This list was last updated in November 2016. Our intent is to be as inclusive and comprehensive as possible, but we recognize that because of the volume of work out there we have likely missed some. If your paper is not included on this list and you would like it included, please email it to info@effectuation.org

Research Paper Title Authors Content Outlet Publish Status Publish Date Link To File
‘Entrepreneuring’ as a conceptual attractor? A review of process theories in 20 years of entrepreneurship studies Chris Steyaert

Entrepreneuring has never achieved a breakthrough as the key concept that could elucidate the inherently process-oriented character of entrepreneurship, but it may be able to serve as the conceptual attractor to accommodate the increasing interest in process theories within a creative process view. This paper considers whether this is possible. In addition to equilibrium-based understandings of the entrepreneurial process, this paper tentatively reconstructs the creative process view by distinguishing between a range of relevant perspectives: from those on complexity and chaos theory, to the interpretive and phenomenological, social constructionist, pragmatic and practice-based, to the relational materialist. Taking entrepreneuring as an open-ended concept to use in theoretical experimentation, the review documents the potential for the concept to develop new meanings and to attach itself to a series of concepts such as recursivity, enactment, disclosure, narration, discourse, dramatization, dialogicality, effectuation, social practice, translation and assemblage. It is argued that the very act of theorizing about the concept of ?entrepreneuring? indicates a move from methodological individualism to a relational turn in entrepreneurship studies, one that inscribes entrepreneurship into a social ontology of becoming.

Entrepreneurship & Regional Development publish 2007  PDF Download
‘Expect the unexpected’: Implications of effectual logic on the internationalization process C Forza
I Kalinic
Saras Sarasvathy

International entrepreneurship literature has indicated that entrepreneurs often increase international activities along unexpected lines of reasoning without having a precise goal, resulting in “unplanned” internationalization. We argue that “unplanned” internationalization does not necessarily involve non-logical decisions; but, entrepreneurs can follow an effectual rather than causal logic and may base their decisions on the affordable loss principle rather than on the maximization of expected returns. Based on five case-studies, we discuss the implication of effectual decision-making on the internationalization process. We find that switching from causal to effectual logic allows firms to rapidly increase the level of commitment in the foreign market and could assist in overcoming liabilities of outsidership and, therefore, successfully increase the level of commitment in the foreign market.

International Business Review publish 2014  PDF Download
‘I Like How You Think’: Similarity as an Interaction Bias in the Investor–Entrepreneur Dyad Murnieks, Charles Y.
Michael Haynie
Rob Wiltbank
Troy Harting

Investigating the factors that influence venture capital decision-making has a long tradition in the management and entrepreneurship literatures. However, few studies have considered the factors that might bias an investment decision in a way that is idiosyncratic to a given investor–entrepreneur dyad. We do so in this study. Specifically, we build from the literature on the ‘similarity effect’ to investigate the extent to which decision-making process similarity (shared between the investor and the entrepreneur) might bias or otherwise impact the investor’s evaluation of a new venture investment opportunity. Our findings suggest venture capitalists evaluate more favourably opportunities represented by entrepreneurs who ‘think’ in ways similar to their own. Moreover, in the presence of decision-making process similarity, the impacts of other factors that inform the investment decision actually change in counter-intuitive ways.

Journal of Management Studies publish 2011  PDF Download
“Differentiating Novice, Non-expert and Expert Entrepreneurs: A Self-regulated Learning Perspective” Alexander Fust
Christoph Winkler
Tobias Johannes Jenert

Entrepreneurial contexts are characterized by uncertainty, often requiring entrepreneurs to adapt in order to tackle the corresponding challenges and succeed. While entrepreneurial success may be explained by experiential learning, little is known as to why some experienced entrepreneurs are more successful at adapting to uncertain conditions. It has been suggested that these differences are due to enhanced cognitive resources that are analogous to those of experts. Since expertise can be developed through self-regulated learning (SRL), our paper seeks to explain the missing link between experience and entrepreneurial success. By drawing from advances in expert research and a social cognitive view of self-regulation, we develop a process oriented model of self-regulated entrepreneurial learning (SREL) in order to explain why expert entrepreneurs are better able to self-regulate and adapt their behavior during uncertainty (compared to novices and non-experts). We further develop empirically testable research propositions, and discuss theoretical and practical implications for aspiring entrepreneurs and entrepreneurs alike.

Academy of Management Proceedings publish 2016  PDF Download
“Emotional Intelligence, Interpersonal Process Effectiveness, and Entrepreneurial Performance” Amy Ingram
Whitney O Peake
Wayne Stewart
Warren E Watson

Scholars note the importance of emotion and cognition in entrepreneurship, thus we develop and test a novel partial mediation model of emotional intelligence, interpersonal processes, and venture performance in a large sample of entrepreneurs, defined as venture owner-managers. We also test the moderating effect of gender on the proposed relationships. The results indicate that emotional intelligence has both a direct effect on venture performance, and an indirect effect on venture performance via interpersonal processes. Gender moderated the direct effect, with males reporting higher performance, but was not significant in the indirect path of the model. We discuss the implications and potential avenues for future research on this important topic.

Academy of Management Proceedings publish 2014  PDF Download
“Opportunity Pursuit, Disinhibition, & Social Bias: Advancing Beyond Individual Action” Lerner Daniel

The perception, pursuit, and exploitation of opportunity are central to entrepreneurship. While relatively unfettered cognition, impulse, and behavior may favor perceiving and acting on opportunities, such disinhibition may present a social liability and thus interfere with reaching opportunity exploitation. This research examines the connection between disinhibition and nascent opportunity pursuit. Drawing on psychological and entrepreneurial literature, this work tests hypotheses related to the effects of disinhibition in a nascent entrepreneur on other individuals. The results shed light on an important tension at the heart of early stage entrepreneurship. Specifically, apparent disinhibition in a potential founder has sizable adverse effects on others’ assessments: of the founder, of the likelihood of venture success, and of interest in supporting (joining) the venture. These findings indicate that an individual factor impelling individual entrepreneurial action presents a friction for advancing in the entrepreneurial process. This research makes several contributions to existing literature. In relation to entrepreneurship, it contributes needed insight into the social psychology of nascent opportunity pursuit. In relation to the psychological sciences, it provides vocationally contextualized insight into disinhibition and social cognition. Lastly, the research contributes to a developing disinhibition perspective of entrepreneurial action.

Academy of Management Proceedings publish 2014  PDF Download
“Sustainability, Ethics and Entrepreneurship” effectuation

Environmental issues, poverty, inequality, corruption and social discontent are intricately linked with business activity, and as such, they cannot be disentangled or addressed in isolation. The needs to understand the Earth and its limited resources, security for humankind and justice for society mean that the demand for social science knowledge is increasing. The fact that sustainability and ethics are intertwined with the concepts of business and organizations (including NGOs) is no longer new. Indeed, ethical choices are critical to any business activity and thus influence how startups, small firms, medium enterprises, and large, multinational corporations-whether those are for profit or not- influence the sustainability of the environment and society. We actually suggest that sustainability, ethics, and entrepreneurship triangulate and give meaning to every ecological consideration, social value, and economic opportunity. The goal of the symposium, then, is to advance knowledge about the meaning and intersection of sustainability, ethics, and entrepreneurship. When Internal Representation Leads to Faultlines: A Study of Board Performance in Social EnterprisPresenter: Saskia Crucke; Ghent U.Presenter: Mirjam Knockaert; Ghent U.Crowding Out Effects of Well-Intended Environmental PoliciesPresenter: Richard Hunt; Virginia Polytechnic InstitutePresenter: Bret Ryan Fund; U. of Colorado, BoulderHow Social Entrepreneurs Facilitate the Adoption of New Industry PracticesPresenter: Theodore L. Waldron; Baylor U.Presenter: Greg Fisher; Indiana U.Presenter: Michael D. Pfarrer; U. of GeorgiaA Theoretical Exploration of Why Firms Delay Reaching True SustainabilityPresenter: Anton Shevchenko; Concordia U.Presenter: Moren Levesque; York U.Presenter: Mark Pagell; U. College Dublin”Environmental Entrepreneurship: Identity Coupling, Venture Goals, and Stakeholder Incentives”Presenter: Jeffrey G. York; U. of Colorado, BoulderPresenter: Isobel O’Neil; The U. of NottinghamPresenter: Saras D. Sarasvathy; U. of VirginiaKicking Off Social Entrepreneurship: How a Sustainability Orientation Influences CrowdfundingPresenter: Goran Calic; Purdue U.Presenter: Elaine Mosakowski; Purdue U.Selling Issues With Solutions: Igniting Social Intrapreneurship in For-Profit OrganizationsPresenter: Elisa Alt; Anglia Ruskin U.Presenter: Justin B Craig; Northwestern Kellogg School of ManagementSocial Enterprise Emergence from Social Movement Activism: The Fairphone CasePresenter: Ona Akemu; Erasmus U. RotterdamPresenter: Gail Whiteman; Erasmus U. RotterdamPresenter: Steve Kennedy; Rotterdam School of Management

Academy of Management Proceedings publish 2016
“They help, yet they hinder: Duality of social networks and opportunities for Ghanaian Self-Employed” Patrick Shulist Shulist

In this study, I seek to understand how subsistence entrepreneurs select specific replication opportunities to exploit, and the impact of this selection on growth. Replication opportunities are different from discovery, creation, and recognition opportunities, and are those opportunities that directly mimic readily observable businesses. While extant research points to the macro-level factors (such as a lack of education) that generally lead to countries’ dependence on replication opportunities, little is known at the micro-level; the level where interventions such as training programs work. I studied a group of self-employed across four research trips to Ghana, where I conducted 227 interviews and 233 hours of observation. My findings indicate that social networks both enable and constrain the selection of specific opportunities. They also indicate that opportunities are widely exploited based on the standard templates accessed through these networks. Similarly, social networks constrain and enable growth, as do the opportunities themselves. The combination of these two factors effectively focuses the microentrepreneur’s attention on growth opportunities that are marginal additions to the current template, and away from efficiency-seeking opportunities. These findings contribute theoretically to social networking theory, franchising, and theories of growth. They also have practical implications for entrepreneur training programs.

Academy of Management Proceedings publish 2016  PDF Download
“Does God Play Dice?” – Randomness vs. Deterministic Explanations of Crowdsourcing Success Christopher Lettl
Nikolaus Franke Franke
Susanne Roiser
Tuertscher Philipp

Which factors are responsible for the success of crowdsourcing tournaments? Current theorizing on crowdsourcing appears to assume that there is a deterministic relationship between factors such as the organization of the tournament, characteristics of the participants attracted, and specific situational factors on the one hand and the quality of their contributions gained on the other. Based on theory that views creativity as a process of blind variation and retention, we introduce the alternative idea that in fact the quality of any participants’ idea is largely random and thus the success of the tournament rests primarily on the number of participants attracted. In order to compare the explanatory power of randomness and 22 deterministic factors derived from literature we conducted a huge experiment in which 1,089 participants developed ideas for smartphone apps. Our finding is unambiguous: the single factor of randomness outperforms all deterministic explanations collectively by far. It appears that at least in crowdsourcing, God indeed plays dice.

Academy of Management Proceedings publish 2014  PDF Download
“ENTREPRENEUR MAKES GOOD”: SOCIAL ENTREPRENEURSHIP AND OPPORTUNITY CREATION (SUMMARY) Michael Conger
Jeffery York

The study of social implications of entrepreneurship, and the influence of socio-cultural factors on entrepreneurial action, is still in its infancy. Although there is a growing interest in “social entrepreneurship” there is a critical need for empirical studies, and for more established entrepreneurship theories and streams of research, to be applied to the context of socially beneficial entrepreneurship (Short et al., 2009). Opportunity recognition and creation has been identified as a defining topic for entrepreneurship research (Shane & Venkataraman, 2000). Key theoretical questions have been raised regarding this topic including how entrepreneurial motivation affects opportunity recognition (Shane et al, 2003) and whether entrepreneurial opportunities are discovered or created (Sarasvathy, 2002; Alvarez & Barney, 2007). Several entrepreneurship scholars have theorized about why and how social entrepreneurship opportunities come to be but empirical study has not yet been brought to bear on these topics. In this study, we seek to bridge the theoretical predictions of the opportunity literature with the context of entrepreneurial action focused on creating social, as well as economic, benefits. We draw on identity theory (Stryker, 1980) to empirically examine how the entrepreneur’s self-concept affects her propensity to discover and/or create opportunities for socially beneficial entrepreneurship.

Frontiers of Entrepreneurship Research publish 2011  PDF Download
2009 BEST PAPER ABSTRACTS. effectuation

The article presents abstracts for what the publication deems to have been the best papers of 2009 including “Acquisitions of Industrial Units and the Evolution of Operational Performance Across the Firm,” “Alliances and Governance in Biotechnology: Firm-Level Effects on Performance,” and “Are Joint Ventures Positive Sum Games? Effects of Cooperative and Non-Cooperative Behavior.”

Academy of Management Proceedings publish 2009  PDF Download
A 2 × 2 Conceptual Foundation for Entrepreneurial Discovery Theory Patrick J. Murphy

Theories about entrepreneurial discovery are important to entrepreneurship. However, the dominant conceptual foundation underlying such theories hinders their development. It assumes that opportunities form based on either deliberate search or serendipitous discovery. I examine this unidimensional logic and identify a gap in its informative content. Then, I reframe it into orthogonal dimensions. The multidimensional model not only describes the same cases as the unidimensional model but also describes what the unidimensional model cannot, including cases that are high or low on both dimensions. This extension yields a 2 × 2 conceptual foundation for entrepreneurial discovery theory that promotes the development and coordination of distinct theoretic streams.

Entrepreneurship Theory and Practice publish 2011
A 2 × 2 Conceptual Foundation for Entrepreneurial Discovery Theory Patrick J. Murphy

Theories about entrepreneurial discovery are important to entrepreneurship. However, the dominant conceptual foundation underlying such theories hinders their development. It assumes that opportunities form based on either deliberate search or serendipitous discovery. I examine this unidimensional logic and identify a gap in its informative content. Then, I reframe it into orthogonal dimensions. The multidimensional model not only describes the same cases as the unidimensional model but also describes what the unidimensional model cannot, including cases that are high or low on both dimensions. This extension yields a 2 × 2 conceptual foundation for entrepreneurial discovery theory that promotes the development and coordination of distinct theoretic streams.

Entrepreneurship Theory and Practice publish 2011  PDF Download
A bureaucrat’s journey from technocrat to entrepreneur through the creation of adhocracies Duncan M Pelly, R

AbstractHow we understand entrepreneurship is a function of the stories we tell. This article uses insights from process theory to explore the ways in which an entrepreneur can employ a story to mobilize others to shed conflicting viewpoints to converge with the abstract. In this story, regulation as a reification of past procedures did not fully account for organizational realities of mailroom inspections conducted by the military post office, so an appeal to foundational values was adopted to alter the shared vision of future potentiality and overcome bureaucratic barriers through the creation of adhocracies. As a result of overcoming interorganizational boundaries, a technocrat became an entrepreneur by changing the view of stakeholders from a fixed audience to active co-authors during the spawning of adhocracies. The creation of adhocracies in this story is explored through an autoethnographic layered account, which is a storytelling approach that mirrors the co-construction of the narratives found within this paper?s vignettes. The understanding of entrepreneurship provided in this paper challenges commonly held assumptions of entrepreneurship, in addition to corporate, organizational and public service entrepreneurship, as well as the methods and writing styles to explore these concepts.

Entrepreneurship & Regional Development publish 2016
A cognitive approach for analyzing the influence of effectual network on entrepreneurs actions Faiez Ghorbel
Younes Boujelbene
Interdisciplinary Journal of Contemporary Research In Business publish 2012
A conceptual framework for entrepreneurship education policy: Meeting government and economic purposes Dr Allan O'Connor

There is an increasing tendency for government policy to promote entrepreneurship for its apparent economic benefit. Accordingly, governments seek to employ entrepreneurship education as a means to stimulate increased levels of economic activity. However, the economic benefit of entrepreneurship education has proven difficult to substantiate. It is perceived that the problem is partly due to the multi-definitional perspectives of entrepreneurship. What stems from this is a lack of a theoretically sound conceptual grounding that will assist policy-makers and educators to locate a program within specific objectives. This article sets out an argument, extending from economic theory, to provide purpose for entrepreneurship education and proposes a policy framework supported by analysis of the Australian government policy context.

Journal of Business Venturing publish 2013  PDF Download
A CONSTRUCTIVIST FRAMEWORK FOR UNDERSTANDING ENTREPRENEURIAL OPPORTUNITIES (SUMMARY) Didier Chabaud
M. Joseph NGIJOL

The seminal papers of Venkataraman (1997) and Shane & Venkataraman (2000) open a new way to analyze entrepreneurship, focusing around the question of opportunities. Nevertheless, although stimulating, these papers remain strongly influenced by an Austrian Economics point of view (Kirzner, 1973, 1979, 1997) and authors that follow this line adopt a positivist perspective: they argue that opportunities are “given” and it is up to the entrepreneur to discover an object which exists independently to him/her (Shane, 2003). In this view, the entrepreneurial process is seen as a sequence distinguishing between the discovery and the exploitation of the business opportunity (Davidsson, 2005, Shane, 2003). Nevertheless, a growing literature tends to argue that opportunities are no longer simply recognised by the entrepreneur as objects existing on an independent basis: opportunities are considered as the result of an emergent process initiated by the entrepreneur (Sarasvathy, 2001; Gartner, Carter and Hills, 2003). In other words, opportunities appear as the fruit of social construction. In a parallel way, Davidsson (2005) will emphasize that “the discovery and exploitation processes feed back on one another”. Building on Chiasson and Saunders (2005), we challenge these views by trying to show how a constructivist point of view enables to reconcile the different perspectives mentioned above, which enables to better understand the phenomenon. This permits us to propose a new conceptual framework opening to empirical research, and enabling to capitalize on the both lines of research.

Frontiers of Entrepreneurship Research publish 2006  PDF Download
A CONTINGENCY MODEL OF ENTREPRENEURIAL ENTRY STRATEGIES: THE ROLE OF MOTIVATION AND RESOURCES AVAILABILITY (INTERACTIVE PAPER) Nadav Rotemberg-Shir
Karl Wennberg

While current theory has tended to focus on either motivational factors or creative strategies of resource utilization, these two streams of research have developed separately. As a result, the literature has little to say under what conditions differences in motivation and resources will lead to divergent types of entry strategies. In this project we outline and test a contingency model suggesting that the interaction of motivation and resource availability is intimately tied to entrepreneurs’ type of entry strategies. When motivation is relatively low but resource availability is high, our model predicts that entrepreneurs will use a real-option entry strategy. When motivation is high but resource availability is low the entrepreneurs will compensate by employing creative solutions, suggesting that entrepreneurs will utilize more of bricolage resource utilization. When both motivation and resource availability is high, our model suggests that the resulted higher self-confidence, allow for a more flexible and experimental strategy coherent with effectuation (Sarasvathy, 2001).

Frontiers of Entrepreneurship Research publish 2011  PDF Download
A Cross-Disciplinary Exploration of Entrepreneurship Research R Duane Ireland
Justin Webb

The eclectic and pervasive benefits of entrepreneurship are generating research questions that interest scholars in a variety of disciplines. These questions have been primarily examined within the context of a scholar’s home discipline while ignoring insights from other disciplines. This approach has left entrepreneurship research as a widely dispersed, loosely connected domain of issues. In this review, the authors explore entrepreneurship research in accounting, anthropology, economics, finance, management, marketing, operations management, political science, psychology, and sociology. They seek to identify common interests that can serve as a bridge for scholars interested in using a multitheoretic and multimethodological lens to design and complete entrepreneurship studies.

Journal of Management publish 2007  PDF Download
A Dialogue With William J. Baumol: Insights on Entrepreneurship Theory and Education Mark Griffiths
Jill Kickul
Sophie Bacq
Siri Terjesen

This interview and commentary addresses key issues in entrepreneurship by highlighting William Baumol’s contributions and his personal insights. We emphasize the multilevel approach that entrepreneurship research should adopt, and that assumptions underlying the research are too often unstated, rendering comparison between studies difficult. Baumol argues for more experimentation and government support of research on ways to improve the teaching of innovative entrepreneurship, since there is little evidence on what works and what does not. The discussion stresses that entrepreneurship is a multifaceted phenomenon that varies depending on context, the level of innovation, and its impact on society. Consequently, entrepreneurship research requires the development of an encompassing paradigm, appropriate educational methods, and study of the institutions that provide the most desirable incentives.

Entrepreneurship Theory and Practice publish 2012  PDF Download
A dynamic model of growth phases and survival in international business-to-business new ventures: The moderating effect of decision-making logic M Gabrielsson
P Gabrielsson

The growth and survival of international new ventures (INVs) has not been the subject of extensive in-depth qualitative study and our understanding of their decision-making is deficient. On the basis of empirical analyses in a small and open economy, a dynamic model was developed that explains the growth phases through which INVs pass as they mature in the high-technology business-to-business field. The model also recognizes rapid advancement, survival crises, and retrenchment. Propositions were devised regarding the impact of opportunities, resources and capabilities, entrepreneurial orientation, and learning on growth phases and survival. A novel finding is that the decision-making logic moderates the impact of these factors. These findings have important implications for industrial marketing scholars and practitioners.

Industrial Marketing Management publish 2013
A field study of entrepreneurial decision-making and moral imagination McVea John F

How entrepreneurs make decisions under extreme uncertainty and ambiguity is central to explaining entrepreneurial success. However, because of their pioneering nature, these decisions also have significant ethical implications. While there has been an increasing focus on the unique approaches entrepreneurs take to decision-making, less attention has been paid to the inherent ethical dimension of making decisions under high uncertainty. This study applies the concept of moral imagination to the challenges of making entrepreneurial decisions under Knightian uncertainty. It examines the extent to which entrepreneurs use moral imagination to integrate the ethical dimensions of pioneering situations into their decision-making.

Journal of Business Venturing publish 2009  PDF Download
A little bit of knowledge is a dangerous thing: Entrepreneurial experience and new venture disengagement Rasmus Vendler Toft-Kehler
Karl Wennberg
Philip H Kime

Abstract Existing research has offered conflicting narratives of how entrepreneurial experience influences whether founders will continue working on or disengage from their ventures. We theorize and test how entrepreneurs with varying levels of experience disengage from early-stage companies. Findings reveal a U-shaped relationship, such that novices and highly experienced entrepreneurs are more likely to quit their ventures, while moderately experienced entrepreneurs are more likely to persist in their pursuits. We offer both theoretical and empirical explanations for how the propensity to disengage from new ventures evolves with entrepreneurial experience.

Journal of Business Venturing Insights publish 2016  PDF Download
A Market for Lemons in Serial Entrepreneurship? Exploring Type I and Type II Errors in the Restart Decision Saras Sarasvathy
Kristian Nielsen

Extant literatures on serial and habitual entrepreneurship contain inconclusive findings about the differential impact of learning from success and failure. Yet, there are no published studies combining both the restart decision and restart performance after previous failure or success with a first venture. Using a comprehensive longitudinal dataset of all one-time starts and restarts in Denmark from 1980 to 2007, we discovered the existence of a market for lemons in serial entrepreneurship. First introduced by Akerlof (1970), the market for lemons refers to a market in which low-quality products come to dominate. In serial entrepreneurship, this occurs due to Type II errors in the restart phenomenon. Type I error occurs when a potential entrepreneur endowed with the human and social capital necessary for restart success does not start a second venture. Type II error refers to the opposite and forms the basis for the market for lemons in serial entrepreneurship. Based on our empirical findings, we develop new theory relating these two types of errors to errors in learning attributions resulting in overconfidence bias and thereby impacting performance.

Academy of Management Discoveries publish 2016  PDF Download
A Measure of Adaptive Cognition for Entrepreneurship Research. Haynie M
Shepherd Dhliwayo

To sense and adapt to uncertainty may characterize a critical entrepreneurial resource. In this research, we employ a metacognitive lens toward the development of a 36-item inventory designed to assess cognitive adaptability, defined as the ability to be dynamic, flexible, and self-regulating in one’s cognitions given dynamic and uncertain task environments. Construction of the inventory, and subsequent factor analysis, is confirmatory in nature based on five theoretically justified dimensions of metacognition. We describe the development of the instrument, discuss its implications for entrepreneurship, and finally offer suggestions for further development and testing.

Entrepreneurship Theory and Practice publish 2009  PDF Download
A meta-analytic review of effectuation and venture performance Stuart Read
Michael Song
Willem Smit

Though much research in entrepreneurship makes the fundamental assumption that opportunities are found, new work is emerging which questions this core tenet. Effectuation, for example, positions the entrepreneur as co-creator of opportunities, together with committed stakeholders. In this study, we conduct a meta-analysis of the articles published in the Journal of Business Venturing, summarizing data on 9897 new ventures to connect three of the principles of effectuation positively with new venture performance. In so doing, we offer both specific insight into precisely measuring effectuation and a general method for extracting variables from prior work to measure new constructs.

Journal of Business Venturing publish 2009  PDF Download
A Narrative Perspective on Entrepreneurial Opportunities. Dr. Raghu Garud
Antonio Paco Giuliani

The article discusses entrepreneurial opportunities from a narrative perspective that is based on actor-network theory. The article notes the narrative perspective on entrepreneurial agency and entrepreneurial opportunities suggests there is an entrepreneurial journey in which discovery and creation are dynamic forces and meaning making results from an interaction of relational space and durational time when the past, present, and future are intertwined. The argument is supported with references to related research on topics such as the narrative inquiry research method and the source of emerging ideas.

Academy of Management Review publish 2013  PDF Download
A New Vision of Management in the 21st Century. Ken G Smith
Jimmy Le
Thomas W Lee
Janet A Thompson
Dr Qing Cao

The article provides information on the 65th Annual Meeting of the Academy of Management in Honolulu, Hawaii in 2005. The annual meeting provides a special opportunity for the Academy community to come together to share knowledge and experiences, to create and renew friendships and professional relations, and to replenish and further develop our careers. The 2005 program vividly demonstrates the strong commitment of our members to the annual meeting. The 2005 Call for Papers had 4,671 paper and symposium submissions and 362 professional development workshops. The 2005 program presents research, panel discussions, professional development workshops and community activities that explore A New Vision of Management in the 21st Century.

Academy of Management Proceedings publish 2005  PDF Download
A Process Perspective on Evaluating and Conducting Effectual Entrepreneurship Research. Vishal K. Gupta
Todd Chiles
Jeffery McMullen

A letter to the editor is presented in response to the article “Effectuation as Ineffectual? Applying the 3E Theory-Assessment Framework to a Proposed New Theory of Entrepreneurship” by R.J. Arend, H. Sarooghi, and A. Burkemper in volume 40 of the periodical.

Academy of Management Review publish 2016  PDF Download
A Qualitative Approach to Evidence-Based Entrepreneurship: Theoretical Considerations and an Example Involving Business Clusters ANDREAS RAUCH
Robert van Doorn
WILLEM Hulsink

Most research in evidence-based entrepreneurship builds on quantitative designs, which is unfortunate because qualitative studies provide a unique contribution to the domain of entrepreneurship. They look at distinctive phenomena in their specific time period and context in one way or another, and can help generate and test new theories. We, therefore, suggest using a systematic synthesis of case studies to aggregate the findings of qualitative research. Moreover, as a first step, we developed an example to demonstrate how this approach can advance evidence-based entrepreneurship. Specifically, we synthesized 13 cases to examine how business clusters increase the performance of firms within clusters.

Entrepreneurship Theory and Practice publish 2014  PDF Download
A Quantum Approach to Time and Organizational Change ROBERT G LORD
Jessica E. Dinh
Hoffman Ernest L

Prevailing perspectives on time and change often emphasize the forward movement of time and the relative stability of attributes, an emphasis that fosters theories of organizational evolution as a linear progression of a past that moves to the present that moves to the future. While useful in many respects, this perspective obscures the uncertainty of emerging organizational phenomena, and it offers little insight into the rare and unpredictable events that change the course of history. To address these concerns, we draw on quantum mechanics and quantum probability theories to present a quantum approach to time and change as a framework for understanding organizational complexity and the common decision-making errors that lead to organizational failures within uncertain environments. This perspective also explains how organizations (or societies) can experience unforeseen potentialities that radically change their development by conceptualizing the future as existing in a state of potentiality that collapses to form the present based on the dynamics of system constraints. Our theory has broad implications for organizational theory and research, as well as management practice.

Academy of Management Review publish 2015
A Quantum Approach to Time and Organizational Change ROBERT G LORD
Hoffman Ernest L
Jessica E. Dinh

Prevailing perspectives on time and change often emphasize the forward movement of time and the relative stability of attributes, an emphasis that fosters theories of organizational evolution as a linear progression of a past that moves to the present that moves to the future. While useful in many respects, this perspective obscures the uncertainty of emerging organizational phenomena, and it offers little insight into the rare and unpredictable events that change the course of history. To address these concerns, we draw on quantum mechanics and quantum probability theories to present a quantum approach to time and change as a framework for understanding organizational complexity and the common decision-making errors that lead to organizational failures within uncertain environments. This perspective also explains how organizations (or societies) can experience unforeseen potentialities that radically change their development by conceptualizing the future as existing in a state of potentiality that collapses to form the present based on the dynamics of system constraints. Our theory has broad implications for organizational theory and research, as well as management practice.

Academy of Management Review publish 2015  PDF Download
A Realist Perspective of Entrepreneurship: Opportunities As Propensities Naveen Reddy
Stratos Ramoglou
Eric W. K. Tsang

The idea that entrepreneurial opportunities exist “out there” is increasingly under attack by scholars who argue that opportunities do not preexist objectively but are actively created through subjective processes of social construction. In this article we concede many of the criticisms pioneered by the creation approach but resist abandoning the preexisting reality of opportunities. Instead, we use realist philosophy of science to ontologically rehabilitate the objectivity of entrepreneurial opportunities by elucidating their propensity mode of existence. Our realist perspective offers an intuitive and paradox-free understanding of what it means for opportunities to exist objectively. This renewed understanding enables us to (1) explain that the subjectivities of the process of opportunity actualization do not contradict the objective existence of opportunities, (2) acknowledge the category of agency-intensive opportunites, (3) develop the notion of “nonopportunity,” and (4) clarify the ways individuals might make cognitive contact with opportunities prior to their actualization. Our actualization approach serves as a refined metatheory for guiding future entrepreneurship research and facilitates the revisiting of subtle conceptual issues at the core of entrepreneurial theory, such as the nature of uncertainty and “nonentrepreneurs,” as well as the role played by prediction in a scientific study of entrepreneurship.

Academy of Management Review publish 2016
A Realist Perspective of Entrepreneurship: Opportunities As Propensities Stratos Ramoglou
Eric W. K. Tsang

The idea that entrepreneurial opportunities exist “out there” is increasingly under attack by scholars who argue that opportunities do not preexist objectively but are actively created through subjective processes of social construction. In this article we concede many of the criticisms pioneered by the creation approach but resist abandoning the preexisting reality of opportunities. Instead, we use realist philosophy of science to ontologically rehabilitate the objectivity of entrepreneurial opportunities by elucidating their propensity mode of existence. Our realist perspective offers an intuitive and paradox-free understanding of what it means for opportunities to exist objectively. This renewed understanding enables us to (1) explain that the subjectivities of the process of opportunity actualization do not contradict the objective existence of opportunities, (2) acknowledge the category of agency-intensive opportunites, (3) develop the notion of “nonopportunity,” and (4) clarify the ways individuals might make cognitive contact with opportunities prior to their actualization. Our actualization approach serves as a refined metatheory for guiding future entrepreneurship research and facilitates the revisiting of subtle conceptual issues at the core of entrepreneurial theory, such as the nature of uncertainty and “nonentrepreneurs,” as well as the role played by prediction in a scientific study of entrepreneurship.

Academy of Management Review publish 2016  PDF Download
A reconceptualization of fear of failure in entrepreneurship Gabriella Cacciotti
James Hayton
J. Robert Mitchell
Dr Andreas Giazitzoglu

Abstract Fear of failure both inhibits and motivates entrepreneurial behavior and therefore represents a rich opportunity for better understanding entrepreneurial motivation. Although considerable attention has been given to the study of fear of failure in entrepreneurship, scholars in this field have investigated this construct from distinct disciplinary perspectives. These perspectives use definitions and measures of fear of failure that are potentially in conflict and are characterized by a static approach, thereby limiting the validity of existing findings about the relationship between fear of failure and entrepreneurship. The purpose of this paper is to delineate more precisely the nature of fear of failure within the entrepreneurial setting. Using an exploratory and inductive qualitative research design, we frame this construct in terms of socially situated cognition by adopting an approach that captures a combination of cognition, affect and action as it relates to the challenging, uncertain, and risk-laden experience of entrepreneurship. In so doing, we provide a unified perspective of fear of failure in entrepreneurship in order to facilitate progress in understanding its impact on entrepreneurial action and outcomes.

Journal of Business Venturing publish 2016
A reconceptualization of fear of failure in entrepreneurship Gabriella Cacciotti
James Hayton
J. Robert Mitchell
Dr Andreas Giazitzoglu

Abstract Fear of failure both inhibits and motivates entrepreneurial behavior and therefore represents a rich opportunity for better understanding entrepreneurial motivation. Although considerable attention has been given to the study of fear of failure in entrepreneurship, scholars in this field have investigated this construct from distinct disciplinary perspectives. These perspectives use definitions and measures of fear of failure that are potentially in conflict and are characterized by a static approach, thereby limiting the validity of existing findings about the relationship between fear of failure and entrepreneurship. The purpose of this paper is to delineate more precisely the nature of fear of failure within the entrepreneurial setting. Using an exploratory and inductive qualitative research design, we frame this construct in terms of socially situated cognition by adopting an approach that captures a combination of cognition, affect and action as it relates to the challenging, uncertain, and risk-laden experience of entrepreneurship. In so doing, we provide a unified perspective of fear of failure in entrepreneurship in order to facilitate progress in understanding its impact on entrepreneurial action and outcomes.

Journal of Business Venturing publish 2016  PDF Download
A situated metacognitive model of the entrepreneurial mindset Haynie J.M
Shepherd Dhliwayo
Mosakowski E
P C Earley

We develop a framework to investigate the foundations of an ‘entrepreneurial mindset’ — described by scholars as the ability to sense, act, and mobilize under uncertain conditions. We focus on metacognitive processes that enable the entrepreneur to think beyond or re-organize existing knowledge structures and heuristics, promoting adaptable cognitions in the face of novel and uncertain decision contexts. We integrate disparate streams of literature from social and cognitive psychology toward a model that specifies entrepreneurial metacognition as situated in the entrepreneurial environment. We posit that foundations of an entrepreneurial mindset are metacognitive in nature, and subsequently detail how, and with what consequence, entrepreneurs formulate and inform “higher-order” cognitive strategies in the pursuit of entrepreneurial ends.

Journal of Business Venturing publish 2010  PDF Download
A SOCIAL NETWORK PERSPECTIVE ON THE DEAL FLOW OF BUSINESS ANGELS. CHRISTOPH GARBOTZ
ANDREAS ENGELEN
PHILIPP NIEMANN

Business angels play a crucial role in new venture financing, but “the private investor market is still largely incompletely understood, inefficient and understudied” (Baty & Sommer, 2002: 290). Based on an empirical study we investigate different drivers of business angels’ two deal flow dimensions, i.e. quantity and quality.

Academy of Management Proceedings publish 2010
A SOCIAL NETWORK PERSPECTIVE ON THE DEAL FLOW OF BUSINESS ANGELS. CHRISTOPH GARBOTZ
ANDREAS ENGELEN
PHILIPP NIEMANN

Business angels play a crucial role in new venture financing, but “the private investor market is still largely incompletely understood, inefficient and understudied” (Baty & Sommer, 2002: 290). Based on an empirical study we investigate different drivers of business angels’ two deal flow dimensions, i.e. quantity and quality.

Academy of Management Proceedings publish 2010  PDF Download
A Stakeholder Capabilities Perspective on Entrepreneurial Performance and Value Creation. Ishrat Ali
Sharon Alicia Simmons
Saras Sarasvathy

Primary purpose of this paper is to better understand how entrepreneurs create value for different stakeholders. Combining concepts from stakeholder theory and capability approach in welfare and development economics, we theoretically develop the concept of “Stakeholder Capabilities” as unit of value. Using this lens, we examine performance of five Inc. 500 companies and six B-Corporations. By conducting detailed semi-structured interviews with 11 founders, we discovered that while interacting with multiple stakeholders they expended thought and effort to expand various stakeholder capabilities within economic, psychological, social, intellectual and physiological dimensions.

Academy of Management Proceedings publish 2016
A Stakeholder-Centric Entrepreneurship Approach to Poverty and Development Saras Sarasvathy
Chowdhury Rashedur
R Edward Freeman

Our stakeholder-centric entrepreneurship framework offers a perspective on how to combine entrepreneurial opportunities as means and stakeholder capability as ends so that firms can address critical social problems while remaining innovative and competitive. When firms adopt marginalized stakeholders capability development, firms provide stakeholders with diverse skill sets and various forms of choices and freedom. This enables firms to create an increased set of high potential opportunities for all stakeholders because marginalized stakeholders bring new ideas that are a source of innovation and higher-level learning for other stakeholders. The sustained success of firms therefore relies on the enhancement of stakeholder capability rather than value creation through separate sets of purely economic and social activities.

Academy of Management Proceedings publish 2015
A Tale of Two Kirzners: Time, Uncertainty, and the “Nature” of Opportunities Steffen Korsgaard
Henrik Berglund
Claus Thrane
Per Blenker

This paper discusses the influence of Israel Kirzner on the field of entrepreneurship research. We review Kirzner’s work and argue that it contains two distinct approaches to entrepreneurship, termed Kirzner Mark I and Kirzner Mark II. Mark I with its focus on alertness and opportunity discovery has exerted a strong influence on entrepreneurship research in the last decade, and helped catapult the field forward. We propose that Mark II, with its emphasis on time, uncertainty, and creative action in pursuit of imagined opportunities, complements the discovery view and can provide an alternative conceptual grounding for the decade to come.

Entrepreneurship Theory and Practice publish 2016  PDF Download
A Terminal Assessment of Stages Theory: Introducing a Dynamic States Approach to Entrepreneurship Jonathan Levie
Benyamin Lichtenstein

Stages of growth models were the most frequent theoretical approach to understanding entrepreneurial business growth from 1962 to 2006; they built on the growth imperative and developmental models of that time. An analysis of the universe of such models (n = 104) published in the management literature showed no consensus on basic constructs of the approach, and no empirical confirmation of stages theory. However, by changing two propositions of stages theory, a new dynamic states approach was derived. The dynamic states approach has far greater explanatory power than its precursor, and is compatible with leading edge research in entrepreneurship.

Entrepreneurship Theory and Practice publish 2010  PDF Download
A theoretical and methodological approach to social entrepreneurship as world-making and emancipation: social change as a projection in space and time Nicolina Montesano Montessori

This article presents and analyses three cases, which integrate features of both social movements and social entrepreneurship (SE). It is the result of a longitudinal study (January 2012 to September 2015). The study contributes new insights to the theoretical and methodological discussions on SE, focusing on ?the social? in SE literature. The three selected movements, active in the Netherlands, are: ?The Dutch Chapter of Zeitgeist? henceforth Zeitgeist (TZM), (2010?present), ?Giving is All we Have? (henceforth GIAWH, (2011?2014) and ?MasterPeace? (MP) (2010?present). Each movement shows a strong inclination towards social transformation, while being rooted in organizational structures, therefore considered ?social entrepreneurial movements?. Specific contributions entail: the presentation of these innovative cases, the design of a methodology based on critical discourse analysis, state theory, narrative analysis, political theory and discourse theory and a thorough analysis and interpretation of these cases in the national and global contexts in which they emerged. More specifically, it contributes to SE literature on emancipation, defined as ?breaking free? when further developing the method in the direction of world-making, defined as ?creating new worlds?. This study suggests that transition theory can be useful for the study of the impact of social entrepreneurial movements.

Entrepreneurship & Regional Development publish 2016  PDF Download
A Three-Path Model of New Venture Creation: An Image Theory Perspective. Tobias Huning
Phil Bryant
Steven Brown
Journal of Applied Management and Entrepreneurship publish 2012
A time-based process model of international entrepreneurial opportunity evaluation Yanto Chandra

This article investigates two important research gaps in international business (IB): how entrepreneurs evaluate international entrepreneurial opportunities (IEOs) and the role of time in the evaluation process. Drawing on the literature on decision-making models and the philosophical foundation of opportunity, this study employs Gioia’s methodology and content analysis to examine how the founders of 15 early-internationalizing firms evaluated IEOs in the early- and late-stage of internationalization. The findings reveal that the interaction of time and three general rules of IEO evaluation that I coin ‘simple’, ‘revised’, and ‘complex’ influenced the entrepreneurs’ decisions. The findings show that the founders transitioned from simple to revised and to complex rules in the IEO evaluation process and that various contingent factors such as time pressure, resource availability, and type of stakeholders drove these transitions. The three general rules correspond to what I label as ‘opportunity actualization’, ‘revision’, and ‘development maximization’ processes, respectively. I propose a Timebased Process model that reconciles extant internationalization models’ (i.e., Process, Network, Economics, and Entrepreneurship) different explanations regarding why and how firms internationalize

publish 2017  PDF Download
Academic networks in a trichotomous categorisation of university spinouts. Nicos Nicolaou
Sue Birley Sue Birley

The paper adopts a network perspective in an attempt to understand the underlying mechanisms generating the different university spinout structures. In this respect, we propose a trichotomous categorisation of university spinouts into orthodox, hybrid and technology spinouts and argue that the academic’s embeddedness in a network of exoinstitutional and endoinstitutional ties influences the type of spinout initiated. We draw from some of the recent network research that has adopted a contingency approach in explaining the value of social networks.

Journal of Business Venturing publish 2003  PDF Download
Academy of Management 2004 Annual Meeting. effectuation

This section provides information on the Academy of Management (AOM) 2004 annual meeting, held in New Orleans, Louisiana. The theme of the 2004 Annual Meeting, Creating Actionable Knowledge, encourages the organization and its members to explore the influence and meaning of its research on management and organizations.

Academy of Management Proceedings publish 2004  PDF Download
Academy of Management Journal Ad Hoc Reviewers of 2010 effectuation
Academy of Management Journal publish 2011
Accounting for the Future: Psychological Aspects of Effectual Entrepreneurship Saras Sarasvathy
Nick Dew
Stuart Read
Rob Wiltbank

Recent attempts to study entrepreneurship as a form of expertise, rather than a collection of traits and abilities have led to the development of the theory of effectuation. Effectuation is a sequence of non-predictive strategies in dynamic problem-solving that is primarily means-driven, where goals emerge as a consequence of stakeholder commitments rather than vice versa. Most important, effectuation isolates, identifies, and exploits techniques that seek to control the future without having to predict it. In this paper we (1) bring effectuation to psychology; (2) develop it further by examining key behavioral constructs that make effectual action possible; and, (3) derive possible implications for future research in psychology, particularly in relation to a more pluralistic understanding of human rationality.

publish 2003  PDF Download
Acquisitions As Exaptation: The Legacy of Founding Institutions in the U.S. Commercial Banking Industry Christopher Marquis
zhi huang

This study focuses on how founding institutions impact intraorganizational capabilities and how such imprints may have different external manifestations in subsequent historical eras. We introduce the concept of exaptation to organizational theory, identifying an important process whereby the historical origin of a capability differs from its current usefulness. Three founding conditions—branching policy, modernization, and political culture—influenced banks’ development of capabilities for managing dispersed branches, and these capabilities subsequently led to variation in banks’ propensity to engage in acquisitions.

Academy of Management Journal publish 2010
Acquisitions As Exaptation: The Legacy of Founding Institutions in the U.S. Commercial Banking Industry Naveen Reddy

This study focuses on how founding institutions impact intraorganizational capabilities and how such imprints may have different external manifestations in subsequent historical eras. We introduce the concept of exaptation to organizational theory, identifying an important process whereby the historical origin of a capability differs from its current usefulness. Three founding conditions—branching policy, modernization, and political culture—influenced banks’ development of capabilities for managing dispersed branches, and these capabilities subsequently led to variation in banks’ propensity to engage in acquisitions.

Academy of Management Journal publish 2010  PDF Download
Action and Action-Regulation in Entrepreneurship: Evaluating a Student Training for Promoting Entrepreneurship Michael Gielnik
Isaac Wasswa Katono
Sarah Kyejjusa Kyejjusa
MUHAMMED NGOMA
JOHN MUNENE
REBECCA NAMATOVU-DAWA
FLORENCE NANSUBUGA
LAURA OROBIA
JACOB OYUGI
SAMUEL SEJJAAKA
ARTHUR SSERWANGA
THOMAS WALTER
KIM MARIE BISCHOFF
THORSTEN J. DLUGOSCH
MICHAEL FRESE
AUDREY KAHARA-KAWUKI

Action plays a central role in entrepreneurship and entrepreneurship education. Based on action regulation theory, we developed an action-based entrepreneurship training. The training put a particular focus on action insofar as the participants learned action principles and engaged in the start-up of a business during the training. We hypothesized that a set of action-regulatory factors mediates the effect of the training on entrepreneurial action. We evaluated the training’s impact over a 12-month period using a randomized control group design. As hypothesized, the training had positive effects on action-regulatory factors (entrepreneurial goal intentions, action planning, action knowledge, and entrepreneurial self-efficacy) and the action-regulatory factors mediated the effect of the training on entrepreneurial action. Furthermore, entrepreneurial action and business opportunity identification mediated the effect of the training on business creation. Our study shows that action-regulatory mechanisms play an important role for action-based entrepreneurship trainings and business creation.

Academy of Management Learning & Education publish 2015  PDF Download
Advancing a Framework for Coherent Research on Women’s Entrepreneurship. Anne de Bruin
Candida Brush
Friederike Welter
Entrepreneurship Theory and Practice publish 2007  PDF Download
Advancing entrepreneurial marketing: Evidence from born global firms. Gillian Sullivan Mort Mort
Jay Weerawardena
Peter Liesch
European Journal of Marketing publish 2012
Advancing Strategic Entrepreneurship Research: The Role of Complexity Science in Shifting the Paradigm minet schindehutte
Michael Morris

Five areas are identified wherein more development might enhance the current model of strategic entrepreneurship (SE): exploration–exploitation, opportunity, newness, micro–macro interaction, and dynamics. Complexity science is presented as an alternative theoretical lens for addressing these issues, and enhancing the potential of SE in a world characterized by fluctuations, irreversibility, nonlinearity, and instabilities. Using this lens, a rearticulation of SE is proposed that centers on the notion of an opportunity space and a paradigm built around forms, flows, and functions. SE’s domain consists of a complex set of phenomena that cannot be neatly bundled according to disciplinary boundaries.

Entrepreneurship Theory and Practice publish 2009  PDF Download
Affordable Loss: Behavioral Economic Aspects of the Plunge Decision Saras Sarasvathy
Stuart Read
Nick Dew
Rob Wiltbank

Affordable loss involves decision makers estimating what they might be able to put at risk and determining what they are willing to lose in order to follow a course of action. Using the entrepreneur’s new venture plunge decision, this article combines insights from behavioral economics to develop a detailed analysis of the affordable loss heuristic. Specifi cally, we develop propositions to explain how individuals: (1) decide what they can afford to lose; and (2) what they are willing to lose in order to plunge into entrepreneurship. The article also discusses the implications of affordable loss for the economics of strategic entrepreneurship.

Strategic Entrepreneurship Journal(sister journal to Strategic Management Journal) publish 2009  PDF Download
After the Venture: The Reproduction and Destruction of Entrepreneurial Opportunity William McKinley
Matthew S Wood

Research summary The endogenous formation of entrepreneurial opportunity has become an important theoretical perspective. Research to date focuses on initial opportunity creation dynamics leading to venture formation. This excludes the ongoing enactment of opportunity that takes place after venture founding. We focus on this phenomenon, arguing that opportunities must be continually reproduced through maintenance of consensus among stakeholders about their viability. If consensus fails, the objectivity of the opportunity is ‘destroyed’ in a process we label ‘opportunity de-objectification.’ We identify predictors of opportunity de-objectification and summarize their effects in propositions suitable for future empirical testing. Implications for future theory and research are also discussed. Managerial summary Previous entrepreneurship research has focused attention on the process through which opportunity ideas become objectified and perceived as external facts by entrepreneurs and their stakeholders during venture formation. While such attention is critical, we argue that venture founding marks the beginning, rather than the end, of a dynamic process in which the fact-like status of opportunities is maintained. If stakeholder consensus about opportunity viability is disrupted, it raises questions about this factual status and opens up the possibility that the opportunity is a subjective cognition of the entrepreneur rather than an objective reality. We call this phenomenon ‘opportunity de-objectification,’ and we identify a number of factors that precipitate it. We also suggest that entrepreneurs may reduce the likelihood of this phenomenon by managing some of the factors that induce it. Copyright © 2016 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2017  PDF Download
ALL ACADEMY SYMPOSIA Conference Symposia Abstracts. effectuation

The article presents abstracts on management topics which include hidden conflicts in organizations, market formation and international management.

Academy of Management Proceedings publish 2008  PDF Download
An Alternative to Business Plan Based Advice for Start-ups? Simon Bridge
Cecilia Hegarty

Business plans are advocated by many business support professionals and others, such as educators in higher education institutions, because they suit their purposes. A typical view is that a business plan is ?one of the most important steps in setting up any new business? (Burns, 2011); but their hegemony is now being questioned. Sarasvathy (2008) suggests that effectuation is the method often favoured by expert entrepreneurs and this paper seeks to combine it with an exploration view of entrepreneurship to produce an alternative tool for start-up ventures. The paper compares the pros and cons of each approach and suggests that an exploration approach is often more natural, logical and effective than the business plan based alternative.

Industry and Higher Education publish 2012  PDF Download
An Auto-Ethnographic Perspective on Academic Entrepreneurship: Implications for Research in the Social Sciences and Humanities Morten Pilegaard
Peter W Moroz
Helle Neergaard

This paper employs a qualitative method to analyze a successful spin-off from a university’s humanities department. We offer insight into (a) how sociospatial contexts may be structured to better evaluate the entrepreneurial facilitation process and (b) why academic entrepreneurship in the social sciences and humanities may differ from that in the hard sciences. Our findings illustrate the importance of bridging innovation using twin skills to balance research and commercial goals, and the need for codifying knowledge capacities and creating new or changing existing institutional structures to legitimize and facilitate entrepreneurial activity. The research also demonstrates the great value of auto-ethnographic techniques to bring fresh insight to the study of entrepreneurship. Directions for future research are offered.

The Academy of Management Perspectives publish 2010  PDF Download
An Effectual Approach to International Entrepreneurship: Overlaps, Challenges, and Provocative Possibilities Saras Sarasvathy
suresh bhagavatula
Jeffery York
Kumar Kothandaraman

In this paper, we outline several interesting observations about international entrepreneurship (IE) research through the theoretical lens of effectuation. In doing so, we show how an effectual approach can help resolve four central conflicts and knowledge gaps identified in two recent comprehensive reviews of IE. We then present an illustrative case study from India that provides an intriguing comparison with the most recent modification of the Uppsala model to integrate with effectuation theory. Finally, we offer four provocative possibilities for future research at the intersection of IE and effectuation research.

Entrepreneurship Theory and Practice publish 2014  PDF Download
An Entrepreneurial Perspective on Value Creation in Public-Private Ventures Jeffery York
Saras Sarasvathy
Wicks Andrew C
Academy of Management Review publish 2013  PDF Download
An Exploration of The Cognitive Factors Involved in Learning from Failure Brandon Mueller
Dean Shepherd

Failure has been consistently extolled as a fundamental learning experience in entrepreneurship. However, researchers acknowledge that this pervasive view of failure is supported in the literature almost solely on the basis of anecdotal evidence. This study empirically investigates the type of knowledge that can be learned through a failure experience as well as the factors that moderate the learning process. We find that business failure can help improve an entrepreneur’s ability to recognize business opportunities by enhancing their use of structural alignment processes. This relationship is particularly strong for those entrepreneurs operating with an intuitive cognitive style, utilizing expert opportunity prototypes, and relying less upon prior professional experience.

