn the rudiments of reading and writing," and is "a private educational institution established on the basis of the lives of common people in the Edo period. Its origin dates back to the end of the Middle Ages and is thought to have been derived from temple education. The teacher of a terakoya was called a master and the students were called terako. The teacher's status was usually that of a commoner, such as a samurai, priest, priest, or doctor, who was not only the teacher but also the manager of the terakoya. This is from the 100-year history of the academic system by Ministry of Education, Culture, Sports, Science and Technology (Available at www.mext.go.jp/b_menu/hakusho/html/others/detail/1317577.htm (accessed on 14 December 2020)