Extended Abstract
Introduction: This study investigates the multilayered implications of international sanctions on the activities of knowledge-based firms, focusing particularly on three interconnected dimensions: the challenges they face, the opportunities that arise, and the coping or adaptive strategies they deploy under sanction conditions. Sanctions, typically designed as political or punitive measures, have been shown in prior research to impose severe restrictions on national economies. For example, sanctions are associated with reduced economic growth (Neuenkirch & Neumeier, 2015), disruptions in international trade (Yang et al., 2009), and declines in social welfare (Gutmann et al., 2021). These consequences are particularly acute for firms embedded in global value chains, such as knowledge-based companies that rely heavily on flows of ideas, technologies, capital, and partnerships. At the same time, however, sanctions are not uniformly negative; they can act as a catalyst for creativity and innovation by compelling firms to devise novel products, processes, and organizational models to bypass restrictions (Bazrafshan, 2025). This duality situates knowledge-based firms in a distinctive position: on the one hand, they suffer from supply shortages, technological lockouts, and financial blockages; on the other, they are compelled to mobilize indigenous resources, build local capacity, and strengthen domestic markets. The study is motivated by this paradox and seeks to address the gap in the literature concerning how managers of such firms perceive, interpret, and respond to sanctions. Despite the increasing salience of knowledge-based firms in developing knowledge economies, their specific experiences under sanction conditions remain underexplored, especially in the context of countries such as Iran where sanctions are recurrent and multi-dimensional. Thus, the purpose of this study is to systematically identify the primary challenges, the emerging opportunities, and the practical coping strategies of knowledge-based firms operating under international sanctions. By doing so, the research provides insights that are relevant not only to managers and policymakers but also to scholars seeking to understand better the dynamics of firm-level adaptation in high-risk and uncertain environments.
Methodology: This study was designed and conducted to identify the opportunities, challenges, and coping strategies of knowledge-based firms under sanction conditions. At the philosophical layer, an interpretivist approach was adopted to enable a deeper understanding of managers’ subjective and perceptual experiences. At the methodological layer, a qualitative approach was employed, allowing the researcher to study complex phenomena within their real-life context. At the strategic level, a multiple case study design was applied, as this strategy facilitated in-depth exploration of several knowledge-based firms and the comparison of their experiences in dealing with sanctions. The statistical population consisted of all managers of active knowledge-based firms in Iran, and purposive sampling was used. Ultimately, 19 managers from various industries were selected, and data were collected through semi-structured interviews. The interview process continued until theoretical saturation was reached. For data analysis, network-based thematic analysis (Attride-Stirling, 2001) was utilized. In this process, interview transcripts were divided into meaningful units and codes, which were then categorized into basic themes, organizing themes, and finally, global themes. Subsequently, thematic networks were mapped, reviewed, and analyzed to extract the semantic structure of the data and identify key patterns. To ensure validity and reliability, the stages of coding and theme identification were iteratively reviewed and refined, and the thematic networks were revised and reorganized where necessary to preserve logical coherence and scientific rigor. Moreover, MAXQDA 2020 software was employed for data management and analysis. Together, these steps provided a coherent analytical framework for examining the opportunities, challenges, and coping strategies of knowledge-based firms under sanction conditions.
Results and Discussion: The network-based thematic analysis identified opportunities, challenges, and coping strategies for knowledge-based firms under sanctions, resulting in a conceptual model structured across multiple levels of themes. The analysis yielded 452 basic codes, 16 organizing themes, and 3 global themes. The findings highlight six major challenges triggered by sanctions: (1) domestic structural and institutional barriers, (2) human resource constraints, (3) production and market-related difficulties, (4) technological and technical knowledge shortcomings, (5) financial and investment limitations, and (6) disruptions in the supply of raw materials, equipment, and supply chains. Conversely, several opportunities emerged, such as growth, innovation, development, and strengthening of national markets. Furthermore, the study identified eight categories of adaptive strategies employed by firms: governmental and policy support, managerial and structural measures, supply chain management, market- and customer-oriented approaches, financial solutions, technological innovation, alternative international collaborations, and productivity enhancement. Overall, the findings suggest that while sanctions impose substantial constraints, they simultaneously create opportunities for capacity renewal and the pursuit of new developmental pathways. These results offer a foundation for managers to design practical strategies that leverage adaptive responses effectively.
Conclusion: Overall, the findings of this study indicate that sanctions are not merely external obstacles but can also serve as catalysts for rethinking managerial models, strengthening cross-sectoral collaborations, and enhancing technological capacities. These results convey two key messages: first, for the academic literature, they highlight how high-risk environments can function as ‘natural laboratories’ for studying and testing innovative strategies; and second, for policymakers and managers, they underscore the need to simultaneously reform institutional structures, preserve and empower human capital, and provide targeted support for innovation and domestic supply chains. Ultimately, achieving a sustainable development trajectory under sanction conditions requires a combined approach that integrates policy support, expanded cross-sectoral cooperation, and systematic investment in knowledge and innovation. Despite its contributions, this study has certain limitations. It is based on interviews with 19 managers of knowledge-based firms, which limits the generalizability of findings across the entire population of such firms or other industries. Hence, the results should primarily be interpreted as exploratory and qualitative in nature. Another limitation relates to the temporal scope: the findings reflect the specific sanction conditions during the period of data collection, which may evolve as the type or intensity of sanctions changes. Moreover, the study focused exclusively on managerial perspectives, omitting those of other stakeholders such as employees, customers, government agencies, or policymakers. Finally, due to security and competitive considerations, some firms were reluctant to disclose detailed information regarding their strategies or actual performance under sanctions.