Academy of Management Proceedings publish 2013
An Identity Based Approach to Social Enterprise Jeffery York
Tyler Wry

Social enterprise has gained widespread acclaim as a tool for addressing social and environmental problems. Yet, because these organizations integrate the social welfare and commercial logics, they face the challenge of pursuing goals that frequently conflict with each other. Studies have begun to address how established social enterprises can manage these tensions, but we know little about how, why, and with what consequences social entrepreneurs mix competing logics as they create new organizations. To address this gap, we develop a theoretical model based in identity theory that helps to explain: (1) how the commercial and social welfare logics become relevant to entrepreneurship, (2) how different types of entrepreneurs perceive the tension between these logics, and (3) the implications this has for how entrepreneurs go about recognizing and developing social enterprise opportunities. Our approach responds to calls from organizational and entrepreneurship scholars to extend existing frameworks of opportunity recognition and development to better account for social enterprise creation.

Academy of Management Review publish 2015  PDF Download
An Integrated Model of Corporate Strategic Entrepreneurship in Service and Manufacturing Contexts marc lerchenmueller

This study relates entrepreneurial orientation to new venturing and strategic renewal through opportunity identifying behavior. Two behaviors are contrasted: adaptive searching (opportunity discovery) versus generative searching (opportunity creation). Based on samples of 111 manufacturing and 110 service organizations, this paper posits and presents evidence that adaptive searching mediates the effect of entrepreneurial orientation on new venturing and strategic renewal in manufacturing. Conversely, generative searching mediates these relationships in manufacturing and service contexts. This research, thus, considers the importance of an integrated view on corporate strategic entrepreneurship and highlights industry differences in the way organizations successfully implement an entrepreneurial strategy.

Academy of Management Proceedings publish 2014  PDF Download
An Intentions-Based Model of Entrepreneurial Teams’ Social Cognition Norris F. Krueger
Dean Shepherd

Research has identified crucial antecedents of corporate entrepreneurship. Research has also identified crucial antecedents of entrepreneurial thinking. This article uses lessons from social cognition to explicitly link these two issues. We adapt an intentions-based model of how to promote entrepreneurial thinking from its original domain of individual entrepreneurship and translate that model to the domain of corporate entrepreneurship. From our intentions-based model of the social cognition of entrepreneurial teams, we emphasize the importance of perceptions of desirability and feasibility and that these perceptions are from the team as well as the individual perspective. This leads to three propositions about entrepreneurial teams and an outline of the opportunities for future research.

Entrepreneurship Theory and Practice publish 2002  PDF Download
An investigation of hindsight bias in nascent venture activity. Gavin Cassar
Justin Craig

We posit that individuals who are actively engaged in activities to develop their own venture will exhibit hindsight bias when recalling their startup experiences. We observe that those who fail to develop their startup activity into an operating business demonstrate substantial hindsight bias concerning the probability of venture formation. In particular, the recalled probability of success, reported after their decision to quit, is lower than the probability of success solicited during the nascent process. We argue that the systematic distortion of the past has important implications for individuals involved in the venturing process. Specifically, we suggest that these individuals are at risk of overestimating their chances of success when starting future nascent activity if they do not correct for their optimistic tendencies. The evidence from this study suggests it is important to recognize that what nascent entrepreneurs believe they experienced, and what they actually experienced, may not be equivalent.

Journal of Business Venturing publish 2009  PDF Download
AN UNDERLYING MECHANISM OF ENTREPRENEURIAL DECISION MAKING: A COGNITIVE-AFFECTIVE-SOCIAL PROCESS SYSTEM APPROACH (INTERACTIVE PAPER) Qian Ye
Sherry Thatcher

In uncertain environments, entrepreneurial experts have a tendency to engage in effectuation, a transformative decision-making response, rather than in prediction-based decision making (Sarasvathy, 2001). Recent research has also found that venture founders differ in their application of both effectual and causal approaches (Mauer, 2009). Yet, little research has investigated why and when entrepreneurs use an effectual decision-making approach rather than a causal decision-making approach. In this paper we extend theory by exploring the relationship between the effectual vs. causal approaches of entrepreneurial decision making and an individual’s internal affective-cognitive structures (Mischel & Shoda, 1998; Izard 1977; 1993). We propose that entrepreneurs differ in their use of decision making reasoning rather than adopt a single effectual vs. causal approach consistently across various situations. Entrepreneurs’ affect, cognition, and venture creating contexts have interactive effects on entrepreneurial decision making and venturing behaviour.

Frontiers of Entrepreneurship Research publish 2010  PDF Download
Angel group members’ decision process and rejection criteria: A longitudinal analysis cecile Carpentier
Jean-Marc Suret

Abstract This paper investigates business angel group members’ decision-making from project submission to the final decision. Using a Canadian group’s archival data on 636 proposals, we provide a detailed longitudinal analysis of the decision process. The rejection reasons generally refer to market and execution risk; this finding holds for every step of the process for proposals that pass the pre-screen. Angel group members focus more on market and execution risk than agency risk, similar to venture capitalists. Inexperienced entrepreneurs are rejected for market and product reasons. Decision-making by the studied angel group members differs from that generally described for independent angels.

Journal of Business Venturing publish 2015  PDF Download
Antecedents and consequences of effectuation and causation in the international new venture creation process. Rainer Harms
Holger Schiele

The selection of the entry mode in an international market is of key importance for the venture. A process-based perspective on entry mode selection can add to the International Business and International Entrepreneurship literature. Framing the international market entry as an entrepreneurial process, this paper analyzes the antecedents and consequences of causation and effectuation in the entry mode selection. For the analysis, regression-based techniques were used on a sample of 65 gazelles. The results indicate that experienced entrepreneurs tend to apply effectuation rather than causation, while uncertainty does not have a systematic influence. Entrepreneurs using causation-based international new venture creation processes tend to engage in export-type entry modes, while effectuation-based international new venture creation processes do not predetermine the entry mode.

Journal of International Entrepreneurship publish 2012  PDF Download
ANTECEDENTS OF CONFLICT IN THE ENTREPRENEUR-INVESTOR RELATIONSHIP: AN EFFECTUATION PERSPECTIVE (SUMMARY) Malte Brettel
Daniel Appelhoff

Venture capital firms (VCFs) play an important role for new ventures and a cooperative working relationship is fundamental (Cable & Shane, 1997). At the same time, their relationship bears significant potential for conflict (Yitshaki, 2008). Conflict between entrepreneurs and their investors only gains attention recently (e.g. Collewaert, 2011; Zacharakis et al., 2010; Higashide & Birley, 2002) and very little is known about specific causes of conflict. We choose the theory of effectuation as a framework to investigate the antecedents of task conflict. Sarasvathy (2001) revealed that entrepreneurs regularly follow principles of effectuation when starting their businesses and the work of Wiltbank & Sarasvathy (2002) suggests diversity in the application of effectuation and causation for investors as well. Therefore this study aims to shed light on the question which and why specific dimensions of effectuation and causation lead to conflict between entrepreneurs and VCFs.

Frontiers of Entrepreneurship Research publish 2012  PDF Download
Antecedents, moderators, and performance consequences of membership change in new venture teams. Gaylen Chandler
Benson Honig
Johan Wiklund

This paper focuses on initial team size and membership change of new venture teams in two studies: (1) a panel study of 408 emerging ventures, and (2) a cross-sectional study of 124 new ventures. The findings suggest that larger initial team size provides an advantage for new organizations, and that the benefits of adding and dropping team members are contingent on the stage of development of the organization and the dynamism of the environment. Both external environment and team composition factors are associated with turnover in venture teams.

Journal of Business Venturing publish 2005  PDF Download
Are current models of entrepreneurial decision-making and cognitive coping relevant to novice entrepreneurs? Louise Elizabeth Pinfold

The objective of this research is to explore the extent to which current models of decision- making and entrepreneurial cognition are relevant to a sample of true novice entrepreneurs, those who are in the process of founding their first business venture. Novice entrepreneurs are recognised as being essential to sustaining the entrepreneurial churn in economies (Disney, Haskel & Heden, 2003) especially as the young firm population requires new entrants. The need arises because of the high rates of churning observed in populations of young firms that require a constant inflow of new ventures to renew the stock of businesses (Ganguly, 1985). Whilst some studies of the behaviour of entrepreneurs do focus on relatively young firms (e.g. Chandler, DeTienne, McKelvie, & Mumford, 2011) studies of true novice entrepreneurs are rare. The thesis seeks to address this gap in the literature. A sample of true novice entrepreneurs, that founded businesses in 2013 and 2014, is interviewed to explore their decision-making and cognition regarding a realistic new business case study. The approach replicates that used by other authors who have studied expert entrepreneurs (Sarasvathy, 2001; Sarasvathy, 2008; Chandler et al., 2011; Dew, Read, Sarasvathy & Wiltbank, 2009) using a think-aloud protocol to identify causation and effectuation styles. However, by using a mixed methods approach of concurrent and retrospective think-aloud aspects it was possible to identify novice decision-making and to capture the prior experiences that they referred to (Banks, Stanton & Harvey, 2014). The sample of 32 true novices was a randomised sub-set of 1128 business founders in the UK. The experimental protocol enabled a comparison with alternative expertise theories of feedback and linear thinking in decision-making (Winch & Maytorena, 2009). The key findings were contrary to the hypotheses; the true novices were both more effectual and more casual than expected; and furthermore were frequently using feedback loops in their decision-making. In addition, as the novice entrepreneurs reflected upon their experiences that informed their decisions, the literature predicts that novice entrepreneurs would have to adopt analytical approaches to decision making as they lack salient experiences to inform their decisions in the early years of trading. However, contrary to expectations, the novices used both analogical and heuristic sense-making approaches and were adept at switching between them (Jones & Casulli, 2014). The outcome of the experimental protocol offers insights into the extent to which the current literature captures the decision-making processes and entrepreneurial cognition of true novice entrepreneurs. The evidence is mixed, offering the opportunity for further refinement of existing theoretical constructs, and reinforcing the relevance of alternative theories of cognition and decision making for novice entrepreneurs, for government policies and the support networks and that provide resources to assist the creation and survival of new entrepreneurial ventures.In addition, for novice entrepreneurs, this research examined the relevance and influence of their prior experiences and emotions on their entrepreneurial decision-making. In founding their first business, the prediction for novices is that they would struggle to draw on appropriate experiences (Mathias, Williams & Smith, 2015). However, the results showed novices referencing a wide variety of experiences, with the majority of these based on personal events that they had directly experienced either in their current start-up or previous work activity. Emotions are believed to influence entrepreneurs’ abilities to cope with uncertainty in business decision making and to persist in their endeavours in the face of adverse experiences and entrepreneurs are predicted to be over optimistic (Koellinger, Minniti & Schade, 2007; Ucbasaran, Westhead, Wright & Flores, 2010). The research profiled the novices’ emotions using the internationally externally validated PANAS (Positive and Negative Affect) scale (Watson, Clark & Tellegan, 1988) and the findings showed the novices engaged consistently with their underlying trait emotions however, interestingly, they were not statistically more optimistic than the UK population (Thompson, 2007). The findings make a contribution to both the theoretical explanations and practical aspects of novice entrepreneurship and show the appropriateness of relating current research to widely used measures from other fields of study, particularly as the impact of emotions is currently influencing the future of entrepreneurship research (Cardon, Foo, Shepherd & Wiklund, 2012; Shepherd, 2015).

publish 2016  PDF Download
Are entrepreneurial strategies culturally biased? The role of culture as an inter-subjective perception-forming construct Martin Stienstra
Rainer Harms
Aard Groen

Scholars have asserted that national culture has an influence on strategic decisions during new venture creation processes. One of the more promising frameworks describing these processes is that of Sarasvathy, known as the Effectuation framework. Within this framework, the role of national culture has not been embedded. Research has been done in 16 countries around the world among 317 entrepreneurs using the Think aloud method to get further insight in the role of national culture if effectual processes are set in a different context. Hierarchical multiple regression analysis findings show that national culture has a significant relationship with Effectual processes. This study highlights the importance of including national culture in studying new venture creation in different countries in general and Effectuation in particular.

publish 2016
Are Formal Planners More Likely To Achieve New Venture Viability? A Counterfactual Model And Analysis FRANCIS J. GREENE
CHRISTIAN HOPP

Research Summary This study develops and tests a counterfactual model of the relationship between formal written business plans and the achievement of new venture viability. This is important because extant theory remains oppositional, and there is a practical need to provide guidance to founders on the utility of formal plans. To test our model, we use propensity score matching to identify the impact that founder, venture, and environmental factors have on the decision to write a formal plan (selection effects). Having isolated these selection effects, we test whether or not these plans help founders achieve venture viability (performance effects). Our results, using data on 1,088 founders, identify two key results: (1) selection effects matter in the decision to plan; and (2) it pays to plan. Managerial Summary This study assesses whether founders who write formal plans are more likely to achieve new venture viability. This is important because, despite its popularity, there is considerable debate about the value of plans. One root reason for this is that what prompts a founder to plan also impacts his/her chances of creating a viable new venture. The study’s novelty is to separate out influences on the decision to plan from the plan-venture viability relationship. Our results show that better-educated founders, those wanting to grow and innovate, and those needing external finance are more likely to plan. Subsequently, having isolated what prompts planning, we assess if writing a plan actually promotes venture viability. We find that it pays to plan. Copyright © 2016 Strategic Management Society.

Strategic Management Journal publish 2017  PDF Download
Are opportunities recognized or constructed?: An information perspective on entrepreneurial opportunity identification Ivan P Vaghely
Pierre Andre Julien

Using a case study of ten SMEs the authors apply a model of human information processing which provides a frame to help understand the entrepreneur’s use of information to identify opportunities. Their model integrates an algorithmic or pattern type of information processing and a heuristic or trial and error type of information processing into a pragmatic frame of the entrepreneur’s opportunity recognition-construction mechanism. This article shows how human information processing can moderate entrepreneurial opportunity identification.

Journal of Business Venturing publish 2010  PDF Download
ATTRACTIVENESS OF VENTURE IDEA AMONGST EXPERT ENTREPRENEURS: A CONJOINT ANALYSIS (INTERACTIVE PAPER) Dissanayake M. Semasinghe

Venture ideas are at the heart of entrepreneurship (Davidsson, 2004). However, we are yet to learn what factors drive entrepreneurs’ perceptions of the attractiveness of venture ideas, and what the relative importance of these factors are for their decision to pursue an idea. The expected financial gain is one factor that will obviously influence the perceived attractiveness of a venture idea (Shepherd & DeTienne, 2005). In addition, the degree of novelty of venture ideas along one or more dimensions such as new products/services, new method of production, enter into new markets/customer and new method of promotion may affect their attractiveness (Schumpeter, 1934). Further, according to the notion of an individual-opportunity nexus venture ideas are closely associated with certain individual characteristics (relatedness). Shane (2000) empirically identified that individual’s prior knowledge is closely associated with the recognition of venture ideas. Sarasvathy’s (2001; 2008) Effectuation theory proposes a high degree of relatedness between venture ideas and the resource position of the individual. This study examines how entrepreneurs weigh considerations of different forms of novelty and relatedness as well as potential financial gain in assessing the attractiveness of venture ideas.

Frontiers of Entrepreneurship Research publish 2010  PDF Download
Attributes of Angel and Crowdfunded Investments as Determinants of VC Screening Decisions Will Drover
Matthew S Wood
Andrew Zacharakis

This research explores whether relationships between young firms and certain early-stage seed funders portray certification effects that influence venture capitalist (VC) screening decisions. Specifically, we analyze how varying attributes of angel and crowdfunded investments certify venture quality in the minds of VCs as they make due diligence screening decisions. Results from two experiments utilizing 104 VCs making 1,036 screening decisions demonstrate that the heterogeneous nature of the attributes of angels and the crowd can produce highly influential certification effects.

Entrepreneurship Theory and Practice publish 2015  PDF Download
Attributions to intuition in the venture founding process: Do entrepreneurs actually use intuition or just say that they do? Brian Blume
Jeffrey Covin

Even though entrepreneurs often cite the use of intuition as a basis for their venturing decisions, verifying that entrepreneurs are actually using intuition is very difficult. We distinguish between entrepreneurs’ attributions to intuition and their actual use of intuition. We propose characteristics of entrepreneurs that increase the likelihood that they will attribute intuition as a basis for decisions during the venture founding process. We then delineate characteristics that make the development and effective use of entrepreneurial intuition more likely. Theoretical implications for researchers studying intuition and practical implications for entrepreneurs using intuition are discussed.

Journal of Business Venturing publish 2011  PDF Download
Balancing “what matters to me” with “what matters to them”: Exploring the legitimation process of environmental entrepreneurs Isobel O’Neil
Deniz Ucbasaran

Abstract We extend current knowledge on new venture legitimation by focusing both on how environmental entrepreneurs enact their values and beliefs during the legitimation process and on the resultant business and personal consequences. On the basis of our longitudinal analysis of six cases studies we develop a staged process model of legitimation. Our findings suggest three novel insights. First, the entrepreneur’s (i.e. the legitimacy seeker’s) own values and beliefs are found to anchor initial decisions about how to gain legitimacy (the “what matters to me” stage) but are then toned down as attention shifts to gain legitimacy from diverse audiences (the “what matters to them” stage). Eventually, the entrepreneurs arrive at an approach that balances “what matters to me and them”. Second, we are able to explain how and why these changes in legitimation take place. The entrepreneurs learned to adapt their legitimation work by engaging in reflection and reflexivity about both the business and personal consequences of their work in each stage. Finally, we detail the significance of dissonance to this process as a trigger for changes in behavior. Overall, our three insights allow us to extend the notion of what a “skillful” legitimacy seeker might be.

Journal of Business Venturing publish 2016  PDF Download
Becoming the Boss: Discretion and Postsuccession Success in Family Firms J. Robert Mitchell
Timothy Hart
Sorin Valcea
DAVID M TOWNSEND

Family firms can enjoy substantial longevity. Ironically, however, they are often imperiled by the very process that is essential to this longevity. Using the concept of managerial discretion as a starting point, we use a human agency lens to introduce the construct of successor discretion as a factor that affects the family business succession process. While important in general, successor discretion is positioned as a particularly relevant factor for productively managing organizational renewal in family businesses. This study represents a foundation for future empirical research investigating the role of agency in entrepreneurial action in the family business context, which consequently can contribute to the larger research literature on succession and change.

Entrepreneurship Theory and Practice publish 2009
Becoming the Boss: Discretion and Postsuccession Success in Family Firms J. Robert Mitchell
Timothy Hart
Sorin Valcea
DAVID M TOWNSEND

Family firms can enjoy substantial longevity. Ironically, however, they are often imperiled by the very process that is essential to this longevity. Using the concept of managerial discretion as a starting point, we use a human agency lens to introduce the construct of successor discretion as a factor that affects the family business succession process. While important in general, successor discretion is positioned as a particularly relevant factor for productively managing organizational renewal in family businesses. This study represents a foundation for future empirical research investigating the role of agency in entrepreneurial action in the family business context, which consequently can contribute to the larger research literature on succession and change.

Entrepreneurship Theory and Practice publish 2009  PDF Download
Behavioral disinhibition and nascent venturing: Relevance and initial effects on potential resource providers Lerner Daniel

Abstract While relatively weak inhibition is often associated with unproductive behavior and pathologies, it may favor acting on entrepreneurial opportunities. Ultimately exploiting opportunities, however, goes well beyond individual action, requiring organizing/others. This raises the question of how others perceive and respond to disinhibition in an entrepreneurial agent. Triangulating from psychology and entrepreneurship literatures, behavioral disinhibition in an entrepreneur is hypothesized to have ambivalent, overall negative effects on potential resource providers. A randomized experiment tested the hypotheses. Results were significant, with moderate to large effect sizes. The findings suggest that behavioral proclivities facilitating individual entrepreneurial action may paradoxically undermine organizing. The work contributes to an emergent literature on ostensibly dark-side characteristics relevant to entrepreneurship, extends knowledge on entrepreneur behavior influencing potential resource providers, and highlights unresolved tensions relevant to opportunity pursuit (e.g., exploration/exploitation dilemmas).

Journal of Business Venturing publish 2016  PDF Download
Beyond Affective Valence: Untangling Valence and Activation Influences on Opportunity Identification Maw-Der Foo
Marilyn A Uy
Charles Murnieks

Research surrounding how entrepreneurs identify opportunities focuses on the impact of affective valence on entrepreneurs’ cognitive processes. Extending this body of research, we theorize how affective valence and affective activation work together to impact opportunity identification. We emphasize that to understand affective influences, both valence and activation should be included because they each influence active search effort and knowledge integration. We discuss the theoretical and practical implications of our study and suggest that future research should include more dynamic relationships among affect and entrepreneurial outcomes.

Entrepreneurship Theory and Practice publish 2015  PDF Download
Beyond creative destruction and entrepreneurial discovery: A radical Austrian approach to entrepreneurship Todd Chiles
Bluedorn, A. C.
V K Gupta

Although Schumpeter’s theory on `creative destruction’ and Kirzner’s on `entrepreneurial discovery’ dominate current entrepreneurship research in organization studies, one of the most fundamental debates in modern Austrian economics is that between Kirzner and Lachmann. Using Low and MacMillan’s (1988) key specifications as a rubric, we introduce organizational entrepreneurship scholars to Lachmann’s work, identify the direction in which his radical subjectivist approach would lead the field, and encourage exploring important questions from, and adopting methods consistent with, his provocative perspective. This unique disequilibrium perspective, which takes into account institutional contexts and multiple levels of analysis, offers new theoretical insight into how entrepreneurs create opportunities through expectations of an imagined future and exploit opportunities through continuous resource combination and recombination. Conceptualizing time as subjective and heterogeneous, it facilitates the examination of patterns in entrepreneurial activity, especially when combined with longer time frames. And it offers hermeneutics and ideal-types as alternatives to statistical models, for developing a theoretically sophisticated understanding of how entrepreneurial processes unfold.

Organization Studies publish 2007  PDF Download
Beyond cultural values? Cultural leadership ideals and entrepreneurship Ute Stephan
Saurav Pathak

Abstract This paper offers a fresh perspective on national culture and entrepreneurship research. It explores the role of Culturally-endorsed implicit Leadership Theories (CLTs) – i.e., the cultural expectations about outstanding, ideal leadership – on individual entrepreneurship. Developing arguments based on culture-entrepreneurship fit, we predict that charismatic and self-protective CLTs positively affect entrepreneurship. They provide a context that enables entrepreneurs to be co-operative in order to initiate change but also to be self-protective and competitive so as to safeguard their venture and avoid being exploited. We further theorize that CLTs are more proximal drivers of cross-country differences in entrepreneurship as compared with distal cultural values. We find support for our propositions in a multi-level study of 42 countries. Cultural values (of uncertainty avoidance and collectivism) influence entrepreneurship mainly indirectly, via charismatic and self-protective CLTs. We do not find a similar indirect effect for cultural practices.

Journal of Business Venturing publish 2016  PDF Download
Beyond environmental scarcity: Human and social capital as driving forces of bootstrapping activities Dietmar Grichnik
Jan Brinckmann
Luv Singh
Sophie Manigart

Abstract Although entrepreneurship scholars highlight bootstrapping as a key resource acquisition approach to respond to the inherent resource constraints that nascent ventures face, little is known about what causes nascent ventures to engage in bootstrapping. Theory highlights the environment as an important determinant of bootstrapping activity. Analyzing bootstrapping behavior of 298 nascent ventures, we find that beyond perceived environmental factors, individual characteristics of the nascent entrepreneurs and factors relating to the embeddedness of the entrepreneurs in the environment determine their venture’s bootstrapping behavior. In a more fine-grained analysis we gain insights into how these antecedents shape the use of particular bootstrapping strategies. Findings contribute to our understanding of factors driving resource management approaches in nascent ventures.

Journal of Business Venturing publish 2014  PDF Download
Beyond hubris: How highly confident entrepreneurs rebound to venture again Saras Sarasvathy
Mathew L.A. Hayward
Bill Forster
Barbara L. Fredrickson

This article outlines why highly confident entrepreneurs of focal ventures are better positioned to start and succeed with another venture; and therefore why overconfidence in one’s capabilities functionally persists and pervades amongst entrepreneurs. By combining cognitive perspectives on confidence in decision making with Fredrickson’s [Fredrickson, B.L. 1998. What good are positive emotions?. Review of General Psychology, 2, 300–319.; Fredrickson, B.L. 2001. The role of positive emotions in positive psychology: the broaden-and-build theory of positive emotions. American Psychologist, 56, 218–226.; Fredrickson, B.L. 2003. The value of positive emotions. American Scientist, 91: 330–335] ‘broaden-and-build’ theory of positive emotions, this paper elaborates the manner in which such entrepreneurs can develop emotional, cognitive, social and financial resilience that can be marshaled and mobilized for a subsequent venture.

Journal of Business Venturing publish 2010  PDF Download
Beyond the Single-Person, Single-Insight Attribution in Understanding Entrepreneurial Opportunities. Dimo Dimov

This article helps develop the creativity perspective within entrepreneurship in two ways. First, it elaborates on the nature of opportunity as a creative product. Rather than viewing opportunities as single insights, it suggests that they are emerging through the continuous shaping and development of (raw) ideas that are acted upon. Second, rather than attributing them to a particular individual, it highlights the contextual and social influences that affect the generation and shaping of ideas. This helps move entrepreneurship research beyond the single-person, single-insight attribution that currently permeates it.

Entrepreneurship Theory and Practice publish 2007  PDF Download
Biohit: A Global, Family-Owned Company Embarking on a New Phase Tanja Kontinen

This case concerns Biohit, a family-owned biotechnology company established in Finland in 1988, selling liquid handling and diagnostics products in the global market. The case also describes the entrepreneurial career of Biohit’s CEO Osmo Suovaniemi, since the company is mainly based on the know-how that Osmo gained as owner-manager of his two earlier companies, Labsystems and Eflab, during the 1970s and 1980s. Hence, this case describes the prior and initial phases of Biohit, examining also its commitment to innovation and its management practices. The case ends with the situation as of March 2010 and includes the reflections of Biohit’s managers on the future of the company. At this point, Osmo was intending to hand over his executive position to someone from outside the family, on the grounds that none of his three sons was able or willing to take up the position. However, he planned to continue as owner, inventor, and full-time board member of Biohit. The managers of Biohit had high hopes of making a breakthrough with diagnostics products that had been under intensive development over a long period.

Entrepreneurship Theory and Practice publish 2014
Boundary Capabilities in MNCs: Knowledge Transformation for Creative Solution Development Esther Tippmann
Pamela Sharkey Scott
Andrew Parker

The management of knowledge across country units is critical to multinational corporations (MNCs). Building on the argument that boundary spanning leads to the development of creative problem solving outcomes, this study advances the concept of MNC knowledge transformation and examines its relationship with solution creativity. Using questionnaire data on 67 problem solving projects, we find that opportunity formation is an underlying mechanism linking MNC knowledge transformation to the development of creative solutions. These insights contribute to our understanding of boundary spanning in global organizations by substantiating MNC knowledge transformation and elaborating the relationship between boundary spanning and creative solution development. If successful at knowledge transformation, collaborators from across the MNC can construct previously unimagined opportunities for the generation of creative outcomes.

Journal of Management Studies publish 2017  PDF Download
Bridging Behavioral Models and Theoretical Concepts: Effectuation and Bricolage in the Opportunity Creation Framework CHRIS WELTER
René Mauer
ROBERT J. WUEBKER

Research summary Opportunity creation, effectuation, and bricolage are three concepts that describe value creation and the central role of entrepreneurial action in that process. Although research often conceptualizes these concepts as interrelated, precisely how they relate to and complement one another and where they diverge remains unclear. This article examines the roots of each of these concepts and their underlying assumptions, organizing them within a unifying conceptual frame. Our analysis reveals a set of entailing implications that can guide future conceptual and empirical work in entrepreneurship, and it advances our understanding of value creation and capture in strategy, organization theory, management, and related fields. Managerial summary What are entrepreneurs doing? At the highest level of abstraction, entrepreneurs are identifying and exploiting opportunities. Recently, several lines of research have examined how certain types of entrepreneurial action can result in forming, rather than merely encountering, opportunities. Scholars engaged in this work have used both deductive and observational approaches, which have been rarely examined jointly or integrated into a comprehensive framework. This article focuses on the literature on opportunity creation, effectuation, and bricolage, examining each of the approaches and their underlying assumptions, and it organizes them within a unifying conceptual frame. Doing so reveals avenues for future work, in particular the development of new theories of opportunity formation, and implications for research in related fields such as strategic management, organization theory, and economics. Copyright © 2016 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2016  PDF Download
Bridging the Mutual Knowledge Gap: Coordination and the Commercialization of University Science reddi kotha
GERARD GEORGE
KANNAN SRIKANTH

We examine why commercialization of interdisciplinary research, especially from distant scientific domains, is different from commercialization of inventions from specialized or proximate domains. We argue that anticipated coordination costs arising from the need to transfer technology to licensee firms and from the need for an inventor team’s members to work together to further develop a technology significantly impact commercialization outcomes. We use a sample of 3,776 university invention disclosures to test whether variation in the types of experience of the scientists on a team influences the likelihood that an invention will be licensed. We proffer evidence to support our hypotheses that anticipated coordination costs influence whether an invention is licensed and that specific forms of team experience attenuate such coordination costs. The implications of these findings for theories of coordination, innovation, and entrepreneurship are discussed.

Academy of Management Journal publish 2013  PDF Download
Bridging the Valley of Death: Lessons Learned From 14 Years of Commercialization of Technology Education Steve H. Barr
TED BAKER
STEPHEN K. MARKHAM
ANGUS I. KINGON

We argue for the increasing importance of providing graduate students with skills in technology entrepreneurship and the commercialization of technology. We describe the lessons we have learned from 14 years of developing commercialization of technology pedagogy and adapting it for use on four continents and within numerous corporations. We demonstrate that the theory-driven approach that we use to shape the curriculum improves our ability to learn from our mistakes and to structure small experiments to improve the curriculum and pedagogy.

Academy of Management Learning & Education publish 2009  PDF Download
Building Inclusive Markets in Rural Bangladesh: How Intermediaries Work Institutional Voids Johanna Mair
IGNASI MARTÍ
Marc J. Ventresca

Much effort goes into building markets as a tool for economic and social development; those pursuing or promoting market building, however, often overlook that in too many places social exclusion and poverty prevent many, especially women, from participating in and accessing markets. Building on data from rural Bangladesh and analyzing the work of a prominent intermediary organization, we uncover institutional voids as the source of market exclusion and identify two sets of activities—redefining market architecture and legitimating new actors—as critical for building inclusive markets. We expose voids as analytical spaces and illustrate how they result from conflict and contradiction among institutional bits and pieces from local political, community, and religious spheres. Our findings put forward a perspective on market building that highlights the on-the-ground dynamics and attends to the institutions at play, to their consequences, and to a more diverse set of inhabitants of institutions.

Academy of Management Journal publish 2012  PDF Download
Building Resilience or Providing Sustenance: Different Paths of Emergent Ventures in the Aftermath of the Haiti Earthquake Trent Williams
Dean Shepherd

Disaster events threaten the lives, economies, and wellbeing of those they impact. Understanding the role of emergent organizations in responding to suffering and building resilience is an important component of the grand challenge of how to effectively respond to disasters. In this inductive case study we explore venture creation initiated by locals in response to suffering following the 2010 Haiti earthquake. In exploring six ventures we found that two distinctive groups emerged in terms of their identification of potential opportunities to alleviate suffering, their access to and use of key resources, the action they took, and ultimately their effectiveness in facilitating resilience. We offer an inductive, grounded theoretical model that emerged from our data that provides insight into and an extension of literature on resilience to adversity and the disaster literature on emergent response groups, opening pathways for management scholarship to contribute in a meaningful way to this grand challenge.

Academy of Management Journal publish 2016  PDF Download
Business Angel Network Saras Sarasvathy
Rob Wiltbank

Business angel “networks,” such as the Band of Angels in Silicon Valley and the Alliance of Angels in the Pacific Northwest have been forming at a rapid pace. It is estimated that there are over 150 business angel networks in the United States and several in European and Asian countries. Books and web sites on business angels continue to proliferate. From a research standpoint, however, in spite of the considerably larger magnitude of business angels when compared to VCs, we know less about the former than the latter.

Wiley Encyclopedia of Management publish 2015  PDF Download
Business Models and Tactics in New Product Creation: The Interplay of Effectuation and Causation Processes M K Sitoh
S L Pan
C Y Yu

Effectuation and causation are two contrasting approaches to new business development. We argue that these two approaches are generic decision-making mechanisms that can coexist with one another and that they are configured in specific ways during different phases in the process of new product creation. These decision-making mechanisms are influenced by internal and external market factors: the nature of activities of a phase and the interplay between the business model and tactics. Our research framework is a generic two-stage competitive process that separates business models from tactics. We conducted an in-depth case study of a console game creation project to examine these decision-making mechanisms and to explore how business models are formulated and how each mechanism influences subsequent tactics during the new product creation process. Our findings suggest the following four decision-making configurations with unique modes of interplay between business models and tactics: effectuation centric, discovery centric, causation centric, and tactic centric. The theoretical insights on the linkage between decision-making mechanisms and business models have important practical implications for new product creation.

IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT publish 2014
Business owners’ network size and business growth in China: The role of comprehensive social competency Xiang-yang Zhao
MICHAEL FRESE
Angelo Giardini

The authors present a model that explains how comprehensive social competency (made up of three components ? social skills, proactive and elaborate social strategies, and relational perseverance) is related to business people’s network development, and how social networks in turn are related to business growth. We conducted two studies with Chinese small business owners, ? one in the capital city Beijing (N?=?133) and a second one in the less developed rural region of Xunyi (N?=?78). Comprehensive social competency was consistently related to network size and business growth. In addition, government network size was related to the business growth since start-up in both studies (employee growth in Study 1 and personal asset growth in Study 2), but business network size was not related to business growth. Government network size also functions as a partial mediator between comprehensive social competency and business growth since start-up. Some differences are found between the rural area and the urban centre.

Entrepreneurship & Regional Development publish 2010  PDF Download
BUSINESS PLANNING, IDEA CHANGE, FLEXIBILITY AND PERFORMANCE: THE BEST OF BOTH WORLDS? (INTERACTIVE PAPER) Christophe Garonne
Per Davidsson

The relationships between business planning and performance have divided the entrepreneurship research community for decades (Brinckmann et al, 2010). One side of this debate is the assumption that business plans may lock the firm in a specific direction early on, impede the firm to adapt to the changing market conditions (Dencker et al., 2009) and eventually, cause escalation of commitments by introducing rigidity (Vesper, 1993). Conversely, feedback received from the production and presentation of business plans may also lead the firm to take corrective actions. However, the mechanisms underlying the relationships between changes in business ideas, business plans and the performance of nascent firms are still largely unknown. While too many business idea changes may confuse stakeholders, exhaust the firm’s resources and hinder the undergoing legitimization process, some flexibility during the early stages of the venture may be beneficial to cope with the uncertainties surrounding new venture creation (Knight, 1921; March, 1982; Stinchcombe, 1965; Weick, 1979). Previous research has emphasized adaptability and flexibility as key success factors through effectual logic and interaction with the market (Sarasvathy, 2001; 2007) or improvisation and trial-and-error (Miner et al, 2001). However, those studies did not specifically investigate the role of business planning. Our objective is to reconcile those seemingly opposing views (flexibility versus rigidity) by undertaking a more fine-grained analysis at the relationships between business planning and changes in business ideas on a large longitudinal sample of nascent firms.

Frontiers of Entrepreneurship Research publish 2011  PDF Download
BUSINESS POLICY & STRATEGY Conference Paper Abstracts. effectuation

This section presents abstracts of conference papers related to business policy and strategy. These include “Competitive Advantage in Transition Economies: Exploring Organizational Capacity for Change,” discussing competitive advantage in developed countries, “A Changing of the Guard: Executive and Director Turnover Following Corporate Earnings Restatements,” on corporate earnings restatements, and “Balancing Exploration and Exploitation in Alliance Formation: A Multidimensional Perspective.”

Academy of Management Proceedings publish 2005
BUSINESS POLICY AND STRATEGY Conference Paper Abstracts. effectuation

This section presents abstracts of several business policy and strategy conferences held in the U.S. as of August 2003. ‘Complementary Resources and the Prediction of Post-Acquisition Performance,’ by David R. King, Rebecca J. Slotegraaf, Idalene F. Kesner and Tom Lenz shows that acquisitions, on average, do not improve firm performance. ‘Exploring Competing Motivations Behind the Acquisition of High-Technology Targets,’ by David R. King represents a significant contribution by demonstrating conflicting findings in existing merger and acquisition research may result from alternate motivations behind merger and acquisition activity. ‘Strategic Inertia Determinants: Analyzing the Size, Middle Manager, and Competitive Intensity Mix,’ by Willie Edward Hopkins, Ajay Menon, Christian Homburg and Shirley Ann Hopkins, revisits firm size as a determinant of strategic inertia. ‘Restructuring in Japanese Companies: Foreign Ownership, Strategic Investments, and Firm Performance’ by Parthiban David, Toru Yoshikawa and Abdual A. Rasheed shows that foreign ownership leads to reduction in research and development and capital expenditures as well as improvement in performance, especially for firms with high free cash flow that are likely to have the most severe agency problems.

Academy of Management Proceedings publish 2003  PDF Download
Can cognitive biases explain venture team homophily? Simon Parker

Although venture teams whose founders are dissimilar (heterophilious) tend to outperform teams whose founders are similar (homophilious), most new venture teams are characterized by homophily. I try to explain this puzzle with a learning model in which founders are prone to two cognitive biases: overoptimism and self-serving attributions. Founders choose cofounders with similar beliefs as themselves because they expect this to promote the most effective allocation of effort to the venture. Self-serving bias reinforces and perpetuates these beliefs. In principle, informed outsiders (e.g., practitioners or hands on investors) can improve venture team composition compared with private choices by founders. Copyright © 2009 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2009  PDF Download
Can genetic factors influence the likelihood of engaging in entrepreneurial activity? Nicos Nicolaou
Scott Shane

This article offers an argument for how genetic factors may influence the tendency of people to engage in entrepreneurial activity, and describes four mechanisms through which genetic factors could operate. It also explores ways that researchers can use quantitative and molecular genetics to examine entrepreneurship, and discusses the potential implications of a genetic perspective for management research on entrepreneurship.

Journal of Business Venturing publish 2009  PDF Download
Capability Development and Decision Incongruence in Strategic Opportunity Pursuit Dean Shepherd
J. Robert Mitchell

In strategic opportunity pursuit, decision incongruence (the gap between the decision-making rationale that an individual conveys to others and the rationale that informs his/her actual decisions) can lead to difficulties achieving the commitment necessary to grow a venture. To understand why some individuals have greater decision incongruence in strategic opportunity pursuit than others, we conducted a field experiment to test how a configuration of theoretically-based capability-building mechanisms—codification, general human capital, and specific human capital—affected 127 CEOs’ decision incongruence. The results indicate that codification decreases decision incongruence the most for CEOs with low general but high specific human capital. Copyright © 2012 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2012  PDF Download
Capital Is Not Enough: Innovation in Developing Economies Jeffery McMullen
Kendall Artz
Steve W Bradley
Edward M. Simiyu

Economic development and social entrepreneurship often conceive of poverty as a resource allocation problem in which a lack of capital prevents the poor from increasing their income through entrepreneurship. This allocative view, however, represents only one possible approach to conceptualizing entrepreneurial opportunity. The alternative discovery- and creativity-based views place a greater emphasis on innovation which implies that superior ideas are also needed if poverty is to be reduced through firm performance. Drawing from a survey of 201 small business owners involved in a microcredit programme in Nairobi, Kenya, we find that the financial, social, human capital–performance relationships are mediated in part by innovation. Further, we find that differentiation-related innovations lead to better firm performance than novelty-related innovations.

Journal of Management Studies publish 2012  PDF Download
Career as Antecedent of Entrepreneurial Decision-making Yuval Engel
Emma Kleijn
Svetlana Khapova

This study explores how careers of entrepreneurs influence their preference for causal and effectual decision logics in the process of new venture creation. We adopt a qualitative research approach including verbal protocols and semi-structured interviews with a sample of 28 entrepreneurs. Based on our findings we propose a framework consisting of four different career profiles, which in turn, are related to a specific decision-making logic. In particular, we show how career properties, that are general, rather than specific to the domain of entrepreneurship, are distinctively related to effectuation and causation through their common foundation in the notions of prediction and control.

Academy of Management Proceedings publish 2013  PDF Download
Causal and Effectual Network Strategies and New Venture Performance: a Study of German Entrepreneurs (Summary) Joris Heuven
Semrau Thorsen
Jeroen Kraaijenbrink
Stefan Sigmund
Frontiers of Entrepreneurship Research publish 2011  PDF Download
Causation and effectuation processes: A validation study. Gaylen Chandler
Dawn DeTienne
Alexander McKelvie
Troy Mumford

We develop and validate measures of causation and effectuation approaches to new venture creation and test our measures with two samples of entrepreneurs in young firms. Our measure of causation is a well-defined and coherent uni-dimensional construct. We propose that effectuation is a formative, multidimensional construct with three associated sub-dimensions (experimentation, affordable loss, and flexibility) and one dimension shared with the causation construct (pre-commitments). As specified by Sarasvathy (2001), we also show that causation is negatively associated with uncertainty, while experimentation, a sub-dimension of effectuation, is positively correlated with uncertainty. The major contribution is the resulting validated scales that measure causation and effectuation.

Journal of Business Venturing publish 2011  PDF Download
Causation and effectuation vs. analysis and intuition: conceptual parallels in the context of entrepreneurial decision-making Andre Hermes

In the past years there has always been the reoccurring phenomenon of reinventing something that had already been successfully researched. Open innovation, for example, is a term created by Henry Chesbrough referring to the use of both internal and external knowledge to improve internal innovation. Nothing new, yet a term that is used in business books until now. It is the phenomenon that organizations are constantly seeking for new answers to old problems. This study aims at analyzing this concerning Sarasvathy’s work of causation and effectuation comparing it with Allinson and Hayes’ earlier work of analysis and intuition in order to determine whether their terms have been replaced by allegedly “new” innovative terms of Sarasvathy having the same meaning after all. Results indeed show parallels in their terms and definitions. However, the terms diverge in terms of their application and use. Furthermore, the phenomenon in general seems to be underlaying a deep cognitive and behavioral approach that lacks in evidence but in return opens doors for further research.

publish 2016  PDF Download
Causation and Effectuation: Toward a Theoretical Shift From Economic Inevitability to Entrepreneurial Contingency Saras Sarasvathy

In economics and management theories, scholars have traditionally assumed the existence of artifacts such as firms/organizations and markets. It is argued that an explanation for the creation of such artifacts requires the notion of effectuation. Causation rests on a logic of prediction – effectuation on the logic of control. Effectuation is illustrated through business examples and realistic thought experiments. Effectuation’s connections with existing theories and empirical evidence are examined. A list of testable propositions for future empirical work is provided.

Academy of Management Journal publish 2001  PDF Download
Causation and Effectuation: Toward a theoretical shift from economic inevitability to entrepreneurial contingency. Saras Sarasvathy

In economics and management theories, scholars have traditionally assumed the existance of artifacts such as firms/organizations and markets.I argue that an explanation for the creation of such artifacts requires the notion of effectuation. Causation rests on a logic of prediction, effectuation on the logic of control. I illustrate effectuation through business examples and realistic thought experiments, examine its connections with existing theories and emperical evidence and offer a list of testable propositions for future empirical work.

publish 2002  PDF Download
CELEBRITY RESTAURATEURS: NARRATIVES OF ENTREPRENEURIAL COMPETENCE DEVELOPMENT (INTERACTIVE PAPER) Magdalena Markowska

Institutional changes within the restaurant industry increased chefs’ autonomy and enabled their creative freedom, turning some of them into entrepreneurs (Rao, Monin & Duran, 2003). But, these changes created also the need to develop the ability to reconcile the professional, artistic and business tensions by chefs (Gillespie, 1994). Consequently, the fine dining segment became innovative and entrepreneurial, and the phenomenon of celebrity restaurateur emerged. Competence reflects the capacity to effectively interact with one’s environment (Johannisson, 1991). Gaining entrepreneurial competence requires restaurateurs to build capacity to create new means-ends frameworks and successfully deliver them to the market (Sarasvathy, 2001). While research showed that role models and achievement motivation facilitate the process, the understanding how this process occurs remains under-theorized. Hence, this paper explores how role models and achievement motivation facilitate entrepreneurial competence attainment.

Frontiers of Entrepreneurship Research publish 2012  PDF Download
Challenging the myths of entrepreneurship? Alf Rehn
Malin Brannback
Alan Carsrud
Marcus

Entrepreneurship studies started out as a young field, one where a mix of economists, psychologists, geographers and the occasional anthropologist came together to study the wonder and weirdness that is entrepreneurship, in a wide range of fashions and with few a priori assumptions to hold it back. Today, some of this eclecticism lives on in the field, but at the same time we have seen that the field has matured and its popularity has led to the field becoming increasingly institutionalized – and thereby beset by an increasing number of assumptions, even myths. Consequently, this special issue queries some of the assumptions and potential myths that flourish in the field, inquiring critically into the constitution of entrepreneurship as a field of research – all in order to develop the same. Without occasions where a field can question even its most deeply held beliefs, we are at risk of becoming ideologically rather than analytically constituted, which is why we in this special issue wanted to create a space for the kind of critical yet creative play that e.g. Sarasvathy (2004) has encourages the field to engage with.

Entrepreneurship & Regional Development publish 2013  PDF Download
CLAIRVOYANCE OR SOMETHING SINISTER: A MODEL OF MARKET INSIGHTS AND OPPORTUNITY RECOGNITION. DAVID M TOWNSEND
JASON A. HARKINS

Within the broad framework of the entrepreneurial opportunity recognition literature, the debate has continued as to whether opportunities are discovered or created. While under the paradigm of neoclassical economics, entrepreneurial opportunities are held to be the temporary result of disequilibrium in external markets, a behavioral perspective on entrepreneurship emphasis the influence of creative agency by individuals on external markets. By examining the theoretical nexus of schema theory and the Neoclassical Economics’ perspective regarding market disequilibrium, this paper describes the formation of market insights as the first discovery stage in the opportunity recognition process. In addition, market insights are distinguished from entrepreneurial opportunities and are shown to be the result of a entrepreneurial cognitive processing while entrepreneurial opportunity recognition is shown to be the result of a unique entrepreneurial decision process. Overall, the goal of this paper is bridge the theoretical gap between the behavioral and economic perspectives regarding entrepreneurial opportunities and to construct a viable framework for considering the process by which entrepreneurs translate external stimuli into specific plans for action.

Academy of Management Proceedings publish 2005  PDF Download
Co-creating a course ahead from the intersection of service-dominant logic and effectuation Saras Sarasvathy
Stuart Read
Marketing Theory publish 2012  PDF Download
Cognitive Adaptability and an Entrepreneurial Task: The Role of Metacognitive Ability and Feedback Michael Haynie
Holger Patzelt

To sense and adapt to uncertainty by leveraging prior entrepreneurial knowledge is a critical ability. However, for many individuals, prior entrepreneurial knowledge is absent or underdeveloped. We investigate the ability of individuals without prior entrepreneurial knowledge to effectively adapt decision policies in response to feedback, while performing an entrepreneurial task. We model 10,000 “entrepreneurial decisions” nested within 217 individuals, to demonstrate how differences in metacognitive ability and feedback type promote (or alternatively impede) cognitive adaptability. Our findings suggest insights into the interplay between knowledge, learning, and cognition that are generalizable to activities and actions central to the entrepreneurial process.

Entrepreneurship Theory and Practice publish 2012  PDF Download
COGNITIVE INSIGHT AND ENTREPRENEUR DECISION-MAKING: AN EXPERIMENTAL INVESTIGATION OF SELF-REFLECTIVENESS IN OPPORTUNITY IDENTIFICATION (INTERACTIVE PAPER) DAVID M TOWNSEND
Steven M Barr

Identifying and exploiting opportunities is frequently described as the most fundamental of entrepreneurial behaviors (Shane & Venkataraman, 2000; Venkataraman, 1997). However, recent work criticizes the teleological basis of most extant theories of the opportunity identification process arguing that many entrepreneurs do not start firms with specific goals or outcomes in mind (Sarasvathy, 2001). Rather, “effectual” entrepreneurs initiate operations with only a general goal in mind (i.e., avoid significant losses). As the market and firm evolves, more specific plans are then formulated and action becomes increasingly more intentional. In reviewing effectuation theory, however, a major question remains unanswered—specifically, why would clearly specifying goals up-front prevent entrepreneurs from taking advantage of contingencies that may arise during the firm creation process? An unstated assumption implied in effectuation theory appears to be that entrepreneurs fully specifying desired outcomes a priori would be less likely (or less willing) to make radical adjustments to their plans. At the base of this assumption is the implied belief that a fundamental decision bias (i.e., escalation of commitment) locks entrepreneurs with strong prior goals into particular courses of action, and, therefore, market dynamism which shifts demand away from the expected trajectory of the market would generate massive losses for the venture.

Frontiers of Entrepreneurship Research publish 2010  PDF Download
Cognitive Logics, Entrepreneurial Cognitive Style, and Growth Intentions: A Conceptual Model and an Exploratory Field Study Dutta D. K
Stuart Thornhill

Using insights based on the entrepreneurial cognition perspective, we develop a conceptual model to explain the evolution of entrepreneurial growth intentions under the influence of venture cognitive logics (causation versus effectuation) and entrepreneurial cognitive style (analytic versus holistic). Our model finds preliminary support based on qualitative data from an exploratory field study of a select group of entrepreneurs, interviewed in three waves over a 5-year timeframe.

Entrepreneurship Research Journal publish 2014
Cognitive mechanisms in entrepreneurship: Why and when enterpreneurs think differently than other people Baron, Robert A.

Because of their importance in creating wealth—both personal and societal—entrepreneurs have long been the subject of intensive study. Past research has focused on important issues such as: Why do some people, but not others, recognize or create new opportunities? Why do some, but not others, try to convert their ideas and dreams into business ventures? And why, ultimately, are some entrepreneurs successful and others not? Efforts to answer these questions in terms of the personal characteristics of entrepreneurs generally yielded disappointing results: contrary to what informal observation suggests, entrepreneurs do not appear to differ greatly from nonentrepreneurs with respect to various aspects of personality. As a result, a growing number of researchers have recently adopted a different approach—one emphasizing the role of cognitive processes in entrepreneurship. This perspective suggests that valuable insights into the questions posed above may be obtained through careful comparison of the cognitive processes of entrepreneurs and other persons. Whereas informative research has already been conducted within this framework, the present study seeks to expand this developing perspective by building additional conceptual bridges between entrepreneurship research and the large, extant literature on human cognition. Basic research on human cognition suggests that our cognitive processes are far from totally rational; in fact, our thinking is often influenced by a number of sources of potential bias and error. It is suggested here that entrepreneurs often work in situations and under conditions that would be expected to maximize the impact of such factors. Specifically, they face situations that tend to overload their information-processing capacity and are characterized by high levels of uncertainty, novelty, emotion, and time pressure. Together, these factors may increase entrepreneurs’ susceptibility to a number of cognitive biases. Several cognitive mechanisms that may exert such effects and that have not previously been considered in detail in the literature on entrepreneurship are examined. These include: counterfactual thinking—the effects of imagining what might have been; affect infusion—the influence of current affective states on decisions and judgments; attributional style—tendencies by individuals to attribute various outcomes to either internal or external causes; the planning fallacy—strong tendencies to underestimate the amount of time needed to complete a given project or the amount of work that can be achieved in a given time; and self-justification—the tendency to justify previous decisions even if they result in negative outcomes. Each mechanism is described, and specific hypotheses concerning its potential impact on the thinking of entrepreneurs are proposed. A final section of the article touches briefly on methods for testing hypotheses concerning these mechanisms and explores the implications of this cognitive perspective for future entrepreneurship research. This section emphasizes the fact that a cognitive perspective can provide researchers in the field with several new conceptual tools and may also facilitate the development of practical procedures for assisting entrepreneurs.

Journal of Business Venturing publish 1998
Cognitive Processes of Opportunity Recognition: The Role of Structural Alignment Denis Gregoire
Pamela S. Barr
Dean Shepherd

Substantial gains can be made by individuals and organizations adept at detecting new opportunities. But how do business leaders do that concretely? Organization research shows that managers are more inclined to identify threats than opportunities, but it is still not clear why this is the case. Likewise, research points to several factors that may facilitate the recognition of opportunities. Yet empirical observations have been limited by retrospective biases and other conceptual challenges. As a result, key questions remain not only about what factors facilitate the recognition of opportunities, but also about why these factors play such a role. To further understanding of these issues, we study the reasoning strategies that individuals mobilize for recognizing opportunities. We develop a model of opportunity recognition as a cognitive process of structural alignment, and analyze the think-aloud verbalizations of executive entrepreneurs as they try to recognize opportunities for new technologies. In contrast to prior research, the qualitative and quantitative data do not provide evidence that individuals use prototypes to recognize opportunities. Instead, we find that different kinds of mental connections play different roles in the process of recognizing opportunities, with different consequences. We also document why and how prior knowledge may facilitate this process. By drawing attention to the cognitive underpinnings of opportunity recognition, we cast light on why it constitutes such a challenging task for individuals and organizations. In turn, this provides a useful basis for exploring the factors that explain why some individuals/organizations are able to recognize opportunities that others simply fail to see.

Organization Science publish 2009  PDF Download
COGNITIVE ROOTS OF CAUSAL AND EFFECTUAL INTERPLAY DURING VENTURE DEVELOPMENT (SUMMARY) Natalie den Engelse
raja Singaram
John Ettlie

Effectuation has been proposed as an alternative decision-making approach that takes into account the cognitive implications of uncertainty and the consequent constraints it places on both information processing and the use of planning heuristics in entrepreneurship (Gregoire et al., 2011). Effectuation is contrasted with causation, which represents the rational decision-making approach. Although individuals can use both causal and effectual reasoning at different times during venture development, prior research finds that entrepreneurs do not transition well between the modes (Sarasvathy, 2008). Literature has not sufficiently addressed the reasons that underlie an entrepreneur’s tendency towards a causal or effectual approach. Considering that both approaches are believed to fundamentally refer to cognitive processes, our study probes the cognitive roots of causal and effectual logics. This paper attempts to study how entrepreneurs’ stable psychological attributes such as thinking style influence entrepreneurial decision-making behaviors associated with the causal and effectual logics.

Frontiers of Entrepreneurship Research publish 2012  PDF Download
Commentary on Front and backstages of the diminished routinization of innovations, An entrepreneurial perspective on the firm-environment relationship, and Cross-boundary disruptors Jeffrey Covin

The papers by Bartunek, Trullen, Immediato, and Schneider (Front and backstages of the diminished routinization of innovations: what innovation research makes public and organizational research finds behind the scenes), Smith and Cao (An entrepreneurial perspective on the firm-environment relationship), and Burgelman and Grove (Cross-boundary disruptors: powerful interindustry entrepreneurial change agents) address the topic of change. The specific foci of these papers are quite different. While commonalities among the papers are certainly identifiable, highlighting the value of these writings is perhaps better achieved by focusing on their unique contributions to the change literature rather than by seeking to identify points of theoretical overlap within the broad domain of change. With this belief in mind, this commentary reviews several of the principal contributions of the three papers to the change literature. Promising research directions pertaining to the topic of change that build directly on observations made in the papers are then discussed. Copyright © 2008 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2007  PDF Download
Commentary: Exploiting and Exploring New Opportunities Over Life Cycle Stages of Family Firms Sharma, Pramodita
Salvato, Carlo

Family firms vary with regards to success achieved in terms of opportunity creation and exploitation over time. Elaborating on this variation, this commentary argues that firms that simultaneously engage in multiple levels of innovation—incremental, progressive, and radical—are likely to enjoy sustainable performance advantages across generations. Toward this end, a strategic split of innovation responsibilities between family and nonfamily professionals is likely to be useful, contingent on the firm’s life cycle and size. In terms of entrepreneurial expertise, a combination of causal and effectual thinking is necessary to ensure exploitation of already discovered or created opportunities and exploration of new ones.

Entrepreneurship Theory and Practice publish 2011  PDF Download
Community-Led Social Venture Creation. Helen Haugh

The addition of new enterprises to the economy has long been considered essential to economic growth. The process of venture creation in the private sector has been heavily researched and frequently modeled, although few models explain the process of nonprofit enterprise creation. Nonprofit social ventures pursue economic, social, or environmental aims, generating at least part of their income from trading. They fill market gaps between private enterprise and public sector provision, and, increasingly, policy makers consider them to be valuable agents in social, economic, and environmental regeneration and renewal. This article presents findings from a qualitative study of the inception of five community-led nonprofit social ventures, producing a model of the stages of venture creation: (1) opportunity identification, (2) idea articulation, (3) idea ownership, (4) stakeholder mobilization, (5) opportunity exploitation, and (6) stakeholder reflection. A formal support network and a tailor-made support network are also part of the model, contributing resources to the new venture and assisting progression through the stages. The model highlights the resource acquisition and network creation that precede formal venture creation. In the nonprofit sector, these activities are undertaken by volunteers who do not have a controlling interest in the new venture. For practitioners, the model identifies critical stages in the process of community-led social venture creation and two areas where assistance is most needed: pre-venture business support and postcreating effective networks.

Entrepreneurship Theory and Practice publish 2007  PDF Download
COMPETITIVE ADVANTAGE THROUGH ENTREPRENEURIAL DECISION-BEHAVIOR: EFFECTUATION FOR FAST PROBLEM-SOLVING (SUMMARY) Matthias Blauth
René Mauer

Research on entrepreneurship has acknowledged the role of employee’s decision-behavior for creating competitive advantage through corporate entrepreneurship (Ireland et al., 2009). One source of competitive advantage is problem-solving speed, as it fosters the ability to develop and market innovative products in a timely manner (Atuahene-Gima and Wei, 2011). Problem-solving speed can be defined as the time needed to find, evaluate and implement an adequate solution to a particular problem (Atuahene-Gima and Li, 2004). In uncertain situations, traditional management methods based on causal logic come to their explanatory limits. Effectuation as logic of entrepreneurial decision-behavior delineates principles describing an alternative behavioral approach, focusing rather on control than on prediction (Sarasvathy, 2001). These principles are the starting point of venturing, the attitude towards risk, towards stakeholders and the attitude towards unexpected events. Building decisions on effectual logic in uncertain situations might explain the differences in problem-solving speed and thus uncover a novel source of competitive advantage.

Frontiers of Entrepreneurship Research publish 2013  PDF Download
Complementary assets as pipes and prisms: Innovation incentives and trajectory choices Brian Wu
ZHIXI WAN
DANIEL A. LEVINTHAL

The issue of the failure of incumbent firms in the face of radical technical change has been a central question in the technology strategy domain for some time. We add to prior contributions by highlighting the role a firm’s existing set of complementary assets have in influencing its investment in alternative technological trajectories. We develop an analytical model that considers firm heterogeneity with respect to both technological trajectories and complementary assets. Complementary assets play a dual role in incumbents’ investment behavior toward radical technological change: they are not only resources (pipes) that can buffer firms from technology change, but also prisms through which firms view those changes, influencing both the magnitude of resources that should be invested and the trajectory to which these resources should be directed. Copyright © 2013 John Wiley & Sons, Ltd.

Strategic Entrepreneurship Journal publish 2014  PDF Download
Complexity Science at a Crossroads: Exploring a Science of Emergence Benyamin Lichtenstein

Complexity scholarship has flourished in organization science for many years, with important implications for managers, organizations, and networks. But the academic expressions of complexity-current publications using complexity science-is dwindling: only 0.2% of papers at last year’s Academy of Management meeting were complexity- based. Has complexity ‘petered out’ in some way? Rather than redouble energy in that direction, this paper argues for a focus on the core phenomenon that is studied by complexity, namely emergence. Two steps are suggested toward a ‘science of emergence.’ First, emergence can be seen as a process and as an outcome; both explanations are equally valid and important. Second, the causes of emergence are not unitary: research suggests that we should see at least four distinct causal mechanisms for emergence. This paper presents those four ‘prototypes’, and reflects on the duality of process/outcomes in emergence, with the goal of incorporating them within a single discipline. Overall, my emphasis is on the flourishing literature on emergence in organization science.

Academy of Management Proceedings publish 2016  PDF Download
Constructing Corridors to Economic Primitives: Entrepreneurial Opportunities as Demand-side Artifacts Saras Sarasvathy

The idea is to model entrepreneurial opportunities as pathways to the edifice of economic primitives such as preferences, demand functions, production functions, and so on — things that economic theory typically takes as “given”. This means that entrepreneurial endeavors can start in non-economic spheres and entrepreneurs construct “corridors” as it were from these pre-economic realities to economic artifacts such as new firms, new markets, and even new utility functions. The essay draws upon the open-universe philosophy of pragmatism and the more concrete “social science” arguments of Simon’s Sciences of the artificial. I connect the two threads of arguments to specific examples and current empirical work in entrepreneurship. I also examine implications for entrepreneurship research and economic development policy.

Research on Management and Entrepreneurship publish 2004  PDF Download
CONSTRUCTING MARKETS AND ORGANIZING BOUNDARIES: ENTREPRENEURIAL ACTION IN NASCENT FIELDS. Filipe Santos
Kathleen Eisenhardt

This article discusses how executives in entrepreneurial firms addressing nascent markets organize the boundaries of their firms. Entrepreneurs need to establish themselves in an initial market, but do not usually have a strong resource base nor established competencies to leverage. By structuring the roles in the market, entrepreneurs are able to reduce the ambiguity they face and prevent competition in the market. Entrepreneurs use acquisitions of smaller firms to increase their market coverage, cancel possible entry points for more powerful competitors, and eliminate threatening business models. Entrepreneurs construct markets by structuring the nascent market around a perceived opportunity for the creation of value.

Academy of Management Proceedings publish 2004  PDF Download
Constructing Markets and Shaping Boundaries: Entrepreneurial Power in Nascent Fields. Filipe Santos
Kathleen Eisenhardt

We examine how entrepreneurs shape organizational boundaries and construct markets through an inductive, longitudinal study of five ventures. Our central contribution is a framework of how successful entrepreneurs attempt to dominate nascent markets by co-constructing organizational boundaries and market niches using three processes: claiming, demarcating, and controlling a market. We propose that power is the underlying boundary logic and indicate the “soft-power” strategies by which entrepreneurs compete in highly ambiguous markets. Overall, we develop a holistic view of organizational boundaries and offer insights into institutional entrepreneurship and resource dependence theories. Our most important contribution is reinvigorating the study of interorganizational power.

Academy of Management Journal publish 2009  PDF Download
Contextualising case studies in entrepreneurship: A tandem approach to conducting a longitudinal cross-country case study Sylvie Chetty
Jukka Partanen
Erik Rasmussen
Per Servais

Using predictive and effectuation logics as a framework, this research note explains how case study research was conducted to demonstrate rigour and relevance. The study involves a longitudinal cross-country case study on small and medium-sized firm growth and networks undertaken by research teams in three countries (Finland, Denmark and New Zealand) involving 33 firms. This research note outlines the implications of this research and provides valuable guidance and reflections upon opportunities for future research regarding the conduct of contextual studies in entrepreneurship without compromising validity and reliability.

International Small Business Journal publish 2014
Contextualizing theory building in entrepreneurship research Shaker A. Zahra

Theory development and testing are central to the advancement of entrepreneurship as a scholarly field. For nearly three decades now, researchers have borrowed popular theories from other disciplines and adapted them to the study of diverse entrepreneurship phenomena. This has enhanced the rigor of research findings. Future studies can achieve greater rigor and relevance by paying more attention to the context of their investigations. Understanding the nature, dynamics, uniqueness and limitations of this context can enrich future studies. This article describes common problems revealed in recent entrepreneurship research when applying existing and new theories to well known vs. emerging and novel phenomena. The article also suggests strategies to enrich creative and constructive theory building.

Current Research - Traditional Questions publish 2007  PDF Download
Contingency as an entrepreneurial resource: How private obsession fulfills public need Susan S Harmeling

Borrowing from Rorty (1989:37), this article portrays the entrepreneurial process as a mechanism through which “private obsession” fulfills “public need.” It begins with an argument that a deeper understanding of contingency can enhance management scholarship in general and entrepreneurship in particular. It continues with an examination of contingency and entrepreneurial opportunity and then uses six narratives to show how both personal and historical contingencies become resources in the entrepreneurial process. A depiction of possible alternative responses (counterfactuals) for each narrative illustrates how entrepreneurs tend to take a resourceful, rather than an adaptive or a heroic stance toward contingency. A discussion of American Pragmatism provides theoretical support for contingency’s role in the entrepreneurial process. The paper concludes with a literature review and a look at how this view of entrepreneurial contingency illuminates the temporal context in management scholarship, among other implications for both research and practice.

Journal of Business Venturing publish 2011  PDF Download
Converging Winds: Logic Hybridization in the Colorado Wind Energy Field Jeffery York
TIMOTHY J. HARGRAVE
Desiree F Pacheco

This study explores the hybridization of field-level logics, a process that integrates previously incompatible logics within an organizational field. Through an inductive study of the wind energy field in Colorado, we find that logic hybridization resulted when social movement organizations (SMOs), electric utility firms, hybrid organizations, and policy makers variously responded to incompatibility between economizing and ecologizing logics. After compromise with electric utilities and efforts to justify wind power in economic terms failed to reduce the dominance of the economizing logic, SMOs switched tactics to promote the ecologizing logic. Once SMOs succeeded in altering the balance of power in the field, hybrid organizations then emerged to legitimize a new set of frames, practices, and arrangements that integrated the previously incompatible logics. Electric utility firms and policy makers then formalized and embedded the new hybridized logic in the field. Our findings suggest that the hybridization of field-level logics is a complex process in which organizational actions and field-level conditions recursively influence each other over time. This process is critical to understanding how entrepreneurs, firms, policy makers, and SMOs each contribute to the emergence of environmentally relevant sectors.

Academy of Management Journal publish 2016  PDF Download
Corporate effectuation: Entrepreneurial action and its impact on R&D project performance. Malte Brettel
René Mauer
A Engelen
Daniel Kupper

Innovative products are widely recognized as an important source of competitive advantage. However, many companies have difficulties finding efficient and successful approaches to different types of R&D projects, particularly those that involve a high level of innovativeness. Therefore, the present study moves effectuation theory from the entrepreneurial context to R&D research. First, the characteristics of an effectual approach in the context of R&D projects are developed and differentiated from those of conventional prediction-based strategies (causation). Second, using a thorough qualitative and quantitative scale-development process to capture particularities of effectual and causal dimensions in the R&D context, expert interviews and a pilot study (123 R&D projects), the study develops a multi-factor measurement model of effectuation and causation. These measures are validated in a follow-up study with a larger sample of 400 projects. Third, the new measures are applied to test two central hypotheses: (a) effectuation is positively related to success in highly innovative contexts, (b) causation approaches are beneficial in projects with low levels of innovativeness. Overall, this study moves the effectuation logic from the entrepreneurial to the corporate R&D context, captures its particularities, and investigates its performance outcomes.

Journal of Business Venturing publish 2012  PDF Download
CORPORATE ENTREPRENEURSHIP INVESTMENT DECISIONS UNDER UNCERTAINTY (INTERACTIVE PAPER) Maribel Guerrero
José L. Gonzalez
inaki pena

The rejuvenation of a company’s core competences may occur through organic growth or by expansion via spin-offs. Indeed, corporate entrepreneurship often entails opportunity-seeking and advantage-seeking activities, which lead to supra-normal profits in the long run. Usually, the strategic decision to strengthen corporate core competencies either internally or externally must be reached under uncertain investment conditions. However, little is known of the process by which such company-unique competences are deployed from the parent company to the spin-off venture. We examine this unexplored issue by drawing upon effectuation and real option theories and to gain a better understanding of how parent companies create and develop spin-offs under uncertain investment conditions in order to build up organizational core competences (Narayanan et al., 2009). We believe that the foundations of both domains, effectuation and real option theories, are useful to explain whether parent companies show a “pro-active and deterministic” investment behavior or a “re-active and flexible” investment behavior at the time of launching and developing spin-offs (McGrath, 1997; Sarasvathy, 2001;).

Frontiers of Entrepreneurship Research publish 2012  PDF Download
Corporate Entrepreneurship Managers’ Project Terminations: Integrating Portfolio-Level, Individual-Level, and Firm-Level Effects Judith Behrens
Holger Patzelt

Corporate entrepreneurship managers often need to terminate projects to maximize their innovation portfolios’ commercial prospects. Drawing on the attention-based view of the firm, we develop a model for how past project failure experience, the firm’s growth rate, and their hierarchical level impact managers’ attention to a project’s fit with the corporate portfolio strategy and the balance of the portfolio when terminating projects. Using data from a conjoint study with 6,944 assessments of project terminations made by 217 managers, we provide insights into corporate entrepreneurship decision making and how portfolio-level, individual-level, and firm-level aspects interact in explaining project termination.

Entrepreneurship Theory and Practice publish 2016  PDF Download
Counterfactual Thinking and Entrepreneurial Self-Efficacy: The Moderating Role of Self-Esteem and Dispositional Affect Punit Arora
Michael Haynie
Gregory A Laurence

Scholars have suggested that counterfactual thinking may play an important role in entrepreneurship; however, empirical research positioned to inform the nature of this relationship has been equivocal. In this study, we draw on the tenets of social cognition theory as a basis to investigate the relationship between counterfactual thinking and the dispositional attributes of the entrepreneur, hypothesizing concomitant influences upon the entrepreneur’s self-efficacy. Based on a survey of 138 entrepreneurs, our findings suggest that the implications of counterfactual thinking for entrepreneurial self-efficacy are moderated by individual differences based in the dispositional attributes of the entrepreneur.

Entrepreneurship Theory and Practice publish 2013  PDF Download
Creating a community of difference in entrepreneurship scholarship William B Gartner

This article argues for alternative forms of inquiry for exploring aspects of entrepreneurship scholarship that are often unseen, ignored or minimized. The label, ?The European School of Entrepreneurship?, might serve as a useful rubric for identifying a community of scholars with tendencies towards the following: (1) an interest in the history of ideas that inform entrepreneurship scholarship, (2) a willingness to step outside of the entrepreneurship field, itself, to embrace a variety of ideas, particularly from philosophy and the humanities and (3) a concern for the ?other?, so as to challenge the unspoken and often unrecognized ?taken-for-granted? aspects of what entrepreneurship is and what it might be. Such tendencies are fundamentally different by degree (rather than contrast) from current norms; yet, these tendencies can make a significant difference in current scholarly practice in entrepreneurship, as well as our understanding of the entrepreneurial phenomenon.

Entrepreneurship & Regional Development publish 2013  PDF Download
Creating major innovations with customers: insights from small and young technology firms Nicole Coviello
R M Joseph

The marketing literature typically argues that customers cannot easily be involved with, and contribute to, the creation of major innovation (MI). This article finds otherwise. The authors use an inductive process method to study how six MIs were developed for business-to-business markets by small and young technology firms. Three of the MIs were successful, and three failed. The firms with MI success are distinguished by a nonconventional new product development process that includes five iterative and overlapping activities and up to ten different customer roles. These activities and roles are captured in a multifaceted taxonomy of customer participation. The analysis also uncovers three capabilities relevant to the development of successful MI—capabilities that are effectual rather than adaptive in nature. These findings and the propositions derived from them offer a more complete understanding of customer participation, new product development across contexts, and marketing capabilities.

Journal of Marketing publish 2012  PDF Download
Creating space for play/invention – concepts of space and organizational entrepreneurship DANIEL HJORTH

This paper focuses on how one can relate management thinking/practices to entrepreneurial processes in the context of formal organization. In order to do this we develop a number of related ?spatial concepts? providing us with the possibility of describing entrepreneurship as a ?creation and use of space for play/innovation?. Using concepts of space, the managerial and the entrepreneurial dimensions and perspectives on organizing creativity become highly visible in the case studied. This is a field study (within the ethnographic tradition) focusing on an organizational transformation of a former public authority into a competitive limited company. A distinction between managerialism and ?entrepreneurship as event? is proposed as conceptually fruitful as well as useful for discussing recommendations to managers for how to handle entrepreneurial processes. A minimal and contextual role for management is suggested when aspiring to support the creations of space for play/invention, for example, for entrepreneurship as forms of organizational creativity.

Entrepreneurship & Regional Development publish 2004  PDF Download
Creating the Future Together: Toward a Framework for Research Synthesis in Entrepreneurship Elco van Burg
Georges Romme

To develop a body of evidence-based knowledge on entrepreneurship, findings and contributions from the positivist, narrative, and design research traditions in this area need to be combined. Therefore, a framework for research synthesis in terms of social mechanisms, contextual conditions, and outcome patterns is developed in this paper. Subsequently, a synthesis of the existing body of research findings on entrepreneurial opportunities serves to illustrate how this framework can be applied and provides results that inform entrepreneurial action. Finally, we discuss how this synthetic approach serves to systematically connect the fragmented landscape of entrepreneurship research, and thus gradually build a cumulative and evidence-based body of knowledge on entrepreneurship.

Entrepreneurship Theory and Practice publish 2014  PDF Download
Crescive entrepreneurship in complex social problems: Institutional conditions for entrepreneurial engagement Silvia Dorado
Marc J. Ventresca

This paper explores entrepreneurship in the context of complex social problems (often referred to as ‘social’ entrepreneurship). Most management research in this area studies the entrepreneurs; we explore the institutional conditions which frame the likelihood of entrepreneurial engagement. We name these conditions ‘crescive’ and, following A.O. Hirschman’s studies on institutional conditions for development we identify two analytically different sets of conditions: those that can stir up actors’ motivations to engage and those that can alter their decision making logic. Our exploration of crescive conditions yields a novel conceptual model for entrepreneurial engagement in the context of complex social problems, which we label ‘crescive entrepreneurship’ and place in a space between functionalist and institutional action.

Community publish 2013  PDF Download
CURRY IN A HURRY? A LONGITUDINAL STUDY ON THE ACCELERATION OF PERFORMANCE THROUGH EFFECTUATION BY NASCENT ENTREPRENEURS (SUMMARY) René Mauer
Willem Smit
WILLIAM FORSTER
Jeffery York

“Curry in a Hurry” is the name of the imaginary Indian restaurant introduced by Sarasvathy (2001) to illustrate the concept of effectuation. Since then, empirical evidence on effectuation is growing. After examinations in various industry contexts – radio frequency (Sarasvathy and Dew, 2002) and private equity (Wiltbank, Read, Dew, and Sarasvathy, 2009) – protocol analyses have shown that expert entrepreneurs use these heuristics more often than MBA graduates (Read, Dew, Sarasvathy, Wiltbank, 2009). There is also evidence that effectual logic increases new venture performance (Read, Song, and Smit, 2009). However, it is still unknown whether effectuation is purely the domain of expert entrepreneurs; and whether this logic would help nascent entrepreneurs accelerate their new firm creation. We address this issue by decomposing the total effect of effectuation on new firm creation effect into a two-stage mechanism. First, we develop and test hypotheses about the effect of the four effectual principles on new firm creation. Second, we examine whether these effects are mediated by the two dynamic cycles of expanding means and converging goals in motion.

Frontiers of Entrepreneurship Research publish 2010  PDF Download
Cutting Microfinance Interest Rates: An Opportunity Co-Creation Perspective Sunny Li Sun
Junyon Im

Microfinance is a social innovation to alleviate poverty by providing small, unsecured loans to local indigent entrepreneurs. Many borrowers use microfinance loans to seed their small entrepreneurial businesses. However, high interest rates charged by microfinance institutions (MFIs) are likely to increase the financial burden of those borrowers. In this study, we adopt an opportunity co-creation perspective to analyze the factors that affect microfinance interest rates. We argue that new opportunities in a social venture could be co-created by multiple stakeholders, including MFIs, borrower communities, female borrowers, governments, MFI managers, and employees. We tested our hypothese on interest rate setting of MFIs by using 4,187 organization-year observations from 2003 to 2011 across 93 countries, and the empirical results largely support the hypotheses. Our opportunity co-creation perspective extends the current understanding on microfinance and provides important managerial implications.

Entrepreneurship Theory and Practice publish 2015  PDF Download
Cutting the Gordian knot: The effect of knowledge complexity on employee mobility and entrepreneurship MARTIN GANCO

Employee entrepreneurship and employee moves to rival firms (employee mobility) have both been recognized as critical drivers of the transfer of knowledge. Drawing on a unique database of intra-industry inventor entrepreneurship and mobility events in the U.S. semiconductor industry, I examine the effect of the complexity of inventors’ prior patenting activities on their decisions to join a rival firm or found a start-up. The findings show that even though complexity inhibits knowledge diffusion to rival firms through employee mobility, complex knowledge may be underexploited within existing organizations and may still flow to startups through employee entrepreneurship. This study sheds new light on how technology shapes patterns of employee entrepreneurship and mobility, with implications for knowledge flows and competitive dynamics.

Strategic Management Journal publish 2013  PDF Download
Danger Zone Entrepreneurs: The Importance of Resilience and Self-Efficacy for Entrepreneurial Intentions Amanda Bullough
Maija Renko
Tamara Myatt

Little is known about the drivers of entrepreneurial decisions during war. We empirically examine the effects of perceived danger, entrepreneurial self-efficacy, and resilience on entrepreneurial intentions in adverse conditions with primary survey data from Afghanistan. Our findings suggest that perceived danger is negatively related to an individual’s entrepreneurial intentions, but marginally less so among highly resilient individuals. Our findings also suggest that even under conditions of war, individuals develop entrepreneurial intentions if they are able to grow from adversity (resilience) and believe in their entrepreneurial abilities (entrepreneurial self-efficacy). Practical implications for role modeling and entrepreneurship training are then discussed.

Entrepreneurship Theory and Practice publish 2014  PDF Download
Decision Comprehensiveness and Corporate Entrepreneurship: The Moderating Role of Managerial Uncertainty Preferences and Environmental Dynamism Ciaran Heavey
Zeki Simsek
Frank Roche
Aidan Kelly

Although comprehensiveness is considered among the most salient and enduring strategic decision-making characteristics in organizations, its influence on firm behaviour has remained elusive. As a first step, our study builds and tests a model that specifies the influence of comprehensiveness on the firm’s pursuit of corporate entrepreneurship. Our core argument is that while comprehensiveness helps decision-makers gain the knowledge needed to escape the ignorance and overcome doubt associated with this pursuit, this beneficial influence is conditional upon managerial uncertainty preferences, together with the level of dynamism in the external environment. Findings from a large sample study of CEOs from 349 SMEs provide general support for this argument and associated hypotheses.

Journal of Management Studies publish 2009  PDF Download
Decision-making processes in biotech commercialization: Constraints to effectuation. Elicia Maine
Pek-Hooi Soh
N Dos Santos

This research explores two entrepreneurial decision-making processes utilizing effectuation and causation modes in the context of new venture creation in the biotechnology industry. Using a case study approach, we investigate the evolution of three biotech ventures from the start of the venture, featuring major decisions over a period of 10 to 20 years. Assessment of qualitative interviews with founders and CEOs demonstrates that, initially, each company began in effectuation mode and, over time, transitioned to a spectrum between effectuation and causation. The two ventures which retained effectuation logic did not engage in clinical trials. Decision making processes in this study illustrate the interplay between entrepreneurs’ ability to manage technological and market uncertainty and circumstantial changes arising from change leadership, venture capital funding and development of lead candidates in the clinical stage of product development.

Technology Management for Emerging Technologies (PICMET) publish 2012
Deepening the Dialogue: New Directions for the Evolution of Effectuation Theory. Reuber, A. Rebecca
Eileen Fischer
Nicole Coviello

A letter to the editor is presented in response to the article “Effectuation as Ineffectual? Applying the 3E Theory-Assessment Framework to a Proposed New Theory of Entrepreneurship” by R.J. Arend, H. Sarooghi, and A. Burkemper in volume 40 of the periodical.

Academy of Management Review publish 2016  PDF Download
Delineating the Domain of Development Entrepreneurship: A Market-Based Approach to Facilitating Inclusive Economic Growth. Jeffery McMullen

Development economists and management scholars have called for a more market-based approach to address the extreme poverty suffered by the billion people residing primarily in least developed countries. This article proposes a theory of development entrepreneurship that blends business entrepreneurship, social entrepreneurship, and institutional entrepreneurship to accelerate the institutional change necessary to make economic growth more inclusive. After examining various explanations of market failure in the base of the pyramid and social entrepreneurship literatures, I explain why entrepreneurial transformation of formal institutions is needed and what differentiates development entrepreneurship from related concepts such as social entrepreneurship, social business entrepreneurship, and socio-political activism.

Entrepreneurship Theory and Practice publish 2011  PDF Download
Demystifying “Value” through an Empirical Examination of Entrepreneurial Ventures Ishrat Ali
Saras Sarasvathy

It is commonly understood that entrepreneurs need to create value for different stakeholders in order for their ventures to be successful in the long run. However, if we were to ask what is this “value”?, there would hardly be a satisfactory answer. For some, value is profits for shareholders, for some others – it is an intangible benefit that cannot be measured, and is only in the eye of the beholder. This paper attempts to demystify “value” by empirically examining value creation/destruction in 11 entrepreneurial ventures. It unearths five different dimensions of value that include both financial and non-financial impacts and argues that value creation or destruction should be described and measured as stakeholder capability improvements. The paper is positioned as an extension of a debate between shareholder wealth and stakeholder value proponents regarding purpose of the corporation.

Academy of Management Proceedings publish 2014
Demystifying the Genius of Entrepreneurship: How Design Cognition Can Help Create the Next Generation of Entrepreneurs Massimo Garbuio
Andy Dong
nidthida lin
TED TSCHANG TSCHANG
DAN LOVALLO

Entrepreneurship education is a key beneficiary of design thinking’s recent momentum. Both designers and entrepreneurs create opportunities for innovation in products, services, processes, and business models. More specifically, both design thinking and entrepreneurship education encourage individuals to look at the world with fresh eyes, create hypotheses to explain their surroundings and desired futures, and adopt cognitive acts to reduce the psychological uncertainty associated with ambiguous situations. In this article, we illustrate how we train students to apply four well-established cognitive acts from the design cognition research paradigm—framing, analogical reasoning, abductive reasoning, and mental simulation—to opportunity creation. Our pedagogical approach is based on scholarship in design cognition that emphasizes creating preferred situations from existing ones rather than applying a defined set of tools from management scholarship. In doing so, we provide avenues for further development of entrepreneurship education, particularly the integration of design cognition.

Academy of Management Learning & Education publish 2017  PDF Download
Designing a Better Business School: Channelling Herbert Simon, Addressing the Critics, and Developing Actionable Knowledge for Professionalizing Managers Denise M. Rousseau

Herbert Simon’s 1967 article ‘The business school: a problem in organizational design’ anticipated many of the challenges business schools face today. Critics charge business schools with failing to realize their primary purpose, that is, to produce professional managers. This article revisits what Simon advocated with regard to a core feature of this professionalism, the production of essential management knowledge, and the process of educating people in applying it. With Simon as a guide, this article outlines educational and research interventions to help business schools realize their founding purpose. In doing so, it addresses the distinctive knowledge products that business school research can contribute to the management profession. This article also highlights the key role that evidence-based management and the related practices of design science play in providing a more complete solution to the design problem Simon identified.

Journal of Management Studies publish 2012  PDF Download
Designing Organizations that Design Environments: Lessons from Entrepreneurial Expertise Saras Sarasvathy
Stuart Read
Nick Dew
Rob Wiltbank

Entrepreneurship has traditionally been viewed as an individual characteristic. Besides investigating personality traits and attributes, studies have examined gender differences (Carter, Gartner, Shaver, & J., 2003), risk aversion (Miner, Smith, & Bracker, 1994) and even sociopathy as possible traits or characteristics of entrepreneurs (Winslow & Solomon, 1987). Unfortunately, these efforts have returned little more than inconclusive results on what defines an entrepreneur and sustains him or her through a continuing career in entrepreneurship. But recently, there is a move to study entrepreneurship as expertise – i.e., a set of skills, models and processes that can be acquired with time and deliberate practice. Take for example, Mitchell (1997) that sought to understand the nature of entrepreneurial expertise in management; or, Reuber & Fischer (1994) that showed an empirical relationship between entrepreneurial expertise and firm performance. Expertise has traditionally been studied in cognitive science using protocol analysis (Ericsson & Simon, 1993). This method consists of having experts solve typical problems from their domain of expertise while continuously thinking aloud. The think-aloud protocols are usually recorded on tape and the contents of the transcribed protocols are analyzed in order to extract the baseline models used by the expert. Sarasvathy (1998) used this time-tested method on a subject pool consisting of 27 founders of companies ranging in size from $200 million to $6.5 billion to induce a baseline model of entrepreneurial expertise called “effectuation.”

Organization Studies publish 2008  PDF Download
Developing Entrepreneurial Expertise: Cognitive Entrenchment and Decision Incongruence Jana Thiel
Sung Min Kim
Jan Brinckmann

Recent research has produced concern about incongruence (the gap between conveyed and actual decision rationale) in strategic opportunity evaluation. Such incongruence can lead to inefficient decision-making, ineffective learning and will subsequently have performance implications in the entrepreneurial process. In this article we build on cognitive theory to investigate individual differences in opportunity-related decisions incongruence. Our assertion is that decision congruence is in large part based on the salience of the decision makers’ opportunity schema—formed through cognitive entrenchment—that is facilitated or impeded by individuals’ images of self. In a study on 146 individuals with in total 7,008 opportunity decisions we investigate how images of vulnerability and capability affect opportunity decision congruence. The results indicate that the images of vulnerability negatively impact congruent decision making, while images of capability have a U-shaped effect on decision incongruence. Our findings extend prior literature on cognitive reasoning in opportunity evaluation and entrepreneurial expertise.

Academy of Management Proceedings publish 2014  PDF Download
DEVELOPMENT OF EFFECTUAL BEHAVIOR – AN ENTREPRENEURIAL LEARNING APPROACH (SUMMARY) Sølvi Solvoll
Gry Agnete Alsos

This study analyzes the role of experience and learning on the development of effectual behavior (Sarasvathy 2001, 2008) among entrepreneurs during the start-up of a new firm. We take a human capital perspective to examine the various experiences of the entrepreneur and their influence on the development of effectual versus causal behavior. Following Unger et al. (2011), we do not limit our analyses to the static measures of human capital, but also seek to understand the influences of dynamic views related to learning, knowledge acquisition, and the transfer of knowledge to entrepreneurial tasks.

Frontiers of Entrepreneurship Research publish 2014  PDF Download
Different Truths in Different Worlds Kent D Miller
Shu-Jou Lin

Models of organizational learning typically assume that organizations rely upon performance feedback and that an exogenous (uncontrollable) environment presents the problems that organizations seek to solve. By contrast, we consider how different epistemologies within organizations, or combinations of epistemologies, and the degree to which the environment is amenable to organizational control jointly affect learning over time. This study presents three different epistemologies expressed in interpersonal learning: pragmatism (learning beliefs from better performers), coherentism (learning beliefs that fit together), and conformism (adopting beliefs that are popular). We also examine the learning implications of a dominant coalition that can promulgate its preferred beliefs throughout an organization. Outcomes from our agent-based model point toward key epistemological and environmental contingencies affecting the dynamics of organizational learning. Organizations filled with pragmatists learn effectively if the environment is fixed or controllable. Coherentists and conformists advance in knowledge only to the extent that they can control the environment. Adding pragmatists to organizations with coherentists or conformists produces a nonlinear (S-shaped) effect on knowledge achieved as different proportions of pragmatists alter social networks. Models involving learning from a dominant coalition affirm March’s trade-off between learning speed and eventual knowledge achieved only for organizations filled with pragmatists and operating in an uncontrollable environment.

Organization Science publish 2008  PDF Download
Digital Entrepreneurship: Toward a Digital Technology Perspective of Entrepreneurship Satish Nambisan

New digital technologies have transformed the nature of uncertainty inherent in entrepreneurial processes and outcomes as well as the ways of dealing with such uncertainty. This has raised important questions at the intersection of digital technologies and entrepreneurship—on digital entrepreneurship. We consider two broad implications—less bounded entrepreneurial processes and outcomes and less predefined locus of entrepreneurial agency—and advance a research agenda that calls for the explicit theorizing of concepts related to digital technologies. In articulating the promise and value of such a digital technology perspective, we consider how it would build on and enrich existing entrepreneurship theories.

Entrepreneurship Theory and Practice publish 2016  PDF Download
DIRECT AND MODERATING EFFECTS OF TOP MANAGEMENT TEAM CHARACTERISTICS ON STRATEGIC ENTREPRENEURIAL BEHAVIOR AND PERFORMANCE OF SMALL ICT VENTURES (SUMMARY) Victor Scholten
Jeroen Hermans
Michaéla Schippers

Entrepreneurship and strategic management are both concerned with growth and wealth creation (Hitt & Ireland, 2000; Hitt, Ireland, Camp & Sexton, 2001). Although both fields have developed largely independently, they both aim at explaining how firms adapt to environmental change and exploit opportunities (Venkatraman and Sarasvathy, 2001). Strategic entrepreneurship reflects both entrepreneurial opportunity-seeking actions and strategic advantage-seeking actions (McGrath and MacMillan, 2000; Hitt and Ireland, 2000). Top management teams (TMT) are critically important for exercising strategic entrepreneurship. They have the final responsibility for selecting the firm’s strategies (Hambrick and Mason, 1984). Particularly in start-up firms, the influence of top management teams on strategic directions and eventually on their firm performance is especially significant (West & Meyer, 1998). Despite scholars recognize the importance of both strategic entrepreneurship and top management team influence in understanding the performance of start-up firms, little empirical work has combined both views. In this paper we examine the relative impact of top management team characteristics on the relationship between strategic entrepreneurial behavior and start-up firm performance.

Frontiers of Entrepreneurship Research publish 2009  PDF Download
Discovering social entrepreneurship Trilok Kumar Jain

Entrepreneurship has been considered as a factor of risk and reward. However, there are instances of entrepreneurship for social cause, where social well being takes a priority over profit motive. In the present study, the researcher analyses the findings from study of 9 pioneering social organization using semi-structured interviews and discussions. The findings from these studies are presented as propositions and as a model for social entrepreneurship. A model has been proposed which shows the growth and direction of social organizations. The ultimate stage in the growth has been identified as the stage of centre of excellence, where the organization works for promoting other organization, as a role model. It tries to focus on HRD and institution building activities for other organizations and institutions. Factors relating to social entrepreneur have also been studied.

Asia Pacific Business Review publish 2009  PDF Download
Discovery and creation: alternative theories of entrepreneurial action. Sharon Alvarez
Jay Barney

Do entrepreneurial opportunities exist, independent of the perceptions of entrepreneurs, just waiting to be discovered? Or, are these opportunities created by the actions of entrepreneurs? Two internally consistent theories of how entrepreneurial opportunities are formed – discovery theory and creation theory – are described. While it will always be possible to describe the formation of a particular opportunity as an example of a discovery or creation process, these two theories do have important implications for the effectiveness of a wide variety of entrepreneurial actions in different contexts. The implications of these theories for seven of these actions are described, along with a discussion of some of the broader theoretical implications of these two theories for the fields of entrepreneurship and strategic management. Copyright © 2007 Strategic Management Society.

Strategic Entrepreneurship Journal(sister journal to Strategic Management Journal) publish 2007  PDF Download
Dispersed knowledge and an entrepreneurial theory of the firm Nick Dew
VELAMURI, S RAMAKRISHNA
S. Venkataraman

In this article, we propose an entrepreneurial theory of the firm that is based on dispersed knowledge. We argue that the dispersion of knowledge over people and places and over time leads to uncertainty. This uncertainty, combined with heterogeneous expectations and the nexus of an individual and opportunity, explains the emergence of new firms. We then suggest that the theory of the firm proposed by us answers questions that have been overlooked by alternative theories. The specific question we discuss in this article is when and why an entrepreneurial opportunity will be taken to market through an existing firm, and when and why a new firm will be chosen as a vehicle for taking a new idea to market, i.e., whether the residual will be concentrated in an existing or in a new firm.

Journal of Business Venturing publish 2004  PDF Download
Do Effectuation Processes Shape the Relationship Between Product Diversification and Performance in New Ventures? Ioanna Deligianni
Irini Voudouris
LIOUKAS SPYROS

This study applies the lens of effectuation to product diversification and examines the moderating effects of effectuation processes on the relationship between diversification and performance in new ventures. Effectuation processes are conceptualized in terms of experimentation, affordable loss, flexibility, and pre-commitments. The findings indicate that, with the exception of affordable loss, effectuation processes exert a positive effect on the diversification–performance relationship. Theoretical and empirical implications are discussed.

Entrepreneurship Theory and Practice publish 2015
Do entrepreneurial goals matter? Resource allocation in new owner-managed firms William Dunkelberg
Carmen Moore
Jonathan Scott
William Stull

This paper focuses on how entrepreneurial goals affect the resource allocation of new firm owners. It connects research in psychology and management that examines the core motivations of entrepreneurs with research in economics that models the behavior of owner-managers as utility-maximizing rather than profit-maximizing. We hypothesize that new owners with nonmonetary goals allocate their resources differently than do owners with monetary goals and that the differences are meaningful in size. To test these hypotheses, we estimate firm level equations based on economic theories of input demand that show how input quantities depend on owner goals. Data come from a national survey of new U.S. business owners. We find owner goals have both a statistically and substantively significant effect on resource allocation for new firms. Owners with nonmonetary goals put in more of their own and family hours rather than hiring outside employees. Implications for research and policy are discussed.

Journal of Business Venturing publish 2013  PDF Download
DO MARKET INFORMATION PROCEDURES IMPROVE VENTURE PERFORMANCE? A CASE Fatemah kahrarian
Fakhraddin maroofi
Farajolalah rahimi
publish  PDF Download
Do market information processes improve new venture performance? Michael Song
Tang Wang
Mark Parry

Does market information improve new venture performance? While some researchers argue that entrepreneurs do not need formal processes to collect and use market information, others suggest that the use of formal market information processes is positively related to firm performance. In this paper, we hypothesize that new venture performance is an increasing function of (1) the firm’s level of customer interaction and (2) the use of formal processes for collecting and utilizing market information. We also hypothesize that these linkages will be stronger among new ventures serving emerging markets (i.e., markets in which customer needs and segments are evolving). We test these hypotheses using data collected from 224 new ventures located in the United States. Our findings indicate that, regardless of market condition, formal processes for the collection of market information are positively associated with the use of formal processes for market information utilization and this relationship is stronger among firms serving established markets. In addition, new venture performance is positively associated with the use of formal processes for utilizing market information and this relationship is also stronger in established markets. We also find that, in emerging markets, new venture performance is a positive function of the use of formal processes for collecting market information. Contrary to expectations, we find that, regardless of market condition, the level of customer interaction has a negative relationship with the use of formal processes for market information utilization and no significant relationship with performance.

Journal of Business Venturing publish 2010
DO RISK ATTITUDES DIFFER WITHIN THE GROUP OF ENTREPRENEURS? Ioanna Deligianni
Irini Voudouris
LIOUKAS SPYROS

Little research exists on the risk attitudes of different types of entrepreneurs. Our focus is on the entrepreneurs’ motivations to start their business. We find that opportunity entrepreneurs are more willing to take risks than necessity entrepreneurs. In addition, entrepreneurs who are motivated by creativity are more risk-tolerant than other entrepreneurs.

Academy of Management Proceedings publish 2010  PDF Download
Do serial entrepreneurs run successively better-performing businesses? Simon Parker

This paper investigates whether – consistent with theories of entrepreneurial learning by doing and resource acquisition – serial entrepreneurs’ performance follows a rising trajectory over successive venturing spells. Or whether – consistent with theories of selective learning from failure and hubris – serial entrepreneurs perform better after experiencing a bad spell (and worse after experiencing a good spell). We test competing hypotheses about serial entrepreneurs’ performance trajectories using Panel Study of Income Dynamics (PSID) data, which track the dynamic performance of a sample of American serial entrepreneurs for up to one-quarter of a century. The findings show that serial entrepreneurs obtain temporary benefits from spells of venturing which eventually die away. This implies that venturing generates benefits which spill over from one venture into subsequent ones, and it can provide a rationale for public policies which encourage re-entries by entrepreneurs, even if those entrepreneurs performed poorly in their first ventures.

Journal of Business Venturing publish 2013  PDF Download
Does experience help or hinder top managers? Working with different types of resources in Hollywood MICHAEL J MANNOR
JAMAL SHAMSIE
DONALD E. CONLON

Research summary: Research on the resource-based view has begun to place more emphasis on the ability of managers to extract better performance from the resources that are available to them. In this paper, we show that prior experience can both help and hinder their ability to generate performance from various categories of resources. Further, we argue that the fungibility of each resource influences the opportunities managers have to use their experiences in order to find the best method to deploy them. We test our hypotheses by examining the ability of Hollywood film producers to generate results from financial, brand, and human resources. Our findings show that experienced producers can generate better performance from more fungible resources, but they actually achieve weaker results with less fungible resources. Managerial summary: Do more experienced top managers get better results from their resources? We examine this question for Hollywood film producers. Our results show that experience can really help when producers work with resources such as cash (budgets) and brand resources (such as film sequels). However, such experiences actually reduce performance when they work with some human resources, such as highly talented directors. We argue that experience can be most helpful when managers work with more fungible resources, which can be used in a variety of different ways but can actually hurt when they work with resources that are more constrained in how they can be deployed. Under ideal circumstances, we find that experienced producers can generate nearly 40 percent more revenue with the right mix of resources. Copyright © 2015 John Wiley & Sons, Ltd.

Strategic Management Journal publish 2016  PDF Download
Does family employment enhance MSEs performance?: Integrating socioemotional wealth and family embeddedness perspectives. Christina Cruz
Rachida Justo
Julio De Castro

This paper analyzes the effect of family employment on performance in micro and small enterprises (MSEs) by combining two research perspectives that, until now, have been conducted separately: the family embeddedness perspective of entrepreneurship (Aldrich and Cliff, 2003) and the socioemotional wealth (SEW) approach to family business (Gomez-Mejia et al 2007). Our integrated perspective allows us to highlight how the nature of the employment relationships in MSEs enhances the benefits derived from the socioemotional endowment associated with family labor, and reduces the opportunity costs of employing relatives. Moreover, we assert that this relationship is moderated by specific family characteristics that determine the firm’s ability to preserve the SEW, while at the same time pursuing financial goals. Our results provide partial support to the enhancing role of family labour on MSEs performance: employing family members increases sales but decreases profitability as measured by ROA. This effect also results in improved performance for women-led firms and for firms that have received family funding, but impairs MSEs performance when the business is the main source of the owner´s household income.

Journal of Business Venturing publish 2010  PDF Download
Doing the Right Entrepreneurial Thing: Ethical Decision Making Under Uncertainty desmond ng

Are entrepreneurs more or less ethical than other business agents? How do individual biases and environmental characteristics affect ethical decision-making among entrepreneurs? Our conceptual framework builds on literatures in stakeholder theory and cognitive psychology to examine the effects of complexity and novelty on biases in an entrepreneur’s ethical judgment. And in using data from the World Values Survey, we find not only that entrepreneurs exhibit systematically lower levels of ethical judgments than business managers, but also that such differences are amplified by highly complex and, in part, novel decision settings. Such a finding raises important questions about the moral expectations that society places on entrepreneurs.

Academy of Management Proceedings publish 2012  PDF Download
DOING WELL BY DOING GOOD. effectuation

This article examines the pursuit of commercial success through the internalization of social good in subsistence markets. Using a study which employs case studies and qualitative research, the authors argue that corporations should internalized social good so that they can succeed in subsistence markets. Micro and macro level rationale is employed to illustrate that societal welfare and customer concerns should be shifted to the focus of strategic planning and should then permeate business processes and functions.

Academy of Management Proceedings publish 2007  PDF Download
Dominant Logic and Entrepreneurial Firms’ Performance in a Transition Economy Tomasz Obloj
Krzysztof Obloj
Michael G. Pratt

Dominant logic is the manner in which firms conceptualize and make critical resource-allocation decisions, and over time develop mental maps, business models, and processes that become organizational recipes. This study compares and contrasts the dominant logic of Polish entrepreneurial firms. We find evidence that a dominant logic characterized by external orientation, proactiveness, and simplicity of routines significantly influences the performance of entrepreneurial firms in this emerging economy. These dominant logic characteristics of high performers serve as a key intangible resource in transition economies that are characterized by the absence of strong institutions and resource constraints. Future research in this critical domain should include how dominant logic needs in transition economies evolve over time as the institutional environment matures and market mechanisms become more solidified.

Entrepreneurship Theory and Practice publish 2010  PDF Download
Drawn to the fire: The role of passion, tenacity and inspirational leadership in angel investing Charles Y. Murnieks
Melissa S Cardon
Richard Sudek
T. Daniel White
Wade Brooks

Abstract Extant research affirms that angel investors seek passionate entrepreneurs but questions surround whether there is value in passion itself, or if it is instead used as a marker for other important characteristics like tenacity and inspirational leadership. Employing both a qualitative and quantitative study, we find that angels value passion in addition to tenacity, as well as both together, when evaluating entrepreneurs for investment. We also find that the entrepreneurial experience of angels positively moderates the value provided by passion and tenacity.

Journal of Business Venturing publish 2016  PDF Download
Dynamic Capabilities and the Role of Managers in Business Strategy and Economic Performance David J Teece
Mie Augier

This paper discusses some developments in the theory of the organizational capabilities of the business enterprise. Antecedents are recognized, and some promising new developments and areas for future research are identified. The role of managers in the economic system is highlighted and discussed within the context of economic and organizational research. Suggestions for future developments of dynamic capability research involve employment of evolutionary and behavioral theories.

Organization Science publish 2009  PDF Download
DYNAMICS OF EFFECTUATION AND CAUSATION IN TECHNOLOGY-BASED NEW VENTURES (INTERACTIVE PAPER) Isabelle Reymen
René Mauer
Petra Andries
Ute Stephan
Elco van Burg

The creation of new ventures is a process characterized by the need to decide and take action in the face of uncertainty, and this is particularly so in the case of technology-based ventures. Effectuation theory (Sarasvathy, 2001) has advanced two possible approaches for making decisions while facing uncertainty in the entrepreneurial process. Causation logic is based on prediction and aims at lowering uncertainty, whereas effectuation logic is based on non-predictive action and aims at working with uncertainty. This study aims to generate more fine-grained insight in the dynamics of effectuation and causation over time. We address the following questions: (1) What patterns can be found in effectual and causal behaviour of technology-based new ventures over time? And (2) How may patterns in the dynamics of effectuation and causation be explained?

Frontiers of Entrepreneurship Research publish 2012  PDF Download
Easy Now, Desirable Later: The Moderating Role of Temporal Distance in Opportunity Evaluation and Exploitation Andranik Tumasjan
Isabell Welpe
Matthias Sporrle

How does the temporal distance between the phases of evaluation and exploitation alter entrepreneurs’ opportunity evaluation? Building on construal level theory, we argue that the impact of an opportunity’s desirability and feasibility on evaluation and exploitation intentions varies systematically with temporal distance. We experimentally demonstrate stronger influences of desirability on evaluation when the exploitation phase is temporally distant rather than near, whereas feasibility more strongly affects evaluation when exploitation is near rather than distant. Using construal level theory, we explain empirical inconsistencies in previous research and demonstrate the usefulness of integrating the concept of temporal distance in entrepreneurship research and education.

Entrepreneurship Theory and Practice publish 2013  PDF Download
Effects of initial teamwork capability and initial relational capability on the development of new technology-based firms Jan Brinckmann
MARTIN HOEGL

New technology-based firms face substantial resource constraints. This study examines how teamwork capability and relational capability of the entrepreneurial team affects the development of new firms. Teamwork capabilities are captured by the quality of collaboration of the entrepreneurial team members among themselves. Relational capabilities are analyzed based on the collaboration of the entrepreneurial team members with partners external to the focal firm. Our findings show that teamwork and relational capabilities, while theoretically originating from social capabilities, can have diverging effects on the development of a new organization. We find that relational capabilities lead to founding team member additions as well as sales and employment growth. In contrast, teamwork capabilities lead to a reduced likelihood to add founding team members and do not affect sales and employment growth. Theoretical and practical implications are discussed. Copyright © 2011 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2011  PDF Download
EFFECTUAL CELLS: FOSTERING INNOVATION-BASED CORPORATE ENTREPRENEURSHIP THROUGH CONDITIONS FOR EFFECTUAL PROCESSES (INTERACTIVE PAPER) Alvaro Filipe da Costa

Corporate Entrepreneurship (CE) features many of the same uncertainties as classical entrepreneurship, e.g. the dependency on innovation outcomes which are difficult to predict (Phan et al., 2009). Moreover, both types of entrepreneurship often involve the possibility of constructing an environment rather than only positioning oneself in a given environment, thus calling for approaches to control and shape rather than merely adapt and predict (Wiltbank et al., 2006). The effectuation approach (Sarasvathy, 2001) thereby seems suited to describe CE situations. We focus on innovation-based CE (ICE), as innovation is the preeminent mechanism for creating business that generates new revenue streams and creates value for shareholders (Kelley, Peters & O’Connor 2009; Narayanan, Yang & Zahra, 2009), and analyze the influence of newness in respect to market and technology as an indicator of innovativeness (Hill and Rothaermel, 2003) . This study examines the performance of corporate innovation projects, the characteristics of their respective processes and the antecedents of these processes. We establish that highly innovative CE benefits from effectual processes (as opposed to causative processes) and develop hypotheses regarding antecedents of such processes in established companies. More specifically, we seek to concretize the concept of “effectual cells” (Wiltbank et al., 2008).

Frontiers of Entrepreneurship Research publish 2010  PDF Download
Effectual entrepreneuring: sensemaking in a family-based start-up ossie jones
Hongqin Li

AbstractIn this paper we examine the microprocesses associated with a successful business established by two young brothers (16 and 18). The study is informed by recent processual approaches to entrepreneurship associated with effectuation theory and sensemaking. We also draw on literature related to personal dispositions, which are the basis of habitual behaviours. The empirical data are drawn from a longitudinal study of an unconventional family business which was created by the two brothers while still at school. Opportunities were created, rather than discovered, by optimizing limited familial resources during the early stages of start-up. We expand effectuation theory by demonstrating the role of sensemaking (enactment, selection and retention), familial influences on dispositions (habits, heuristics and routines) and experiential learning during the first three years of operation.

Entrepreneurship & Regional Development publish 2017  PDF Download
Effectual entrepreneuring: sensemaking in a family-based start-up ossie jones

In this paper we examine the microprocesses associated with a successful business established by two young brothers (16 and 18). The study is informed by recent processual approaches to entrepreneurship associated with effectuation theory and sensemaking. We also draw on literature related to personal dispositions, which are the basis of habitual behaviours. The empirical data are drawn from a longitudinal study of an unconventional family business which was created by the two brothers while still at school. Opportunities were created, rather than discovered, by optimizing limited familial resources during the early stages of start-up. We expand effectuation theory by demonstrating the role of sensemaking (enactment, selection and retention), familial influences on dispositions (habits, heuristics and routines) and experiential learning during the first three years of operation.

Entrepreneurship & Regional Development publish
Effectual Networks: A Pre-commitment Approach to Bridging the Gap Between Opportunism and Trust Saras Sarasvathy
Nick Dew

One of the theoretical puzzles concerning how organizations and markets come to be has to do with our fundamental behavioral assumptions. While economic theories are built on assumptions of opportunism, organizational and sociological theories either look for existing structures of trust as ways to overcome opportunism, or emphasize the role of a third-party arbiter. In this paper, we bring together two existing concepts in previous literature, namely, docility and effectuation, to construct a pre-commitment approach to the creation of new networks that proceeds in the face of motivational uncertainty – i.e. irrespective of assumptions of opportunism or trust. We develop our synthesis within the context of new market creation in entrepreneurship. Instead of strong behavioral assumptions based on opportunism or trust, we begin with the far weaker assumption of docility – i.e. the fact that human beings are, to varying degrees, persuadable. Furthermore, in the context of extremely nascent or non-existent markets, actors may not only be uncertain about each others’ motivations, but may be unsure of their own future preferences and goals. Under such circumstances of combined motivational and environmental uncertainty, non-predictive strategies such as effectuation are called for in creating and managing new networks. The effectual pre-commitment approach we develop in this setting is analogous to other pre-commitment approaches developed in areas such as finance, jurisprudence, and economic psychology. A pre-commitment is defined as a self-imposed non-negotiable constraint that stacks the deck in favor of or against specific future choices.

Academy of Management Conference publish 2003  PDF Download
Effectual Reasoning in Entrepreneurial Decision Making: Existence and Bounds Saras Sarasvathy

That entrepreneurs create firms is a simple fact. But that entrepreneurs often create firms in the absence of markets is an idea that is recently gaining ground with researchers (Shane & Venkataraman, 1999). The phenomenon is further complicated by the fact that much of the information required to bring new markets into existence itself does not come into existence until those markets are created (Arrow, 1974). In an attempt to tackle the issues raised by this central research question in entrepreneurship, Sarasvathy (2001) has proposed effectuation as the dominant decision model for entrepreneurial decision making, particularly in the absence of pre-existent markets. Through a verbal protocol study of 27 expert entrepreneurs, this paper establishes the existence of effectual reasoning in their cognitive processes and delineates the bounds between their use of causation and effectuation. In quantitative terms, over 63% of the subjects used effectuation more than 75% of the time.

Academy of Management Journal publish 2001  PDF Download
EFFECTUAL REASONING IN ENTREPRENEURIAL DECISION MAKING: EXISTENCE AND BOUNDS. Saras Sarasvathy

Recent theorizing in entrepreneurship has proposed effectuation as a dominant decision model in entrepreneurial decision making. Through a verbal protocol study of 27 expert entrepreneurs who were asked to identify the market for a single new product, this paper establishes the existence of effectual reasoning in their cognitive processes and delineates the bounds between their use of causation and effectuation. In quantitative terms, over 63% of the subjects used effectuation more than 75% of the time.

Academy of Management Proceedings publish 2001  PDF Download
Effectual reasoning in expert entrepreneurial decisions: Existence and bounds Saras Sarasvathy

Recent theorizing in entrepreneurship has proposed effectuation as a dominant decision model in entrepreneurial decision making. Through a verbal protocol study of 27 expert entrepreneurs who were asked to identify the market for a single new product, this paper establishes the existence of effectual reasoning in their cognitive processes and delineates the bounds between their use of causation and effectuation. In quantitative terms, over 63% of the subjects used effectuation more than 75% of the time.

publish 2001
Effectual versus predictive logics in entrepreneurial decision-making: Differences between experts and novices Saras Sarasvathy
Stuart Read
Nick Dew
Rob Wiltbank

In support of theory, this study demonstrates that entrepreneurial experts frame decisions using an “effectual” logic (identify more potential markets, focus more on building the venture as a whole, pay less attention to predictive information, worry more about making do with resources on hand to invest only what they could afford to lose, and emphasize stitching together networks of partnerships); while novices use a “predictive frame” and tend to “go by the textbook.” We asked 27 expert entrepreneurs and 3 7 MBA students to think aloud continuously as they solved typical decision-making problems in creating a new venture. Transcriptions were analyzed using methods from cognitive science. Results showed that expert entrepreneurs framed problems in a dramatically different way than MBA students. Published by Elsevier Inc.

Journal of Business Venturing publish 2009  PDF Download
Effectuation & Causation Approaches and their effect on Business Performance: An analysis of Business Plans Jos Lennips

This paper is about the influence of Effectuation and Causation, two entrepreneurial strategies, on the performance of companies. These terms were first coined by Sarasvathy in 2001 and in this research empirically tested on the survival of companies. Causation processes take a particular effect as given and focus on selecting between means to create that effect. Effectuation processes take a set of means as given and focus on selecting between possible effects that can be created with that set of means. According to the literature it is not yet known whether one approach is the preferable approach over the other in order to have a bigger chance of survival for a company, some literature hints towards effectuation as the most preferable but empirical prove does not yet exist. The same goes for a company that has survived an early phase of development. Literature suggests that causation is the better option, but empirical evidence is absent. Therefore, these two claims were tested after data on 382 business plans was gathered and coded. The findings do not give a clear and distinctive answer, but, Causation has the (slightly) better outcomes. This study poses a contribution to literature on causation and effectuation as concepts of early entrepreneurial strategy. It has made use of an extensive coding scheme and a rich database of coded business plans. However, further research on this subject is needed to validate the measures that were created, to check whether the results hold for bigger and different samples, and whether the same results come up if a different way of gathering data, not through analysing business plans, is used.

publish 2016  PDF Download
EFFECTUATION & NEWNESS: AN INTERTWINED RELATIONSHIP? (SUMMARY) Christophe Garonne
Per Davidsson

Effectuation theory suggests that entrepreneurs develop their new ventures in an iterative way by selecting possibilities through flexibility and interactions with the market; a focus on affordability of loss rather than maximal return on the capital invested, and the development of pre-commitments and alliances from stakeholders (Sarasvathy, 2001, 2008; Sarasvathy et al., 2005, 2006). As Sarasvathy resumes, “effectuation is a straight inversion of rational choice theory” (Sarasvathy, 2001). However, little is known about the consequences of following either of these two processes. One aspect that remains unclear is the relationship between newness and effectuation. On one hand it can be argued that the combination of a means-centered, interactive and open-minded process should encourage and facilitate the development of innovative solutions. On the other hand, having a close relationship with their “future first customers” and focussing too much on the resources and knowledge already within the firm may be a constraint that is not conducive to innovation, or at least not to a radical innovation.

Frontiers of Entrepreneurship Research publish 2009  PDF Download
Effectuation 10 year waypoint Stuart Read
S Dolmans
International Review of Entrepreneurship publish 2012
Effectuation and causation in entrepreneurship education S.makimurto koivumaa
Puhakka, Vesa

Entrepreneurship refers to development and enactment of entrepreneurial opportunities at the intersection of venture creation and market creation. The present study approaches entrepreneurship education as effectuation of possible futures and causation of relevant knowledge in the creation of entrepreneurial opportunities. Through emphasis on the role of effectuation, a creative process view of entrepreneurship education is advocated. It builds on the cognitive and social-psychological schools of entrepreneurship and cognitive, contextual and creation views on entrepreneurial opportunities. As a result, we suggest a model in which effectuation could be used systematically together with causation in entrepreneurship education. Effectuation in entrepreneurship education is proposed to open a new pedagogic view and context to increase student awareness of their ability to create societal impact rather than to accomplish the effective establishment of a company.

International Journal of Entrepreneurial Venturing publish 2013
Effectuation and entrepreneurial orientation in high-technology firms T S Mthanti
B Urban

Effectuation provides an explanation of the behaviour of entrepreneurial firms in transforming environments. This article empirically investigates the influence of effectuation on entrepreneurial orientation (EO) and firm performance, while considering environmental uncertainty as a moderating influence. A survey is administered to a sample of high-technology firms and hypotheses are tested using correlational and regression analysis. A positive relationship between effectuation and the firm’s level of EO is established, where this effectuation moderates the relationship between EO and firm performance. However, the interaction effect between effectuation and environmental dynamism and hostility proves to be non-significant. By applying an empirical lens this study increases the relevance and generalisability of effectuation theory by expanding it from mostly a descriptive nature to a theory that accounts for moderators in the EO–performance relationship.

Technology Analysis & Strategic Management publish 2014
Effectuation and home-based online business entrepreneurs Daniel Kupper
Di Domenico MariaLaura
Sharma, Pramodita

This article explores effectual processes within home-based, online businesses. Our empirical evidence provides a number of refinements to the concept of effectuation in this specific domain. First, the ubiquity of non-proprietary online trading platforms encourages the adoption of effectual approaches and removes the importance of forming proprietary strategic alliances and pre-commitments. Second, the notion of affordable loss – a central tenet of effectuation – should be extended beyond the notion of economic to social affordable loss, including loss of status and reputation, and finally, home-based online businesses allow effectuation to be associated with low levels of entrepreneurial self-efficacy and experience.

International Small Business Journal publish 2014  PDF Download
Effectuation and Networking of Internationalizing SMEs Tamara Galkina
Sylvie Chetty

This paper explores previously discarded phenomena in the internationalization process literature, namely the non-predictive logic of foreign market entry, and employs effectuation theory to examine how small and medium-sized enterprises (SMEs) network during internationalization. It integrates effectuation theory with the revisited Uppsala internationalization process model to understand the unintentional aspect of networking by internationalizing SMEs. The research design is a multiple-case study approach. The findings show how entrepreneurs network with interested partners, instead of carefully selecting international partners according to predefined network goals. Entrepreneurs who network effectually enter markets wherever an opportunity emerges, and commit to network relations that increase their means. Network relations become an integrating point for effectuation theory from entrepreneurship research and the revised Uppsala model from international business. This bridge between the two areas suggests some implications for network research in International Entrepreneurship.

Management International Review publish 2015  PDF Download
Effectuation and over-trust: Debating Goel and Karri Saras Sarasvathy
Nick Dew

In their article on entrepreneurship, effectuation, and over-trust, Goel and Karri suggest relationships between effectuation, over-trust, and certain psychological characteristics of entrepreneurs. In this response we debate their article. Goel and Karri are correct in claiming that effectuation supposes over-trust. However, we argue that effectual logic works in a different way than they presented because it neither predicts nor assumes trust. Goel and Karri’s article also draws attention to the behavioral assumptions underlying constructs such as over-(under) trust. Our suggestion is that effectuation is based on alternative behavioral assumptions that open up interesting avenues for future research in entrepreneurship.

Entrepreneurship Theory and Practice publish 2008  PDF Download
Effectuation and Over-Trust: Response to Sarasvathy and Dew. Ranjan Karri
Sanjay Goel

In their response to our article, Sarasvathy and Dew (S&D) agree with us that effectuation supposes over-trust and yet claim that trust is irrelevant to an effectual entrepreneur. They further claim that our approach to entrepreneurship is trait based. We respond to these comments by pointing out the more subtle ways in which entrepreneurs deal with trust. In addition, while acknowledging the utility (and limitations) of a trait-based approach in advancing entrepreneurship theory, we refute their assertions that our paper is based on this approach. Finally, we address the “alternate” behavioral assumptions that S&D advance. Independent of the merit of these alternate assumptions, they are not contradicted in our article. We believe that these assumptions need to be developed further to contribute to a debate on their merits for advancing theory building in entrepreneurship.

Entrepreneurship Theory and Practice publish 2008  PDF Download
Effectuation As Ineffectual? Applying the 3E Theory-Assessment Framework to a Proposed New Theory of Entrepreneurship Richard J Arend
Hessamoddin Sarooghi
Andrew Burkemper

Effectuation is a proposed new theory of entrepreneurship, with insufficient empirical testing and critical analysis. Drawing on a new, comprehensive set of theory-building criteria—sourced from and complementing those of Robert Dubin and others—we provide the first formal assessment of effectuation as a theory. We highlight its strengths and weaknesses, leveraging the former to address the latter in five different directions that would build on the existing work to improve this theory. The assessment exercise also displays the value of our assessment framework in guiding the evaluation and development of other existing and future theories in entrepreneurship and management.

Academy of Management Review publish 2015  PDF Download
Effectuation e causation: um estudo sobre o processo decisório empreendedor em redes de micros e pequenos supermercados ANDERSON QUEIROZ LEMOS
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EFFECTUATION IN THE CONTEXT OF R&D PROJECTS: CHARACTERISTICS AND IMPACT ON PROJECT PERFORMANCE. Daniel Kupper
TINA BURKHART

The aim of this study is to adopt a new theoretical concept called effectuation to the R&D project management research. This concept brings in a new perspective on the issue of how to accomplish successful R&D projects by focusing on the decision making in uncertain situations

Academy of Management Proceedings publish 2009  PDF Download
Effectuation in the Management of Knightian Uncertainty: Evidence From the RealNetworks Case Saras Sarasvathy
Suresh Kotha

This study investigates how entrepreneurs in the Internet economy manage Knightian uncertainty during the early stages of the new venture creation process (Knight, 1921). Based on a detailed analysis of the decision-events that created RealNetworks, a leading audio/video streaming firm, we demonstrate both the existence and the extensive use of processes of effectuation to combat the Knightian uncertainty that typifies the new economy. Specifically, we show how RealNetworks used the three principles of effectuation – (1) affordable loss, (2) strategic partnerships, and (3) leveraging contingencies – to deal with complex and multiple manifestations of Knightian uncertainties in its micro and macro decision environments. We highlight how this firm used the logic of action and control, rather than that of analysis and prediction, to create its markets for streaming media and other applications on the World Wide Web. We argue that this logic is particularly useful in areas where human action (locally or in the aggregate) is the predominant factor shaping the future.

Research on Management and Entrepreneurship publish 2001  PDF Download
Effectuation Research: Taking Stock and Moving Forward effectuation

Effectuation changed the way we think about entrepreneurship. Until recently, most research in entrepreneurship conceptualizes new venture creation as a rational, goal-driven, and mostly linear process. Sarasvathy’s work (2001, 2008) though suggests that entrepreneurs employ a different logic when pursuing opportunities. Despite the perceived growing popularity of effectuation, a surprisingly small number of researchers have engaged in resolving some of its shortcomings (Perry et al, 2011). For instance, effectuation measurement is not yet developed to an acceptable level. Chandler and colleagues (2010) find that effectuation is a multi-dimensional construct while causation could only be measured uni-dimensionally. At the same time, some important theoretical tenets such as pre-commitments and alliances appear in both causation and effectuation measurements (Chandler et al., 2010). Also theoretically and philosophically the effectuation construct requires further development. It is, for example, not entirely clear how effectuation relates to and is different from other constructs such as improvisation, experimentation, and bricolage (Fisher, 2012), or what exactly is the role of planning in effectuation processes. The purpose of this symposium is to engage a global group of experts in the fields of entrepreneurship strategy, organization behavior, and decision-making in an interactive discussion about how to move the effectuation concept further. The discussion will be structured around the following questions: a) How can effectuation be better conceptualized to describe how entrepreneurs act? b) Is effectuation unique to entrepreneurship? Is it applicable to other contexts and, if so, which ones and how? c) How can effectuation research benefit from and contribute to research and theory in other fields? d) How can effectuation be measured in a reliable and valid way? e) How can effectuation be made more valuable to practitioners? This proposal for a symposium is particularly opportune considering that the Academy of Management Review has just published a fresh critique of effectuation, one of the co- authors of which has agreed to participate here. We believe there is enough interest on this topic at this time for the symposium to blossom into a journal special issue on the topic.

Academy of Management Proceedings publish 2015
Effectuation, Causation, and Bricolage: A Behavioral Comparison of Emerging Theories in Entrepreneurship Research Greg Fisher

This study provides a critical examination of how different theoretical perspectives in entrepreneurship research translate into individual behavior, and whether such behavior is evident in the creation and development of new ventures. Using an alternative templates research methodology, the behaviors underlying the theories of effectuation, causation, and bricolage are evaluated to see whether such behaviors are observable in case study data describing the early development of six new ventures. The analysis highlights behavioral similarities and differences between the various theoretical perspectives in entrepreneurship research, providing insight into how these perspectives contrast and complement one another, and how they could be integrated in future research.

Entrepreneurship Theory and Practice publish 2012  PDF Download
Effectuation, near-decomposability, and the creation and growth of entrepreneurial firms Saras Sarasvathy
Herbert A Simon
First Annual Research Policy Technology Entrepreneurship Conference publish 2000
Effectuation, Not Being Pragmatic or Process Theorizing, Remains Ineffectual: Responding to the Commentaries. Richard J Arend
Hessamoddin Sarooghi
Andrew Burkemper

A letter to the editor is presented in response commentary featured in the issue on the authors’ article “Effectuation as Ineffectual? Applying the 3E Theory-Assessment Framework to a Proposed New Theory of Entrepreneurship” in volume 40 of the periodical.

Academy of Management Review publish 2016  PDF Download
EFFECTUATION: A STUDY OF CONCEPT’S USE Ananda Pimenta
Raissa Azevedo
publish  PDF Download
Effectuation: Elements of Entrepreneurial Expertise. Saras Sarasvathy
Academy of Management) publish 2008
Emerging Firms and the Allocation of Control Rights: A Bayesian Approach. Sharon Alvarez
Simon Parker

This paper suggests that founders often use firm formation to exploit opportunities and must sometimes make organizing decisions about the allocation of control before the economic value of the opportunity can reliably be known even probabilistically. Motivated by questions surroundings such settings, we use incomplete contract theory and apply a Bayesian learning model to the allocation process of ownership control rights of founders in emerging firms. This model examines how founders learn and build on their prior beliefs, enabling them to allocate and change ownership control rights under differing conditions of risk and uncertainty.

Academy of Management Review publish 2009  PDF Download
Emerging Theories of Entrepreneurial Behavior in Uncertain and Resource Constrained Environments effectuation

In the contemporary turbulent and constantly changing economic environments, it is difficult to predict the outcomes of an action and thus plan the societal, organizational end entrepreneurial goals beforehand. Certainly for a reason, in recent years, several different perspectives describing entrepreneurial behavior in uncertain and resource constrained environments have come to challenge the more traditional business plan- oriented, and goal – based perspectives in entrepreneurship. These theories explain “creative process in general and entrepreneurship in particular” (Sarasvathy 2008) and “shed light on the processes by which firms generate heterogeneous value from ostensibly identical resources” (Baker & Nelson 2005) as well as to how “to create innovative solutions within structural constraints using limited resources and imaginative problem solving” (Lampel, Honig & Drori 2014). Miner & Moorman (1998) and Miner, Bassof & Moorman (2001) also link improvisation closely to organizational learning, hence in addition to new venture creation, these theories shed light also to the processes of renewal in existing organizations. A recent perspective on founder identity as well has come to suggest that also founder identity might stand in a meaningful role in answering adversities (Powell & Baker 2014). The perspectives describing entrepreneurial behavior in uncertain and resource constrained environments relate to the conference theme, “Making Organizations Meaningful” in several ways. First of all, these perspectives are at the very heart of the action and meaningfulness, by researching and explaining entrepreneurial behavior. Second, these perspectives have striven to explain how enactment in organizations transforms objects, resources, goals and even thoughts in small steps. However, the overlaps, complementarities and for that matter, research gaps between and across these perspectives are not yet thoroughly explored by entrepreneurship researchers. Thus this symposium seeks to ignite the discussion in order to broaden it from e.g. Fisher (2012) by bringing along together more emerging theoretical perspectives explaining entrepreneurial behavior under uncertain and/ or resource constraints. This symposium seeks to clarify the overlaps and complementarities of the published theories on entrepreneurial ingenuity, entrepreneurial bricolage, effectuation, and improvisation as well as other possibly emerging concepts. The aim is to start a discussion in order to establish clearer boundaries and offer future research guidelines around these different conceptualizations.

Academy of Management Proceedings publish 2016
Encouraging sustainable entrepreneurship in climate-threatened communities: a Samoan case study Brendan James Gray
Suzanne Duncan
Jodyanne Kirkwood
Sara Walton

South Pacific island states are at the forefront of climatic changes that have precipitated severe environmental events. These small countries also face economic and social challenges that require entrepreneurial solutions. We develop a model of how external factors and chance events impact on sustainable opportunity recognition and exploitation in this context. We assess the efficacy of this model in an in-depth study of Women in Business Development Incorporated, a non-governmental organization that helps women and families in Samoa to establish sustainable enterprises. Our findings make a significant contribution to the emerging literature on entrepreneurship, sustainability and resilience in at-risk communities by showing how key organizational capabilities are necessary for coping with exogenous shocks in this context. The findings have important implications for research, policy and practice.

Entrepreneurship & Regional Development publish 2014  PDF Download
Enduring Entrepreneurship: Antecedents, Triggering Mechanisms, and Outcomes PETER JASKIEWICZ
JAMES G. COMBS
DAVID J KETCHEN
R Duane Ireland
Strategic Entrepreneurship Journal publish 2016  PDF Download
Engaging the Student entrepreneur building upon a typology of student entrepreneurs Jerry Allen

The paper aims to add to the debate on student entrepreneurship and employability. It builds upon earlier work postulating a typology of student entrepreneurs. It studies the motivations of 184 student entrepreneurs using an online survey with refined questions and fresh findings to substantiate three of the original five key typologies of student entrepreneur. These are: the ‘Dabbler’, those who are first time experimenters with entrepreneurship; the ‘Persistent Pursuer’, representing those with previous experience of entrepreneurship and the ‘Family Followers’ presenting a family history of entrepreneurship (Allen 2015) Alternative perspectives on entrepreneur typologies are discussed, which feature: the type of enterprise (Smith 1967); innovation (Risker 1998); inventor (Miner, Smith et al. 1992) and second generation (Masurel and Nijkamp 2004) (Fraboni and Saltstone 1990). These typologies are juxtaposed with comparative studies examining the motivation, attitudes and self perception (Zhao and Wu 2014), (Leon, Descales et al. 2007), (Miner 1997) and comment on the debate surrounding entrepreneur education particularly concerning effectuation (Sarasvathy 2001) and the lean movement approach (Blank 2013) The paper concludes with reflection on a pull approach advocated by (Hammer and Van der Meer 2013) involving entrepreneurs in the pedagogical process. It concludes with the identification of further research opportunities for a longitudinal cohort study of student entrepreneurs.

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Enrolling Stakeholders under Conditions of Risk and Uncertainty BARCLAY L BURNS
Jay Barney
Ryan W Angus
HEIDI NOELLE HERRICK

Research summary Entrepreneurs often need resources controlled by stakeholders to form and exploit opportunities. While many of these resources can be acquired through simple contracts, the acquisition of some may require efforts on the part of stakeholders that go beyond what can be specified contractually. Such efforts—extra-role behaviors—generally involve the formation of deep psychological bonds between stakeholders and entrepreneurial endeavors. In an entrepreneurial context, the process of creating these bonds can be called stakeholder enrollment. Critical attributes of this process are shown to vary by the informational setting (risky or uncertain) within which entrepreneurship takes place. Managerial summary Entrepreneurs often need to gain access to resources controlled by other stakeholders to be successful. In some cases, entrepreneurs must induce these stakeholders to form deep psychological bonds in order to obtain the required resources. The process of creating these bonds is called stakeholder enrollment. This article notes that entrepreneurs can use information about the nature of the opportunity they are pursuing, information about themselves (i.e., the entrepreneurs’ charisma, trustworthiness, and reputation), or both, to enroll stakeholders. This article suggests that the more uncertain a particular opportunity is, the less entrepreneurs can use information about the opportunity and the more they must rely on information about themselves to successfully enroll stakeholders.

Strategic Entrepreneurship Journal publish 2016  PDF Download
Entrepreneur behaviors, opportunity recognition, and the origins of innovative ventures JEFFREY H. DYER
HAL B GREGERSEN
CLAYTON CHRISTENSEN

This study traces the origins of innovative strategies by examining the attributes of ‘innovative entrepreneurs.’ In an inductive grounded theory study of innovative entrepreneurs, we develop a theory that innovative entrepreneurs differ from executives on four behavioral patterns through which they acquire information: (1) questioning; (2) observing; (3) experimenting; and (4) idea networking. We develop operational measures of each of these behaviors and find significant differences between innovative entrepreneurs and executives in a large sample survey of 72 successful and unsuccessful innovative entrepreneurs and 310 executives. Drawing on network theory, we develop a theory of entrepreneurial opportunity recognition that explains why these behaviors increase the probability of generating an idea for an innovative venture. We contend that one’s ability to generate novel ideas for innovative new businesses is a function of one’s behaviors that trigger cognitive processes to produce novel business ideas. We also posit that innovative entrepreneurs are less susceptible to the status quo bias and engage in these information-seeking behaviors with a motivation to change the status quo. Copyright © 2009 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2008  PDF Download
Entrepreneurial action and the Euro-American social science tradition: pragmatism, realism and looking beyond ‘the entrepreneur’ Tony J Watson

Entrepreneurship studies are dominated by the disciplines of economics and psychology and work within a limiting methodological frame of reference; a ?scientistic? and individualistic framework that dominates the US-led mainstream of research. To achieve a more balanced scholarship, it is helpful to look at an alternative style of research and analysis which has deep and intertwined European and American roots. This looks to other social sciences such as sociology, as well as to history and the philosophy of science. Its adoption would encourage to shift the focus away from ?entrepreneurs? and onto the much broader phenomenon of entrepreneurial action or ?entrepreneuring? in its societal and institutional contexts. Such a shift would open up a greatly expanded range of research questions and enable a better balance to be achieved between attention to individual entrepreneurial actors and their organizational, societal and institutional contexts. A pragmatist and realist frame of reference, which recognizes both the importance of processes of social construction and the existence of a ?real world?, has considerable potential to enrich and expand the scope of entrepreneurship scholarship.

Entrepreneurship & Regional Development publish 2013  PDF Download
Entrepreneurial Action And The Role Of Uncertainty In The Theory Of The Entrepreneur. Jeffery McMullen
Shepherd Dhliwayo

By considering the amount of uncertainty perceived and the willingness to bear uncertainty concomitantly, we provide a more complete conceptual model of entrepreneurial action that allows for examination of entrepreneurial action at the individual level of analysis while remaining consistent with a rich legacy of system-level theories of the entrepreneur. Our model not only exposes limitations of existing theories of entrepreneurial action but also contributes to a deeper understanding of important conceptual issues, such as the nature of opportunity and the potential for philosophical reconciliation among entrepreneurship scholars.

Academy of Management Review publish 2006  PDF Download
ENTREPRENEURIAL ACTION: EXPLOITATION DECISIONS UNDER CONDITIONS OF UNCERTAINTY. Alexander McKelvie
VERONICA GUSTAFSSON
Michael Haynie

We explore opportunity exploitation decisions made under varying conditions of uncertainty. We conceptualize uncertainty as a multidimensional construct, and employ conjoint analysis to understand entrepreneurs’ likelihood of exploiting an opportunity by going forward with a new product launch given varying combinations of state, effect, and response uncertainty.

Academy of Management Proceedings publish 2008  PDF Download
Entrepreneurial alertness in the pursuit of new opportunities Jintong Tang
K. Michele(Micki) Kacmar
Lowell Busenitz

The recognition and development of new opportunities are at the heart of entrepreneurship. Building from Kirzner’s (1973, 1999) work, cognition theory, and McMullen and Shepherd’s (2006) recent development, we offer a model involving three distinct elements of alertness: scanning and search, association and connection, and evaluation and judgment. We then conduct multiple studies to develop and validate a 13-item alertness scale that captures these three dimensions. Results demonstrate appropriate dimensionality, strong reliability, and content, convergent, discriminant, and nomological validity. The resultant instrument provides researchers with a valuable tool for probing the entrepreneurial opportunity development process including antecedents and outcomes.

Journal of Business Venturing publish 2012  PDF Download
ENTREPRENEURIAL ARCHETYPES IN MAKING SENSE OF THE STRUCTURAL HOLES (SUMMARY) Antti J Kauppinen
Puhakka, Vesa

Entrepreneurial qualities have been discussed for over twenty years, but there is no consensus about how much the personality differences vary between entrepreneurs and non-entrepreneurs (Gartner 1989; Delmar 2006; Busenitz & Barney 1997 see Kirzner 1997; Gaglio & Katz 2001). The entrepreneurial activities, processes, networks, events, and structural holes are widely discussed, but the problem of the mythic entrepreneur has remained an unsolved matter (Obgor 2000; Bruni, Gherardi & Poggio 2004; Mirchandani 1999). Nevertheless, social ties in particular are seen to be different between entrepreneurs and non-entrepreneurs (Burt 1992; Venkataraman 1997; Sarasvathy 2001 see Granovetter 1973). Approaches considering social ties and structural holes neglect the fundamental nature of the phenomenon of entrepreneurship, as the actors are separated from their context (Sarasvathy 2004; Gartner 1989). In this study, we used a sense-making approach in investigating the context-dependent phenomenon of the subjective creation of the structural holes (see Burt 1992; Burt, Hogarth & Michaud 2000; Burt 2004). We argue that the entrepreneurs are no different than other people as persons, but instead they are different as sense-makers in the creation of structural holes (see Weick 1995; Berger & Luckmann 1966). Therefore, it is more meaningful to discuss the entrepreneurial archetypes rather than personality differences.

Frontiers of Entrepreneurship Research publish 2010  PDF Download
Entrepreneurial beacons: The Yale endowment, run-ups, and the growth of venture capital Y. Sekou Bermiss
Benjamin Hallen
RORY McDONALD
EMILY C. PAHNKE

Research summary: This article investigates the social context of entrepreneurship in organizational sectors. Prior research suggests that firm foundings are driven by collective patterns of activity—such as patterns of prior foundings in a given sector. Building on research on social salience and signals, we consider the influence of singular sector-level triggers, which we call entrepreneurial beacons. We argue that the actions or outcomes of single, salient organizations attract and motivate entrepreneurs, thus increasing the rate of foundings. We test this logic by examining the impact of the Yale University endowment’s investment choices and of venture-capital-backed IPO run-ups on venture-capital foundings between 1984 and 2011. We find support for the existence and influence of beacons and outline boundary conditions for their effects. Managerial summary: What leads entrepreneurs to found new companies in nascent sectors? In contrast to prior research, which emphasizes patterns of activity, we argue that entrepreneurial activity can sometimes be driven by the actions of a singular trigger—what we call an entrepreneurial beacon. We examine the influence of two such beacons, Yale University’s endowment investments and exceptional venture-capital-backed IPO run-ups, on the founding of new venture-capital firms over a 28-year period. We find that Yale’s increased allocations to the venture-capital asset-class has a significant influence on the founding of new venture-capital firms, while exceptional venture-capital-backed IPO run-ups only influence venture-capital foundings under certain conditions. Overall, we offer an explanation for heretofore anecdotal accounts of certain organizations or events that appear to have an outsized influence on entrepreneurial activity. Copyright © 2016 John Wiley & Sons, Ltd.

Strategic Management Journal publish 2017  PDF Download
ENTREPRENEURIAL DISCOVERY AND EXPLOITATION PROCESSES: SEQUENCE OR SYMBIOSIS? (SUMMARY) Scott R. Gordon

Entrepreneurship scholars are showing more interest in process (van de Ven & Engleman, 2004), but, there remains little consensus on conceptualization, operationalisation, analytical approach, or results. Some agree the twin concepts of entrepreneurial discovery and exploitation (Shane & Venkataraman, 2000) are useful sub-processes which, together, explain venture emergence (Davidsson, 2008). This perspective implicitly assumes sequential sub-processes where discovery preceedes exploitation (Eckhardt & Shane, 2010). However, other literature questions the strictness of this ordering (Bhave, 1994; Sarasvathy, 2001); or suggests symbiosis, where discovery and exploitation might overlap (Davidsson, 2008). Despite the inherent importance, there is a dearth of research accounting for temporal structure in new venture emergence. Resultantly, this order hypothesis remains largely untested. Accordingly this paper makes two contributions: first, it tests the temporality of discovery and exploitation; second, it introduces a new method for such process analysis.

Frontiers of Entrepreneurship Research publish 2011  PDF Download
Entrepreneurial Effectuation: A Review and Suggestions for Future Research John Perry
Gaylen Chandler
Gergana Markova

Effectuation represents a paradigmatic shift in the way that we understand entrepreneurship. Since its introduction, however, few researchers have attempted to empirically test effectuation. Our purpose is to encourage effectuation research. To do so, we review the effectuation literature and make suggestions for how to design and conduct empirically rigorous effectuation studies consistent with the developmental state of the research stream.

Entrepreneurship Theory and Practice publish 2012  PDF Download
Entrepreneurial exit as a critical component of the entrepreneurial process: Theoretical development Dawn DeTienne

By demonstrating the importance of entrepreneurial exit to the entrepreneur, the firm, the industry, and the economy I contend that our understanding of the entrepreneurial process is incomplete without the inclusion of entrepreneurial exit. I define entrepreneurial exit and demonstrate how this conceptualization provides concepts that are unique from those addressed by researchers in other domains; thus outlining a space for it within the literature. In each phase of the entrepreneurial process I explore the development of an exit strategy, reasons for exit and options for exit.

Journal of Business Venturing publish 2010  PDF Download
Entrepreneurial expertise and the use of control Saras Sarasvathy
Nick Dew
Stuart Read
Rob Wiltbank

Abstract Significant evidence has accumulated describing the importance of expertise. As this knowledge is extended, it is critical to understand when expertise matters and how. We unpack expertise in entrepreneurial decision making by presenting 412 founder/entrepreneur subjects with a unique tool involving four scenarios so we can measure an element of theoretical relevance to expertise in the entrepreneurial domain, efficacy at applying control and prediction strategies to situations which vary in environmental predictability and controllability. Results show that entrepreneurial expertise yields significant decision-making improvements in the situational use of control strategies – those strategies conceptually associated with uncertain new ventures, products and markets.

Journal of Business Venturing Insights publish 2015  PDF Download
Entrepreneurial learning from failure: An interpretative phenomenological analysis Jason Cope

This article develops a deeper conceptualisation of the process and content dimensions of learning from venture failure. I propose that recovery and re-emergence from failure is a function of distinctive learning processes that foster a range of higher-level learning outcomes. This qualitative research demonstrates that entrepreneurs learn much not only about themselves and the demise of their ventures but also about the nature of networks and relationships and the “pressure points” of venture management. This article also provides evidence that these powerful learning outcomes are future-oriented, increasing the entrepreneur’s level of entrepreneurial preparedness for further enterprising activities.

Journal of Business Venturing publish 2011
Entrepreneurial learning from failure: An interpretative phenomenological analysis Jason Cope

This article develops a deeper conceptualisation of the process and content dimensions of learning from venture failure. I propose that recovery and re-emergence from failure is a function of distinctive learning processes that foster a range of higher-level learning outcomes. This qualitative research demonstrates that entrepreneurs learn much not only about themselves and the demise of their ventures but also about the nature of networks and relationships and the “pressure points” of venture management. This article also provides evidence that these powerful learning outcomes are future-oriented, increasing the entrepreneur’s level of entrepreneurial preparedness for further enterprising activities.

Journal of Business Venturing publish 2011  PDF Download
Entrepreneurial Learning: Researching the Interface Between Learning and the Entrepreneurial Context Richard T Harrison
Claire Leitch

The context for the research presented in this article arises from increasing interest, by academics and practitioners, in the importance of learning and knowledge in the knowledge-based economy. In particular, we consider the scope for applying concepts of learning within the field of entrepreneurship. While it has gained currency within the field of management, the application of these concepts to entrepreneurship has been limited. In this Introduction to the Special Issue, we review the development of the field of entrepreneurship as a context for the emergence of learning as an area of scholarly attention, summarize a number of key themes emerging from the organizational learning literature, and outline the article selection process and summarize the key elements of each of the included articles. The article concludes with some reflections on future research at the interface between learning and the entrepreneurial context.

Entrepreneurship Theory and Practice publish 2005  PDF Download
Entrepreneurial logics for a technology of foolishness Saras Sarasvathy
Nick Dew

Several years ago Professor March pointed out that rational choice involves two guesses, a guess about uncertain future consequences and a guess about uncertain future preferences, and called for the development of a technology of foolishness to complement the technologies of intelligence that have been developed to improve the first guess. In this essay we use empirical data from two separate studies of entrepreneurial expertise, one involving the creation of new ventures and the other the birth of a new industry to identify three logics that constitute working elements of a technology of foolishness: (1) the logic of identity, as opposed to the logic of preferences; (2) the logic of action, as opposed to the logic of belief; and (3) the logic of commitment, as opposed to the logic of transaction.

publish 2005
Entrepreneurial logics for a technology of foolishness Saras Sarasvathy
Nick Dew

Several years ago Professor March pointed out that rational choice involves two guesses, a guess about uncertain future consequences and a guess about uncertain future preferences, and called for the development of a technology of foolishness to complement the technologies of intelligence that have been developed to improve the first guess. In this essay we use empirical data from two separate studies of entrepreneurial expertise, one involving the creation of new ventures and the other the birth of a new industry to identify three logics that constitute working elements of a technology of foolishness: (1) the logic of identity, as opposed to the logic of preferences; (2) the logic of action, as opposed to the logic of belief; and (3) the logic of commitment, as opposed to the logic of transaction.

Present and Future publish 2005  PDF Download
Entrepreneurial Networking Under Uncertainty: An Effectual Lens Yuval Engel
mariette kaandorp
Tom Elfring

Although research has started to acknowledge the strategies by which entrepreneurs form and maintain network ties, most efforts to date present an incomplete picture of entrepreneurs as heroic network architects who search, plan, and pursue contact with targeted ties. Herein, we review this nascent literature, argue that it has so far overlooked alternatives in favor of an overly planned and instrumental perspective, and consider the implications of incorporating the notion of uncertainty into investigations of how entrepreneurs engage in networking. We therefore take a novel perspective on entrepreneurial networking and adopt an effectual lens to theorize about how entrepreneurs act when desired ties cannot be identified in advance, networking outcomes cannot be predicted, and ongoing social interactions fuel the emergence of new objectives. Overall, we add important insights to the literature as we flesh out an effectual networking process and discuss how it may stimulate a broader research agenda focused on the inquiry of networking agency under uncertainty.

Academy of Management Proceedings publish 2015  PDF Download
Entrepreneurial Opportunities and Poverty Alleviation Sharon Alvarez
Jay Barney

Entrepreneurial activity does not always lead to economic growth. While improvements have been made to human capital, property rights protection, and access to financial capital in abject poverty contexts with the assumption that they will increase entrepreneurial activity, the results have been mixed. More recently, many entrepreneurs interested in poverty alleviation are crossing borders to engage in initiatives aimed at reducing poverty internationally. These efforts have also had mixed results. This paper posits that one reason is that entrepreneurial opportunities and their wealth creation potential vary, and the impact of exploiting these opportunities on economic growth in poverty contexts can also vary. This paper identifies self-employment opportunities, often exploited in abject poverty, that do not lead to sustainable growth solutions. Alternatively, discovery and creation opportunities while difficult to exploit in poverty contexts hold the greatest potential for significant economic impact.

Entrepreneurship Theory and Practice publish 2014  PDF Download
Entrepreneurial opportunities and the entrepreneurship nexus: A re-conceptualization Per Davidsson

Abstract The literature on “entrepreneurial opportunities” has grown rapidly since the publication of Shane and Venkataraman (2000). By directing attention to the earliest stages of development of new economic activities and organizations, this marks sound redirection of entrepreneurship research. However, our review shows that theoretical and empirical progress has been limited on important aspects of the role of “opportunities” and their interaction with actors, i.e., the “nexus”. We argue that this is rooted in inherent and inescapable problems with the “opportunity” construct itself, when applied in the context of a prospective, micro-level (i.e., individual[s], venture, or individual–venture dyad) view of entrepreneurial processes. We therefore suggest a fundamental re-conceptualization using the constructs External Enablers, New Venture Ideas, and Opportunity Confidence to capture the many important ideas commonly discussed under the “opportunity” label. This re-conceptualization makes important distinctions where prior conceptions have been blurred: between explananda and explanantia; between actor and the entity acted upon; between external conditions and subjective perceptions, and between the contents and the favorability of the entity acted upon. These distinctions facilitate theoretical precision and can guide empirical investigation towards more fruitful designs.

Journal of Business Venturing publish 2015  PDF Download
Entrepreneurial opportunities as propensities: Do Ramoglou & Tsang move the field forward? Per Davidsson

Abstract Ramoglou & Tsang’s (R&T) article “A realist perspective of entrepreneurship: Opportunities as propensities” is a recent, potentially influential addition to the literature on “entrepreneurial opportunities”. This short communication argues that R&T’s intellectual exercise largely fails to move matters forward on the two most central problems with prior research on “entrepreneurial opportunities”, namely 1) lack of construct clarity and 2) slow progress regarding how characteristics of “entrepreneurial opportunities” give shape to entrepreneurial action and outcomes. I suggest that entrepreneurship researchers should avoid the detour of conceptually dichotomizing complex and empirically non-tractable sets of external circumstances into “opportunities” vs. “non-opportunities” and instead direct attention to multi-dimensional and continuous variation in “those [evolving] entities which entrepreneurs actually evaluate and [sometimes] act upon” (and which should not be mislabeled as “opportunities”). For this endeavor, the notion of “agency-intensity” is the primary take-away from R&T’s study.

Journal of Business Venturing Insights publish 2016  PDF Download
Entrepreneurial Optimism in the Market for Technological Inventions Gary Dushnitsky

How do potentially optimistic entrepreneurs attract prospective investors? We investigate an entrepreneur’s decision to pursue either disclosure?where investors inspect the invention?or a contingent payment scheme (CPS) offer (e.g., salary deferral, royalty-based license)?where an invention’s value is inferred from the entrepreneur’s willingness to make her pay contingent on the invention’s success. Using a parsimonious model, we highlight the role of optimism and demonstrate that it only affects CPS ex post. As a result, a novel trade-off unfolds ex ante: In choosing an action that maximizes the valuation of the invention, a moderately wealthy entrepreneur weighs optimism discount (affecting CPS) versus imitation discount (affecting disclosure). More broadly, the paper advances a view of entrepreneurs as optimists, thus departing from the prevailing approach, which characterizes entrepreneurs as opportunistic individuals who consciously pursue self-serving goals.

Organization Science publish 2009  PDF Download
Entrepreneurial Orientation: do we actually know as much as we think we do? Kathleen Randerson

AbstractThe focus of this paper is on firm-level entrepreneurial behaviours and the processes that lead to them, known as Entrepreneurial Orientation. Despite the popularity of this construct, we argue that extant EO research suffers from major limitations linked to definitional inconsistencies and measurement issues. We present five distinct conceptualizations of EO in order to frame further research in the positivist mode. Moreover, we show that to gain a holistic and robust understanding of firm-level entrepreneurship, works from other research traditions and philosophies of science are needed. In this respect, the European research tradition and its wide variety of fields of research and research methods can offer a contextualized view of firm-level entrepreneurial behaviours and processes. Works embedded in the social constructionist philosophy of science might also offer an understanding of how, when, and why actors of different levels act do so and the likely outcomes of these actions as well as the interplay and divergence among these actors and levels. Works embedded in the pragmatic approach, illustrated by effectuation, could also contribute to a holistic understanding of the phenomenon. Finally, we call for researchers to be attentive to the need to align their conceptualizations, research methods and philosophies of science.

Entrepreneurship & Regional Development publish 2016
Entrepreneurial Risk and Market Entry Brian Wu
Anne Marie Knott

This paper attempts to reconcile the risk-bearing characterization of entrepreneurs with the stylized fact that entrepreneurs exhibit conventional risk-aversion profiles. We propose that the disparity arises from confounding two distinct dimensions of uncertainty: demand uncertainty and ability uncertainty. We further propose that entrepreneurs will be risk averse with respect to demand uncertainty, yet ?apparent risk seeking? (or overconfident) with respect to ability uncertainty. To examine this view, we construct a reduced-form model of the entrepreneur?s entry decision, which we aggregate to the market level, then test empirically. We find that entrepreneurs in aggregate behave as we predict. Accordingly, risk-averse entrepreneurs are willing to bear market risk when the degree of ability uncertainty is comparable to the degree of demand uncertainty. Potential market failures exist in instances where there is a high demand uncertainty but low performance dispersion (insufficient entry), or low demand uncertainty but high performance dispersion (excess entry).

Management Science publish 2006  PDF Download
Entrepreneurial Spirals: Deviation-Amplifying Loops of an Entrepreneurial Mindset and Organizational Culture Dean Shepherd
Holger Patzelt
Michael Haynie

As environments become more dynamic and increasingly competitive, organizations must become more entrepreneurial. To explain how and why an organization becomes more (or less) entrepreneurial over time, we investigate the interrelationship between the psychology of individuals and the culture of organizations. To that end, we develop the notion of entrepreneurial spirals—enduring, deviation-amplifying loops—that serve to link the manager’s mindset to his or her organization’s culture and vice versa. We investigate how entrepreneurial spirals start, perpetuate, and stop, and detail the implications and insights suggested by entrepreneurial spirals for the relationship between managerial mindset and organizational culture.

Entrepreneurship Theory and Practice publish 2010  PDF Download
Entrepreneurial Team Composition Characteristics and New Venture Performance: A Meta-Analysis Linlin Jin
Kristen Madison
Nils D Kraiczy
Franz W Kellermanns
T. Russell Crook
Jing Xi

Upper echelon theory highlights the importance of top management teams in large and established firms; however, effects are not always clear outside of this context. Due to the unique nature of new ventures, the composition of entrepreneurial teams and its effects on performance is worthy of investigation. Accordingly, we meta-analyze the effect of three characteristics of entrepreneurial team composition (i.e., aggregated, heterogeneity, team size) on new venture performance. Our meta-analysis, which includes 55 empirical samples and 8,892 observations, finds significant and unique effects of entrepreneurial team characteristics on new ventures. Based on our findings, we derive avenues for future research.

Entrepreneurship Theory and Practice publish 2016  PDF Download
Entrepreneuring as Emancipation VIOLINA RINDOVA
Daved Barry
Dave Ketchen

We define “entrepreneuring”as efforts to bring about new economic, social, institutional, and cultural environments through the actions of an individual or group of individuals. Thus, we view entrepreneuring as an emancipatory process with broad change potential. This view foregrounds three aspects of entrepreneuring that merit closer attention in future research—seeking autonomy, authoring, and making declarations. We highlight the novel directions for entrepreneurship research suggested by our emancipatory perspective and relate it to the special topic forum articles.

Academy of Management Review publish 2009  PDF Download
Entrepreneurs Under Uncertainty: An Economic Experiment in China Hakan J Holm
Sonja Opper
Victor Nee

This study reports findings from the first large-scale experiment investigating whether entrepreneurs differ from other people in their willingness to expose themselves to various forms of uncertainty. A stratified random sample of 700 chief executive officers from the Yangzi delta region in China is compared to 200 control group members. Our findings suggest that in economic decisions, entrepreneurs are more willing to accept strategic uncertainty related to multilateral competition and trust. However, entrepreneurs do not differ from ordinary people when it comes to nonstrategic forms of uncertainty, such as risk and ambiguity. This paper was accepted by John List, behavioral economics.

Management Science publish 2013  PDF Download
Entrepreneurs, Effectual Logic, and Over-Trust. Ranjan Karri
Sanjay Goel

This article complements extant literature on entrepreneurship and trust by proposing a model of over-trust (the tendency to trust more than what is warranted) using entrepreneurial characteristics and effectual logic. We trace how entrepreneurs following effectual processes may tend to over-trust. More formally, we propose that specific personality characteristics of the entrepreneur interact with effectual logic to make the entrepreneur more susceptible to over-trust. The proposed model is value neutral in that we do not imply that over-trust has negative consequences for entrepreneurs. In fact, it may be part of the overall risk that entrepreneurs assume in a new venture creation.

Entrepreneurship Theory and Practice publish 2006  PDF Download
Entrepreneurs’ Cognitive Biases and Heuristics in Entrepreneurial Team Recruitment. Jonathan pinto

Scholarly work on entrepreneurial cognitions has focused largely on opportunity recognition. However, the formation of the entrepreneurial team is an important step towards making the enterprise a reality and the selection of team members is a complex decision-making task which could be affected by cognitive biases and heuristics. This topic been relatively neglected thus far and I address it by developing a cognitive model of entrepreneurial team recruitment which serves as an integrative framework to articulate the potential role of several cognitive biases and heuristics in black boxes at two stages – (1) identification of a consideration set of criteria and candidates; and (2) evaluation and choice of team members. I also separately apply this model to experienced (i.e., habitual or repeat) entrepreneurs. I discuss the research implications of this work with particular focus on three entrepreneur individual difference topics – entrepreneur’s motivations (i.e., necessity and opportunity entrepreneurs), gender, and cognitive style. Finally, I provide entrepreneurs with a set of debiasing tactics and strategies.

Academy of Management Proceedings publish 2014  PDF Download
Entrepreneurs’ Social Skills and New Venture Performance: Mediating Mechanisms and Cultural Generality Jintong Tang
Baron Robert A

This research seeks to extend previous findings concerning the relationship between entrepreneurs’ social skills and new venture performance. Two potential mediators of such effects (entrepreneurs’ success in obtaining information and essential resources) were investigated, and data were collected in a culture not included in previous studies (China). Results indicate that several social skills (e.g., social perception, expressiveness) are significantly related to measures of new venture performance and that these effects are indeed mediated by the two proposed mediating variables. Implications of these findings for efforts to understand how micro-level variables influence macro-level measures of new venture performance are discussed.

Journal of Management publish 2008  PDF Download
Entrepreneurs’ Decisions to Exploit Opportunities Young Rok Choi
Dean Shepherd

Opportunity exploitation is a necessary step in creating a successful business in the entrepreneurial process, yet there has been little conceptual and empirical development of this issue in the literature. This study examines the decisions of entrepreneurs to begin exploiting business opportunities from a resource-based view. Our analysis of a sample of entrepreneurs whose businesses are located in incubators suggests that entrepreneurs are more likely to exploit opportunities when they perceive more knowledge of customer demand for the new product, more fully developed necessary technologies, greater managerial capability, and greater stakeholder support. Moreover, the findings of this study shed a light on a less emphasized aspect of the resource-based view: the new product?s anticipated lead time acts as an enhancing moderator in entrepreneurs? exploitation decision policies. Implications for future research on opportunity exploitation are discussed.

Journal of Management publish 2004
Entrepreneurs’ Decisions to Exploit Opportunities Young Rok Choi
Dean Shepherd

Opportunity exploitation is a necessary step in creating a successful business in the entrepreneurial process, yet there has been little conceptual and empirical development of this issue in the literature. This study examines the decisions of entrepreneurs to begin exploiting business opportunities from a resource-based view. Our analysis of a sample of entrepreneurs whose businesses are located in incubators suggests that entrepreneurs are more likely to exploit opportunities when they perceive more knowledge of customer demand for the new product, more fully developed necessary technologies, greater managerial capability, and greater stakeholder support. Moreover, the findings of this study shed a light on a less emphasized aspect of the resource-based view: the new product?s anticipated lead time acts as an enhancing moderator in entrepreneurs? exploitation decision policies. Implications for future research on opportunity exploitation are discussed.
pinto

Journal of Management publish 2004  PDF Download
ENTREPRENEURS’ DISPOSITIONAL AFFECT AS ANTECEDENT OF NETWORK SIZE AND QUALITY: WHAT’S AFFECT GOT TO DO WITH IT? (SUMMARY) Marcus Erken

Networking is of utmost importance for entrepreneurial success (e.g., Stam, Arzlanian, & Elfring, 2014) and continues to be a prominent theme in entrepreneurship research (Busenitz, Plummer, Klotz, Shahzad, & Rhoads, 2014). Network characteristics, such as network size and quality, can differ significantly from one entrepreneur to another. However, it remains unclear why those differences occur. Sarasvathy and Venkataraman (2011) go so far as to say that “almost the entirety of social networks research takes networks as mostly given.” This study tries to shed some light on the dark by empirically investigating “entrepreneurs’ dispositional affect”, which can be defined as entrepreneurs’ “stable tendency to experience positive [or negative] moods and emotions” (Baron, Hmieleski, & Henry, 2012). Specifically, this study analyzes to what degree entrepreneurs’ dispositional affect (independent variable) can predict entrepreneurs’ network size, time spent networking, and long-term orientation & quality of relationships (dependent variables).

Frontiers of Entrepreneurship Research publish 2015  PDF Download
Entrepreneurs’ Exploratory Perseverance in Learning Settings Katrin Muehlfeld
Diemo Urbig
Utz Weitzel

We introduce “exploratory perseverance” as a novel construct that captures perseverant behavior in settings in which several alternatives can be explored and evaluated. We suggest that entrepreneurs display exploratory perseverance reflected by a tendency to keep exploring broader sets of alternatives, to adopt a parallel rather than sequential approach to trial-and-error learning, and, after negative experiences with some alternatives, to be more inclined to give them a second chance. The results from an experimental study of 449 individuals participating in the Iowa Gambling Task indicate that more entrepreneurially experienced individuals display greater exploratory perseverance than those with little to no entrepreneurial experience.

Entrepreneurship Theory and Practice publish 2015  PDF Download
Entrepreneurs’ social identity and the preference of causal and effectual behaviours in start-up processes Gry Agnete Alsos
Tommy Høyvarde Clausen
Ulla Hytti
Sølvi Solvoll

This paper examines how the social identity of an entrepreneur influences his or her behaviour when engaged in new venture formation. Building on the typology of entrepreneurial identities developed by Fauchart and Gruber, this study examines the relationship between the social identity of the entrepreneur and subsequent entrepreneurial behaviour using a mixed-method approach. Based on interviews with entrepreneurs in six start-ups within the tourism sector and on previous literature, three hypotheses were developed regarding the relationship between entrepreneurial identity and entrepreneurial behaviour (causation, effectuation). Subsequently, the hypotheses were tested using a survey among a sample of entrepreneurs who registered a new firm in 2013. The study finds that the entrepreneurial identity influences whether the individual predominantly engages in effectual or causal behaviour. Hence, the study contributes by focusing on entrepreneurial identity as an important factor shaping the behaviours of entrepreneurs. In addition, we add to the understanding of entrepreneurs as a heterogeneous group. Entrepreneurs vary in terms of their identity, and this variation has consequences for their entrepreneurial behaviour. Finally, by adopting a mixed-method approach, this study benefits from and contributes to the interaction of qualitative and quantitative data in entrepreneurship research.

Entrepreneurship & Regional Development publish 2016  PDF Download
Entrepreneurship and being: the case of the Shaws Andrew Popp
Robin Holt

Our paper takes the case of John and Elizabeth Shaw, early nineteenth-century English hardware factors. The sources are almost 200 hundred letters written by the Shaws and their circle. Using these, two readings of the Shaws’ experiences of creating a business are presented. The first is couched within a narrative structure of plotted stages and finds the Shaws starting, struggling to, and ultimately succeeding in creating a successful business. Here, their actions within a nascent industrialized economy can be described as entrepreneurial ? they successfully pursued opportunity through founding an enterprise within economically and technologically auspicious environments. The second, more phenomenological reading, opens up for consideration the questionableness of their experience of ?being in business?. Here the Shaws’ understanding of themselves (as conveyed in personal letters) brings into question the academic tendency to emplot their story as one of the staged growth and profitability. Specifically, it resists attempts to ascribe to their experience entrepreneurial status, not simply because they did not think of themselves as entrepreneurs, but because the appearance of the business for the Shaws was woven with their lives in ways that belie the narrative direction and coherence that concepts like entrepreneurship give to it.

Entrepreneurship & Regional Development publish 2013  PDF Download
Entrepreneurship and Dynamic Capabilities: A Review, Model and Research Agenda* Shaker A. Zahra
Harry Sapienza
Per Davidsson

abstract  The emergent literature on dynamic capabilities and their role in value creation is riddled with inconsistencies, overlapping definitions, and outright contradictions. Yet, the theoretical and practical importance of developing and applying dynamic capabilities to sustain a firm’s competitive advantage in complex and volatile external environments has catapulted this issue to the forefront of the research agendas of many scholars. In this paper, we offer a definition of dynamic capabilities, separating them from substantive capabilities as well as from their antecedents and consequences. We also present a set of propositions that outline (1) how substantive capabilities and dynamic capabilities are related to one another, (2) how this relationship is moderated by organizational knowledge and skills, (3) how organizational age affects the speed of utilization of dynamic capabilities and the learning mode used in organizational change, and (4) how organizational knowledge and market dynamism affect the likely value of dynamic capabilities. Our discussion and model help to delineate key differences in the dynamic capabilities that new ventures and established companies have, revealing a key source of strategic heterogeneity between these firms.

Journal of Management Studies publish 2006  PDF Download
Entrepreneurship and Firm Boundaries: The Theory of A Firm Michael G Jacobides
Sidney G Winter

abstract  In this paper, we consider how a better understanding of entrepreneurial activities can help explain how firm and industry boundaries change over time and how a more comprehensive understanding of boundary setting can explain where entrepreneurial activities are directed. We start from the premise that while entrepreneurs believe themselves to have superior ideas in one or multiple parts of the value chain, they are characteristically short of cash, and of the ability to convince others to provide it. This premise motivates a simple model in which the entrepreneur has a value-adding set of ideas for ‘upstream’ and ‘downstream’ parts of a value chain, as well as for the ways to make these two parts of the value chain work better when joined under unitary control. Assuming that the entrepreneur’s objective is to maximize her wealth, we observe that even in the presence of transactional risks or other factors that might make integration preferable to specialization, initial scope depends also on relatively unexplored factors such as (a) how severe the entrepreneur’s cash constraint is, and (b) how much value the entrepreneur’s ideas add at each part of the value chain. Entrepreneurs will focus on the areas that provide the maximum profit yield per available cash – a criterion which implies that scope choices depend on cash availability and the depth of the demand for the new idea along the value chain. We also note that entrepreneurs make money not only from the operating profits of their firms, but also from the appreciation of the assets the firm has accumulated. This consideration can change the optimal choice of the firms’ boundaries, as entrepreneurs must be sensitive to choosing the segment that will enable them to benefit not only in terms of profit, but also in terms of asset appreciation. We propose that, in the entrepreneurial context especially, it is helpful to focus on the multiple considerations affecting the choice of boundaries for ‘a’ firm – the context faced by an individual entrepreneur – rather than on generic considerations affecting ‘the’ (representative) firm. Scope choices reflect the entrepreneur’s own theory of ‘how to make money’.

Journal of Management Studies publish 2007  PDF Download
Entrepreneurship and psychological disorders: How ADHD can be productively harnessed Johan Wiklund
Holger Patzelt
Dimo Dimov

Abstract Amidst predominant focus on positive traits for entrepreneurship, this paper explores how disorders such as ADHD influence the decision to engage in entrepreneurial action and the success of entrepreneurial action. Based on a multiple case study of fourteen entrepreneurs previously diagnosed with ADHD, our inductive model highlights impulsivity as a major driver of entrepreneurial action and hyperfocus as a major catalyst for its consequences, both positive and negative. By drawing attention to the positive implications of symptoms commonly seen as negative, the paper opens several major avenues for future theoretical development and empirical research.

Journal of Business Venturing Insights publish 2016  PDF Download
ENTREPRENEURSHIP AND STEREOTYPES: ARE ENTREPRENEURS FROM MARS OR FROM VENUS? Vishal K. Gupta
Daniel B. Turban
S. Arzu Wasti
ARIJIT SIKDAR

The goal of this study was to examine gender-role stereotypes in entrepreneurship and the relationship between such stereotypes and entrepreneurial intentions. Three forms of the 92-item Schein Descriptive Index were used to measure gender role stereotypes and characteristics of entrepreneurs in general. Data were collected from respondents at the pre-entrepreneurial stage in three countries, US, Turkey and India. The results revealed that, in general, entrepreneurs are perceived to have predominantly male characteristics. Further, although both men and women perceive entrepreneurs to have characteristics similar to those of males, only women also perceived entrepreneurs and females as having some similar characteristics. We also found that respondents who perceived themselves as more similar to males had higher entrepreneurial intentions than those who see themselves as less similar to males while no such difference was found for people who saw themselves as more or less similar to females. The results were consistent across the three national cultures in our sample. The implications of our findings for both research and practice are discussed.

Academy of Management Proceedings publish 2005  PDF Download
Entrepreneurship and Strategy in Emerging Economies Garry Bruton
Igor Filatotchev
STEVEN SI
MIKE WRIGHT

The goals of the special issue are to: (1) publish work that builds knowledge about the nature of strategic and entrepreneurial activities in emerging economies, as well as their antecedents and consequences; and (2) develop a theoretical foundation for future research. In this introduction to the special issue, we initially review the existing literature and the major definitions used to date for emerging economies. We then develop a framework for the analysis of where strategic entrepreneurship in emerging economies now stands that, in turn, allows us to develop an understanding of where the field needs to move in the future. We subsequently identify how each article in this special issue informs our research questions as we develop an agenda for future research. Copyright © 2013 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2013  PDF Download
Entrepreneurship as a Platform for Pursuing Multiple Goals: A Special Issue on Sustainability, Ethics, and Entrepreneurship Gideon D Markman
Michael Russo
Thomas Lumpkin
P. Devereaux (Dev) Jennings
Johanna Mair

The great challenge of sustainability is addressed by firms with varying levels of social and environmental responsibility and performance. Though traditionally, firms sought a balance, we argue that this is not enough. Rather, we advocate that the natural environment be the foundation on which society resides and the economy operates. Sustainable, ethical, entrepreneurial (SEE) enterprises are moving in this direction, seeking to regenerate the environment and drive positive societal changes rather than only minimizing harm. We also note that sustainability is justified and motivated by ethical considerations and pioneered by entrepreneurial engagement. The eight articles included in this Special Issue draw from cross-disciplinary scholarship to elaborate how SEE enterprises approach sustainability through new organizational forms, business models and innovation, and new governance mechanisms. They also emphasize the roles of institutional forces and logics, government policies and social movements for promoting or impeding sustainable practices. Collectively, they reveal new and compelling insights while spotlighting the great questions for SEE enterprise that await study.

Journal of Management Studies publish 2016  PDF Download
Entrepreneurship as a Process: Toward Harmonizing Multiple Perspectives Peter Moroz
Kevin Hindle

Are there any common denominators within the diversity of entrepreneurship literature that may serve as foundations for understanding the entrepreneurial process in a systematic and comprehensive way that is useful to both scholars and practitioners? The objective of this paper was to discover about the entrepreneurial process what, if anything, is both generic (all processes that are “entrepreneurial” do this) and distinct (only entrepreneurial processes do this). Our approach was to evaluate published models of entrepreneurial process to discover what scholars have argued about what entrepreneurs do and how they do it (the processes they use) and to seek out any key commonalities that scholars claim are associated with the phenomenon. Unfortunately for the field, the investigation demonstrates that, as at the time of our investigation, the 32 extant models of entrepreneurial process are highly fragmented in their claims and emphases and are insufficient for establishing an infrastructure upon which to synthesize an understanding of entrepreneurial process that is both generic and distinct. Insights gained in the study lead to suggestions for future research and theory development of which the most urgent is the need to develop a single harmonized model of entrepreneurial process capable of embracing the best of what is on offer and adding new theoretical arguments in areas where practice shows that they are lacking.

Entrepreneurship Theory and Practice publish 2012  PDF Download
Entrepreneurship As a Science of the Artificial Saras Sarasvathy

This essay connects four key ideas from Herb Simon’s “Sciences of the Artificial” to recent research on entrepreneurial expertise: (1) Natural laws constrain but do not dictate our designs; (2) We should seize every opportunity to avoid the use of prediction in design; (3) Locality and contingency govern the sciences of the artificial; and, (4) Near-decomposability is an essential feature of enduring designs. The essay is based on a series of conversations and emails with Herb about the empirical findings of my doctoral dissertation that involved a protocol analysis study of expert founder-entrepreneurs.

Journal of Economic Psychology publish 2003  PDF Download
Entrepreneurship as a science of the artificial Saras Sarasvathy

This essay connects four key ideas from Herbert Simons ‘‘Sciences of the Artificial’’ to recent research on entrepreneurial expertise: (1) natural laws constrain but do not dictate our designs (2) we should seize every opportunity to avoid the use of prediction in design (3) locality and contingency govern the sciences of the artificial; and (4) near-decomposability is an essential feature of enduring designs. The essay is based on a series of conversations and emails with Simon about the empirical findings of my doctoral dissertation that involved a protocol analysis study of expert founder-entrepreneurs.

The Economic Psychology publish 2003  PDF Download
Entrepreneurship as Economics with Imagination Saras Sarasvathy

To date, economics has failed to develop a useful theory of entrepreneurship because of its inability to break out of the static equilibrium framework and the modeling of success/failure as a 0-1 variable. Entrepreneurship research also has not achieved this task due to its preoccupation with the quest for “the successful entrepreneur” and/or the successful firm. This essay calls for a new vocabulary for entrepreneurship, consisting of: (1) a plural notion of the entrepreneurial process as a stream of successes and failures, wherein failure management becomes the key science of entrepreneurship; (2) an effectual notion of bringing together particular entrepreneurs and particular environments through creative action; and, (3) a contingent notion of aspirations that places imagination at the center stage of economics. Together, the new vocabulary allows us to ask new questions and develop new approaches that allow entrepreneurship to tackle the central task of imagination in economics – i.e., to create from the society we have to live in, the society we want to live in.

Business Ethics Quarterly publish 2001  PDF Download
Entrepreneurship as Elixir and Mutagen Lundmark, Erik
Westelius, Alf

Metaphors are powerful tools for sensemaking, sensegiving, and theory development, but they are often concealed in academic writing. This paper uncovers two metaphors underlying entrepreneurship discourse and research—elixir and mutagen. The elixir metaphor is uncovered by examining critiques of entrepreneurship research, and serves as a compact description of problematic aspects entrepreneurship scholars should be mindful of. The mutagen metaphor is uncovered by examining evolutionary frameworks, focusing on the role entrepreneurship plays in them. The paper illustrates how the mutagen metaphor can be used to reframe entrepreneurship, and uses the metaphors to interest, inform, and provoke.

Entrepreneurship Theory and Practice publish 2014  PDF Download
Entrepreneurship as everyday practice: towards a personalized pedagogy of enterprise education Per Blenker
Signe Hedeboe Frederiksen
Steffen Korsgaard
Sabine Mueller
Helle Neergaard
Claus Thrane

Adopting the perspective of ‘entrepreneurship as an everyday practice’ in education, the authors conceptualize opportunities as arising from the everyday practice of individuals. Opportunities are thus seen as emanating from the individual entrepreneur’s ability to disclose anomalies and disharmonies in their personal life. The paper illustrates how opportunities unfold depending on regional differences, local heritage and gender, to show how entrepreneurship education must take into account differences in context, culture and circumstance. Rather than perceiving entrepreneurship education as universalistic and searching for a generally applicable teaching approach, the authors argue that there is a need to tailor entrepreneurship education to the particular. They therefore propose that the pedagogy of entrepreneurship education should be personalized and they build a conceptual framework that contrasts two opposing views of entrepreneurship education: ‘universalistic’ and ‘idiosyncratic’. Following this distinction, they explore how different elements of entrepreneurship education may be fitted to the particular needs of each individual learner. This insight is relevant for didactic reflections on single entrepreneurship courses and for the construction of an entrepreneurship education curriculum.

Industry and Higher Education publish 2012  PDF Download
Entrepreneurship as Method: Open Questions for an Entrepreneurial Future Saras Sarasvathy
S. Venkataraman

In this essay, we outline the provocative argument that in the realm of human affairs there exists an “entrepreneurial method” analogous to the scientific method spelled out by Francis Bacon and others with regard to the natural realm. We then suggest a series of open questions that we believe will help future scholars spell out the contents of such a method and ways in which it can be put to work in the design and achievement of socio-economic ends. At least one normative implication of accepting the argument would be to teach entrepreneurship not only to entrepreneurs but to everyone, as a necessary and useful skill and an important way of reasoning about the world.

Entrepreneurship Theory and Practice publish 2011  PDF Download
Entrepreneurship as translation: Understanding entrepreneurial opportunities through actor-network theory Steffen Korsgaard

Entrepreneurship scholars argue that opportunities are at the heart of entrepreneurial activity. Yet, there is still a heated debate on the nature of opportunities. The discovery view argues that opportunities are discovered and have objective existence prior to the entrepreneurial process. The creation view argues that the discovery view is incomplete and makes wrongful assumptions about agency, process and opportunities in entrepreneurship. More conceptual development, however, is needed for the creation view to become a fully developed theoretical alternative to the discovery view. In this article, Actor-Network Theory is used to develop the creation view and further our understanding of entrepreneurial processes.

Entrepreneurship & Regional Development publish 2011  PDF Download
ENTREPRENEURSHIP Conference Paper Abstracts. effectuation

The article presents abstracts on the field of entrepreneurship which includes a behavioral model of venture capital firms’ risk taking, social entrepreneurship’s application to internationalization from a behavioral view, and a longitudinal analysis of business planning and performance.

Academy of Management Proceedings publish 2008
ENTREPRENEURSHIP Conference Paper Abstracts. effectuation

The article presents abstracts on entrepreneurship topics which include a longitudinal study of venture capital (VC) decision making, sustainable entrepreneurial firm growth, and a developed framework to explain opportunity formation and new value-emergence in regard to the interface between organizations and institutions.

Academy of Management Proceedings publish 2009
ENTREPRENEURSHIP Conference Paper Abstracts. effectuation

The article presents abstracts concerning issues related to entrepreneurship. They include “”Generative Dance” Between Tacit Knowledge, Expertise and Organizational Frameworks,” “A Behavioral Agency View of Pay Incentives and Risk-Taking Actions by the Upper Echelons of Spinoffs,” and “A Conceptual and Theoretic Examination of Social Entrepreneurial Discovery.”

Academy of Management Proceedings publish 2007
ENTREPRENEURSHIP Conference Paper Abstracts. effectuation

This article presents abstracts of various conference papers related to entrepreneurship including “Optimal Time for Market Entry: Learning From Participation and Other’s Experiences,” “More than Raising Capital: An Exploratory Study of Managerial Implications of IPOS,” and “Contribution of Venture Capital to Entrepreneurial Orientation in Management Buyouts.”

Academy of Management Proceedings publish 2002
ENTREPRENEURSHIP Conference Paper Abstracts. effectuation

The article presents abstracts on entrepreneurship topics which include the influence of tie-order on network emergence, a complexity science-based model for innovation and the formation of entrepreneurial enterprises, and fuzzy-set hierarchical classification of family businesses.

Academy of Management Proceedings publish 2010
ENTREPRENEURSHIP Conference Paper Abstracts. effectuation

This section presents abstracts of several papers on entrepreneurship. The first paper proposes a multi-dimension, multi-contingent fit perspective for examining different practices adapted by entrepreneurial firms in acquiring human resources. Another paper elaborates theoretical foundations for opportunity-based entrepreneurial discovery research and presents an empirical study providing evidence for examining the validity of an opportunity-based research approach. One more paper explores innovation as a corporate entrepreneurial outcome in recently established small firms.

Academy of Management Proceedings publish 2005
ENTREPRENEURSHIP Conference Symposia Abstracts. effectuation

The article presents abstracts on entrepreneurship topics which include academic entrepreneurship in the U.S. and Europe, business model innovation and industry architecture, and entrepreneurial performance in nascent firms.

Academy of Management Proceedings publish 2009  PDF Download
Entrepreneurship education and context Claire Leitch
Shirley-Anne Hazlett
Pittaway Luke
Entrepreneurship & Regional Development publish 2012  PDF Download
Entrepreneurship Education: Toward a Model of Contingency-Based Business Planning. Benson Honig

Despite the ubiquity of business planning education in entrepreneurship, there is little evidence that planning leads to success. Following a discussion of the theoretical and historical underpinnings, three pedagogical models are compared, including two alternative experiential methods: simulations and the contingency approach. The contingency model, as introduced, utilizes Piaget’s concept of equilibration, and is asserted to provide both cognitive tools and flexibility in accommodating unanticipated environmental factors faced by future entrepreneurs.

Academy of Management Learning & Education publish 2004  PDF Download
Entrepreneurship in action: bringing together the individual, organizational and institutional dimensions of entrepreneurial action T J Waston
Entrepreneurship & Regional Development publish 2013  PDF Download
Entrepreneurship in Regulated Markets: Framing Contests and Collective Action to Introduce Pay TV in the U.S. KEREM GURSES
PINAR OZCAN

In their endeavor to establish new products and services, entrepreneurs can face strong resistance from market incumbents whose resources and market position they threaten. This paper looks at the battles between entrepreneurs and market incumbents in a regulated market where various institutional actors (e.g., regulators, courts) have the power to protect the incumbents by hindering the entrepreneurs. Our comparison of one failed and one successful attempt to introduce pay TV in the U.S. reveals how entrepreneurs can first enter a regulated market without facing resistance, and then introduce a new frame to legitimize their product or service despite growing resistance from incumbents. Our framework highlights framing as a strategy and framing contests as a mechanism through which entrepreneurs and incumbents can battle to enable or disable institutional change. As part of this process, we also uncover how entrepreneurs evolve from self-serving actors with no field-level intentions to powerful groups that create a ripple effect in their environment by moving their target of influence from private to institutional actors. Our work constitutes a step toward a more “realistic” tale of institutional change.

Academy of Management Journal publish 2015  PDF Download
Entrepreneurship Research (1985–2009) and the Emergence of Opportunities Lowell Busenitz
Lawrence A. Plummer
Anthony C Klotz
Ali Shahzad
Kevin Rhoads

In order to identify shifts and trends in the entrepreneurship literature over the past 25 years, we conduct a bibliometric study involving new data from the 2000–2009 era building on 1985–1999 data to study entrepreneurship research published in the major management journals. Our findings indicate that entrepreneurship articles now have a significant presence in the mainline “A” journals. Furthermore, we contend that this presence signals legitimacy and, more importantly, a growing exchange among researchers studying entrepreneurship. The area of entrepreneurial opportunities and nascent ventures is showing signs of growth and in our view represents an area where entrepreneurship is contributing back to the broader research conversation in organizational studies.

Entrepreneurship Theory and Practice publish 2014  PDF Download
Entrepreneurship Research in AMJ: What Has Been Published, and What Might the Future Hold? R Duane Ireland
Christopher R Reutzel
Justin Webb

This article describes the trends associated with publishing entrepreneurship research in the “Academy of Management Journal” (AMJ), identifies some of the characteristics of the entrepreneurship research that has been published in the past, and offers some expectations about the entrepreneurship research that may be published in the future. The authors state that the amount of entrepreneurship research AMJ is publishing continues to increase. The authors’ research indicates that scholars are increasingly interested in studying questions regarding new ventures, international entrepreneurship, and initial public offerings.

Academy of Management Journal publish 2005  PDF Download
Entrepreneurship research in China: internationalization or contextualization? Qinghua Zhai
Hans Landström
Jing Su

Entrepreneurship is an emerging research field that has received much scholarly attention in recent decades. Given the global scope of this attention, this article compares entrepreneurship research in China with that in the USA and Europe. Based on publications in Social Science Citation Index and Chinese Social Science Citation Index databases over the past 10 years, we use bibliometric method to analyse entrepreneurship research in different regions. Our analysis shows that, on the one hand, entrepreneurship research in China has much in common with such research in the USA and Europe. In addition to borrowing ideas from Western researchers, Chinese entrepreneurship researchers study similar themes and use similar theoretical foundations. On the other hand, Chinese contextual environment helps preserve the uniqueness of its entrepreneurship research. Researchers deal with several context-specific topics such as guanxi, i.e. networks of interpersonal relationships, and its influence on entrepreneurship. We further discuss ways for Chinese researchers to explore the distinct context and contribute to the global literature.

Entrepreneurship & Regional Development publish 2015  PDF Download
Entrepreneurship Research in Emergence: Past Trends and Future Directions Lowell Busenitz
G. Page West
Dean Shepherd
T E Nelson
Gaylen Chandler
Andrew Zacharakis

This article evaluates the emergent academic field of entrepreneurship to better understand its progress and potential. We apply boundary and exchange concepts to examine 97 entrepreneurship articles published in leading management journals from 1985 to 1999. Some evidence was found of an upward trend in the number of published entrepreneurship articles, although the percentage of entrepreneurship articles remains low. The highly permeable boundaries of entrepreneurship facilitate intellectual exchange with other management areas but sometimes discourage the development of entrepreneurship theory and hinder legitimacy. We argue that focusing entrepreneurship research at the intersection of the constructs of individuals, opportunities, modes of organizing, and the environment will define the field and enhance legitimacy. Decision theory, start-up factors of production, information processing and network theory, and temporal dynamics are put forward for entrepreneurship scholars to explore important research questions in these intersections.

Journal of Management publish 2003  PDF Download
Entrepreneurship Research in Germany. Jurgen Schmude
Friederike Welter
Stefan Heumann

This article explores entrepreneurship research in Germany, paying particular attention to its origins and current “re-emergence.” Since the late 1990s, the field has gained ground, as is reflected in an increasing number of entrepreneurship chairs at universities, and the establishment of an annual national entrepreneurship conference. A particular strength of the German approach to researching entrepreneurship, which can be traced back directly to the historical roots, is found to be its consideration of context specificity and embeddedness, going hand-in-hand with a strong multidisciplinary tendency. These are two features where entrepreneurship research in Germany could add a distinctive flavor to the current mainstream debate. In practice, the diffusion of this perspective is inhibited by an insufficient exchange with the international scientific community.

Entrepreneurship Theory and Practice publish 2008  PDF Download
Entrepreneurship theory: possibilities and future directions Phillip H Phan
Journal of Business Venturing publish 2004  PDF Download
Entrepreneurship through a qualitative lens: Insights on the construction and/or discovery of entrepreneurial opportunity Roy Suddaby
Garry Bruton
STEVEN SI

Abstract This article applies inductive analytic techniques to identify and elaborate on two recurring themes that underpin the core puzzle of entrepreneurship research — where entrepreneurial opportunities come from. The first theme is the unique role of imprinting, or the profound influence of social and historical context in constraining the perceptual apparatus of entrepreneurs and delimiting the range of opportunities for innovation available to them. Second, our analysis offers insight into the counterbalancing role of reflexivity, operating at both individual and collective levels of analysis, in generating the ability of entrepreneurs to overcome the constraints of imprinting. These insights are based on a thematic review of the nine studies that comprise this special issue on qualitative research. The nine studies, individually and each in their own way, offer key insights into how we might better understand the emergence of entrepreneurial opportunity.

Entrepreneurship through a qualitative lens publish 2015  PDF Download
Entrepreneurship under adverse conditions: Global study of individual resilience and self-efficacy Maija Renko
Amanda Bullough
SAADAT SAEED

The drivers of entrepreneurial decisions in adverse environments remain poorly understood. In this study we empirically examine the effects of an adverse society (country-level) as well as the effects of individual-level resilience and self-efficacy on entrepreneurial intentions. Eight countries are included in the analyses, and primary survey data has been collected from each country (total n=2,591). Our findings suggest that adverse social conditions in the country impede the development of entrepreneurial intentions among its citizens. Furthermore, adversity dampens the positive relationship between entrepreneurial self-efficacy (belief in one’s entrepreneurial skills) and entrepreneurial intentions, but strengthens the importance of resilience (ability to grow from adversity) for the development of these intentions.

Academy of Management Proceedings publish 2016  PDF Download
Entrepreneurship, subjectivism, and the resource-based view: toward a new synthesis NICOLAI J FOSS
Peter G. Klein
YASEMIN Y KOR
Joseph T. Mahoney

This article maintains that the consistent application of subjectivism helps reconcile contemporary entrepreneurship theory with the strategic management literature, particularly the resource-based view of the firm. The article synthesizes theoretical insights from Austrian economics, Penrose’s (1959) resources approach, and modern resource-based theory, focusing on the essential subjectivity of the entrepreneurial process. This new synthesis describes entrepreneurship as a creative team act in which heterogeneous managerial mental models interact to create and arrange resources to produce a collective output that is creatively superior to individual output. Copyright © 2008 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2008  PDF Download
Entrepreneurship’s Next Act Shaker A. Zahra
MIKE WRIGHT

Entrepreneurship has become firmly established as a legitimate scholarly discipline. For entrepreneurship to influence managerial practice and public policy, however, we believe there needs to be a substantive shift in the focus, content, and methods of entrepreneurship research. We discuss ways this shift could occur, highlighting the need to recognize the multiple dimensions of entrepreneurial activities—and the importance of examining the heterogeneous aspects of context and factoring them into future theory building and testing efforts—and delineating the microfoundations of entrepreneurship. We also discuss how to strengthen the link between entrepreneurship research and public policy.

The Academy of Management Perspectives publish 2011  PDF Download
Entry and Technological Performance in New Technology Domains: Technological Opportunities, Technology Competition and Technological Relatedness BART LETEN
RENE BELDERBOS
Bart Van Looy

Entry and success in new technology domains (NTDs) is essential for firms’ long-term performance. We argue that firms’ choices to enter NTDs and their subsequent performance in these domains are not only governed by firm-level factors but also by environmental characteristics. Entry is encouraged by the richness of opportunities for technology development, while technology competition by incumbent firms discourages entry and render entries that do take place less successful. Firms are expected to be positioned heterogeneously to recognize and capitalize on technological opportunities, depending on the presence of a related technology base. We find qualified support for these conjectures in a longitudinal analysis of entry and technological performance in NTDs by 176 R&D intensive firms. While opportunity rich technology environments attract entries by firms even if these NTDs are distal from firms’ existing technologies, firms require related technological expertise in order to exploit technological opportunities post-entry.

Journal of Management Studies publish 2016  PDF Download
Envirofit International: A Venture Adventure Paul Hudnut
Dawn DeTienne

This case focuses on Envirofit International, a student start-up venture that began in an undergraduate entrepreneurship course. Two engineering students and two faculty members at a land grant university in the United States designed a retrofit kit to vastly reduce emissions from dirty two-stroke motorcycles, which are used throughout Asian cities as taxis. This case presents the beginnings of the Envirofit story, and the issues involved in creating an entrepreneurial venture focused on triple bottom line objectives in “base of pyramid” markets. Specifically, the case examines the ambiguity facing a start-up as it begins to develop a technology, a business model, and a management team. The case demonstrates the tension between planning and doing in managing the uncertainty facing a new venture.

Entrepreneurship Theory and Practice publish 2010
Environment, organization, and innovation: how entrepreneurial decisions affect innovative success MICHAEL J LEIBLEIN
Strategic Entrepreneurship Journal publish 2007  PDF Download
Environmental Entrepreneurship and Interorganizational Arrangements: A Model of Social-benefit Market Creation Jacqueline Corbett
Wren Montgomery

Research summary Social-benefit markets, such as those for carbon trading, are becoming increasingly popular for combating complex social and environmental problems. However, their unique characteristics pose substantial challenges to market creation and require novel entrepreneurial approaches. Integrating the entrepreneurship literature with that of management information systems, we conceptualize social-benefit markets as a new type of interorganizational arrangement and develop a model of social-benefit market creation. First, we argue a core entrepreneurial collective, comprising a plurality of actors from government, business and social movements, is essential. Second, we elaborate a six-phase process through which the interests of entrepreneurs are aligned and inscribed in a market artifact and the market is formed. The model is illustrated with reference to the Western Climate Initiative’s carbon market creation efforts. Managerial summary Carbon markets have become a popular strategy for reducing greenhouse gas emissions, with similar market-based solutions being proposed for other social and environmental challenges. We refer to these new structures as social-benefit markets. Social-benefit market creation is a complex undertaking that will require novel entrepreneurial approaches and new interorganizational information systems. In an effort to reduce some of this complexity, we propose a model to explain how entrepreneurs from government, business and social movements must work collectively to build social-benefit markets. We further elaborate a six-phase process through which entrepreneurs are able to align their diverse interests and create a stable market artifact. For managers from all sectors, our work offers actionable guidance for forming collective ventures that deliver real social benefits.

Strategic Entrepreneurship Journal publish 2017  PDF Download
Environmental Perceptions and Scanning in the United States and India: Convergence in Entrepreneurial Information Seeking? Wayne Stewart
Ruth May
Arvind Kalia

Drawing on institutional theory and entrepreneurial cognition, we test the environmental perception-scanning framework in the United States and India. The results suggest that culture and transition context help explain scanning frequency, but entrepreneurs in the two countries are similar in their perceptions of strategic uncertainty in environmental sectors. Moreover, the perceptions of increased environmental change and sector importance, as conditioned by perceived information accessibility, are associated with increased scanning. Overall, our results provide important indications about perceptions and information seeking, and lend support to indications of a universal mindset of entrepreneurship.

Entrepreneurship Theory and Practice publish 2008  PDF Download
Epistemology, Opportunities, and Entrepreneurship: Comments on Venkataraman et al. (2012) and Shane (2012) Sharon Alvarez
Jay Barney
Academy of Management Review publish 2013  PDF Download
Escaping the green prison: Entrepreneurship and the creation of opportunities for sustainable development Desirée F. Pacheco
Thomas J. Dean
David Payne

While entrepreneurial activity has been an important force for social and ecological sustainability; its efficacy is dependent upon the nature of market incentives. This limitation is sometimes explained by the metaphor of the prisoner’s dilemma, which we term the green prison. In this prison, entrepreneurs are compelled to environmentally degrading behavior due to the divergence between individual rewards and collective goals for sustainable development. Entrepreneurs, however, can escape from the green prison by altering or creating the institutions–norms, property rights, and legislation–that establish the incentives of competitive games. We provide a variety of evidence of such entrepreneurial action and discuss its implications for theory and practice.

Journal of Business Venturing publish 2010  PDF Download
Ethics and entrepreneurs: An international comparative study Branko Bucar
MIROSLAV GLAS
Robert D Hisrich

In this study, we develop a conceptual framework for the examination of cross-cultural differences in ethical attitudes of business people based on the assumptions of integrative social contract theory (ISCT). ISCT reveals the relevant cultural and economic norms that are predictive of the level of the ethical attitudes among societies and at the same time points out the more subtle impact of social institutions on ethical attitudes of different groups within a society. The evidence supports the use of integrative theoretical approaches within the field of business ethics.

Journal of Business Venturing publish 2003  PDF Download
Ethics and entrepreneurship Jared Harris
Harry Sapienza
Norman Bowie Norman Bowie

As the study of entrepreneurship and the study of business ethics become increasingly established, the intersection of entrepreneurship and ethics is receiving increasing scholarly attention. In this paper, we review the research connecting ethics and entrepreneurship, classifying the literature into three broad themes; we also identify and integrate the key themes that emerge, and we offer suggestions for future research. We conclude by introducing the articles in this special issue.

Journal of Business Venturing publish 2009  PDF Download
Ethnic entrepreneurship: the myths of informal and illegal enterprises in the UK Sanya Ojo
Sonny Nwankwo
Ayantunji Gbadamosi

This study, based on lived experiences of a sample of Nigerian entrepreneurs in the UK, provides an insight into why ethnic minority entrepreneurs work and feel justified in working outside the formal/legal structures regulated by government. It contributes an understanding of ethnic entrepreneurship at the periphery or grey zones of the market economy. Thirty Nigerian entrepreneurs based in London were interviewed over a period of 3 months, and their responses analysed for characterization of their entrepreneurial activities. It was found that besides their regular involvements in ?off-the-book? illicit deals, the demarcation between formal and informal entrepreneurial activities is blurred and not easily navigable. Importantly, the study explanatorily exposes the inherent myths of informal/illegal space associated with the study and power of entrepreneurship as an analytical concept.

Entrepreneurship & Regional Development publish 2013
Event- and outcome-driven explanations of entrepreneurship Andrew Van de Ven
Rhonda Engleman

Aldrich [J. Manag. Inq. 10 (2001) 115] importantly points out that not all forms of process research are equal or the same. He emphasizes the need to distinguish between outcome-driven and event-driven research. We build upon Aldrich’s distinctions, arguing that event-driven and outcome-driven explanations represent different kinds of process and variance theories that are based on fundamentally different ontological assumptions. We examine and compare these variance and process theory assumptions in order to sharpen our understanding of process theory as distinct and not derivable from variance theory. We conclude by arguing that variance and process theories must be evaluated on their own items.

Journal of Business Venturing publish 2004  PDF Download
Evolution of Entrepreneurial Judgment With Venture-Specific Experience Sung Min Kim
UGUR UYGUR

Research summary This study advances research on entrepreneurial cognition by investigating how entrepreneurial judgment evolves during new venture creation. We conceptualize entrepreneurial judgment as a cognitive process in the minds of entrepreneurs that operates on the causal map—i.e., a knowledge structure concerning what factors they believe will help the chances of profitability under uncertainty. At the time of initial epiphany, entrepreneurs construct cognitive causal maps, which guide resource allocation decisions. Over time, venture-specific experience accumulates and entrepreneurial judgment evolves in response to their observations. Using a dataset of 524 nascent entrepreneurs, we find that entrepreneurs with more venture-specific experiences have more selective judgments, and they have stronger conviction in those judgments. We also find that perceived uncertainty and cognitive dispositions of the individuals affect entrepreneurial judgment. Managerial summary Entrepreneurs often have to exercise judgment due to limited information and resources when creating new businesses. Because they cannot effectively make progress in all aspects of a new venture at once, entrepreneurs choose the important success factors to focus on. Our findings suggest that it is important to understand the cognitive mechanisms underpinning their judgments. As entrepreneurs gain more experience with the venture, their chosen set of success factors narrows and their confidence increases. Additionally, their self-efficacy and decisiveness encourage them to make stronger judgments. This may imply a precarious scenario because of the risk of overconfidence in their judgments. Similarly, investors are also advised to check if the entrepreneur’s conviction is supported by accumulated experience in the context of the venture. Copyright © 2016 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2016  PDF Download
Experience, effectuation, and something good does the use of effectuation lead to positive outcomes T E Nelson

The theory of effectuation is ascending in entrepreneurship education. Hundreds of articles have been written on the topic. Many textbooks mention the theory, and one college level textbook teaches entrepreneurship entirely from an effectual perspective. Given its acceptance, the natural assumption is that effectuation is somehow ‘good.’ That is, there is some unique benefit that an entrepreneur gains from using effectuation. This dissertation examines the concept of effectuation, and its value to entrepreneurship. It seeks to determine if entrepreneurs who use effectual logic outperform entrepreneurs who don’t. Four hundred and fifty entrepreneurs across three states are surveyed to determine if and how much they effectuate, their business’s performance, and their satisfaction with their business’s performance, as well as their lives overall. Findings indicate that entrepreneurs with more experience adopt the effectual idea of seeking out pre-commitments before starting a new venture. Findings also indicate that the entrepreneur’s perception of his business’s financial performance is positively related to his or her inclination to experiment, be flexible, and to evaluate business opportunities by considering how much he or she can afford to lose.

University of Louisville publish 2012
Experiencing Family Business Creation: Differences Between Founders, Nonfamily Managers, and Founders of Nonfamily Firms Michael Morris
Jerry Allen
Kuratko Donald F.
Dave Brannon

An experiential perspective for examining family business creation is introduced. As a “lived experience,” the family firm generates a cumulative series of interdependent events that takes on properties rooted in affect. The family business is a context that enables unscripted temporal performances by founders. Characteristics of the venture creation experience are examined, and underlying dimensions are proposed and empirically investigated. Building on social capital theory, differences in experiences between founders of family businesses, nonfamily managers, and founders of nonfamily ventures are explored. These differences are argued to have important implications for decision making and ongoing dynamics within the family firm.

Entrepreneurship Theory and Practice publish 2010  PDF Download
Expertise and Entrepreneurship Saras Sarasvathy
Stuart Read

Recently there is a move to study entrepreneurship as expertise: a set of skills, models, and processes that can be acquired with time and deliberate practice. Effectual reasoning, or expert entrepreneurial reasoning, however, does not begin with a specific goal. Instead, it begins with a given set of means and allows goals to emerge contingently over time from the varied imagination and diverse aspirations of the founders and the people they interact with.

Wiley Encyclopedia of Management publish 2015
EXPERTS RELY LESS ON PLANNING THAN NOVICES: EVIDENCE FOR EFFECTUATION FROM NASCENT TECHNOLOGY COMMERCIALIZERS (SUMMARY) Erik Willard Monsen
Courtney Price
Sandra Miller

While some researchers find that business planning can improve the growth and survival of new ventures (Gruber, 2007), others find that successful entrepreneurs improvise and effectuate rather than plan (Dew, Read, Sarasvathy, & Wiltbank, 2009). Recent research suggests that these findings are not in conflict, rather, business planning is simply less important for more experienced entrepreneurs (Dencker, Gruber, & Shah, 2009). Extending research on entrepreneurial intentions (Krueger, Reilly, & Carsrud, 2000), we investigate if this applies to earlier-stage entrepreneurial situations and, in particular, nascent-stage technology commercialization intentions of scientists.

Frontiers of Entrepreneurship Research publish 2010  PDF Download
Explaining growth paths of young technology-based firms: structuring resource portfolios in different competitive environments BART CLARYSSE
JOHAN BRUNEEL
MIKE WRIGHT

We explore how environmental contingencies determine the way resources are accumulated in young technology-based firms and argue that growth paths are critically shaped at the nexus between resource management and the competitive environment, defined along its most important dimensions, ‘stability’ and ‘complexity.’ We also build propositions about the way environmental conditions affect resource portfolio development or acquisition. We show how particular high-growth paths result from structuring resource portfolios in accordance with environmental demands and provide insights into why, based on six case studies of young technology-based high-growth firms, involving 27 interviews, 121 press releases, 605 press articles, and archival data. Copyright © 2011 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2011  PDF Download
Exploring Entrepreneurial Cognition in Franchisees: A Knowledge-Structure Approach Kristie K Seawright
Isaac H. Smith
Ronald Mitchell
Richard McClendon

Franchisees participate in new business creation uniquely, because, in many respects, the development of their ventures is under the direction of franchisors. In this study, using entrepreneurial scripts, we compare the extent to which franchisee venturing is similar to and/or distinct from individual-based entrepreneurship in nonfranchise new ventures. We therefore examined the entrepreneurial scripts of individuals in a purposeful sample of 54 franchisees compared to two counterpart groups: 54 independent entrepreneurs and 94 managers (neither franchisee nor entrepreneur). Using MANCOVA and follow-up tests we find that franchisees are less like entrepreneurs and more similar to nonentrepreneur managers.

Entrepreneurship Theory and Practice publish 2013  PDF Download
Exploring Environmental Entrepreneurship: Identity Coupling, Venture Goals, and Stakeholder Incentives Jeffery York
Isobel O’Neil
Saras Sarasvathy

On the basis of a qualitative study of 25 renewable energy firms, we theorize why and how individuals engage in environmental entrepreneurship, inductively defined as: the use of both commercial and ecological logics to address environmental degradation through the creation of financially profitable organizations, products, services, and markets. Our findings suggest that environmental entrepreneurs: (1) are motivated by identities based in both commercial and ecological logics, (2) prioritize commercial and/or ecological venture goals dependent on the strength and priority of coupling between these two identity types, and (3) approach stakeholders in a broadly inclusive, exclusive, or co-created manner based on identity coupling and goals. These findings contribute to literature streams on hybrid organizing, entrepreneurial identity, and entrepreneurship’s potential for resolving environmental degradation.

Journal of Management Studies publish 2016  PDF Download
Exploring internal corporate venturing in SMEs: Effectuation at Work in a new context M R Evald
Martin Senderovitz
Journal of Enterprising Culture publish 2013
Exploring the Problem-Finding and Problem-Solving Approach for Designing Organizations Jackson A. Nickerson
C. James Yen
Joseph T. Mahoney

An emerging problem-finding and problem-solving approach suggests that management’s ability to discover problems to solve, opportunities to seize, and challenges to respond to is vital to organizations. This paper explores the extent to which the problem-finding and problem-solving approach can provide a foundation for joining the capabilities, dynamic capabilities, and governance perspectives as a way to help scholars and practitioners to coherently design organizations from the perspective of design science. The problem-finding and problem-solving approach offers a unit of analysis and a set of behavioral assumptions that enable us to address open questions within the extant literature and to propose new questions in management research.

The Academy of Management Perspectives publish 2012  PDF Download
Exploring the Role of Trust in Entrepreneurial Activity. Friederike Welter
David Smallbone
Entrepreneurship Theory and Practice publish 2006  PDF Download
Extending the Role of Similarity Attraction in Friendship and Advice Networks in Angel Groups Cheryl Mitteness
Rich DeJordy
Manju K. Ahuja
Richard Sudek

Although similarity attraction theory is often utilized to explain why people form relationships with similar others, we utilize diversity research to look beyond surface-level demographic characteristics similarity to explain situations when angels form interpersonal relations with angels with dissimilar deep-level personal characteristics due to a strong desire to receive information and cognitive benefits. We use data collected from a chapter of one of the largest angel organizations in the United States. Our results show that although individuals often form relations with similar others, conditions exist when angels exert the extra effort required to form relations with dissimilar others.

Entrepreneurship Theory and Practice publish 2016  PDF Download
Extending Women’s Entrepreneurship Research in New Directions Karen D Hughes
Jennifer E Jennings
Candida Brush
Sara Carter
Friederike Welter

The dramatic expansion of scholarly interest and activity in the field of women’s entrepreneurship within recent years has done much to correct the historical inattention paid to female entrepreneurs and their initiatives. Yet, as the field continues to develop and mature, there are increasingly strong calls for scholars to take their research in new directions. Within this introduction to the special issue, we expand upon the reasons for this call, describe who responded, and summarize the new frontiers explored within the work appearing in this and another related collection. We conclude by delineating new territories for researchers to explore, arguing that such endeavors will join those in this volume in not only addressing the criticisms raised to date, but also in generating a richer and more robust understanding of women’s entrepreneurship.

Entrepreneurship Theory and Practice publish 2012  PDF Download
Factor payments, resource-based bargaining, and the creation of firm wealth in technology-based ventures DAVID M TOWNSEND
Lowell Busenitz

A central tenet of resource-based logic is that undervalued resources utilized by firms organized to exploit them will produce superior economic performance over the long run. Yet when young technology-based ventures pursuing new opportunities do not possess full property over these resources, input providers retain the right to bid up factor prices to match each resource’s marginal productivity. In response to these limitations in extant resource-based logic, we apply and extend Lippman and Rumelt’s full payments and bargaining perspectives and propose an alternative method by which entrepreneurs can generate firm wealth through the unique bundling of cospecialized resources. Both theoretical implications and directions for future research are discussed as well. Copyright © 2009 Strategic Management Society.

Strategic Management Journal publish 2008  PDF Download
Fail but Try Again? The Effects of Age, Gender, and Multiple-Owner Experience on Failed Entrepreneurs’ Reentry Massimo Bau
Philipp Sieger
Kimberly A Eddleston
Francesco Chirico

We investigate what leads failed entrepreneurs to reenter entrepreneurship by taking a developmental career perspective. Specifically, we hypothesize that the age of failed entrepreneurs has a nonlinear relationship with the likelihood of reentering entrepreneurship that follows different career stages (early, middle, and late). The gender of failed entrepreneurs and multiple-owner experience in the failed firm are hypothesized to be moderators of this relationship. We test our hypotheses using a database consisting of the Swedish population, including 4,761 entrepreneurs who failed between 2000 and 2004. Analyzing their career paths over the years following their failure offers support for our theoretical expectations.

Entrepreneurship Theory and Practice publish 2016  PDF Download
Failing Firms And Successful Entrepreneurs: Serial Entrepreneurship As A Simple Machine Saras Sarasvathy
Anil menon

A detailed review of four literatures, namely, (1) Industrial organization, (2) Population ecology, (3) Labor and micro economics, and (4) Entrepreneurship, suggests that entrepreneurial performance is almost always confounded with firm performance. Serial entrepreneurial experience is at best seen as one of the inputs into firm performance. In this paper we argue for an instrumental view of the firm by formally showing that entrepreneurs can amplify their expected success rates (as compared to firm success rates) by exploiting contagion processes embedded in serial entrepreneurship. The advantages to holding concurrent portfolios that exploit heterogeneity are well known. The same advantages may be achieved in the serial context through contagion. Our model exploits an observation due to William Feller on the near equivalence of the two, statistically speaking. It also leads to empirically sound implications about the size distribution of firms in the economy and suggests more nuanced approaches toward future research. For example, both failed firms and successful ones entail useful learning effects and path dependencies in the careers of serial entrepreneurs.

Management Science publish 2002  PDF Download
Failing firms and successful entrepreneurs: Serial entrepreneurship as a temporal portfolio. Saras Sarasvathy
Anil menon

A detailed review of four literatures, namely, (1) Industrial organization, (2) Population ecology, (3) Labor and micro economics, and (4) Entrepreneurship, suggests that entrepreneurial performance is almost always confounded with firm performance. Serial entrepreneurial experience is at best seen as one of the inputs into firm performance. In this paper we argue for an instrumental view of the firm by formally showing that entrepreneurs can amplify their expected success rates (as compared to firm success rates) by exploiting contagion processes embedded in serial entrepreneurship. The advantages to holding concurrent portfolios that exploit heterogeneity are well known. The same advantages may be achieved in the serial context through contagion. Our model exploits an observation due to William Feller on the near equivalence of the two, statistically speaking. It also leads to empirically sound implications about the size distribution of firms in the economy and suggests more nuanced approaches toward future research. For example, both failed firms and successful ones entail useful learning effects and path dependencies in the careers of serial entrepreneurs.

publish 2012
Failure or voluntary exit? Reassessing the female underperformance hypothesis Rachida Justo
Dawn DeTienne
Philipp Sieger

Abstract We reevaluate the female underperformance hypothesis by challenging the assumption that female-owned ventures are more likely to fail. Instead of equating exit with failure, we draw on exit literature and feminist theories to argue that female entrepreneurs are actually more likely than males to exit voluntarily. We argue for further gender differences by using an even more fine-grained conceptualization of entrepreneurial exit (failure, exit for personal reasons, and exit for other professional/financial opportunities). Post-hoc analyses also point to within-gender heterogeneity depending on family status. A sample probe of 219 Spanish entrepreneurs who had exited their business supports our overall reasoning.

Journal of Business Venturing publish 2015  PDF Download
Financing decisions as a source of conflict in venture boards Daniel P Forbes
M. Audrey Korsgaard
Harry Sapienza

Governance scholarship has suggested that venture boards should be structured so as to stimulate internal conflict. However, structure is a weak predictor of board effectiveness. Moreover, conflict can be dysfunctional, especially when it is focused on relationships rather than tasks. We show that venture boards experience more relationship conflict when they make financing decisions that involve devaluation of the venture and that this effect is moderated by whether the CEO is a founder. Our findings should prompt venture governance scholars to reconsider the importance of board structure, the value of board conflict and the behavior of founder- versus non-founder CEOs.

Journal of Business Venturing publish 2010  PDF Download
Firm growth and the illusion of randomness James Derbyshire
Elizabeth Garnsey

Abstract This paper shows that randomness can be an artefact of the methods used to examine firm performance. It questions the recent equating of entrepreneurship with gambling based on the assumption of random firm performance. It shows that complexity science provides a useful alternative perspective on randomness in relation to firm performance.

Journal of Business Venturing Insights publish 2014  PDF Download
Focus on opportunities as a mediator of the relationship between business owners’ age and venture growth. Michael Gielnik
MIchael Frese Zacher

Focus on opportunities as a mediator of the relationship between business owners’ age and venture growth.

Journal of Business Venturing publish 2010
Fostering Creativity in New Product Development through Entrepreneurial Decision Making M Blauth
René Mauer
Malte Brettel
Creativity and Innovation Management publish 2014
Founding Moral Reasoning on Evolutionary Psychology: A Critique and an Alternative Saras Sarasvathy

In this paper I develop a critique of the strong adaptationist view inherent in the work of Leda Cosmides and John Tooby, as presented at the Ruffin Lectures series in 2002. My critique proceeds in two stages. In the first stage, I advance arguments as to why I find the particular adaptation story that the authors advance for their experimental results unpersuasive even when I fully accept the value of their experimental results. In the second stage, I grant them their adaptation story and critique the implications of such stories for business ethics and for future research. In sum, I argue against recasting key problems in the social sciences to fit the use of tools developed in the so-called “hard” sciences. Instead, I urge that we deal with these problems on their own terms, i.e. through their basis in and dependence on deliberate social action.

Science and Business Ethics publish 2003  PDF Download
Founding moral reasoning on evolutionary psychology: A critique and an alternative. Saras Sarasvathy

At the heart of economics is an ethical story. From Adam Smith’s invisible hand (Smith, 1976) to Vilfredo Pareto’s innovation on the notion of optimality (Pareto, 1980) and Amartya Sen’s basic capability equality (Sen, 1998), economists do indeed preach the ethics of creative freedom and allocative justice. Yet, the charge, that homo economicus as a species — decked out in rational raiment and utilitarian hat — has limited imagination, is not exactly specious. Economics has repeatedly been criticized for its (presumably) arrogant presumptions to “hardness” as opposed to other social sciences. Philosophers have criticized its utilitarianism (Rawls, 1999); psychologists have criticized its rationality (Simon, 1959; Gigerenzer, 1999); sociologists have criticized its individualism (Merton, 1957; Joas, 1996); historians have criticized its static method (Galambos, 1988); and its own rhetoricians have criticized its metaphors (McCloskey, 1990). On the one hand, one could argue that the root cause of this astonishing barrage of critical attention focused on economics is precisely due to its unarguable success in the living vocabularies and actions of recent generations of educated human beings around the world. On the other hand, however, the particular charge being investigated in this essay is the failure of economics to date to incorporate the task of imagination within its domain and therein develop a useful theory of entrepreneurship.

publish 2003
Founding moral reasoning on evolutionary psychology: A critique and an alternative. Saras Sarasvathy

In this paper I develop a critique of the strong adaptationist view inherent in the work of Leda Cosmides and John Tooby, as presented at the Ruffin Lectures series in 2002. My critique proceeds in two stages. In the first stage, I advance arguments as to why I find the particular adaptation story that the authors advance for their experimental results unpersuasive even when I fully accept the value of their experimental results. In the second stage, I grant them their adaptation story and critique the implications of such stories for business ethics and for future research. In sum, I argue against recasting key problems in the social sciences to fit the use of tools developed in the so-called “hard” sciences. Instead, I urge that we deal with these problems on their own terms, i.e. through their basis in and dependence on deliberate social action.

publish 2003
Founding Team Capabilities and New Venture Performance: The Mediating Role of Strategic Positional Advantages Y. Lisa Zhao
Michael Song
Gregory L. Storm

This study conceptualizes founding team human capital with three multi-item scales that are related to critical functional areas in new service ventures: marketing capabilities, market-linking capabilities, and service design capabilities. We develop and empirically test a theoretical framework linking founding team capabilities to service venture performance through two strategic positional advantages: scalability and protectability. Our results provide insight into previous inconsistent findings regarding founding teams’ impact on new venture performance, offer important managerial implications, and point to future research directions.

Entrepreneurship Theory and Practice publish 2013  PDF Download
Framing the Entrepreneurial Experience Michael Morris
Kuratko Donald F.
minet schindehutte
Spivack, April J.

Building on affective events theory (AET), an experiential perspective for conceptualizing entrepreneurship is introduced. As a “lived experience,” entrepreneurship represents a cumulative series of interdependent events that takes on properties rooted in affect and emotion. Unique characteristics of entrepreneurial experiences are examined. The entrepreneur is presented as actor in an unscripted temporal performance who continually encounters novelty. A model and set of propositions are presented linking pre-venture experience, key events, experiential processing, learning, affective outcomes, and decision making. It is argued that the entrepreneur and venture emerge as a function of ongoing experience, with the venture creating the entrepreneur as the entrepreneur creates the venture.

Entrepreneurship Theory and Practice publish 2012  PDF Download
From Goldilocks to Gump: A Research Agenda for Entrepreneurial Mechanisms Design Anusha Ramesh
WILLIAM FORSTER
Saras Sarasvathy

In this essay we argue that the exclusive focus on research aimed at isolating the characteristics of entrepreneurs as opposed to others, while intellectually exciting and even practically valuable, may have blinded us to another wholly new and exciting possibility – namely, the design of mechanisms that allow all kinds of individuals to start new ventures and provide useful and valuable tools to enable them and their stakeholders to build enduring organizations. The research stream on effectuation has identified a few of these mechanisms. By showing where effectuation may be located within the history of behavioral and experimental economics, we were led to the outline of at least three more mechanisms that could open the door to an entirely new research agenda on entrepreneurial mechanisms design that parallels the effort in experimental economics on economic systems design.

Academy of Management Proceedings publish 2013  PDF Download
From Opportunity Insight to Opportunity Intention: The Importance of Person-Situation Learning Match Dimo Dimov

Within the context of opportunity development as a learning process, this paper explores the intentionality that drives the early stages of this process, from the initial occurrence of an idea to its further exploration and elaboration by a potential entrepreneur. It establishes that the specific situations that induce opportunity insights also affect the roles that individuals’ prior knowledge and learning approaches play for the formation of opportunity intentions. The likelihood of acting on their initial opportunity insights depends not only on how much prior knowledge individuals have of the opportunity domain, but also on whether their learning style matches the situation at hand. The results from an experiment show that domain-specific knowledge enables action when there is a person–situation match and impedes it when such a match is lacking.

Entrepreneurship Theory and Practice publish 2007  PDF Download
From resource munificence to ecosystem integration: the case of government sponsorship in St. Louis Yasuyuki Motoyama
Karren Knowlton

AbstractGovernment sponsorship of entrepreneurship has become a popular policy tool in the last 15 years. Despite this popularity, past academic studies have largely focused on firm-level survival rates and treated the effects of government sponsorship in isolation, which fails to capture the full effect of the sponsorship. That is, the objectives of the public sector include enhancing the macro-level entrepreneurial environment of the region as well as the success of individual firms. We expand research in this area through a case study in St. Louis, Missouri. We focus on the Arch Grants, a public?private coalition that provides $50,000 to 20 winners through their annual competition. Based on interviews of 46 recipient firms and 15 support organizations, we first demonstrate how government sponsorship can create a cohort of entrepreneurs who are able to learn from each other about business strategy, local mentors and other resources. Second, we uncover the process through which sponsorship can facilitate coordination among local entrepreneurship support organizations. Thus, we conclude that the evaluation of government sponsorship should go beyond the traditional firm-level performance measurement and consider the integration and enhancement of the local entrepreneurship ecosystem.

Entrepreneurship & Regional Development publish 2016
From Venture Idea to Venture Opportunity Peter Vogel

Opportunities are a core construct in the field of entrepreneurship. Despite recent advances suggesting the separation of ideas from opportunities, the field still suffers from conceptual deficiencies. This article builds on this distinction and leverages insights from creativity and innovation management literature to propose a framework that allows tracing the evolution of a venture from first insight to exploitation. It discusses real-time/longitudinal and retrospective measurement techniques from the fields of entrepreneurship, creativity, and innovation management to empirically capture the framework. Several research questions for future studies are provided, concluding with a discussion of implications for research and practice.

Entrepreneurship Theory and Practice publish 2016  PDF Download
Fundamental entrepreneurial planning processes: resource assessment and opportunity evaluation Kevin C. Cox

Research focused on new venture planning has received much attention in the entrepreneurship literature. However, while this stream of research has enjoyed substantial development, it also faces numerous challenges that must be addressed to ensure future progress. This paper identifies existing challenges in research focused on entrepreneurial planning and offers resolution via the development of a more parsimonious but fuller conceptualization of new venture planning. Focus is placed specifically on the most basic and fundamental planning processes and on the identification of important internal and external factors that influence how entrepreneurs progress through these fundamental planning processes.

The International Journal of Entrepreneurship and Innovation publish 2014  PDF Download
Get It Together! Synergistic Effects of Causal and Effectual Decision-Making Logics on Venture Performance Katrin Smolka
Ingrid Verheul
Katrin Burmeister-Lamp
Pursey P.M.A.R. Heugens

Entrepreneurs rely on different decision-making logics when starting new ventures, including causal and effectual reasoning. Extant research suggests that venture performance is positively associated with both causal business planning and effectual action-orientation, but studies have not yet tested the synergistic potential of these two logics. We contribute to the debate on entrepreneurial decision making by exploring the interrelationship between causation and effectuation, detailing their main and interactive effects on venture performance. Using survey data collected on 1,453 entrepreneurs residing in 25 countries, we find that ventures benefit from using these two entrepreneurial logics in tandem.

Entrepreneurship Theory and Practice publish 2016  PDF Download
Globalization of social entrepreneurship opportunities Shaker A. Zahra
Hans Rawhouser
NACHIKET BHAWE
DONALD O. NEUBAUM
James Hayton

Social entrepreneurship has emerged as an important research topic in the literature. This interest stems from social entrepreneurs’ role in addressing serious social problems on a worldwide scale while enhancing social wealth, often without regard for profits. In this article, we explain the forces contributing to the formation and rapid internationalization of social ventures. We use the behavioral theory of the firm to distill key attributes of social opportunities and show how these attributes influence the timing and geographic scope of social ventures’ international operations. Copyright © 2008 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2008  PDF Download
Governance Challenges in Family Businesses and Business Families Lloyd P Steier
James J Chrisman
Jess Chua

We use the articles and commentaries in this special issue to reinvigorate the theme of family business governance and extend its scope beyond the single business, single-family approach that has traditionally dominated the family business literature. Through a discussion of the implications of the articles and commentaries included in this special issue we begin to chart a new and expanded research program for governance that addresses the challenges of the large and complex multifamily and/or multibusiness family enterprise. We hope to encourage research in a direction that will add significantly to our understanding of business families’ contributions to the global economy.

Entrepreneurship Theory and Practice publish 2015  PDF Download
Grappling With the Unbearable Elusiveness of Entrepreneurial Opportunities. Dimo Dimov

The notion of opportunity, as currently discussed in entrepreneurship research, is theoretically exciting but empirically elusive. This article seeks to stimulate a new conversation about entrepreneurial opportunities by distinguishing two conceptions of entrepreneurial behavior—formal and substantive—and situating the construct of opportunity within the latter. It discusses three substantive premises for studying opportunities empirically: (1) opportunity as happening; (2) opportunity as expressed in actions; and (3) opportunity as instituted in market structures. These premises stimulate research questions that can invigorate and expand the study of entrepreneurial opportunities. They invite a continuous dialogue between qualitative and quantitative methodologies in behalf of understanding how opportunities emerge and evolve at the level of individual entrepreneurs.

Entrepreneurship Theory and Practice publish 2011  PDF Download
HelppoAsu aikoo tehdä Metallicat ja valloittaa maailman effektuaalisesti Erno Salmela
Mia Patanen
Tekes-uutiset in Finnish publish 2016  PDF Download
Heuristics, learning and the business angel investment decision-making process Richard T Harrison
Colin Mason
Donald Smith

ABSTRACTThis paper extends the literature on the investment decision-making of business angels.Using insights from the emerging body of research on entrepreneurial learning processes, particularly the use of heuristics and the nature of learning from meagre experience, we explore whether angels learn from experience, how they learn and what they learn. These issues are addressed using verbal protocol analysis, a methodology for examining decision-making in real time, with three groups of business angels with differing levels of investment experience, and with follow-up debriefing interviews with these angels. This reveals some differences in the speed of decision making and the emphasis given to various investment criteria. There is some evidence for the use of heuristics in the decision making process, and for the critical role played by vicarious learning from the experience of others. Learning in the individual angel decision making process is a social as well as an individual phenomenon.

Entrepreneurship & Regional Development publish 2015
High-Potential Concepts, Phenomena, and Theories for the Advancement of International Entrepreneurship Research Patricia McDougall
Marian Jones
Manuel G. Serapio

The purpose of this special issue on international entrepreneurship (IE) is to explore concepts, phenomena, and theories with high potential to advance the field. Rather than identify concepts from the extant IE literature, we took the more novel approach of challenging leading researchers to write about IE-relevant issues through the perceptual lenses of their own, or other scholarly domains. Through this process of cross-fertilization, our intention was to generate new topics and fresh insights, alternative arguments, and constructs. The issue’s seven articles enrich concepts and theories for IE; advance complementary, or competing arguments that underpin IE thinking; and open the IE dialogue to issues of current global significance.

Entrepreneurship Theory and Practice publish 2014  PDF Download
How can we know the dancer from the dance?: Reply to “Entrepreneurship as the structuration of individual and opportunity: A response using a critical realist perspective”. Yolanda Sarason
Thomas J. Dean
J Dillard
Journal of Business Venturing publish 2010  PDF Download
How community context affects entrepreneurial process: A diagnostic framework Kevin Hindle

This study reports a multi-faceted search to discover and articulate, in the form of a manageable framework, a diagnostic system for assessing the influence that community factors will have upon the conduct and outcome of any proposed entrepreneurial process. A methodological approach based on investigation of a rich empirical database supported by a wide examination of extant theory in several literatures, resulted in the production of a diagnostic system whose diagrammatic depiction employs a ?bridge? analogy. It depicts the culmination of the diagnostic procedure as the ability of different travellers (entrepreneurial actors and community members affected by their actions) to proceed via multiple pathways from an origin to a destination. The origin is a deep understanding of the community as an intermediate environment containing factors both conducive and hostile to any proposed entrepreneurial process. This deep understanding is founded upon intense local examination of the nature and interrelationship of three generic institutional components of any community: physical resources, human resources and property rights, and three generic human factors: human resources, social networks and the ability to span boundaries. The destination thus becomes a contextualised understanding and re-articulation of any proposed entrepreneurial process under consideration. Validation of the efficacy of the framework is being undertaken internationally as a key component of seven substantial projects, which simultaneously involve research and practice. Implications for research and practice are discussed.

Entrepreneurship & Regional Development publish 2010  PDF Download
How do Developing Country Entrepreneurs Navigate Extreme Institutional Voids? Ajnesh Prasad

Extending previous research on institutional voids within emerging economies, we propose for more scholarly attention to the study of ‘extreme institutional voids’–institutional environments that have simultaneous formal and informal institutional voids, which compromise the ability for robust institutions to compensate for weak institutions. Departing from previous work that has largely emphasized multinational enterprise strategies amidst formal voids, we explore the acute entrepreneurial dilemmas faced by indigenous entrepreneurs operating in regions impaired by challenges of individual mobility, security, and justice. By investigating these settings, we gain a deeper understanding of how entrepreneurship unfolds without clear guidance from institutions.

Academy of Management Proceedings publish 2012  PDF Download
HOW DO EXECUTIVES’ EXPERIENCES INFLUENCE STRATEGY AND PERFORMANCE? AN EMPIRICAL ANALYSIS OF ENTREPRENEURIAL TEAMS IN RESEARCH-BASED SPIN-OFF COMPANIES (SUMMARY) Rigo Tietz

Entrepreneurial teams in research-based spin-off companies face specific constraints for establishing sustainable ventures. They often lack managerial and entrepreneurial skills, because the scientists themselves are typically the founders and managers. For this reason, the compositions of the entrepreneurial teams are likely to change over time and involve experienced external entrepreneurs and managers (Franklin et al., 2001; Vanaelst et al., 2006). This study analyzes the characteristics and compositions of executive teams in research-based spin-offs. Drawing on an upper echelons framework (Hambrick and Mason, 1984) executives´ prior professional experiences are expected to have an essential impact on organizational outcomes such as strategy and performance. According to effectuation and causation theory (Sarasvathy, 2001) experienced entrepreneurs are more likely to rely on intuitive reasoning, whereas entrepreneurs without prior experiences presumably tend to plan more systematically and analytically.

Frontiers of Entrepreneurship Research publish 2011  PDF Download
How do Firms Come to Be? Towards a Theory of the Entrepreneurial Process Saras Sarasvathy

The paper presents a model of the pre-firm — defined here as the entity that transforms an idea into a firm. The entrepreneur who undertakes the pre-firm process creates the firm through a set of entrepreneurial decisions that arise out of four interconnected decision domains. Every pre-firm, whether it aborts early or creates a firm, provides the economy with an opportunity to create economic novelty and discover/create new demand — and leads to constraints and consequences that influence economic realities down the road. Developing a theory of the pre-firm should enhance our understanding of a variety of economic phenomena in terms of their initial conditions.

Frontiers of Entrepreneurship Research publish 1998  PDF Download
How entrepreneurs acquire the capacity to excel: insights from research on expert performance Baron Robert A
REBECCA A HENRY

Most new ventures fail, but a few prosper and attain rapid growth. Many factors contribute to such outcomes, but we propose that among these are mechanisms identified by cognitive science research on the origins of expert performance. Literature on this topic indicates that across many fields (e.g., medicine, science, sports, music), outstanding performance derives largely from participation in intense, prolonged, and highly focused efforts to improve current performance—a process known as deliberate practice. By comparison, mere experience in a field and individual talent play smaller roles in generating expert performance. Additional evidence indicates that participation in deliberate practice does not simply expand domain-specific knowledge and skills; it also generates actual enhancements to basic cognitive resources (e.g., memory, perception, metacognition). We suggest that to the extent entrepreneurs acquire enhanced cognitive resources through current or past deliberate practice, their capacity to perform tasks related to new venture success (e.g., accurate identification and evaluation of business opportunities) is enhanced and, hence, the performance of their new ventures, too, is augmented. Specific ways in which entrepreneurs can gain enhanced cognitive resources are described, and implications for entrepreneurship theory and practice are considered. Copyright © 2010 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2010  PDF Download
HOW ENTREPRENEURSHIP IS EXPERIENCED: THE AFFECTIVE NATURE OF NEW VENTURE CREATION (SUMMARY) Mike Morris
Dave Brannon
minet schindehutte

The experiential nature of entrepreneurship is receiving increased scholarly attention. Kreft and Sobel (2005) characterize venture creation as a trial and error experience, while Sarasvathy (2004) suggests the ability to effectuate outcomes is rooted in ongoing experiences. Politis (2005) argues that entrepreneurial learning results from the manner in which experiences are processed. Shepherd (2008) describes impending venture failure as a grieving experience. Schindehutte and Morris (2003) examine “peak experiences” of entrepreneurs. While entrepreneurship would seem inherently experiential, we know surprisingly little about what it is like to be “in the moment” as a venture takes form. This research argues that entrepreneurial experiences are fundamentally affective in nature, and attempts to uncover their underlying dimensionality.

Frontiers of Entrepreneurship Research publish 2009  PDF Download
How great entrepreneurs think L Buchanan
Inc. Magazine publish 2011
How Opportunities Develop in Social Entrepreneurship Patricia Corner
Marcus Ho

The purpose of this article was to extend existing research on opportunity identification in the social entrepreneurship literature through empirically examining this phenomenon. We used an inductive, theory-building design that surfaced patterns in social value creation across multiple case studies. The patterns showed actors seeing a social need and prospecting ideas that could address it. Data also revealed multiple, not individual, actors, dynamically engaged in interactions that nudged an opportunity into manifestation. Also, data suggested complementarities to effectuation and rational/economic processes that are divergent theoretical approaches to the study of entrepreneurship to date.

Entrepreneurship Theory and Practice publish 2010  PDF Download
How Social Entrepreneurs Facilitate the Adoption of New Industry Practices Theodore L. Waldron
Greg Fisher
Michael Pfarrer

This paper explores how social entrepreneurs use rhetoric to facilitate the pervasive adoption of new, socially focused, industry practices. Our conceptualization proposes that the nature of social entrepreneurs’ rhetoric hinges on perceptions of their relationships to the industry members they seek to influence. We develop a framework that explains the effects of two cognitive structures – identity and power – on social entrepreneurs’ perceptions of industry members and, in turn, the social entrepreneurs’ rhetorical strategies for persuading the industry members to adopt new practices. Our framework specifies mechanisms through which social entrepreneurs facilitate systemic social change and, in doing so, informs theory at the intersection of social entrepreneurship, sustainable social change, and rhetoric.

Journal of Management Studies publish 2016  PDF Download
Human Capital and Entrepreneurship Research: A Critical Review and Future Directions Matthew R. Marvel
Justin L Davis
Curtis R Sproul

Human capital has emerged as a highly utilized theoretical lens through which scholars can better understand entrepreneurship. To synthesize the progress of this stream and promote its use, we review 109 articles in leading management and entrepreneurship journals over two decades. We organize our discussion in terms of multi-theory approaches, methods and analyses, constructs, and study focus. A number of research gaps and promising areas for inquiry are put forward. We develop a typology of human capital and discuss how future investigations of types of human capital related to the entrepreneurship process can benefit research and practice.

Entrepreneurship Theory and Practice publish 2016  PDF Download
Human Capital and Search-Based Discovery: A Study of High-Tech Entrepreneurship Matthew R. Marvel

What types of knowledge and experience enable those who have the desire to start a venture find an appropriate opportunity? To respond to this question, a human capital perspective is used with a sample of 166 founders of new technology ventures in university incubators. General human capital is assessed using experience depth and formal education. Specific human capital is measured using prior start-up experience as well as Shane’s knowledge framework of markets, customer problems, and ways to serve markets. Findings reveal key aspects of human capital vital to explaining search-based discovery. Implications for research and entrepreneurship education are drawn.

Entrepreneurship Theory and Practice publish 2013  PDF Download
Human capital theory and venture capital firms: exploring “home runs” and “strike outs” Dimo Dimov
Dean Shepherd

Using a human capital perspective, we investigated the relationship between the education and experience of the top management teams of venture capital firms (VCFs) and the firms’ performance. We found that although general human capital had a positive association with the proportion of portfolio companies that went public [initial public offering (IPO)], specific human capital did not. However, we did find that specific human capital was negatively associated with the proportion of portfolio companies that went bankrupt. Interestingly, some findings were contrary to expectations from a human capital perspective, specifically the relationship between general human capital and the proportion of portfolio companies that went bankrupt. Future research is suggested.

Journal of Business Venturing publish 2005  PDF Download
I LIKE HOW YOU THINK: THE ROLE OF COGNITIVE SIMILARITY AS A DECISION BIAS. Murnieks, Charles Y.
Michael Haynie
Rob Wiltbank
Troy Harting

This article presents academic business research. The article examines the role of cognitive similarity in determining decision outcomes and as a decision bias. In particular, the authors analyze the decision making policies of a sampling of venture capitalists contemplating new ventures. An overview of the hypotheses development and methodology of the research is presented. Results indicate that similarity in cognitive processes has a significant impact on the probability that a venture capitalist will invest, as the probability increases.

Academy of Management Proceedings publish 2007
I Like How You Think’: Similarity as an Interaction Bias in the Investor–Entrepreneur Dyad Murnieks, Charles Y.
Haynie J.M
Rob Wiltbank
Troy Harting

Investigating the factors that influence venture capital decision-making has a long tradition in the management and entrepreneurship literatures. However, few studies have considered the factors that might bias an investment decision in a way that is idiosyncratic to a given investor–entrepreneur dyad. We do so in this study. Specifically, we build from the literature on the ‘similarity effect’ to investigate the extent to which decision-making process similarity (shared between the investor and the entrepreneur) might bias or otherwise impact the investor’s evaluation of a new venture investment opportunity. Our findings suggest venture capitalists evaluate more favourably opportunities represented by entrepreneurs who ‘think’ in ways similar to their own. Moreover, in the presence of decision-making process similarity, the impacts of other factors that inform the investment decision actually change in counter-intuitive ways.

Journal of Management Studies publish 2011
Identity in entrepreneurship effectuation theory: a supplementary framework Suna Lowe Nielsen
Astrid Heidemann Lassen

The article proposes a new framework on identity construction in entrepreneurship that in valuable ways supplements the logic of identity presented in Sarasvathy’s (2001, 2008) popular effectuation theory. Effectuation theory assumes that identity is a given and relative stable precondition of the entrepreneurial process that support the entrepreneur in ordering preferences in the process of effectuating resources, stakeholder commitment, etc.. The article shows that identity construction is an active and integral part of the effectuation process, and it importantly influences the manner in which the entrepreneur acts and makes decisions in the process. The article seeks to challenge and advance effectuation theory’s view on identity based on a narrative study of ten novice student entrepreneurs. The study gives insight into the identity processes involved in becoming a student entrepreneur, and it may serve as a guide to how entrepreneurship educators and counselors can place more emphasis on identity related struggles involved in the entrepreneurial effectuation process.

International Entrepreneurship and Management Journal publish 2012
Identity, identity formation and identity work in entrepreneurship: conceptual developments and empirical applications Claire Leitch
Richard T Harrison

AbstractThis paper reviews the current status of research into entrepreneurial identity. Identities ? individual and organizational ? can potentially serve as powerful elements that both drive and are shaped by entrepreneurial actions. Identity is, of course, a complex construct with multidisciplinary roots and consequentially a range of conceptual meanings and theoretical roles associated with it. Building on a framework for identifying schools of thought in the social sciences, we highlight the need for more critical studies of entrepreneurial identity that recognize, first, that entrepreneurial identity is a dynamic and fluid rather than (relatively) fixed and unchanging feature, and second, that research attention should shift from the analysis of identity per se (the identity-as-entity position) to the identity work processes through which entrepreneurial identities are shaped and formed (the identity-as-process position). Following a summary of the key contributions of the five papers included in this Special Issue, we conclude with some pointers for future research.

Entrepreneurship & Regional Development publish 2016
If we can’t have it, then no one should: Shutting Down Versus Selling in Family Business Portfolios AKHTER NAVEED
Philipp Sieger
Francesco Chirico

Research summary How does a business family manage its business portfolio in times of declining performance to sustain the portfolio’s long-term endurance? Drawing on social identity theory and six family business portfolios from Pakistan, we find that business families may prefer to shut down a satellite business rather than sell it, which is primarily driven by identity considerations. In addition, the family’s goal to recycle the assets, the aim to restart the business later, and the increasing decline in performance are important contingency factors. This study contributes to the literature on portfolio entrepreneurship, business exit, and the enduring entrepreneurship of family firms. Managerial summary Family business managers and practitioners can benefit from our work, which provides evidence of how family firm portfolios can respond to business decline and ensure enduring entrepreneurship. Shutting down a satellite firm instead of selling it is a promising turnaround strategy that can prevent a family’s identity loss while supporting the family business portfolio’s continuity. Copyright © 2016 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2016  PDF Download
Imagining and Rationalizing Opportunities: Inductive Reasoning and the Creation and Justification of New Ventures. Joep Cornelissen
john clarke

We argue that creating novel ventures consists of inductive analogical or metaphorical reasoning, which generates a platform for the creation and commercialization of novel ventures and facilitates the comprehension and justification of a venture. We argue that such inductive reasoning is shaped by two determinants (the applicability of prior entrepreneurial experience and the motivation to resolve uncertainty and acquire legitimacy) that interrelate to predict and explain patterns of analogical and metaphorical reasoning by which novice and experienced entrepreneurs construct meaning for themselves as well as others in the early stages of creating a venture.

Academy of Management Review publish 2010  PDF Download
Immigrant entrepreneurship on the move: a longitudinal analysis of first- and second-generation immigrant entrepreneurship in the Netherlands Pascal Beckers
Boris Blumberg

Second-generation immigrants starting businesses in industries not traditionally associated with immigrants have inspired a new line of research on migrant entrepreneurship. New entrepreneurs are expected to profit from better economic prospects arising from the relatively high levels of human capital available to them and improved integration into society compared to their parents’ generation. So far, it is unclear whether these expectations have been met owing to a lack of reliable data on immigrants in general and immigrant entrepreneurs in particular. This paper uses newly available data from Statistics Netherlands (1999?2004) to compare the differences between the business success of second- and first-generation immigrant entrepreneurs. The data enable us to compare these intergenerational differences for each of five major non-Western groups of immigrants in the Netherlands and contrast them with developments among native entrepreneurs from both inter-temporal and longitudinal perspectives. Contrary to expectations, the higher levels of socio-cultural integration of second-generation immigrants do not necessarily lead to better business prospects. The differences between the major ethnic groups of immigrants are noteworthy, as are those with non-immigrant entrepreneurs. While high levels of human capital and social integration foster entrepreneurial success, they are no guarantee of good business prospects.

Entrepreneurship & Regional Development publish 2013  PDF Download
Immortal Firms in Mortal Markets? An Entrepreneurial Perspective on the Innovator’s Dilemma. Saras Sarasvathy
Nick Dew
Stuart Read
Rob Wiltbank

“The Innovators’ Dilemma” consists in the fact that by doing the right thing – i.e., listening to current customers, leading firms often end up losing their markets to upstart newcomers. Therefore, understanding how entrepreneurs successfully create such upstart firms and new markets ought to have direct implications for strategic management theorizing about this dilemma. This paper examines such implications of some recent developments in entrepreneurship and outlines how effectual reasoning may be used to overcome the innovators’ dilemma in large corporations. The paper also identifies new questions for future research in the overlap between strategic management and entrepreneurship.

European Journal of Innovation Management publish 2008  PDF Download
Immortal Firms in Mortal Markets? How Entrepreneurs Deal with “The Innovators’ Dilemma” Saras Sarasvathy
Nick Dew

“The Innovators’ Dilemma” consists in the fact that by doing the right thing – i.e., listening to current customers, leading firms often end up losing their markets to upstart newcomers. Therefore, understanding how entrepreneurs successfully create such upstart firms and new markets ought to have direct implications for strategic management theorizing about this dilemma. This paper examines such implications of some recent developments in entrepreneurship and outlines how effectual reasoning may be used to overcome the innovators’ dilemma in large corporations. The paper also identifies new questions for future research in the overlap between strategic management and entrepreneurship.

Strategic Management Journal publish 2001  PDF Download
Implications of intra-family and external ownership transfer of family firms: short-term and long-term performance differences Karl Wennberg
Johan Wiklund
Karin Hellerstedt
MATTIAS NORDQVIST

We contrast the performance consequences of intra-family versus external ownership transfers. Investigating a sample of all private family firms in Sweden that went through ownership transfers during 10 years, we find that firms transferred to external owners outperform those transferred within the family, but that survival is higher among intra-family transfers. We attribute these performance differences to the long-term orientation of family firms passed on to the next generation and to the entrepreneurial willingness of acquirers to bear uncertainty. Based on distinct ownership transition routes and theoretical mechanisms explaining performance differences, we outline implications for family business and entrepreneurship research. Copyright © 2011 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2011  PDF Download
Implicit Mental Models in Teaching Cases: An Empirical Study of Popular MBA Cases in the United States and China NENG LIANG
JIAQIAN WANG

To identify the possible mismatch between what MBA students are supposed to learn and what they are actually exposed to in the case methods, we analyzed the manifest and latent meanings of popular MBA teaching cases in the United States and China. Our findings suggest that despite repeated calls for a more holistic approach to management education, overemphasis on the rational framework persists. We identify five patterns common to both U.S. and Chinese cases; namely, rationalistic framework, undersocialized protagonist, strategy-driven organization, manager-as-analyst, and naïve and biased politics. We also discuss the likely causes for the biases and propose possible ways to develop better-balanced teaching cases.

Academy of Management Learning & Education publish 2004  PDF Download
Imprinting by Design: The Microfoundations of Entrepreneurial Adaptation Peter Bryant

Entrepreneurial ventures need frequently to adapt. Yet their adaptive capacity is often limited by the legacies of imprinted founding characteristics. The question then arises whether it is possible to explain and manage the imprinting process so that the capacity to adapt is enhanced, rather than diminished. I address this question by developing a model of the microfoundations of imprinting based in collective memory. I argue that entrepreneurial founding teams naturally develop transactive autobiographical memory systems. By partially managing the design and imprinting of these memory systems, I argue that founders may improve their venture’s long-term capacity to adapt.

Entrepreneurship Theory and Practice publish 2014  PDF Download
Improvised internationalization in new ventures: The role of prior knowledge and networks Natasha Evers
colm ogorman

How do entrepreneurs identify foreign market opportunities and how do they identify foreign market(s) and customers? We draw on the concepts of effectuation, improvisation, prior knowledge and networks to study the early internationalization of new ventures operating in the Irish Shellfish sector. We argue that the internationalization process was strongly influenced by two ?resources to hand?: the entrepreneurs? idiosyncratic prior knowledge and their prior social and business ties. We observe an effectuation logic and extensive improvisation in the internationalization process of these new ventures.

Entrepreneurship & Regional Development publish 2011  PDF Download
In the beginning: Identity processes and organizing in multi-founder nascent ventures TED BAKER
E. Erin Powell

We conducted a longitudinal field study of nine nascent ventures attempting to revitalize local municipalities to understand how and why identity processes shape organizing in multi-founder nascent ventures. We develop grounded theory and a process model showing how the patterning of founders’ social identities shapes early structuring processes, how this in turn influences the construction of a collective identity prototype and its attempted enforcement by an in-group, and how the overall process influences whether or not founders remain engaged in their joint organizing efforts. Our contributions extend the growing entrepreneurship literature on founder identity from an individual focus toward understanding how founding teams work through organizing issues and from a focus on established organizations to exploring why and whether teams move forward in nascent ventures. We open up a series of important questions for future research about how founders become “who we are.”

Academy of Management Journal publish 2017  PDF Download
In the eye of the beholder: How regulatory focus and self-efficacy interact in influencing opportunity recognition Andranik Tumasjan
Reiner Braun

Although there is evidence that regulatory focus is associated with opportunity exploitation, there is a lack of research examining its role at the early stages of opportunity recognition. The present study makes two major contributions to address this gap. First, we demonstrate that entrepreneurs’ promotion focus is positively related to opportunity recognition, whereas prevention focus is not significantly related to opportunity recognition. Second, integrating two theories of self-regulation – regulatory focus theory and self-efficacy theory – our findings reveal that a high promotion focus compensates for entrepreneurs’ low levels of creative and entrepreneurial self-efficacy in opportunity recognition. Our study extends extant cognitive theories of opportunity recognition.

Journal of Business Venturing publish 2012  PDF Download
Increasing the Problem Solving Speed Through Effectual Decision Making Matthias Blauth
René Mauer
Niklas Friederichsen

Effectuation has been acknowledged as an appropriate alternative to causal decision making in highly uncertain situations by shifting the focus from a logic of prediction to a logic of control (Sarasvathy, 2001). Problem-solving speed as part of the holistic problem solving competence is crucial for the establishment of competitive advantages within corporations, as it promotes the ability to develop and market innovative products in a timely manner (Atuahene-Gima and Wei, 2011). Problem- solving speed can be defined as the time needed to find, evaluate and implement an adequate solution to a particular problem (Atuahene-Gima and Li, 2004). We conducted a survey with employees from new product development (NPD) departments of industrial and service companies located in Germany and discovered, that embracing the unexpected as one of the four effectual dimensions has a positive impact on the problem solving speed in highly uncertain situations. In contrast the causal dimensions of goal- and competition-orientation slow down problem-solving speed. All effects depend on the moderating influence of uncertainty. Thus, building decisions on entrepreneurial decision-making logic in uncertain situations partially explains the differences in problem-solving speed and uncovers a novel source of competitive advantage.

Academy of Management Proceedings publish 2014
Individual Entrepreneurial Intent: Construct Clarification and Development of an Internationally Reliable Metric Edmund R. Thompson

Individual entrepreneurial intent is a key construct in research on new business formation. However, neither a clear or consistent definition of nor a uniform and reliable way to measure individual entrepreneurial intent has yet emerged. Several management scholars have highlighted the impediment this constitutes to the advancement of entrepreneurship research. This paper first seeks to clarify the construct of individual entrepreneurial intent and then reports the development and validation of a reliable and internationally applicable individual entrepreneurial intent scale.

Entrepreneurship Theory and Practice publish 2009  PDF Download
Individual responses to firm failure: Appraisals, grief, and the influence of prior failure experience Anna Jenkins
Johan Wiklund
Ethel Brundin

This paper provides a systematic assessment of how entrepreneurs react to firm failure. We use appraisal theory as an overarching theoretical framework and hypothesize that the more the failure experience is appraised as stressful in terms of its implications for harm or loss, the greater the feelings of grief. To test this hypothesis we developed a unique database of entrepreneurs who recently filed for firm bankruptcy. Our results support that there is great variation in responses to firm failure, and we provide theoretically valid explanations to why this is the case. These findings have substantial implications for how scholars conceive and theorize about entrepreneurial failure.

Journal of Business Venturing publish 2014  PDF Download
Individual-Level Resources and New Business Activity: The Contingent Role of Institutional Context Dirk De Clercq
Dominic S.K Lim
Chang Hoon Oh

This study considers the relationship between people’s access to resources and their likelihood to start a new business, and particularly how this relationship might be moderated by formal and informal institutions. Individual-level resources might be more potent for new business creation in countries with financial and educational systems that are more oriented toward entrepreneurship, higher levels of trust, and cultures that are less hierarchical and conservative. The hypotheses are tested by undertaking random-effects multilevel analyses of a multi-source data set that spans a 5-year time period (2003–2007). The study’s findings offer important implications for research and practice.

Entrepreneurship Theory and Practice publish 2013  PDF Download
Industry changes in technology and complementary assets and the creation of high-growth firms JONATHAN T ECKHARDT
Scott Shane

This study uses employment data to examine why some industries host more new high-growth firms than others. Using a unique data base of 201 industries over a 15-year period, we find that increases in the proportion of employment of scientists and engineers in industries are positively associated with counts of fast-growing new firms; however, we do not detect a relationship between fluctuations in the proportion of employment in sales and production occupations and counts of fast-growing new firms. The findings suggest that technological innovation is an important determinant of entrepreneurial opportunity. Further, they suggest that private new firms are an important means of organizing commercial innovation and that new firms may be less constrained by complementary assets than has been previously understood.

Journal of Business Venturing publish 2011  PDF Download
Information Exposure, Opportunity Evaluation, and Entrepreneurial Action: An Investigation of an Online User Community Erkko Autio
LINUS DAHLANDER
LARS FREDERIKSEN

We study how an individual’s exposure to external information regulates the evaluation of entrepreneurial opportunities and entrepreneurial action. Combining data from interviews, a survey, and a comprehensive web log of an online user community spanning eight years, we find that technical information shaped opportunity evaluation and that social information about user needs drove individuals to entrepreneurial action. Our empirical findings suggest that reducing demand uncertainty is a central factor regulating entrepreneurial action, an insight that received theories of entrepreneurial action have so far overlooked.

Academy of Management Journal publish 2013  PDF Download
Innovation for Inclusive Business: Intrapreneurial Bricolage in Multinational Corporations Minna Halme
Sara Lindeman
Paula Linna

It is often argued that multinational corporations (MNCs) are in a unique position to innovate business models that can help to alleviate poverty. This empirical study into intra-organizational aspects of pro-poor business innovation in two MNCs suggests, however, that certain elements of their management frameworks – such as short-term profit interests, business unit based incentive structures, and uncertainty avoidance – may turn into obstacles that prevent MNCs from reaching their full potential in this respect. We introduce the concept of intrapreneurial bricolage to show how middle manager innovators may promote pro-poor business models despite these obstacles. We define intrapreneurial bricolage as entrepreneurial activity within a large organization characterized by creative bundling of scarce resources, and illustrate empirically how it helps innovators to overcome organizational constraints and to mobilize internal and external resources. Our findings imply that intrapreneurial bricolage may be of fundamental importance in MNC innovation for inclusive business. In addition to the field of inclusive business, this study has implications for the study of bricolage in large organizations and social intrapreneurship, as well for managerial practice around innovation for inclusive business.

Journal of Management Studies publish 2012  PDF Download
Innovation in Large Corporations: A Development of the Rudimentary Theory of Effectuation. Erik Svensrud
Havard Asvoll

Motivated by the rudimentary theory of effectuation, this theoretical study was conducted in order to develop the theory to encompass effectual innovation in large corporations, and to include the aspect of tacit knowledge and time. We present a theoretical socio dynamic model focusing on the relationship between the use of effectual strategies and the evolution of the value of opportunities over time. We suggest that effectuation processes are valuable for innovation in large corporations, especially in the early stages of the opportunity growth, and that tacit knowledge and time can be important aspects of the effectuation strategies.

In Academy of Entrepreneurship publish 2011
Innovation-driven entrepreneurship in developing economies José L. González-Pernía
Andres Jung,
inaki pena

The knowledge spillover theory of entrepreneurship (KSTE) has recently emerged as an influential research stream that examines the origin, development and economic impact of innovation-driven entrepreneurship. While empirical evidence has shown that the main premise of the KSTE generally holds in most advanced economies, the purpose of the present study is to investigate the extent to which the ideas advocated by the KSTE are generalizable to different contexts in developing countries. On applying a logistic multilevel analysis to a sample of almost 250,000 individuals across 45 developing countries, the results show that the different context found in developing economies produces a limited connection between knowledge spillovers, innovation and entrepreneurship in comparison with the conventional linkage studied in the KSTE literature.

Entrepreneurship & Regional Development publish 2015
Innovations, stakeholders and entrepreneurship. Saras Sarasvathy
Nick Dew

In modern societies entrepreneurship and innovation are widely seen as key sources of economic growth and welfare increases. Yet entrepreneurial innovation has also meant losses and hardships for some members of society: it is destructive of some stakeholders’ wellbeing even as it creates new wellbeing among other stakeholders. Both the positive benefits and negative externalities of innovation are problematic because entrepreneurs initiate new ventures before their private profitability and/or social costs can be fully recognized. In this paper we consider three analytical frameworks within which these issues might be examined: pre-commitments, contractarianism, and an entrepreneurial framework. We conclude that the intersection of stakeholder theory and entrepreneurial innovation is a potentially rich arena for research.

Journal of Business Ethics publish 2007  PDF Download
INPUT-OUTPUT KNOWLEDGE THEORY: POTENTIAL AND APPLICATION AS A THEORY OF ENTREPRENEURIAL COGNITION (SUMMARY) Elaine C Rideout

David Birch, author of the seminal research implying the enormity of the contribution of the small business sector to the overall economy, once said, “If you want to teach people to be entrepreneurs, you can’t.” (Aronsson, 2004). Nonetheless, millions of dollars are spent every year on programs, courses, centers, workshops, etc., based on the assumption that entrepreneurship educators can teach the cognitive mindsets and skillsets that in turn generate entrepreneurship, new companies, and new jobs. This controlled study is grounded in psychosocial theories of entrepreneurial cognition. Tacit knowledge, “expert” scripts, (Mitchell et al., 2002), cognitive “alertness” (Kirzner, 1985), and satisficing on inputs under conditions of uncertainty (Sarasvathy, 2001, Baker, 2005) are all inputspecific cognitive strategies. The study applied and tested an overarching theory, Input-Output (IO) Knowledge Theory, to help make sense of these disparate views. IO Theory has recently been applied by electronics and systems theory researchers where controlling dynamic systems under conditions of uncertainty are of paramount importance. IO Systems research has found that when uncertainty is high and factual/structural knowledge is low or unavailable, IO cognitive strategies (manipulating the number of inputs if that’s the only strategy available, for example) to control dynamic systems outcomes can be as effective performance-wise as when structural information about a system is known or knowable.

Frontiers of Entrepreneurship Research publish 2013  PDF Download
Inside opportunity formation: enterprise failure, cognition, and the creation of opportunities Ronald Mitchell
J. Robert Mitchell
Brock Smith

To better understand opportunity creation, we investigate the extent to which recognition of failure impacts the new transaction commitment mindset of entrepreneurs. In a PLS model, we utilize data gathered from a sample of 220 entrepreneurs, and augment these results with an ANOVA analysis that provides a deeper exploration of the theory. In this article, we: (1) elaborate on the critical dimensions that represent a multi-construct view of the new transaction commitment mindset and describe ways that these dimensions can be measured; (2) examine the extent to which the recognition of new venture failure impacts the new transaction commitment mindset; and (3) explore the implications of the interaction between failure recognition and the new transaction commitment mindset for an entrepreneur’s decision to continue or abandon opportunity creation efforts. Our results suggest that recognition of failure does indeed impact the new transaction commitment mindset and, by extension, can enable opportunity creation. Copyright © 2008 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2008
Inside opportunity formation: enterprise failure, cognition, and the creation of opportunities Ronald Mitchell
J. Robert Mitchell
Brock Smith

To better understand opportunity creation, we investigate the extent to which recognition of failure impacts the new transaction commitment mindset of entrepreneurs. In a PLS model, we utilize data gathered from a sample of 220 entrepreneurs, and augment these results with an ANOVA analysis that provides a deeper exploration of the theory. In this article, we: (1) elaborate on the critical dimensions that represent a multi-construct view of the new transaction commitment mindset and describe ways that these dimensions can be measured; (2) examine the extent to which the recognition of new venture failure impacts the new transaction commitment mindset; and (3) explore the implications of the interaction between failure recognition and the new transaction commitment mindset for an entrepreneur’s decision to continue or abandon opportunity creation efforts. Our results suggest that recognition of failure does indeed impact the new transaction commitment mindset and, by extension, can enable opportunity creation. Copyright © 2008 Strategic Management Society.

Strategic Management Journal publish 2008  PDF Download
Institutional Entrepreneurship in the Informal Economy: China’s Shan-Zhai Mobile Phones CHUAN KAI LEE
SHIH CHANG HUNG

During the last decade, Chinese shan-zhai mobile phones have steadily and deliberately evolved from an informal economy to a formal one. We draw on institutional entrepreneurship to study this evolution, focusing in particular on how informal Chinese entrepreneurs pursued change and the transition to a formal economy. We emphasize three strategies—framing, aggregating, and bridging—Chinese entrepreneurs employed to mobilize support, garner resources, and increase their amount and level of legitimacy. We also discuss implications for research on informal economies and institutional entrepreneurship. Copyright © 2014 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2014  PDF Download
Institutional Environment and Entrepreneurial Cognitions: A Comparative Business Systems Perspective Dominic S.K Lim
Eric Morse
Ronald Mitchell
Kristie K Seawright

In this study, we investigate the relationship between institutional elements of the social environment and entrepreneurial cognitions, which lead to the individual’s venture creation decision. Employing a sample of 757 entrepreneurs and non-entrepreneurs from eight countries we examine the extent to which institutions influence venture creation decisions, where entrepreneurial expert scripts act as a mediator. Results show that various institutional elements, such as legal and financial systems, affect venture arrangements and willingness scripts. Venture arrangements scripts, in turn, have the most significant impact on an individual’s venture creation decision.

Entrepreneurship Theory and Practice publish 2010  PDF Download
Institutions, entrepreneurs, and communities: A special issue on entrepreneurship P. Devereaux (Dev) Jennings
Royston Greenwood
Michael Lounsbury
Roy Suddaby

This Special Issue’s aim is to demonstrate that drawing on sociological research can further enrich entrepreneurship studies of institutions, entrepreneurs, and communities. We develop an organizing framework for our ten Special Issue papers that categorizes the pieces by community level and type, observed changes, form of entrepreneurial actor, institutional and entrepreneurial concepts and processes, and integrative methodologies. This set of categorizations helps us to identify components that scholars can use to build more mid-range theory around our special issue topics. The framework also helps us to isolate limitations in the Special Issue papers, thereby providing avenues for future research.

Journal of Business Venturing publish 2013  PDF Download
Institutions, Entrepreneurship, and Economic Growth: What Do We Know and What Do We Still Need to Know? CHRISTIAN BJORNSKOV
NICOLAI J FOSS

We review the literature that links institutions, entrepreneurship, and economic growth outcomes, focusing in particular on empirical research. Most of the literature has an economics orientation, but we also review relevant literature from other social sciences, including management research. The review helps identify a number of conceptual, theoretical, and empirical gaps, calling for further research. For example, the literature narrowly identifies entrepreneurship with start-ups and self-employment; does not theorize many potentially relevant inter-level links and mechanisms; and suffers from sample limitations, omitted variable biases, causality issues, and response heterogeneity. We argue that theories in management research, such as the resource-based view, transaction cost economics, and strategic entrepreneurship theory, can fill some of the conceptual and theoretical gaps.

The Academy of Management Perspectives publish 2016  PDF Download
Instructor’s Note Envirofit International: A Venture Adventure Paul Hudnut
Dawn DeTienne
Entrepreneurship Theory and Practice publish 210  PDF Download
Integrating Cognition, Evolution, and Design: Extending Simonian Perspectives to Strategic Organization Saras Sarasvathy
Mie Augier

Several streams of research in strategic management and organizational theory build upon the early work of Herbert Simon. Yet, as content analyses of articles published in leading management journals show, key ideas from his later years are for the most part either neglected or misinterpreted. We bring to strategic organization three constructs from Simon’s later work and make a case for their use in future research in strategic management and entrepreneurship: Docility is a fundamental behavioral assumption in lieu of opportunism or embedded networks of trust; Near-decomposability is an evolutionarily robust structural feature that permeates Nature’s designs and has implications for human artifacts; and, Artifacts are products of human design that reshape local environments and/or help select between them to create and achieve human purposes. Each of these constructs embodies a uniquely Simonian integration of evolution, cognition, and design. Together they enable us to conceptualize empirical phenomena as thick three-dimensional reality rather than as abstractions entailed by any one of these perspectives alone.

Strategic Organization publish 2004  PDF Download
Integrating Discovery and Creation Perspectives of Entrepreneurial Action: The Relative Roles of Founding CEO Human Capital, Social Capital, and Psychological Capital in Contexts of Risk Versus Uncertainty Keith Hmieleski
JON C CARR
Baron Robert A

Research summary This study examines the relationships of founding CEOs’ intangible resources (human, social, and psychological capital) with the performance of their firms in environmental contexts of discovery (stable industry conditions that are characterized by risk) versus creation (dynamic industry conditions that are characterized by uncertainty). Results from a national (USA) random sample of founding CEOs (n = 223) found entrepreneurial experience (an aspect of human capital) to be positively related to performance in discovery contexts, whereas educational attainment, strong ties, and psychological capital (a composite index of optimism, self-efficacy, resilience, and hope) were positively related to performance in creation contexts. These findings extend theorizing concerning discovery and creation perspectives from the pre-entry phase (opportunity recognition) to the post-entry phase (opportunity exploitation) of the entrepreneurial process. Managerial summary This research investigates the relationships of founding CEOs’ intangible resources with the performance of their firms in industry environments that are stable (slow changing and predictable) versus dynamic (fast changing and unpredictable). The results indicate that entrepreneurial experience (number of prior new ventures founded) is positively related to performance in stable environments, whereas educational attainment (highest educational degree earned), strong ties (social connections to family members and friends who provide support relating to the firm), and psychological capital (inner cognitive, emotional, and behavioral resources used to cope with adversity) are positively related to performance in dynamic environments. The findings highlight the importance of fit between the intangible resources of founding CEOs and the characteristics of the industries in which they attempt to develop and grow their firms.

Strategic Entrepreneurship Journal publish 2015  PDF Download
International Entrepreneurship and the Theory of the (Long-Lived) International Firm: A Capabilities Perspective Abdulrahman Al-Aali
David J Teece

This paper expands on the Oviatt–McDougall framework of sustainable international ventures. It does so by relating the elements of the framework to existing scholarship on the multinational enterprise (MNE), a category that encompasses foreign direct-invested new ventures (FDINVs). The paper then incorporates entrepreneurship and capabilities into MNE theory and applies them to the FDINV. Strong dynamic capabilities coupled with good strategy work together to generate and sustain superior enterprise performance in fast-moving global environments. The resulting framework is used to revisit key questions in MNE/FDINV research such as the timing and mode of FDI.

Entrepreneurship Theory and Practice publish 2014  PDF Download
International Entrepreneurship research (1989–2009): A domain ontology and thematic analysis Marian Jones
Nicole Coviello
Yee Kwan Tang

This article explores the domain of international entrepreneurship (IE) research by thematically mapping and assessing the intellectual territory of the field. Extant reviews show that the body of IE knowledge is growing, and while notable contributions towards theoretical and methodological integration are evident, the field is described as phenomenally based, potentially fragmented and suffering from theoretical paucity. Premising that IE is positioned at the nexus of internationalization and entrepreneurship where entrepreneurial behavior involves cross-border business activity, or is compared across countries, we identify 323 relevant journal articles published in the period 1989–2009. We inventory the domain of IE to provide a relevant and comprehensive organization of its research. This involves examining the subject matter of IE research, and inductively synthesizing and categorizing it into major themes and sub-themes. In so doing, we offer a reliable, ontologically constructed and practically useful resource. From this base, we discuss the phenomena, issues, inconsistencies and interim debates on which new theory in IE may be built and research may be conducted. We conclude that IE has several coherent thematic areas and is rich in potential for future research and theory development.

Journal of Business Venturing publish 2011  PDF Download
International entrepreneurship, born globals and the theory of effectuation Svante Andersson

Purpose – The purpose of this study is to enhance the understanding of a born global firm’s early internationalization process and the entrepreneur’s decisions regarding internationalization by using effectuation theory.Design/methodology/approach – An explorative case study is used to explore whether effectuation theory is a fruitful alternative perspective compared with the dominant paradigm (causation), which is primarily used in earlier studies on born globals.Findings – The study shows how a born global company could enter many markets in a short time, by co‐operating with local network partners. The founders’ prior knowledge and networks were important to understand the rapid international expansion. Effectuation theory focuses on the entrepreneurs’ ability to create opportunities together with network partners and is a useful tool to understand the development in the born global firm.Research limitations/implications – The study shows that effectuation theory holds promise for developing the international entrepreneurship area. Future research is recommended to focus not only on the entrepreneur’s competencies, but also on the entrepreneur’s behavior, including during the time before they started the firm.Practical implications – Decision‐makers in the early development of born global firms are recommended to use his/her own and his/her company’s resources and network. Also advantage should be taken of opportunities when they are recognized or created, instead of focusing on traditional planning activities.Originality/value – There are few studies that have used effectuation theory as a basis for understanding the early development of a born global firm.

Journal of Small Business and Enterprise Development publish 2011  PDF Download
International Entrepreneurship: Exploring the Logic and Utility of Individual Experience Through Comparative Reasoning Approaches Marian Jones
Casulli, Lucrezia

In this paper, we suggest that individual experience and reasoning, as applied to new endeavors in internationalization, are concepts with high potential to advance conceptual and empirical research in international entrepreneurship (IE). Experience is known to be important in internationalization, but the logic or reasoning with which it is applied is insufficiently understood. Cognitive, comparison-based reasoning theories explain how individuals draw on experience to make sense of uncertain, novel, and complex situations. Drawing on two such theories, heuristics and analogical reasoning, we delineate the logic of experience and advance speculative propositions on its utility in the context of internationalization research.

Entrepreneurship Theory and Practice publish 2014  PDF Download
Internationalization as an entrepreneurial process Schweizer, Roger
Vahlne, Jan-Erik
Johanson, Jan

When firms cross-borders it is, by definition, internationalization. We believe that often internationalization should be seen as either a by-product of a firm’s efforts to improve its position within its network or networks, or as the result of an entrepreneurial action. We consider three theoretical approaches as a starting point and breathe life into them with a rich case study. We suggest adjustments to Johanson and Vahlne’s business network internationalization process model, an update of the Uppsala internationalization process model, to emphasize the entrepreneurial aspects of the process.

Journal of International Entrepreneurship publish 2010
Internationalization through exaptation:The role of Domestic geographical dispersion Grazia D Santangelo
Tamara Stucchi

This study investigates the influence of an organization’s domestic geographical dispersion on its internationalization process. From evolutionary biology, we borrow the concept of exaptation – a process in which capabilities developed in a specific context are used in a different environment – and develop the concept of learning through exaptation. We draw on recent developments on organizational learning and economic geography to argue that organizations learn to engage in FDI by exapting knowledge that is domestically developed in order to organize and manage geographically dispersed units across sub-national areas. However, learning through exaptation is limited over time and across space. As organizations increase their engagement in FDI, FDI experience becomes a substitute for the exaptation of domestically developed capabilities. In addition, organizations mainly dispersed in less (versus more) urbanized sub-national areas lack opportunities to exapt domestically developed knowledge associated with Jacobs (diversification) externalities. We test our argument on a sample of 641 Indian business groups over the period 2001-2010.

Academy of Management Proceedings publish 2015  PDF Download
Internationalizing Entrepreneurs: Bridging Real Options Reasoning and Affordable Loss Logics Richard Hunt
Yue Song

Drawing upon the theories of real options and affordable loss, this study examines why and how internationalizing entrepreneurs willingly and rationally contend with extreme uncertainty in the pursuit of new market opportunities. Through a transaction-level longitudinal analysis of 1,040 small lumber exporters from 52 countries, we develop and test a framework wherein entrepreneurs pair affordable loss logics (ALL) with real options reasoning (ROR) to internationalize more quickly and profitably than those who employ either or neither. Our study informs the ongoing debate among scholars regarding the applicability and suitability of ROR to strategic direction setting by entrepreneurs. By explicating the mechanisms through which export-minded entrepreneurs capture the value-enhancing benefits of uncertainty, we contribute to the literature on international new market entry and reinvigorate efforts to apply ROR to the sequential decision- making that uniquely characterizes opportunity exploration among entrepreneurs under conditions of irreducible uncertainty.

Academy of Management Proceedings publish 2015  PDF Download
Interplay between reputation and growth: the source, role and audience of reputation of rapid growth technology-based SMEs Jukka Partanen
Sanjay Goel

AbstractDrawing on resource-based view and signalling theory, this paper presents a comparative case of four (young vs. old; small vs. medium-sized) business-to-business firms to examine how (i.e. through which sources), why (i.e. for which managerial purposes) and for whom (i.e. for which audiences) do technology-based small and medium-sized enterprises build their reputation along the process of rapid growth? The results indicate that in the pre-growth stage product awards as well as technological and financial partners are important sources of reputation for demonstrating technological capabilities and firm sustainability to potential customers especially for young firms. Older firms, in turn, rely on technology partners and acquisitions in the rapid growth stage to convince existing customers that the firms? can keep up with their customer?s changing needs. Moreover, the reputation gained from the first well-known customer and a focused clientele appear to be two critical antecedents of rapid growth whereas patents do not seem to have a significant reputational role in rapid growth. Our study informs the theory of reputation development of growing technology-based firms by abstracting a more nuanced understanding of stakeholder- and stage-contingent reputation that fosters rapid growth, and provides new insight into the literature on small firm growth.

Entrepreneurship & Regional Development publish 2017
Intrafamily Entrepreneurship: The Formation and Membership of Family Entrepreneurial Teams Allan Discua Cruz
Carole Howorth
Eleanor Hamilton

Family entrepreneurial teams are groups of related individuals who engage in entrepreneurship. Entrepreneurial teams studies emphasize the resources that members bring to the team. Family business studies suggest that relationships and social theories are important. Social capital explains the formation and composition of family entrepreneurial teams (FETs). Analysis is of case studies of FETs based in Honduras. A shared commitment to entrepreneurial stewardship of the family’s assets underpins formation of FETs. Trust and shared values were important for membership. This study highlights that families are not internally consistent, and family ties are not equally strong.

Entrepreneurship Theory and Practice publish 2013  PDF Download
Introduction from the new coeditors Jay Barney
MIKE WRIGHT
Strategic Entrepreneurship Journal publish 2011  PDF Download
Introduction to Special Topic Forum multilevel theory. Violina Rindova
Daved Barry
Dave Ketchen
Academy of Management Review publish 2009
Introduction to the SEJ Special Issue on Business Models: Business Models within the Domain of Strategic Entrepreneurship BENOÎT DEMIL
XAVIER LECOCQ
JOAN E. RICART
CHRISTOPH ZOTT

The study of business models involves exploring how firms do business at the system level. It lies at the intersection of strategy and entrepreneurship research and is, therefore, a topic of interest for scholars of strategic entrepreneurship. The purpose of this special issue is to publish work that develops theory on business models, or empirically investigates the phenomenon, and to inspire future research on the topic. In our introduction, we briefly review the main conceptual developments of the past two decades. We highlight three contributions that business model research is poised to make to the domain of strategic entrepreneurship, and, by extension, to its constituent disciplines of strategy and entrepreneurship: (1) reconnecting strategy with entrepreneurship; (2) suggesting a more central place for customers in our frameworks and analyses; and (3) emphasizing the importance of implementation. We subsequently present the articles in this special issue and explain how they relate to these themes. We conclude with suggestions for future research. Copyright © 2015 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2015  PDF Download
Introduction to the special issue: Organization studies as a science for design: Creating collaborative artifacts and research Mariann Jelinek
Georges Romme
Richard J Boland

Organization research has recently started to reach beyond the antagonisms of positivism versus its postmodernist and critical counterparts, which have dominated the discourse in organization studies over the last 20 years. A promising approach instead involves positioning organization studies as a science for design. While the natural sciences seek description, explanation or prediction of what is, design scientists ask what could be, seeking betterment of the human condition. Inspired by Simon’s (1969) The Sciences of the Artificial, an organization science for design seriously addresses the need for scholars and managers alike for better organizational forms and processes. Organization design science is still very early in its development: different, even conflicting theories about organization design and development abound; laboratories for organizational experiments are largely absent; and little knowledge on management and organization is systematically codified — too much remains anecdotal and dependent on context. As a result, the current state of a science for organization design is fragmented and immature. Previous academic research on organization design focussed primarily on questions of theoretical relevance. A science-for-design perspective differs from previous treatments of organization design in two ways. First, it can bridge the worlds of theoretical and practical significance. Without theory, organizational practice is uninformed; without practice, organization theory is moribund. Second, the enormous diversity in organization research and theory is merely confusing without an adequate epistemology, particularly in view of the need to connect to practice. A design science approach can facilitate an integrative framework that acknowledges the unique role and contribution of key epistemological traditions in organization studies (including positivism, constructivism and pragmatism). The call for papers for this Special Issue invited submissions from scholars who view organization and management research as a pluralist discipline that draws on (at least) two key modes of engaging in research: science and design. According to Simon (1969), science views existing organizational systems as empirical objects from an outsider perspective, while design envisions systems that do not yet exist — either completely new systems or new states of existing systems. Science raises the question ‘is this proposition valid or true?’, while article title Organization Studies 29(03): 317–329 ISSN 0170–8406 Copyright © 2008 SAGE Publications (Los Angeles, London, New Delhi and Singapore) Mariann Jelinek College of William & Mary, Virginia, USA A. Georges L. Romme Eindhoven University of Technology, The Netherlands Richard J. Boland Case Western Reserve University, Ohio, USA www.egosnet.org/os DOI: 10.1177/0170840607088016 design asks ‘will it work better?’ Simon foresaw that a design science approach could help overcome the isolation of specialists by providing a common ground for bringing our diverse interests together in a search for more desirable states of (organizational) affairs. This Special Issue is therefore dedicated to exploring the interface between organization science and design. As such, it extends and fundamentally differs from previous work, for example published in the special issue on organization design in Organization Science (Dunbar and Starbuck 2006) as well as the special issue on organization development in the Journal of Applied Behavioral Science (Bate 2007).

publish 2008  PDF Download
Inventors and New Venture Formation: the Effects of General Self-Efficacy and Regretful Thinking Gideon D Markman
David B. Balkin
Baron, Robert A.

This research assesses two individual differences—general self-efficacy and regretful thinking—in the context of technological innovation. Results, obtained from a random sample of 217 patent inventors show that both general self-efficacy and regretful thinking distinguish inventors who started a business (i.e., technological entrepreneurs) from inventors who did not start a new business (i.e., technological nonentrepreneurs). More to the point, patent inventors, who at the time of our survey were actively involved in new business formation, tended to have significantly higher self-efficacy. Also, while technological entrepreneurs tended to have stronger regrets about business opportunities, technological nonentrepreneurs tended to have stronger regrets regarding career and education decisions. The two groups did not differ in terms of the quantity of these regrets. Implications for theory, practice, and future study of individual differences in entrepreneurship are discussed.

Entrepreneurship Theory and Practice publish 2002  PDF Download
Investment Practices and Outcomes of Informal Venture Investors Rob Wiltbank

This study explores a model of venture investing developed from the literature on formal venture capital research in the setting of angel investing in the United States. The model explores the role of venture stage, due diligence, deal flow, co-investing, and post investment participation on the distribution of returns to angel investors. Doing so directly addresses an interesting question regarding the extent to which formal venture capital practices are appropriate and effective in the typical angel investment setting. In the process, results from the first relatively large scale study of angel investor outcomes in the U.S. are reported and related to earlier findings for U.K. angel investors.

Venture Capital: International Journal of Entrepreneurial Finance publish 2005  PDF Download
Is effectuation Lachmannian? A response to Chiles et al. Saras Sarasvathy
Nick Dew
Organization Studies publish 2008
Is effectuation Lachmannian? A response to Chiles, Bluedorn, and Gupta (2007) Saras Sarasvathy
Nick Dew

In an excellent recent paper on Ludwig Lachmann’s contributions to entrepreneurship, Chiles, Bluedorn and Gupta draw parallels between Lachmann’s work and later contributions in the entrepreneurship literature, including Sarasvathy (2001), suggesting that, ‘Sarasvathy’s economic approach to entrepreneurship is decidedly Lachmannian’ (Chiles et al. 2007: 487). Our purpose in responding to the Chiles et al. article is twofold. First, our interpretation about how effectuation works differs in certain ways from the interpretations placed on it by these authors; we therefore wish to clarify our views on these matters. Second, we view the relationship between effectuation and Lachmann’s perspective on entrepreneurship somewhat differently than Chiles et al.; in this note we lay out this alternative view. The crux of our presentation is that, although Lachmann and Sarasvathy have much the same starting point (entrepreneurial action in the face of true uncertainty) and several overlaps in terms of the overall implications for dominant economic theories, there are crucial differences that draw upon recent developments in our understanding of how the human mind works and what knowledge is constituted of. In particular, there are at least three areas of possible conceptual confusion: The problem of knowledge — or What do we take as impossible? Strategies. The problem of resources — or What do we take as given? Players. The problem of institutions — or What do we take as outside our control? Rules.

Organization Studies publish 2008  PDF Download
Is innovation always beneficial? A meta-analysis of the relationship between innovation and performance in SMEs Rosenbusch, Nina
Jan Brinckmann
Bausch, Andreas

The performance implications of innovation in small and medium-sized enterprises (SMEs) have attracted considerable interest among academics and practitioners. However, empirical research on the innovation-performance relationship in SMEs shows controversial results. This meta-analysis synthesizes empirical findings in order to obtain evidence whether and especially under which circumstances smaller, resource-scarce firms benefit from innovation. We find that innovation-performance relationship is context dependent. Factors such as the age of the firm, the type of innovation, and the cultural context affect the impact of innovation on firm performance to a large extent.

Journal of Business Venturing publish 2011
Is R&D risky? Philip Bromiley
DEVAKI RAU
YU ZHANG

Research summary: Many studies use research and development (R&D) intensity or R&D spending as a proxy for risk taking, but we have little evidence that either associates positively with firm risk. We analyze the relations between R&D intensity (R&D spending to sales) and R&D spending on the one hand and 11 different indicators of firm risk on the other, using data from 1,907 to 3,908 firms in various industries over 13 years. The analysis finds a general lack of consistent positive association between R&D and firm risk, making the use of R&D as an indicator of risk taking questionable. Furthermore, R&D intensity and spending do not correlate positively, suggesting they measure different constructs. We discuss potential reasons for these nonsignificant results. Our study demonstrates that researchers should avoid casual use of R&D as a proxy for risk taking without explicitly providing a clear definition and measurement model for risk. Managerial summary: Risk is a key construct in strategic management research. Many studies in this area measure risk taking by research and development (R&D) intensity (the ratio of R&D spending to sales) or R&D spending. However, since R&D intensity and spending have also been used to measure various other things such as information processing demands, this raises the question of whether R&D intensity and spending are valid indicators of firm risk. We examine this issue by considering the associations of R&D intensity and R&D spending with conventional measures of firm risk. We find a general lack of consistent positive association between R&D and firm risk, making the use of R&D as an indicator of risk taking questionable. Furthermore, R&D intensity and spending do not correlate positively, suggesting they measure different things. Copyright © 2016 John Wiley & Sons, Ltd.

Strategic Management Journal publish 2017  PDF Download
Is There a Single Driver of Entrepreneurship? A Power-Law of Organizational Emergence and Growth Christopher Crawford, G
Benyamin Lichtenstein

Whereas the creation and emergence of high-growth firms are central topics in entrepreneurship research, senior scholars lament the absence of a comprehensive theory to explain and predict this rare but important phenomenon. One approach that remains untested, however, is the use of power-law distributions to explain key growth measures in nascent and high-growth firms. A unique statistical property of power laws is that these distributions are usually caused by a single generative mechanism that drives outcomes at all levels of analysis. In this paper we explore this possibility, by testing how well power laws explain entrepreneurial growth, and proposing “opportunity tension” as a generative mechanism for that growth. We test the model using MATLAB, to construct semi-parametric bootstrap estimates for maximum likelihood fit with a power-law model, based on data from the Panel Study of Entrepreneurial Dynamics II and Inc. 5000. We find significant support for our hypothesis, i.e. we find a universal scaling exponent of ~1.75 for multiple growth measures including outcomes of nascent ventures and hyper-growth firms. Our results provide an intriguing foundation for a scale-free theory of new venture performance.

The Academy of Management Perspectives publish 2013  PDF Download
Is There Conceptual Convergence in Entrepreneurship Research? A Co-Citation Analysis of Frontiers of Entrepreneurship Research, 1981-2004. Denis Gregoire
MArtin Noel
Richard Dery
Jean-Pierre Bechard

Conceptual convergence is often seen as a holy grail in entrepreneurship research. Yet little empirical research has focused specifically on the extent and nature of this convergence. We address this issue by content-analyzing the networks of co-citation emerging from the 20,184 references listed in the 960 full-length articles published in the Frontiers of Entrepreneurship Research series between 1981 and 2004. Our results provide evidence for the varying levels of convergence that have characterized entrepreneurship research over the years, as well as the evolution of the conceptual themes that have attracted scholars’ attention in different periods. In addition, we provide evidence that the field relies increasingly on its own literature, something that points toward the unique contribution that it makes to the management sciences.

Entrepreneurship Theory and Practice publish 2006  PDF Download
IT Enabled Frugal Effectuation Prem B. Khanal
Didier BERNARD
Benoit A Aubert

To succeed, entrepreneurs operating in frugal contexts tend to adopt an effectual logic of action. Such entrepreneurs also increasingly rely on digital technologies to pursue opportunities. Yet, despite a flurry of scholarly attention to effectuation tactics and their outcomes, surprisingly little is known about how digital technologies support effectuation, and with what outcomes. This paper sketches a theoretical model of how IT affordances support effectuation in frugal contexts.
The model extends entrepreneurship and information systems theories of frugal entrepreneurship by linking specific IT affordances to dimensions of effectuation. The paper also discusses how the model could be refined by empirical studies and extended across levels of analysis.

Digital Business and Innovation publish 2017  PDF Download
Journal of Evolutionary Economics Saras Sarasvathy
Nick Dew

Is new market creation a search and selectionprocess within the theoretical space of all possible markets? Or is it the outcome of a process of transformation of extant realities into new possibilities? In this article we consider new market creation as a process involving a new network of stakeholders. The network is initiated through an effectual commitment that sets in motion two concurrent cycles of expanding resources and convergingconstraints that result in the new market. The dynamic model was induced from two empirical investigations, a cognitive science-based investigation of entrepreneurial expertise, and a real time history of the RFID industry.

Journal of Evolutionary Economics publish 2005
Judging a business by its cover: An institutional perspective on new ventures and the business plan Tomas Karlsson
Benson Honig

Business plans are widely spread among new businesses, and they are supported by various universities, governmental assistance agencies, management consultants and a wide array of literature. Business plans are often taken for granted as highly useful tools that should be frequently updated and used. This study is based on data from six companies and their environments, over five years, using several forms of data collection such as interviews, observations, and archival data. In contrast to previous studies, we found that initial conformity to business plan norms gradually and without exception lead to loose coupling. Entrepreneurs who wrote business plans never updated or rarely referred to their plans after writing them.

Journal of Business Venturing publish 2009  PDF Download
Kinship and business: how entrepreneurial households facilitate business growth Gry Agnete Alsos
Sara Carter
Elisabet Ljunggren

Building on studies that have stressed the importance of context and the role of the family in business growth, this study explores the role of the entrepreneurial household in the process of business development and growth. We seek to understand how household strategy influences the development of new businesses, the ways in which household characteristics and dynamics influence business growth strategy decisions and how business portfolios are managed and developed by the household. To examine these questions, comparative case studies were undertaken drawing data from four entrepreneurial households located in remote rural regions of Norway and Scotland. The data reveal the role of the entrepreneurial household in the evolution of business creation and growth, examining the processual aspects of entrepreneurial growth, the interactions between business activities and entrepreneurial households and how business portfolios are developed in practice. Three analytical themes emerged from the analyses: the tightly interwoven connections between the business and the household, the use of family and kinship relations as a business resource base and how households mitigate risk and uncertainty through self-imposed growth controls. Although previous studies have viewed entrepreneurial growth largely as an outcome of personal ambition and business strategy, these results reveal the importance of the entrepreneurial household and the household strategy in determining business growth activities.

Entrepreneurship & Regional Development publish 2014  PDF Download
Knowing what to do and doing what you know: Entrepreneurship as a form of expertise. Saras Sarasvathy
Stuart Read

The authors acknowledge that entrepreneurship is a complex phenomenon that merits a variety of approaches to study it. They add to extant approaches the study of entrepreneurial expertise–that is, a set of skills, models, and processes that can be …

The Journal of Private Equity publish 2005  PDF Download
Knowledge as the source of opportunity Truls ERikson
Steffen Korsgaard

Abstract In this paper, we show how Davidson’s theory of knowledge can be used to elaborate the objective, intersubjective and subjective components of knowledge. Departing from Hayek’s core insights about the dispersion of knowledge in society, we reiterate that opportunities involve subjective knowledge such as judgment and imagination, intersubjective knowledge of the social and institutional context, as well as knowledge about objective realities “out there”.

Journal of Business Venturing Insights publish 2016  PDF Download
Knowledge Combination and the Potential Advantages of Family Firms in Searching for Opportunities Pankaj C. Patel
J O Fiet

This study examines differences in knowledge structures and combinative capabilities that provide family firms with distinct advantages over nonfamily firms in identifying opportunities. Drawing on constrained, systematic search, we explore how noneconomic goals and family relations enhance searching for opportunities. Unique human capital conditions create specific knowledge and economies of scope in knowledge combination. Differences in knowledge stocks, knowledge combination, and the long-term orientation of family firm managers explain differences in finding opportunities between family and nonfamily firms. Furthermore, we propose that family firms are more likely to improve their search routines over time. Fewer endgame scenarios in family firms allow the refinement of search routines.

Entrepreneurship Theory and Practice publish 2011  PDF Download
KNOWLEDGE, ACTION AND THE PUBLIC CONCERN: ATLANTA, GEORGIA AUGUST 11-16 2006. effectuation

Information about several papers discussed at the annual Academy of Management (AOM)conference on the connections between organizational knowledge, managerial action and the global economy is presented. Topics include the organization of news rooms, methods of workplace reform, and how managerial knowledge can positively impact global change. The conference featured several management theorists and organizers including AOM President Thomas G. Cummings, President-Elect Ken G. Smith, and Vice President Thomas W. Lee.

Academy of Management Proceedings publish 2006  PDF Download
L’effectuation, une approche pragmatique et pragmatiste de l’entrepreneuriat Saras Sarasvathy
Olivier Germain

Le mythe de l’entrepreneur rationnel et divinateur, figure héroïque et solitaire, porteur de la grande idée qu’il planifie puis exécute avec succès, a vécu même s’il tend à persister, d’une part, en filigrane d’approches pédagogiques désemparées et, d’autre part, comme idéologie du développement économique à tout prix. Les mythes survivent parfois par confort, faute de recours. La théorie de l’effectuation, proposée par Saras S. Sarasvathy depuis une dizaine d’années, constitue un de ces recours. Elle prend pour prémisse un avenir non prédictible et envisage l’entrepreneuriat comme exercice de transformation des moyens dans l’élaboration des fins. Il s’agit donc de rechercher les « effets » possibles de moyens donnés. Les objectifs de l’entrepreneur émergent au fur et à mesure de l’avancée du projet entrepreneurial en fonction de l’aspiration et des connaissances du fondateur, des rencontres et réseaux mobilisés et de diverses contingences. Dans l’entretien qui suit, Saras Sarasvathy revient sur l’élaboration de cette théorie et ses lignes de force. Elle en trace les filiations avec le pragmatisme et la pensée d’Herbert Simon. Elle s’interroge avec nous sur l’applicabilité de l’effectuation à tout type d’entrepreneur mais aussi sur des extensions parfois inappropriées de cette théorie. Enfin, à l’examen de ses critiques, Saras Sarasvathy suggère quelques pistes d’amélioration d’un « entrepreneuriat effectual ».

Revue de l’Entrepreneuriat publish 2011
La dérive “situationniste”. Le plus court chemin pour apprendre à entreprendre? Sylvain Bureau
Jacqueline Fendt Jacqueline Fendt

Les formations en entrepreneuriat au sein des écoles de commerce et à l’université semblent déconnectées des pratiques réelles des entrepreneurs. La pédagogie traditionnelle demande aux étudiants d’appliquer des connaissances présentées dans le cadre de cours théoriques, dans un contexte prévisible où le raisonnement causal standard est parfaitement adapté. Les auteurs proposent de construire de nouvelles situations d’apprentissage basées sur la théorie de l’effectuation et sur une expérimentation, la dérive, fondée sur les travaux de l’Internationale Situationniste. Ils montrent comment ce dispositif permet d’apprendre à entreprendre.

Revue française de gestion publish 2012
Language, Communication, and Socially Situated Cognition in Entrepreneurship Jean Clarke
Joep Cornelissen
Academy of Management Review publish 2011  PDF Download
Learning asymmetries and the discovery of entrepreneurial opportunities Andrew Corbett

Discovering entrepreneurial opportunities requires that individuals not only possess some form of prior knowledge, but that they also have the cognitive abilities that allow them to value and exploit that knowledge. This article builds upon and extends this line of inquiry by examining the relationship between opportunity identification and learning. Based upon an experimental task and other data collected from 380 technology professionals, the article defines a relationship between how individuals acquire and transform information and experience (i.e., learning) in order to identify opportunities. After analyzing the empirical data, the article develops the concept of learning asymmetries and explains how the manner in which people learn may affect their ability to identify entrepreneurial opportunities.

Journal of Business Venturing publish 2007  PDF Download
Learning From Levi-Strauss’ Legacy: Art, Craft, Engineering, Bricolage, and Brokerage in Entrepreneurship Bryan T. Stinchfield
Reed E. Nelson
Matthew S Wood

Given the increasing attention to traditionally less “rational” entrepreneurial behaviors, such as bricolage, we used grounded theory techniques to study 23 diverse entrepreneurs. From this, we developed a five-category typology of entrepreneurial behavior that includes art, craft, engineering, bricolage, and brokerage. Themes such as self-perceived identity, organization of space, integration of materials, sense of personal limits, and responsiveness to changing market conditions were observed along categorical lines. We discuss the significance of the typology and each category’s associations with venture longevity and financial performance for practitioners and for the study of entrepreneurship.

Entrepreneurship Theory and Practice publish 2013  PDF Download
LEARNING FROM TECHNOLOGY ENTREPRENEURS: EFFECTUATION AS A NEW TOOLBOX IN CONTEXTS OF HIGH UNCERTAINTY (SUMMARY) René Mauer
Malte Brettel

Adopting a process view on technology entrepreneurship, we examine ways of approaching uncertainty in the early-stage technology venturing process. A recent study on university R&D expenditures and new business formations provided us with results confirming once again a positive economic impact of technology-based entrepreneurial activity in terms of the creation of new firms, employment and change (Kirchhoff, Newbert, Hasan, & Armington, 2007). On the other hand, German policy makers worry about a decreasing number of technology-based companies due to a strong job market for technology experts and perceived high levels of uncertainty by the would-be entrepreneurs (Niefert, Metzger, Heger, & Licht, 2006). As there have been only very few empirical studies on the early stage of technology-based entrepreneurship, this study uses qualitative methodology to research in the given context the types of uncertainty and the ways to approach it, differentiating between causal and effectual ones (Sarasvathy, 2005).

Frontiers of Entrepreneurship Research publish 2008  PDF Download
Learning Strategies of Nascent Entrepreneurs Saras Sarasvathy
Benson Honig
Per Davidsson
Tomas Karlsson

This research utilizes a longitudinal methodology to study the entrepreneurial learning strategies of a representative sample (n=171) of nascent entrepreneurs in Sweden. We examine Sarasvathy’s theory of effectuation with respect to six different learning strategies and their effect on the progression of start-up processes. The results show that the progression of the start-up process, as represented by the number of gestation activities undertaken during each time period, is systematically related to the nascent entrepreneur’s learning strategy. The analysis covers 24 months, and findings indicate that learning strategies associated with effectuation processes have positive effects on the progression of the start-up process. We also found positive effects from persistent learning strategies in the progression of the start up process.

University of Haifa publish 2002  PDF Download
Learning to Create Value Under Conditions of Uncertainty Ryan W Angus
Matthew A Barlow

Can organizations learn to create value under conditions of uncertainty? This paper seeks to provide an empirical answer to this question by drawing on two theoretical literatures that provide different answers. The organizational learning literature suggests that organizational efforts to learn from uncertain experiences are not likely to improve future performance. On the other hand, the opportunity creation literature suggests that organizations can learn under conditions of uncertainty and that learning is an important determinant of success. Using the Google Play App Store as an empirical setting, the paper finds that within- opportunity learning is important to the creation of value under conditions of uncertainty – but that many organizations fail to learn this lesson as a result of their past value creating experiences. Past value creating experience may be a poor substitute for within-opportunity learning when seeking to create value under conditions of uncertainty – especially when that past experience resulted in failure.

Academy of Management Proceedings publish 2016  PDF Download
Letter from the editor-in-chief: Dean A. Shepherd Shepherd Dhliwayo
Journal of Business Venturing publish 2010
Leveraging effectual means through business plan competition participation Kayleigh Watson
Pauric McGowan
Paul Smith

This paper explores whether the business plan competition (BPC), as a classically causational mechanism for extracurricular entrepreneurship education, can facilitate the development of the means that underpin an effectual approach to new venture creation. In-depth, open-ended qualitative interviews were conducted with participants in a regional university-based extracurricular BPC before, immediately after and six months after the competition. The BPC was found to facilitate the means that could be used to adopt an effectual approach. The competition afforded valuable networking opportunities and collaborative contacts with regard to ‘who they know’; and it enhanced ‘what they know’ through enabling the acquisition, development and application of key competencies. Participants were able to gain and project a confident sense of ‘who they are’ in terms of their venture, changing their perception of the venture from a student project to a credible and viable business prospect. There were strong indications that these acquired means endured in the six months following participation. The implication is that education in which a business plan is dominant need not automatically impede the promotion of an effectual approach.

Industry and Higher Education publish 2015  PDF Download
Life course pathways to business start-up Dilani Jayawarna
Julia Rouse
Allan Macpherson

We explore how socially embedded life courses of individuals within Britain affect the resources they have available and their capacity to apply those resources to start-up. We propose that there will be common pathways to entrepreneurship from privileged resource ownership and test our propositions by modelling a specific life course framework, based on class and gender. We operationalize our model employing 18 waves of the British Household Panel Survey and event history random effect logistic regression modelling. Our hypotheses receive broad support. Business start-up in Britain is primarily made from privileged class backgrounds that enable resource acquisition and are a means of reproducing or defending prosperity. The poor avoid entrepreneurship except when low household income threatens further downward mobility and entrepreneurship is a more attractive option. We find that gendered childcare responsibilities disrupt class-based pathways to entrepreneurship. We interpret the implications of this study for understanding entrepreneurship and society and suggest research directions.

Entrepreneurship & Regional Development publish 2014  PDF Download
Limits to and prospects of entrepreneurship education in the academic context Bengt Johannisson

AbstractProcess philosophy has drawn attention to the world as ambiguous and ever changing, however also enactable. This makes entrepreneurship a processual phenomenon, rightly addressed as ?entrepreneuring?. Recognizing not only their cognitive, yet also affective and conative capabilities, makes it possible for human actors to mobilize forces that bring the world to a standstill long enough to create a venture for value creation. This, however, calls for the insight that is different to universal scientific knowledge ? episteme and techne ? namely, the situated insights that Aristotle addressed as m?tis and phronesis. M?tis then concerns alertness and shrewdness and phronesis is about prudence in the context of action. Academic education can only provide these competencies needed to train for entrepreneuring by letting the students travelling across the boundaries of the university. In addition, the dominance of management as an ideology must be proactively dealt with. Three cases in academic training for entrepreneuring, all in the Swedish context, which show radically different ways of dealing with these challenges, are presented in a comparative analysis. The lessons are summarized in general conditions for providing training that advances entrepreneurship students? situated and actionable insights.

Entrepreneurship & Regional Development publish 2016
Linking Effectuation to Causation in Chinese High-Tech Entrepreneurship: Strategic Framing Based on Culture, Cognition and Institutional Context. YiPeng Liu
A Issak
RESEARCH IN ENTREPRENEURSHIP AND SMALL BUSINESS publish 2011
Macro-level determinants of formal entrepreneurship versus informal entrepreneurship Mai Thi Thanh Thai
Ekaterina Turkina

Abstract Based on the eclectic theory of entrepreneurship, this article analyzes macro-level determinants of national rates of formal versus informal entrepreneurship. Our evaluation of the factors identified in this theory reveals a set of empirically-testable, higher-order determinants: economic opportunities, quality of governance, macro-level resources and abilities, performance-based culture and socially-supportive culture. The results of our analysis obtained through the PLS (partial least squares) approach to structural equation modeling contribute to the entrepreneurship literature by providing an empirically-supported model that shows how formal and informal entrepreneurship are driven differently. This model clarifies the conflicting findings in previous research about the effects of socioeconomic, institutional, and cultural factors on entrepreneurship rates across countries. Finally, by showing the effect of each determinant on formal and informal entrepreneurship, this study has important implications for policymakers as well as businesses.

Journal of Business Venturing publish 2014  PDF Download
Made, as well as found: Researching entrepreneurship as a science of the artificial. Saras Sarasvathy
S. Venkataraman
Nick Dew
Yale University Press. publish 2010
Making It Happen: Beyond Theories of the Firm to Theories of Firm Design Saras Sarasvathy

Current theories of the firm fail to distinguish between firm and entrepreneur and provide no explanation for entrepreneurial success except in terms of firm success. Even in current theories of the entrepreneur (psychological and otherwise) he or she is entirely cast as a bundle of traits or behaviors or heuristics and biases that serve to explain firm performance. In this paper, I suggest we put the entrepreneur center stage and adopt an instrumental view of the firm. I draw heavily upon theories of symbolic cognition from the Sciences of the Artificial and explore more recent work on semantic cognition to illustrate how we can go beyond theories of the firm to theories of firm design.

Conference on Entrepreneurial Cognition publish 2002
Making It Happen: Beyond Theories of the Firm to Theories of Firm Design Saras Sarasvathy

Current theories of the firm provide no explanation for entrepreneurial success except in terms of firm success. Even when the focus is on the entrepreneur, s/he is entirely cast as a bundle of traits/behaviors or heuristics/biases that serves to explain firm performance. In this article, I suggest putting the entrepreneur center stage, adopting an instrumental view of the firm. Drawing upon the work of Simon in symbolic cognition and Lakoff in semantic cognition, I explore how we can go beyond explanations based on economic forces and evolutionary adaptation to entrepreneurial effectuation; I end with specific research questions pertaining to firm design.

Entrepreneurship Theory and Practice publish 2004  PDF Download
Making it personal: Opportunity individuation and the shaping of opportunity beliefs Matthew S Wood
Alexander McKelvie
Michael Haynie

Abstract We develop a model that focuses on the individuation of opportunity beliefs. We adopt inferences from the ecology literature and integrate those with mental model theory to examine the ‘individuation’ of opportunity as the result of the interplay between industry conditions and person-specific factors. We test our predictions using conjoint analysis of 2880 opportunity decisions. We find that an entrepreneur’s related knowledge, motivation to evaluate the opportunity, prior failure, and fear of failure shape perceptions of opportunity attractiveness as one individuates exogenous opportunity information. We articulate our findings as evidence that when combined with opportunity related data, an individual’s cognitive resources play an important role as one forms opportunity beliefs about the personal attractiveness of pursing an opportunity.

Journal of Business Venturing publish 2014  PDF Download
Making rational use of ‘irrationality’? Exploring the role of need for cognitive closure in nascent entrepreneurial activity Mark Schenkel
Charles H Matthews
Matthew W Ford

A fundamental question of interest to both researchers and practitioners alike focuses on why some individuals discover and elect to exploit opportunities to create future goods and services while others do not. Past studies have focused on the role knowledge-based resources play in the early stages of new venture creation, yet few have considered the role cognitive motivations play in impacting the processing and use of information during this process. In this study, we theorize that a cognitive need for closure (NfC), or possessing a desire for an answer on some topic as opposed to enduring confusion and ambiguity, is an important aspect of the entrepreneurial judgment formation process. We hypothesize that the need for closure will be positively related to nascent entrepreneurial activity because it provides a cognitive mechanism for dealing with the opened-ended nature of opportunity pursuit. Data drawn from the Panel Study of Entrepreneurial Dynamics (PSED) support this hypothesis. More specifically, results suggest that a high NfC is likely to foster the exploitation of discovered opportunity irrespective of their age, gender, position in the family birth order, or unique personal knowledge base. Implications for future research and practice are discussed.

Entrepreneurship & Regional Development publish 2009  PDF Download
Making sense of entrepreneurial exit strategies: A typology and test Dawn DeTienne
Alexander McKelvie
Gaylen Chandler

Abstract Entrepreneurial exit is a major event in the development of a venture. However, we have little understanding of the factors that drive the development of an important pre-cursor to exit: the exit strategy of the founder. Based on the existing literature, we develop a typology of entrepreneurial exit strategies consisting of three higher-level exit categories (i.e., financial harvest, stewardship, and voluntary cessation) and develop an initial test of our typology. Specifically, we examine entrepreneurs’ perceived innovativeness of their opportunity, motivational considerations, decision-making approach, founding team, and firm size. Our results show different predictors for each of the three exit strategy types and represent a significant contribution to the understanding of exit strategies in new ventures.

Journal of Business Venturing publish 2015  PDF Download
Making the Most of Failure Experiences: Exploring the Relationship Between Business Failure and the Identification of Business Opportunities Shepherd Dhliwayo
Brandon Mueller

Although previous research has extolled the importance of business failure as a precursor to transformational learning, few studies have explored the conditions under which such learning occurs or the content of the resulting knowledge. We explore several cognitive moderators of the relationship between failure experiences and a specific type of opportunity identification knowledge—the use of structural alignment processes. Results indicate that learning from failure is facilitated for entrepreneurs who possess a cognitive toolset that consists of opportunity prototypes and an intuitive cognitive style. Moreover, we found that prior professional knowledge negatively moderates this relationship.

Entrepreneurship Theory and Practice publish 2014  PDF Download
Management as a Science of the Artificial Saras Sarasvathy
Mie Augier

In some of his final papers on organization economics, Simon suggested building a new theoretical edifice of organizations and markets based on a “full-bodied” theory of the firm, as opposed to the “skeletal” view currently embraced by economics. The full-bodied firm would, in Simon’s conceptualization, rest upon: (a) the fundamental behavioral assumption of docility rather than opportunism; (b) focus on design activities of managers as well as on their decision making; and, (c) challenge the ubiquity and exogeneity of markets, making them instead an artificial product of human design. In other words, the endeavor he left us with is to begin constructing a behavioral theory of markets.

Journal of Economic Psychology publish 2003  PDF Download
Managing Disruptive Innovation: Entrepreneurial Strategies and Tournaments for Corporate Longevity. Yanto Chandra
S J S Yang

Extant research on disruptive innovation has implicitly incorporated entrepreneurship as the underlying driver of the disruptive phenomenon. We integrate recent developments from entrepreneurship and innovation research streams to better understand the conditions and causal mechanisms that influence disruptive innovation. Drawing on effectuation, evolutionary entrepreneurship, lead-users, collective intelligence, and opportunity tournament literature, we develop a theoretical framework that explains disruptive innovation as a co-evolutionary entrepreneurial process at the firm, product, and customer level. The framework offers a set of testable propositions to advance theory and practice in the field. We suggest avenues for future research and conclude entrepreneurial strategies to help general managers create and cope with disruptive innovation.

SSRN publish 2011
Managing Firm Resources in Dynamic Environments to Create Value: Looking Inside the Black Box David Sirmon
Michael A Hitt
R Duane Ireland

We address current criticisms of the RBV (oversight of dynamism, environmental contingencies, and managers’ role) by linking value creation in dynamic environmental contexts to the management of firm resources. Components of the resource management model include structuring the resource portfolio; bundling resources to build capabilities; and leveraging capabilities to provide value to customers, gain a competitive advantage, and create wealth for owners. Propositions linking resource management and value creation are offered to shape future research.

Academy of Management Review publish 2007  PDF Download
Managing knightian uncertainty in the new economy Saras Sarasvathy
Suresh Kotha
CT: IAP publish 2001
Managing Resources: Linking Unique Resources, Management, and Wealth Creation in Family Firms David Sirmon
Michael A Hitt

The appropriate resources are necessary but insufficient to achieve a competitive advantage. Resources must also be managed effectively. Herein, we develop a resource management process model composed of three components that can lead to a competitive advantage. These components include the resource inventory (evaluating, adding, and shedding), resource bundling, and resource leveraging. We examine resource management in family firms and thus explore the unique characteristics of five resources and attributes of family firms that provide potential advantages over nonfamily firms. The resources are human capital, social capital, patient capital, survivability capital, along with the governance structure attribute.

Entrepreneurship Theory and Practice publish 2003  PDF Download
Mark Casson: The Entrepreneur at 30—Continued Relevance? Sharon Alvarez
ANDREW GODLEY
MIKE WRIGHT

Mark Casson’s The Entrepreneur: An Economic Theory (1982) has become one of the most influential books in the field of entrepreneurship. For the first time, this article outlines its origins and summarizes its main themes. The article goes on to show how Casson’s subsequent research has closely followed the research agenda he set for himself in The Entrepreneur and illustrates the continuing challenge his work presents to entrepreneurship scholars. The article is based on an interview the authors conducted with Mark Casson on the thirtieth anniversary of the book’s publication. Copyright © 2014 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2014  PDF Download
Market imperfections, opportunity and sustainable entrepreneurship Boyd Cohen
Monika I. Winn

This research develops the argument that four types of market imperfections (i.e., inefficient firms, externalities, flawed pricing mechanisms and information asymmetries) at once contribute to environmental degradation and that they also provide significant opportunities for the creation of radical technologies and innovative business models. We show that these opportunities establish the foundations for an emerging model of sustainable entrepreneurship, one which enables founders to obtain entrepreneurial rents while simultaneously improving local and global social and environmental conditions. To advance this new field, we offer suggestions for a research agenda focusing on two areas: the relationship between market imperfections and entrepreneurial opportunities, and the emerging field of sustainable entrepreneurship.

Journal of Business Venturing publish 2007  PDF Download
Marketing Amid the Uncertainty of the Social Sector: Do Social Entrepreneurs Follow Best Marketing Practices? Scott L. Newbert
Journal of Public Policy & Marketing publish 2012  PDF Download
Marketing Under Uncertainty: A Knock on the Door. Saras Sarasvathy
Stuart Read
Nick Dew
Rob Wiltbank

How do people approach marketing in the face of uncertainty, when the product, the market, and the traditional details involved in market research are unknowable ex ante? The authors use protocol analysis to evaluate how 27 expert entrepreneurs approach such a problem compared with 37 managers with little entrepreneurial expertise (all 64 participants are asked to think aloud as they make marketing decisions in exactly the same unpredictable situation). The hypotheses are drawn from literature in cognitive science on (1) expertise in general and (2) entrepreneurial expertise in particular. The results show significant differences in heuristics used by the two groups. While those without entrepreneurial expertise rely primarily on predictive techniques, expert entrepreneurs tend to invert these. In particular, they use an effectual or nonpredictive logic to tackle uncertain market elements and to coconstruct novel markets with committed stakeholders.

Journal of Marketing publish 2009
Marketing under uncertainty: The logic of an effectual approach. Saras Sarasvathy
Stuart Read
Nick Dew
Rob Wiltbank
Michael Song

How does one approach marketing in the face of uncertainty, where the product, the market and the traditional details involved in market research are unknowable ex ante? We use protocol analysis to evaluate how 27 expert entrepreneurs approach such a problem, compared to 37 managers with little entrepreneurial expertise, with all 64 subjects being asked to think aloud as they make marketing decisions in exactly the same unpredictable situation. Our hypotheses are drawn from literature in cognitive science on (a) expertise in general and (b) entrepreneurial expertise in particular. Results show significant differences in heuristics used by the two groups. While those without entrepreneurial expertise rely primarily on predictive techniques, expert entrepreneurs tend to invert these. In particular, they use an effectual or non-predictive logic to tackle uncertain market elements and co-construct novel markets with committed stakeholders.

Journal of Marketing publish 2009  PDF Download
MAZES without minotaurs: Herbert Simon Saras Sarasvathy
In this essay, I remember Herbert Simon as author of Sciences of the Artificial and my thesis advisor and collaborator. Even for a lifetime of deep insights into human behavior and its role in shaping the world we live in, Simons insight into the need for a whole new class of sciences is an astonishing one. The artificial is essential for entrepreneurship and for developing an organization-centric view of markets and economies.
publish 2012
Measuring emergence in the dynamics of new venture creation Benyamin Lichtenstein
kevin Dooley
Thomas Lumpkin

Modeling the dynamics of nascent entrepreneurship provides insight into how organizations are created. In order to study this complex phenomenon we develop a longitudinal case study and analyze it with respect to three modes of organizing: vision, strategic organizing, and tactical organizing. Multiple sources of data are used to identify changes within and across these three modes. Using longitudinal content analysis and other complexity science methods, we found a nearly simultaneous shift in all three modes, indicating a punctuation event. We define this punctuation as an “emergence event,” and provide a process model of organizational emergence showing that a shift in tactical organizing generated a shift in strategic organizing, which resulted in a shift in the vision (identity) of the firm. We conclude with some theoretical implications of our analysis.

Journal of Business Venturing publish 2006  PDF Download
Measuring the social identity of entrepreneurs: Scale development and international validation Philipp Sieger
Marc Gruber
Emmanuelle Fauchart
Thomas Zellweger

Abstract Social identity theory offers an important lens to improve understanding of founders as enterprising individuals, the venture creation process, and its outcomes. Yet, further advances are hindered by the lack of valid scales to measure founders’ social identities. Drawing on social identity theory and a systematic classification of founders’ social identities (Darwinians, Communitarians, and Missionaries), we develop and test a corresponding 15-item scale in the Alpine region and validate it in 13 additional countries and regions. The scale allows identifying founders’ social identities and relating them to processes and outcomes in entrepreneurship. The scale is available online in 16 languages.

Journal of Business Venturing publish 2016  PDF Download
Metallicalta oppia suomalaiselle elinkeinoelämälle – Kuinka raivataan tie autotallista maailman huipulle ja luodaan uudet markkinat Erno Salmela
Tekes-uutiset in Finnish publish 2016  PDF Download
Mindful deviation through combining causation and effectuation: a design theory-based study of technology entrepreneurship K Middleton
M Johanson

Technology entrepreneurship can be seen as building upon, while also deviating from, technological paths. Such deviation has primarily been described as singular events where individuals with prior knowledge discover a new opportunity. In this article, we will instead study deviation as a process of collective decision making, seen more as something mindful than singular. The purpose is to explore mindful deviation as decision making by nascent technology entrepreneurs as they conceptualize an early platform technology. Based on case assignments undertaken by 13 teams in a venture creation programme, C-K design theory is used to trace how nascent technology entrepreneurs in action combine causal and effectual decision-making logics. Individually answered questionnaires also offered insights into how the entrepreneurs perceived their decision making in hindsight. The findings break with our received wisdom around how opportunities are recognized as well as how effectual and causal logics occur. As a result, mindful deviation through combinations of effectual and causal logic is suggested as a means to understand early-stage technology entrepreneurship.

Creativity and Innovation Management publish 2015
Misgivings about dismantling the opportunity construct Matthew S Wood

Abstract The concept of entrepreneurial opportunity has become a fundamental entity organizing entrepreneurship research. Recently, however, the validity of the construct has come into question with scholars noting definitional fragmentation as highly problematic and advocating for dismantling the construct in favor of replacement concepts. This paper articulates misgivings over this movement by identifying several stumbling blocks it creates for the future of entrepreneurship research. These realizations are followed by the notion that agreeing the construct is representationally valuable and accepting systematic variation in construct definition as a function of clarified conceptualizations of the process underpinning entrepreneurship is a more advantageous equilibrium state. Specific benefits associated with a move in this direction are identified.

Journal of Business Venturing Insights publish 2017  PDF Download
Missing the boat or sinking the boat: a study of new venture decision making John W Mullins
David Forlani

Taking two conceptualizations of risk, Dickson and Giglierano’s [J. Mark. 50 (1986) 58] nautical analogy of entrepreneurial risk (sinking vs. missing the boat) to represent the likelihood of loss element of new venture risk, and March and Shapira’s [Manage. Sci. 33 (1987) 1404] risk as hazard (boat size) to represent the magnitude of loss element of new venture risk, we investigated how two contextual factors, the suitability of entrepreneurs’ skills and their sources of funds, and two individual differences factors, the entrepreneurs’ risk propensities and their perceptions of risk, influence their new venture decision making. Metaphorically speaking, we found that most entrepreneurs would rather risk missing than sinking the boat, and that they preferred to pilot bigger craft than smaller ones. Perhaps surprisingly, our sample of highly successful entrepreneurs made relatively risk-averse choices, with 83% choosing either of the two ventures for which the chances for loss were lowest. We also found that the source of new venture funding—the entrepreneur’s own money versus that of investors—influenced our subjects’ choices between ventures whose chances for loss or gain differed. A similar effect was found for the entrepreneur’s risk propensity. On the other hand, we found that the risk the entrepreneurs perceived in the choice set also influenced choices, but only where the magnitude of the new venture’s potential gain or loss varied. When viewed in total, our study and results suggest a risk- and reward-based typology of new venture opportunities, one that may provide a conceptual foundation for future explorations of a variety of questions relevant for entrepreneurs and theorists alike.

Journal of Business Venturing publish 2005  PDF Download
Missing the Point? Finding Contextual Detail in Entrepreneurship and Small Firm Scholarship Dominic Michael Chalmers
Eleanor Shaw

The trajectory of entrepreneurship scholarship can be characterized by a trend towards functionalist approaches. This has arguably led to findings that trade the contextualization of entrepreneurial processes for abstracted theoretical generalizations. We propose a methodological response that draws on ethnomethodology and conversation analysis to form the theoretical basis of a more nuanced empirical conception of the entrepreneur in situ. Our approach addresses current epistemological concerns in entrepreneurship scholarship by prioritizing the practical knowledge and reasoning skills of the entrepreneur. Additionally the proposed methodology provides a solution to an analytical problem confronting scholars who must select from myriad potentially relevant contexts to incorporate into analysis. We conclude our article by identifying some research opportunities that are enabled through adoption of an ethnomethodology/conversation analysis perspective. We hope that scholars may expand upon, complement and challenge current conceptualizations of entrepreneurial behavior through this method.

Academy of Management Proceedings publish 2014  PDF Download
Mission Drift Or Strategic Shift? Group Formation Strategies Within Meps. V Chu
B Luke

Mission drift is a common criticism of microenterprise programs (MEPs) that target those likely to succeed rather than those most in need. This note examines approaches to group formation within international NGOs operating MEPs in Vietnam. A deliberate strategy of involving both poor and non-poor households in MEPs emerges through effectuation, learning from past challenges. This approach represents a shift in focus away from the extremely poor but presents a potential pathway for effective and sustainable poverty alleviation, if undertaken as part of an integrated program. Copyright © 2012 John Wiley & Sons, Ltd.

Journal of International Development publish 2012
Monetising blogs: Enterprising behaviour, co-creation of opportunities and social media entrepreneurship VERONICA GUSTAFSSON
Mohammad Saud Khan

Abstract Our essay aims to investigate the emerging phenomenon of monetising life-style blogs as an example of social media entrepreneurship. Using a variety of business models and based on interplay of virtual and real-life networks while monetising their blogs, bloggers engage in numerous economic activities. By attracting attention to this phenomenon, we seek to understand the process of co-creation of entrepreneurial opportunities as it occurs among the networking actors. We pose that bloggers, despite taking focal positions within their virtual networks may not be the most (pro)active partners in the process of opportunity co-creation. Rather, their role is often receptive, whereas opportunities become actively identified by other, corporate members of networks, who demonstrate creative and innovative approaches. Thus, opportunity co-creation within the network becomes the main driver of the entrepreneurial process.

Journal of Business Venturing Insights publish 2017  PDF Download
Motivational Cues and Angel Investing: Interactions Among Enthusiasm, Preparedness, and Commitment Melissa S Cardon
Cheryl Mitteness
Richard Sudek

Angel investors often make investment decisions based on motivational cues communicated during pitches—including enthusiasm, preparedness, and commitment—to evaluate potentially important qualities of entrepreneurs. We tested the independent and interaction effects of these cues by having 72 angels complete 1,995 evaluations of 133 live pitches. We found a positive effect of preparedness on angel evaluations, an effect enhanced by one form of commitment. The relationship between enthusiasm and evaluations of funding potential varies depending on the type of commitment considered. Our findings suggest that enthusiasm, preparedness, and commitment should be treated as conceptually and empirically distinct.

Entrepreneurship Theory and Practice publish 2016  PDF Download
Much Ado About Nothing? The Surprising Persistence of Nascent Entrepreneurs Through Macroeconomic Crisis Per Davidsson
Scott R Gordon

We hypothesize that a major macroeconomic crisis triggers four alternative responses among nascent entrepreneurs: disengagement, delay, compensation, and adaptation. We also suggest that commitment and ambition (or “high potential”) moderate these responses. Our most important finding is the relative absence of behavioral crisis responses. However, crises may make high-tech founders become more likely to disengage, whereas the opposite holds for founders far into the process. Our study sheds light on the mechanisms behind aggregate effects of crises on the number and type of start-ups in an economy, and can guide future research on the effect of crises on nascent entrepreneurship.

Entrepreneurship Theory and Practice publish 2016  PDF Download
Multistage Selection and the Financing of New Ventures JONATHAN T ECKHARDT
Scott Shane
Frédéric Delmar

Using a random sample of 221 new Swedish ventures initiated in 1998, we examine why some new ventures are more likely than others to successfully be awarded capital from external sources. We examine venture financing as a staged selection process in which two sequential selection events systematically winnow the population of ventures and influence which ventures receive financing. For a venture to receive external financing its founders must first select it as a candidate for external funding, and then a financier must fund it. We find evidence that founders select ventures as candidates for external finance based on their perceptions of market competition, market growth, and employment growth, while financiers base funding decisions on objective verifiable indicators of venture development, such as the completion of organizing activities, marketing activities, and the level of sales of the venture. Our findings have implications for venture financing and evolutionary theories of social processes.

Management Science publish 2006  PDF Download
Narcissism: An Integrative Synthesis and Dominance Complementarity Model EMILY GRIJALVA
P. D. HARMS

Narcissism has become an increasingly popular research topic in recent years. We describe why it is beneficial for organizational researchers to study narcissism due to its two strongest organizational correlates: counterproductive work behavior and leadership. We explore why narcissists perform counterproductive work behavior and offer advice on what organizations can do to prevent narcissists’ counterproductivity. Subsequently, we discuss narcissism’s relationship with leadership effectiveness, and propose a Narcissistic Leaders and Dominance Complementarity Model, which examines the dynamic interaction of narcissistic leaders’ characteristics with those of their followers to predict leadership effectiveness. Finally, we suggest four areas of management that may benefit from incorporating narcissism as a determinant of their respective organizational outcomes of interest: international management, social issues in management/corporate social responsibility, entrepreneurship, and negotiation.

The Academy of Management Perspectives publish 2014  PDF Download
Nascent entrepreneurs and venture emergence: Opportunity confidence, human capital, and early planning Dimo Dimov

Nascent entrepreneurs continuously evaluate the merits of the opportunities they pursue and so can abandon those that lack promise and persist with those that remain attractive. This paper articulates this evolving judgment about the opportunity as the nascent entrepreneur’s opportunity confidence. It situates this construct in the context of the nascent entrepreneur’s human capital and early planning actions in respect to the pursued opportunity, and in respect to the emergence of the nascent venture. Analyses of PSED data show that opportunity confidence positively affects venture emergence and that, through it, entrepreneurial experience and early planning have only indirect effects on venture emergence. In contrast, industry experience has a direct, positive effect on venture emergence. These results provide some novel insights into the nascent entrepreneurial process as well as into the role of human capital and early planning in that process.

Journal of Management Studies publish 2010  PDF Download
Nations of entrepreneurs: A social capital perspective Seok Woo Kwon
Pia Arenius

This research examined the effects of social capital on entrepreneurial opportunity perception and weak tie investment using individual-level data from the Global Entrepreneurship Monitor linked with national-level data on social capital. Consistent with a social capital perspective, this study found that a resident of a country with higher generalized trust and breadth of formal organizational memberships was more likely to perceive entrepreneurial opportunities. A resident of a country with higher generalized trust was also more likely to invest in an entrepreneur with whom he or she had a weak personal tie than was a resident of a country with lesser generalized trust.

Journal of Business Venturing publish 2010  PDF Download
Navigating the hostile maze: A framework for Russian entrepreneurship Sheila M. Puffer
Daniel j McCarthy

Unstable government, an undeveloped legal system, overregulation, a virtually unfathomable business taxation system, a pervasive mafia, and an inadequate business infrastructure characterize the maze that Russian entrepreneurs must navigate in their attempts to create successful ventures. To better understand their attitudes and decisions in this hostile environment, we propose a framework for analyzing Russian entrepreneurship during the country’s transition to a market-oriented economy. The framework draws upon the entrepreneurship and strategy literatures, and is illustrated primarily by the experiences of five entrepreneurial ventures we studied throughout the decade of the 1990s. Actions, based on (he framework, are suggested for Russian entrepreneurs as well as Western executives who might do business with them, as ways of strengthening Russian entrepreneurship.

The Academy of Management Executive publish 2001  PDF Download
New market creation as transformation. Saras Sarasvathy
Nick Dew

Is newmarket creation a search and selection process within the theoretical space of all possible markets? Or is it the outcome of a process of transformation of extant realities into new possibilities? In this article we consider new market creation as a process involving a new network of stakeholders. The network is initiated through an effectual commitment that sets in motion two concurrent cycles of expanding resources and converging constraints that result in the new market. The dynamic model was induced from two empirical investigations, a cognitive science-based investigation of entrepreneurial expertise, and a real time history of the RFID industry.

Journal of Evolutionary Economics publish 2005
New Venture and Family Business Teams: Understanding Team Formation, Composition, Behaviors, and Performance Leon Schjoedt
Erik Monsen
Allison Pearson
Tim Barnett
James J Chrisman

New ventures are frequently started by entrepreneurial teams rather than lone entrepreneurs. Often, team members have family ties. Yet, there has been relatively little research on new venture and family business teams. The papers in this special issue address this gap by studying team formation and composition, faultlines among team members, generational involvement in teams, the influence of shared organizational experience and functional homogeneity, and the likelihood of couples, biologically related, and unrelated teams achieving first sales. Combined, they suggest that relationships are more important than skill diversity in determining the effectiveness of both family business and new venture teams.

Entrepreneurship Theory and Practice publish 2013  PDF Download
NEW VENTURE CO-CREATION: A STUDY OF EARLY STAKEHOLDERS AND THEIR INFLUENCE (INTERACTIVE PAPER) raja Singaram
Paul Bijleveld

New ventures are born out of the labors of multiple actors (Gartner, Shaver, Gatewood, Katz, 1994). Venture co-creation is initiated by the selection of relevant stakeholders. Once ‘in’, these stakeholders exert considerable influence on the resources and offerings of the venture (Dew et al., 2005, Sarasvathy, 2008). A comprehensive process perspective that captures introduction of early stakeholders to one another leading to selection and commitment has been lacking so far. Present study addresses this gap by mapping the process of selection of a particular stakeholder into a new venture. It reports results from the first part of a longitudinal empirical study to build theory on new venture co-creation. Observable effects early stakeholders have upon the resources assembled coupled with their influence on product or service offering of the business is documented. Thus the specific research questions were: RQ#1: How does each stakeholder get selected in a new venture? RQ#2: How does each stakeholder influence: a) the resources available for the new venture and b) shape the product or service offering over time?

Frontiers of Entrepreneurship Research publish 2012  PDF Download
NEW VENTURE CREATION IN MATURE INDUSTRIES: THE ROLE OF ORGANIZATIONAL DETRITUS, EFFECTUATION AND BRICOLAGE (INTERACTIVE PAPER) Katrin Smolka
Jochem Kroezen

Our research aims to challenge conventional ideas about entrepreneurship in mature industries. The established perspective is that entrepreneurs in such industries are more successful when they engage in rigorous planning and pursue aggressive competitive strategies to overcome steep entry barriers due to a limited availability of resources (Delmar & Shane, 2003; Gruber, 2007; Lumpkin & Dess, 2001; Woo & Cooper, 1981). Instead, we build on recent ideas in organizational sociology (cf. Dobrev, 2000; Schneiberg, 2007; Zietsma & McKnight, 2009) and argue that in mature industries barriers to entry are low because of the availability of organizational detritus.We define detritus as the recyclable organizational elements with both technical and symbolic value left behind by organizations that previously failed. These elements can function as cost-efficient and effective building blocks for new firms. We suggest that the availability of detritus may reduce the need for rigorous planning and competitive aggressiveness, thereby allowing entrepreneurs to create blossoming organizations. We reason that by adopting the principles of effectuation (Sarasvathy, 2001; 2008), entrepreneurs are more likely to profit from venturing in detritus-rich environments. As opposed to causation which focuses on predictive strategies, effectuation allows for a non-predictive way of controlling the future. Similarly, adopting the principles of bricolage – i.e. “making do by applying combinations of resources at hand to new problems and opportunities” (Baker & Nelson, 2005: 33) – also appears to be suitable in detritus-rich environments.

Frontiers of Entrepreneurship Research publish 2014  PDF Download
Niche construction: The process of opportunity creation in the environment PAVEL LUKSHA

This article contributes to the emerging theory of opportunity creation by examining how organizations (including entrepreneurial ones) create and transform their niches. Using insights from contemporary evolutionary theory, the article classifies types of niche construction activities along dimensions of governance and the nature of the strategic actor. It then focuses on mechanisms of niche construction governed by the focal organization or entrepreneur to explain how competitive imperfections can be induced within industries and markets. The central role of communicative strategies in niche construction is emphasized. Copyright © 2009 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2008  PDF Download
Nordic Entrepreneurship Research. Daniel Hjorth

This article describes and discusses Nordic entrepreneurship research (NER). It does so by providing a broader context for conducting entrepreneurship research, including historical, sociocultural, and disciplinary elements substantiating an understanding of “Nordic.” Contextualizing NER this way, we attempt for the article to do what it says, i.e., to also write here in a style we argue is characteristically Nordic. This includes a priority to the local and particular, and a subsequent focus on questions resonant with nominalist research. We thereby enable an experience of NER as a cultural practice, as we argue that this is a crucial part of understanding what it is. Drawing on a tracing of NER in journal publications (in between 2001 and 2005), the article identifies trends and tendencies. We identify three generations of entrepreneurship research and suggest directions for the future development of the third. This way, the discussion and conclusions are drawn toward images of what a Nordic entrepreneurship research might become.

Entrepreneurship Theory and Practice publish 2008  PDF Download
Note to Instructors: Biohit: A Global, Family-Owned Company Embarking on a New Phase Tanja Kontinen
Entrepreneurship Theory and Practice publish 2014  PDF Download
O EMPREENDEDORISMO SOB O ENFOQUE DO PROCESSO DE ESTRATÉGIAS EMERGENTES E A ABORDAGEM EFFECTUATION. Jéssica Rodrigues dos Santos
Janaína Samara Kowalski
publish  PDF Download
Of Narratives and Artifacts S. Venkataraman
Saras Sarasvathy
Nick Dew
WILLIAM FORSTER
Academy of Management Review publish 2013  PDF Download
Offical Response to Arend et al: Co-Creating Effectual Entrepreneurship Research Saras Sarasvathy
Stuart Read
Nick Dew
Rob Wiltbank

In the October issue, the Academy of Management Review published a critique of effectuation (Arend et al, 2015). Forthcoming from Read et al (2016) is a dialog piece in response to that critique. Until the dialog piece is published in the Academy of Management Review, it will be available for download here. Please note that our forthcoming dialog is accompanied by a non-peer reviewed document which adds detail to our response: <a href=”http://www.effectuation.org/paper/unreasonable-assumptions”>Link to ASB Assumptions</a> We understand that there are several more dialog pieces in the works from other authors, and as they become available, we will provide links to them here.

Academy of Management Review publish 2016  PDF Download
On Lachmannian and Effectual Entrepreneurship: A Rejoinder to Sarasvathy and Dew (2008) Todd Chiles
V K Gupta
Bluedorn, A. C.

We welcome the comments of Professors Sarasvathy and Dew (2008) on our recent article, which introduced a new paradigm for entrepreneurship research based on one of the central figures in modern Austrian economics: Ludwig Lachmann (Chiles et al. 2007). Our purpose in writing the article was (1) to bring together a wide range of disparate entrepreneurship concepts under a sin- gle new conceptual framework,2 and (2) to provide greater coherence and theo- retical underpinnings to entrepreneurship research. In doing so, we described connections between a Lachmannian approach to entrepreneurship and numer- ous extant approaches, including effectuation. Sarasvathy and Dew (hereafter, S&D), in taking issue with some of our interpretations of effectuation, clarified their previous work on this approach and explicated its primary foundations. We find S&D’s discussion of the problems of knowledge, resources, and institutions provocative, and their conclusion about the basis of effectuation revealing. Our response to these arguments attempts to further clarify areas of possible confusion and suggests that the Lachmannian and effectuation approaches may share more common ground than S&D realize in some areas and less than we thought in others. In our brief response, we do not attempt to critique every point S&D make, but instead focus on what we view as their fun- damental arguments.

Organization Studies publish 2008  PDF Download
On the Entrepreneurial Genesis of New Markets: Effectual Transformations Versus Causal Search and selection Saras Sarasvathy
Stuart Read
Nick Dew
Rob Wiltbank

The generation of new markets is an emerging area of interest among researchers working in the traditions of evolutionary economics. And true to those traditions, the current study incorporates empirical evidence from psychology and cognitive science to develop micro-foundations for evolutionary theories of new market generation. In this paper we present an in-depth analysis of how expert entrepreneurs use effectual logic to conceptualize the creation of new markets. Our results challenge received wisdom based on search and selection processes and move beyond combinatorial ideas to develop instead a “transformational” view of market genesis.

publish 2011
On the Misuse of Realism in the Study of Entrepreneurship Stratos Ramoglou
Academy of Management Review publish 2013  PDF Download
On the Theory of Entrepreneurial Incentives and Alertness McCaffrey, Matthew

This paper analyzes the theory of “entrepreneurial incentives” in the work of Israel Kirzner. It argues that there is a logical problem with the notion of profit opportunities as exogenous causal agents: Without additional assumptions, the existence of opportunities alone does not sufficiently explain the alertness of entrepreneurs. The paper considers both stronger and weaker versions of this problem. It also questions the relation between entrepreneurial incentives and the tendency toward entrepreneurial success. Finally, it provides some commentary on the relevance of entrepreneurial incentives for an overall theory of the entrepreneur, and identifies several potential solutions to the problems discussed.

Entrepreneurship Theory and Practice publish 2014  PDF Download
ON THE USE OF EFFECTUATION VERSUS CAUSATION IN THE NEW VENTURE CREATION PROCESS: THE ROLE OF RESOURCES VERSUS THE ENVIRONMENT (SUMMARY) Miguel Meuleman
Jan Lepoutre
Olivier Tilleuil

Effectuation theory suggests that entrepreneurs focus primarily on the resources under their control, and then develop their new ventures in an iterative way. They do this by selecting different potential goals that can be accomplished with the resources at hand based on a focus on affordability of loss rather than maximal return on the capital invested, and the use of precommitments from self-selected stakeholders (Sarasvathy, 2001, 2008; Sarasvathy et al., 2005, 2006). In contrast to the effectual logic, a causational logic starts from a specific goal and then focuses on selecting the resources needed to achieve those goals. Relatively little empirical research has looked at the conditions under which an entrepreneur will use either a causation or an effectuation logic in the new venture formation process, or whether both logics are used at the same time (Sarasvathy, 2003). In this study, therefore, our main research question is: what factors determine whether entrepreneurs use causational and/or effectuation processes in forming their ventures? As strategies require a “fit” between organizational resources and the environment of the firm (Grant, 2008; Eisenhardt & Martin, 2000), we developed hypotheses that were interested in both the resources available to the entrepreneur and the external environment that influence the adoption of causation and/or effectuation strategies. With respect to the environment, we look at the effect of different sources of uncertainty. When studying the impact of resources, we examine the effect of human capital, social capital and organizational slack.

Frontiers of Entrepreneurship Research publish 2010  PDF Download
ONE SIZE FITS ALL? THE ROLE OF COGNITIVE STYLES IN TEACHING ENTREPRENEURIAL DECISION-MAKING TO NOVICES (SUMMARY) Martin Stienstra
raja Singaram
Michel Ehrenhard

Scholars have asserted that effectuation theory brings to focus the cognitive implications of uncertainty and consequent effects on entrepreneurial decision-making (Grégoire & Corbett, 2011; Sarasvathy, 2001). Cognitive styles account for the differences in the way individuals gather and evaluate information (Allinson & Hayes, 1996). Researchers have been successful in establishing notable relationships between cognitive styles of individuals and their entrepreneurial decision- making (Krueger and Kickul, 2006; Kickul et al., 2009). Given the cognitive underpinnings of effectuation theory we examine the relationship between cognitive styles of individuals and their preference to make effectual decisions in entrepreneurial situations. Once this relationship has been established, we make our case that entrepreneurship education to business school students that teach effectuation must also pay attention to individual differences in cognitive styles.

Frontiers of Entrepreneurship Research publish 2015  PDF Download
Opportunities and institutions: A co-creation story of the king crab industry Sharon Alvarez
Susan L. Young
Jennifer Woolley

Abstract If entrepreneurs are constrained and shaped by existing institutions, how? If entrepreneurs products and services, how can institutions remain unchanged? This paper explores this theoretical conundrum empirically through the examination of the actions of entrepreneur Lowell Wakefield. Contrary to previous work that suggests that it is institutional entrepreneurs that bring about institutional change as a means of advancing their social interests, this paper shows that a profit-seeking entrepreneur without prior institutional affiliation or experience can create an opportunity along with the supporting industry standards and regulations.

Entrepreneurship through a qualitative lens publish 2015  PDF Download
Opportunities as Existing and Created: A Study of Entrepreneurs in the Swedish Mobile Internet Industry Henrik Berglund

The notion of opportunities is fast becoming a central theme in the field of entrepreneurship research. As part of this growing interest, the ontological status of opportunities has been scrutinized with researchers tending to view them as either objectively existing or socially created. In the present treatment, this ontological debate is partly avoided in favor of a phenomenological examination of Mobile Internet entrepreneurs, which naturally bridges these distinctions. The empirical findings are used to propose a framework in which opportunities are seen as both existing and created in the evolving set of perceptions and projections, sometimes fixed and sometimes mutable, that provide the cognitive and practical drivers needed to guide entrepreneurial action.

Journal of Enterprising Culture publish 2007  PDF Download
Opportunities, organizations, and entrepreneurship Sharon Alvarez
Jay Barney
Strategic Entrepreneurship Journal publish 2008  PDF Download
OPPORTUNITY ACKNOWLEDGEMENT AS A COGNITIVE PROCESS OF ALIGNMENT: EVIDENCE FROM VERBAL PROTOCOLS. Denis Gregoire
Pamela S. Barr
Dean Shepherd

The article discusses research into how managers interpret and new information as a precursor to opportunity. Past research has theorized that entrepreneurs/managers base opportunity recognition on the identification of complex patterns. A model is proposed that would track the methods of reasoning that go along with what to do with new technologies to show that entrepreneurs match up the superficial aspects of their new tools with the superficial aspects of their markets. Many of the businesspeople that participated in the research proved to go beyond the superficial aspects of their markets to try and incorporate opportunities that they believed to be helpful.

Academy of Management Proceedings publish 2006  PDF Download
Opportunity development as a learning process for entrepreneurs Stefan A Sanz-Velasco

Purpose ? To contrast and test two conceptualisations of entrepreneurship: ?opportunity discovery? and ?opportunity development?.Design/methodology/approach ? Following the development of a conceptual framework for the study, an investigation was conducted through semi?structured interviews with the founders and managing directors of 20 start?up ventures in the Swedish mobile internet industry.Findings ? The study illustrates how entrepreneurial learning can be understood from the perspective of ?opportunity development?. This conceptualisation of opportunity incorporates market interaction and real?life processes influenced by prior knowledge, resources, and the industrial context. It is especially appropriate in situations characterised by uncertainty. The alternative conceptualisation of opportunity (in terms of ?opportunity discovery?) is more suitable in situations of low risk when initial opportunity perceptions are comprehensive, allowing entrepreneurs to focus on their products and services, rather than on potential customers and/or appropriation in the market.Research limitations/implications ? The study concerns one industry undergoing substantial changes during a specific period, which limits the generalisability of the findings.Practical implications ? Entrepreneurs might do well to launch ventures based on comprehensive opportunity perceptions.Originality/value ? The paper takes a novel approach to the discussion of opportunity in entrepreneurship.

International Journal of Entrepreneurial Behavior & Research publish 2006  PDF Download
Opportunity discovery, entrepreneurial action, and economic organization Peter G. Klein

This article reviews and critiques the opportunity discovery approach to entrepreneurship and argues that entrepreneurship can be more thoroughly grounded, and more closely linked to more general problems of economic organization by adopting the Cantillon-Knight-Mises understanding of entrepreneurship as judgment. The article begins by distinguishing among occupational, structural, and functional approaches to entrepreneurship and distinguishing among two influential interpretations of the entrepreneurial function—discovery and judgment. It turns next to the contemporary literature on opportunity identification and argues that this literature misinterprets Kirzner’s instrumental use of the discovery metaphor and mistakenly makes opportunities the unit of analysis. The article then describes an alternative approach in which investment is the unit of analysis and link this approach to Austrian capital theory. I close with some applications to organizational form and entrepreneurial teams. Copyright © 2008 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2008  PDF Download
Opportunity discovery, entrepreneurial action, and economic organization Peter G. Klein

This article reviews and critiques the opportunity discovery approach to entrepreneurship and argues that entrepreneurship can be more thoroughly grounded, and more closely linked to more general problems of economic organization by adopting the Cantillon-Knight-Mises understanding of entrepreneurship as judgment. The article begins by distinguishing among occupational, structural, and functional approaches to entrepreneurship and distinguishing among two influential interpretations of the entrepreneurial function—discovery and judgment. It turns next to the contemporary literature on opportunity identification and argues that this literature misinterprets Kirzner’s instrumental use of the discovery metaphor and mistakenly makes opportunities the unit of analysis. The article then describes an alternative approach in which investment is the unit of analysis and link this approach to Austrian capital theory. I close with some applications to organizational form and entrepreneurial teams. Copyright © 2008 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2008
Opportunity Discovery, Problem Solving and a Theory of the Entrepreneurial Firm Chihmao Hsieh
Jackson A. Nickerson
Todd R. Zenger

abstract  When should an entrepreneur employ a market to help discover and exploit opportunities, and when should the entrepreneur create a firm to do so? If a firm is created, how should it be organized? In this paper we argue that opportunities equate to valuable problem-solution pairings, and that opportunity discovery relates to deliberate search or recognition over this solution space. As problem complexity increases, experiential (or ‘directional’) search via trial-and-error provides fewer benefits, and cognitive (or ‘heuristic’) search via theorizing becomes more useful. Cognitive search, however, requires knowledge sharing, when knowledge is distributed among specialists, that is plagued by a knowledge appropriation hazard and a strategic knowledge accumulation hazard. Markets, authority-based hierarchy, and consensus-based hierarchy then have differential effects on the efficiency of opportunity discovery given the complexity of the associated problem. Those entrepreneurs with exceptional capabilities of opportunity recognition can efficiently adopt authority-based governance over a wider range of complexity. We thus combine the two major modes of opportunity discovery – search and recognition – onto one framework that can explain different entrepreneurial organizational forms, resulting in an entrepreneurial theory of the firm.

Journal of Management Studies publish 2007  PDF Download
Opportunity Evaluation as Rule-Based Decision Making Matthew S Wood
David W Williams

We draw from cognitive science literature on rule-based thinking to develop and empirically test a theoretical framework of entrepreneurial opportunity evaluation. We argue that entrepreneurs make use of socially constructed rules to discern the attractiveness of an opportunity, for them, specifically. Using conjoint analysis data of 498 decisions made by 62 entrepreneurs, we find that entrepreneurs’ use of rules regarding opportunity novelty, resource efficiency, and worst-case scenario significantly influences entrepreneurs’ evaluations of opportunities and that individual differences in opportunity market and technology knowledge augment the effect of the rules on opportunity attractiveness. Additionally, we document that the worst-case scenario diminishes the positive effect of other rule criteria (e.g. novelty, resource efficiency) on opportunity evaluation and that market and technology knowledge further influence the negative effects of the worst-case scenario.

Journal of Management Studies publish 2014  PDF Download
Opportunity recognition in social entrepreneurship: A thematic meta analysis Othmar M Lehner
Juha Kaniskas

Opportunity recognition (OR) is at the very heart of entrepreneurship. However, research on OR in the context of social entrepreneurship is still in its early stages. First, this article identifies, codifies and analyses OR-relevant articles on social entrepreneurship (SE) through the lens of Sarasvathy’s three views of entrepreneurial opportunity recognition. In the second step, statistical methods are applied on the results to indicate possible correlations among different schools of thought in SE and views on OR. OR in social ventures is found to be a prevalent topic in SE literature and differences in OR between social and commercial ventures are found.

The Journal of Entrepreneurship publish 2012  PDF Download
Optimal Inertia: When organizations should fail Saras Sarasvathy
Nick Dew
Brent Goldfarb

We challenge the premise that the CEO’s job is to keep the corporation alive and thriving at all costs and under all circumstances. We briefly review the differing normative views of strategic management theorists and organizational theorists about organizational inertia. We then develop an economic model of incumbent behavior in the face of challenger competition that accommodates complementary assets. The model predicts and describes conditions under which organizational inertia, as subsequent organizational failure, is optimal. We then extend the logic and propose that the failure of entrepreneurial firms does not necessarily imply the failure of entrepreneurs. We conclude with a call to study ‘‘exit’’ as a viable strategic option.

publish 2006
Organising new business in a turbulent context: Opportunity discovery and effectuation for IJV development in transition markets Mainela, Tuija
Puhakka, Vesa

Research on entrepreneurship has suggested entrepreneurial phenomena to take place in a wide variety of contexts that deal with new venture emergence. Opportunity discovery and effectuation are seen as the essence of entrepreneurship. The present study examines entrepreneurial behaviour in the organising of an international joint venture (IJV) in Polish transition markets. The paper aims to answer the following question: How is an international joint venture organised in turbulent context through opportunity-discovery and effectuation behaviours? Based on theoretical analysis and a longitudinal case study, we illustrate the organising of an international joint venture in transition markets through specific behaviours of opportunity discovery and effectuation. We show especially the relationship-based nature of all the behaviours. The study advances international entrepreneurship research by emphasising the intertwinedness of the entrepreneurial behaviours with the drastic developments in the transition markets and the evolution of the IJV partnership.

Journal of International Entrepreneurship publish 2009  PDF Download
ORGANIZATION & MANAGEMENT THEORY Conference Paper Abstracts. effectuation

The article presents abstracts in regard to the topic of organization and management theory, including one about the types of motivations that push businesses towards innovation, another about how management leaders approach the processes of exploration and exploitation, and a third which discusses the dependence of commercial television stations on competing organizations.

Academy of Management Proceedings publish 2006
ORGANIZATION & MANAGEMENT THEORY Conference Symposia Abstracts. Naveen Reddy

The article presents abstracts of symposia for a conference on organization and management theory including “Attitudes and Latitudes: Origins, Dynamics and Consequences of Regional Identity,” “Behavioral Foundations of Strategy,” and “Beyond Unidimensionality of Social Structure: Consequences and Antecedents of Multiplex Networks.”

Academy of Management Proceedings publish 2009  PDF Download
ORGANIZATION AND MANAGEMENT THEORY Conference Paper Abstracts. effectuation

This article presents several conference paper abstracts about organization and management theory. The conference paper entitled “Multiple Logics in the Decision-Making Process,” by Sergio Janczak, is a qualitative empirical study that reveals the multiple logics which managers, in undertaking projects, used to influence other employees. This paper seeks to contribute to the literature decision-making process by exploring further the often ignored area of middle management’s processes. In addition, as an exploratory approach this paper aims to reveal the factors that influence such processes. The design of this qualitative study includes the identification of a sample of 59 projects undertook by 39 middle managers in 35 complex multidivisional organizations in Canada. The conference paper entitled “The Ecology of Strategic Positioning: Mutualism, Competition, and Inertia,” by Stanislav D. Dobrev, Tai-Young Kim, and Glenn R. Carroll develops an ecological theory of the strategic positioning of all firms in an organizational population across its evolution. Drawing on established ecological theories and notions of strategic positioning from the management literature, we contend that processes of mutualism, competition, and inertia shape the propensity of firms to move in the market space.

Academy of Management Proceedings publish 2003  PDF Download
Organizational Aspects of Business Model Innovation: The Case of the European Postal Industry Kristian Johan Sund
Juan Andrei Villarroel
Marcel Bogers

Organizations are often challenged to find new ways of creating and capturing value to compete with new entrants and disruptive technologies. Several studies have addressed some of the organizational barriers that incumbents face when developing new business models, but our understanding of the organizational (re)design aspects inherent to business model innovation is still very incomplete. In this study, we investigate the organizational (re)design challenges for incumbent organizations in mature industries when they need to reinvent their business model in reaction to disruptive changes in their environment. Our empirical setting focuses on national postal operators in the European postal industry. Using an inductive case study we distinguish between two stages within business model innovation: namely, business model exploration and business model exploitation. Focusing on the former, our findings shed new light on the existence of four key organizational issues: (1) organizational conflicts for scarce resources, (2) cognitive limitations in terms of a persistent dominant logic, (3) design of organizational structure, and (4) the sourcing and development of new capabilities.

Academy of Management Proceedings publish 2014  PDF Download
Organizational Contexts for Environmental Construction and Objectification Activity William McKinley

This paper argues that organizations are the source of an adaptation–construction cycle. In that cycle, the consequences of organizational adaptations to current environmental states are constructed by the organization’s managers into new environmental states. Therefore organizational action in response to environmental conditions has both an adaptive component and an unintended environmental enactment component. The paper identifies attributes of adapting organizations that increase the level of managerial activity devoted to environmental construction and objectification. The theoretical logic of delineating these organizational attributes moves the paper beyond present versions of enactment theory, ‘social construction of reality’ theory, and structuration theory to focus on predictors of variation in concrete activity resulting in environmental construction and objectification. Based on the discussion of the organizational predictors, propositions to be tested in future empirical research are offered. Also, the propositions are used to suggest extensions to enactment theory, social construction of reality theory, structuration theory, and contemporary versions of neo-institutional theory. These extensions are detailed in the discussion section.

Journal of Management Studies publish 2011  PDF Download
Organizational emergence: The origin and transformation of Branson, Missouri’s musical theaters Todd Chiles
A. D. Meyer
T J Hench

We draw on complexity theory to explain the emergence of a new organizational collective, and we provide a much-needed empirical test of the theory at the collective level of analysis. Taking a case study approach, we use four dynamics of emergence posited by complexity theory’s dissipative structures model—fluctuation, positive feedback, stabilization, and recombination—to explain how a collective of live musical performance theaters in Branson, Missouri, came into being and periodically transformed itself over a 100-year period. Our findings suggest a strong match between the theoretical perspective employed and the empirical processes uncovered, empirically validating the model at the collective level. The study demonstrates the value of conceptualizing evolution in terms of emergence, highlighting distinctions between the nascent complexity approach to evolution and the neo-Darwinian evolutionary approach that has dominated the theoretical conversation in organization science for the past generation. Our findings complement the insights of the dominant theoretical perspectives in organization theory, providing a more comprehensive understanding of organizational evolution by directly addressing the heretofore intractable phenomenon of emergence.

Organization Science publish 2004  PDF Download
Organizational Entrepreneurship as Active Resistance: A Struggle Against Outsourcing David Courpasson
Françoise Dany
Ignasi Marti

This paper aims to contribute to the emerging perspective on organizational entrepreneurship by outlining how resistance to managerial policies and decisions can give birth to alternative organizational styles. Drawing on an in-depth analysis of a personal narrative of an R&D team manager opposition to hierarchical decisions, we link studies on resistance and organizational entrepreneurship to suggest that active resistance, which we define as the capacity to live beyond managerial control to create spaces of creativity and solidarity and alternative modalities of work in an organizational context, can actually contribute to the entrepreneurial process.

Entrepreneurship Theory and Practice publish 2016  PDF Download
Outlines of a behavioral theory of the entrepreneurial firm Saras Sarasvathy
Nick Dew
Rob Wiltbank
Stuart Read

In A Behavioral Theory of the Firm (BTF), Cyert and March [Cyert, R.M., March, J.G., 1963. A Behavioral Theory of the Firm. Prentice-Hall, Englewood Cliffs, NJ] present a clutch of ideas for explaining the behavior of established firms within an environment of well-defined markets, stakeholder relationships, technologies, and so on. In this paper, we outline a behavioral theory of the entrepreneurial firm that emphasizes transforming environments rather than acting within extant ones. In particular, we explicate three ideas that parallel key concepts in BTF: (1) accumulating stakeholder commitments under goal ambiguity (in line with a political conception of goals), (2) achieving control (as opposed to managing expectations) through non-predictive strategies, and (3) predominately exaptive (rather than adaptive) orientation. (c) 2008 Elsevier B.V. All rights reserved.

Journal of Economic Behavior and Organization publish 2008  PDF Download
Overoptimism and the performance of entrepreneurial firms R A Lowe
A A Ziedonis

Recent theoretical and empirical research on cognitive bias in decision making suggests that overoptimism critically influences entrepreneurs’ decisions to establish and sustain new ventures. We investigate whether such cognitive bias influences entrepreneurial venture performance using data on commercialization efforts for university inventions. In contrast to prior studies, our results suggest that entrepreneurial overoptimism does not appear to be the determining factor in the decision to found a firm. We do find that entrepreneurs continue unsuccessful development efforts for longer periods of time than do established firms, which is consistent with entrepreneurial overoptimism in the development of technologies with uncertain market prospects. This latter finding is also consistent with rationality-based models of decision-making behavior, however. We find that the economic returns associated with many of the technologies in our sample are realized after the start-up has been acquired by an established firm, suggesting that start-ups may serve as a transitional organizational form in the market for technology commercialization.

Management Science publish 2006  PDF Download
PAPER ABSTRACTS ENTREPRENEURSHIP. effectuation

The article presents abstracts on entrepreneurial topics, which include the growth of business enterprises, perseverance, and business planning.

Academy of Management Proceedings publish 2001
Particularistic and system trust among small and medium enterprises: A comparative study in China’s transition economy Justin Tan
Jun Yang
Rajaram Veliyath

Guanxi, a type of particularistic trust observed in Confucian societies has mostly been viewed as a static phenomenon. It is not clear how the role of guanxi changes over time during institutional transitions. This field study of twenty one small and medium enterprises (SMEs) located in two large cities in Western China examines the changes in SME behaviors since the beginning of economic reforms in 1979. Based on neo-institutionalist trust perspectives, the article argues that the role of guanxi also arose from the paucity of market system trust created by the absence of well-established market institutions during China’s transition from a centrally planned to a market economy. Guanxi became relatively less important when market system trust based on well-established institutions was firmly established. Regardless of past practices, the dynamics of institutional transitions leading to the establishment of system trust inevitably reshapes managerial as well as business behaviors, with adaptation occurring to the new rules of the market economy.

Journal of Business Venturing publish 2009  PDF Download
Partnership Steering Wheels H Schirmer
Journal of Corporate Citizenship publish 2013
Party On! A call for entrepreneurship research that is more interactive, activity based, cognitively hot, compassionate, and prosocial Dean Shepherd
Journal of Business Venturing publish 2015  PDF Download
Past Career in Future Thinking: How Career Management Practices Shape Entrepreneurial Decision Making Yuval Engel
Elco van Burg
Emma Kleijn
Svetlana Khapova

Research Summary: This study builds a grounded model of how careers shape entrepreneurs’ preferences for causal and effectual decision logics when starting new ventures. Using both verbal protocol analysis and interviews, we adopt a qualitative research approach to induct career management practices germane to entrepreneurial decision making. Based on our empirical findings, we develop a model conceptualizing how configurations of career management practices, reflecting different emphases on career planning and career investment, are linked to entrepreneurial decision making through the imprint that they leave on one’s view of the future, generating a tendency toward predictive and/or creative control. These findings extend effectuation theorizing by reformulating one of its most pervasive assumptions and showing how careers produce distinct pathways to entrepreneurial thinking, even prior to entrepreneurial entry. Managerial Summary: Treating your own career as a start-up impacts how you make decisions when actually becoming an entrepreneur. Based on empirical findings, we explain why and how sets of career management practices are distinctively linked to the use of different logics when making entrepreneurial decisions. Individuals who throughout their careers have emphasized investments in skills and networks over efforts to forecast and plan develop a general view of the future in which creative control dominates predictive control. The opposite is true for those who rely on managing their careers through planning but remain passive in their career investments. Upon entry to entrepreneurship, these differences become relevant such that some entrepreneurs rely on attempts to predict the future while others actively try to create it. © 2016 The Authors. Strategic Entrepreneurship Journal published by Strategic Management Society.

Strategic Entrepreneurship Journal publish 2017  PDF Download
Path Dependence or Path Creation? Dr. Raghu Garud
Arun Kumaraswamy
Peter Karnoe

We discuss the assumptions that underlie path dependence, as defined by Vergne and Durand, and then provide the outlines of an alternative perspective which we label as path creation. Path creation entertains a notion of agency that is distributed and emergent through relational processes that constitute phenomena. Viewed from this perspective, ‘initial conditions’ are not given, ‘contingencies’ are emergent contexts for action, ‘self-reinforcing mechanisms’ are strategically manipulated, and ‘lock-in’ is but a temporary stabilization of paths in-the-making. We develop these points using a narrative approach and highlight the theoretical and methodological implications of our perspective.

Journal of Management Studies publish 2010  PDF Download
Perceived Institutional Ambiguity and the Choice of Organizational Form in Social Entrepreneurial Ventures. David Townsend
Timothy Hart

Social entrepreneurship (SE) is emerging as a common approach to meeting social needs. However, SE founders appear to be organizing under both for-profit and nonprofit organizational forms to engage in essentially the same activities. We investigate this lack of consistency regarding the choice of organizational form by examining two possible explanations: a difference in motivational goals among social entrepreneurs or perceived ambiguity regarding trends in core dimensions of the institutional environment. Overall, we argue that founder perceptions of an ambiguous institutional environment are leading to the variance in choice of organizational form for SE ventures. Both theoretical and practical directions for future research are discussed as well.

Entrepreneurship Theory and Practice publish 2008  PDF Download
Perceived progress variability and entrepreneurial effort intensity: The moderating role of venture goal commitment Marilyn A Uy
Maw-Der Foo
Remus Ilies

Abstract Drawing on entrepreneurial motivation and goal striving literatures, we examined the dynamic relationship between momentary perceived progress, or an ongoing sense of how one is doing in the pursuit of one’s venture goal, and entrepreneurial effort intensity among early-stage entrepreneurs who are based in business incubators. We also examined how perceived progress variability over time predicted entrepreneurial effort intensity, and whether venture goal commitment moderated this link. Experience-sampling data collected from over one hundred early-stage entrepreneurs indicated that perceived progress predicted greater effort intensity. Moreover, perceived progress variability over time negatively predicted entrepreneurial effort intensity, and venture goal commitment attenuated this negative relationship. Theoretical and practical implications of our study to entrepreneurial motivation and goal striving research are discussed.

Journal of Business Venturing publish 2015  PDF Download
Perceiving and Managing Business Risks: Differences Between Entrepreneurs and Bankers Saras Sarasvathy
Herbert A Simon
Lester Lave

We compared entrepreneurs with bankers in their perception and management of a variety of risks. Problems included financial risk, risk to human life and health, and risk of a natural disaster. Cluster analysis and content analysis of think-aloud protocols revealed surprising details. Entrepreneurs accept risk as a given and focus on controlling outcomes at any given level of risk; they also frame their problem spaces with personal values and assume greater personal responsibility for outcomes. Bankers focus on target outcomes — attempting to control risk within structured problem spaces and avoiding situations where they risk higher levels of personal responsibility.

Journal of Economic Behavior and Organization publish 1998  PDF Download
Performance Configurations Over Time: Implications for Growth- and Profit-Oriented Strategies. Paul Steffens
Per Davidsson
Jason Fitzsimmons

Strategic entrepreneurship can be described as simultaneous opportunity seeking and advantage seeking. Younger firms are generally more flexible and therefore enjoy “discovery advantages,” whereas established firms tend to be resource rich and more experienced and consequently enjoy “exploitation advantages.” The resulting evolution of the two important performance dimensions, “growth” and “profitability,” by firm age is not well understood. In this article we integrate several theoretical arguments concerning profit–growth relationships to develop a dynamic model of firm development, which suggests different development pathways for young firms. This leads to several unidirectional, competing hypotheses that we examine by studying the profitability-growth configurations of approximately 3,500 small firms and how these configurations evolve over time. We find that for both young and old firms a focus on achieving above-average profitability and then striving for growth is a more likely path toward achieving sustained above-average performance than is first pursuing strong growth in the hope of building profitability later. In line with our hypothesis we find that younger firms are over represented as “Stars” (high on both growth and profitability) and underrepresented as “Poor” (low on both growth and profitability). However, young firms in the “Star” category are also less likely than their older counterparts to maintain that position. Furthermore, our results indicate that young firms are overrepresented not only among “Stars,” but also among growth-orientated firms, regardless of the level of profitability. The findings strongly caution against the blind pursuit of growth for young firms, in favor of a thoughtful analysis of how both growth and profitability might be developed by firms. The results also question whether simultaneous high performance in terms of growth and profitability among young firms usually reflects a successful entrepreneurial strategy. The results can also be interpreted as luck on the part of a subgroup of young firms who indiscriminately pursue growth opportunities with varying profit prospects, and in many cases, the high growth–profit performance will be short lived.

Entrepreneurship Theory and Practice publish 2009  PDF Download
PERFORMANCE EFFECTS OF EFFECTUATION AND CAUSATION – THE MODERATING ROLE OF INNOVATIVENESS IN YOUNG VENTURES (SUMMARY) Daniel Appelhoff

Most empirical research on effectuation is based on experiments or field studies (Chandler et al., 2009). Especially, the critical question “under what circumstances which types of processes provide particular advantages and disadvantages” remains empirically unanswered (Sarasvathy, 2001: 249). But it is exactly the relationship between effectuation, causation and performance that is of particular interest for both researchers and practitioners. Therefore, this study tackles the question: Do effectuation and causation predict performance in new ventures and do factors such as innovativeness moderate this relationship? The opinions regarding this question are diverse. Sarasvathy (2001) suggests that effectuation and causation do not predict performance directly, whereas Read et al. (2009) find three effectual principles positively and directly linked to performance in their meta-analytic review.

Frontiers of Entrepreneurship Research publish 2012  PDF Download
Persistence and heterogeneity in entrepreneurship: An evolutionary game theoretic analysis Graciela Kuechle

Studies show that countries exhibit a relatively stable level of entrepreneurial activity. To account for this fact, we adopt an evolutionary game theoretic approach. Based upon the analysis of games that capture essential features of the entrepreneurial phenomenon, we ascertain conditions under which evolutionary stable equilibria will be played by a population consisting of agents who engage in entrepreneurship and agents who do not. We show that entrepreneurship may persist even without assuming strategic complementarities or group selection. Lastly, we explain how information about equilibrium payoffs to self- and paid employment could help address the question of whether entrepreneurs differ from other economic agents.

Journal of Business Venturing publish 2011  PDF Download
Personal views on the future of entrepreneurship education Alain Fayolle

Entrepreneurship education is growing worldwide, but key educational and didactical issues remain. What are we talking about when we talk about entrepreneurship education? What are we really doing when we teach or educate people in entrepreneurship, in terms of the nature and the impact of our interventions? What do we know about the appropriateness, the relevancy, the coherency, the social usefulness and the efficiency of our initiatives and practices in entrepreneurship education? Addressing these issues and challenges, this article suggests that at least two major evolutions might reinforce the future of entrepreneurship education. First, we need strong intellectual and conceptual foundations, drawing from the fields of entrepreneurship and education, to strengthen our entrepreneurship courses. And finally, we also need to deeply reflect on our practices, as researchers and educators, taking a more critical stance toward a too often adopted ?taken for granted? position.

Entrepreneurship & Regional Development publish 2013  PDF Download
PERSONALITY, UNCERTAINTY AND LOGIC: IMPACT ON ENTREPRENEURIAL OUTCOMES. Greg Fisher

In this paper I draw on prior empirical findings and theoretical relationships to develop a conceptual model to describe the relationship between personality factors and entrepreneurial outcomes. The model incorporates uncertainty as a moderator and decision logic as mediator in the relationship between personality and entrepreneurial outcomes.

Academy of Management Proceedings publish 2009  PDF Download
PERSPECTIVE TAKING AND FOUNDER EQUITY SPLITS: AN EXPERIMENTAL STUDY OF INTERSUBJECTIVE INTERACTIONS (SUMMARY) Anusha Ramesh
Saras Sarasvathy
Frontiers of Entrepreneurship Research publish 2013  PDF Download
Perspective, classification and concept in understanding entrepreneurship: comparing effectuation and entrepreneurial capacity. Kevin Hindle
Peter Moroz
Advancing small business and entrepreneurship publish 2012
Planning for Growth: Life Stage Differences in Family Firms Kimberly Eddleston
Franz W Kellermanns
Steven W Floyd
Victoria L Crittenden
William F Crittenden

Applying insights from the generational perspective, this study explores when strategic planning and succession planning are most conducive to privately held family firm growth. The results show that the degree to which strategic planning and succession planning are associated with family firm growth depends on the generation managing the firm. Both forms of planning are most conducive to the growth of first-generation firms; however, neither form of planning confers much growth for second-generation firms. For third-and-beyond-generation firms, the benefits of succession planning appear to reemerge. However, strategic planning is negatively associated with their level of growth.

Entrepreneurship Theory and Practice publish 2013  PDF Download
PLANNING THE UNKNOWN: THE SIMULTANEITY OF PREDICTIVE AND NON-PREDICTIVE ENTREPRENEURIAL STRATEGIES (SUMMARY) Jeroen Kraaijenbrink
Tiago Ratinho

Entrepreneurship scholars have taken considerable interest in investigating which entrepreneurial strategies are effective. While some argue that planning is beneficial under certain conditions (e.g. Gruber, 2007), others have put forth notions such as bricolage (Baker & Nelson, 2005), improvisation (Kamoche, Cunha, & Cunha, 2003; Moorman & Miner, 1998) or effectuation (Sarasvathy, 2001, 2008). Gradually, the debate on predictive vs. non-predictive strategies has become more nuanced and several authors have proposed the co-existence of both strategies. While potentially providing a resolution to the alleged conflict between seemingly opposing strategies, co-existing strategies raise further questions. Can entrepreneurs build on their means while setting a goal and a vision for the future? Is it possible to calculate expected returns and still draw affordable loss scenarios? Are entrepreneurs leveraging unexpected contingencies but at the same time trying to avoid them? In addressing these questions, this paper explores empirically the independence of two of the effectuation constructs (Sarasvathy, 2001, 2008): prediction vs. control and means-based vs. ends-based strategies.

Frontiers of Entrepreneurship Research publish 2012  PDF Download
Portfolio entrepreneurs: an effectuation approach to multiple venture development Sussie Morrish
Journal of Research in Marketing and Entrepreneurship publish 2009
Portrait of an Entrepreneur: Vincent van Gogh, Steve Jobs, and the Entrepreneurial Imagination Joep Cornelissen
Academy of Management Review publish 2013  PDF Download
Positive Institutional Work: Exploring Institutional Work Through the Lens of Positive Organizational Scholarship WARREN NILSSON

Despite its emancipatory ambitions and its rich portraits of agency, the institutional work literature has been criticized for its limited engagement with questions of normative social purpose. Synthesizing the literature on institutional work and on positive organizational scholarship, in this article I define positive institutional work as the creation or maintenance of institutional patterns that express mutually constitutive experiential and social goods. This synthesis expands existing theories of institutional work in three ways. It introduces the concept of experiential legitimacy and suggests that experiential surfacing may be a foundational aspect of positive institutional work. It offers collaborative inquiry as a largely overlooked solution to the paradox of embedded agency and explores such inquiry as a primary mode of positive agency. And it argues that positive institutional stability rests upon work aimed at making group boundaries and material practices more inclusive. Taken together, these three themes suggest new theoretical and practical directions for further inquiry into the relationship between institutional work and social purpose. They also contribute to the positive organizational scholarship literature’s implicit institutional ambitions by articulating a more socially embedded vision of positive organizational practices.

Academy of Management Review publish 2015  PDF Download
Practice makes perfect: Entrepreneurial-experience curves and venture performance Rasmus Vendler Toft-Kehler
Karl Wennberg
Philip H Kime

Abstract This study tackles the puzzle of why increasing entrepreneurial experience does not always lead to improved financial performance of new ventures. We propose an alternate framework demonstrating how experience translates into expertise by arguing that the positive experience–performance relationship only appears to expert entrepreneurs, while novice entrepreneurs may actually perform increasingly worse because of their inability to generalize their experiential knowledge accurately into new ventures. These negative performance implications can be alleviated if the level of contextual similarity between prior and current ventures is high. Using matched employee–employer data of an entire population of Swedish founder-managers between 1990 and 2007, we find a non-linear relationship between entrepreneurial experience and financial performance consistent with our framework. Moreover, the level of industry, geographic, and temporal similarities between prior and current ventures positively moderates this relationship. Our work provides both theoretical and practical implications for entrepreneurial experience—people can learn entrepreneurship and pursue it with greater success as long as they have multiple opportunities to gain experience, overcome barriers to learning, and build an entrepreneurial-experience curve.

Journal of Business Venturing publish 2014  PDF Download
Prediction and Control Under Uncertainty: Outcomes in Angel Investing Saras Sarasvathy
Stuart Read
Nick Dew
Rob Wiltbank

Venture investing plays an important role in entrepreneurship not only because financial resources are important to new ventures, but also because early investors help shape the ventures’ managerial and strategic destiny. In this study of 121 angel investors who had made 1038 new venture investments, we empirically investigate angel investors’ differential use of predictive versus non-predictive control strategies. We show how the use of these strategies affects the outcomes of angel investors. Results show that angels who emphasize prediction make significantly larger venture investments, while those who emphasize non- predictive control experience a reduction in investment failures without a reduction in their number of successes.

while those who emphasize non- predictive control experience a reduction in investment failures without a reduction in their number of successes. publish 2009  PDF Download
PREDICTION VS. CONTROL: A LONGITUDINAL STUDY OF PERFORMANCE IMPLICATIONS IN STRATEGIC DECISION MAKING UNDER UNCERTAINTY (INTERACTIVE PAPER) Philipp Tillmanns
René Mauer

Entrepreneurial and corporate success is driven by creating unique competitive advantages. The process of strategy design is the crucial step in “matching” internal and external characteristics of the firm (Anderson & Paine, 1975). In an uncertain and dynamic environment, the choice of strategy design should be adapted according to the environment to achieve optimal performance (Selsky et al. 2007). Based on work by Sarasvathy (2001) on effectual entrepreneurs operating in highly uncertain environments Wiltbank, Dew and Read (2006) enhanced the strategy toolbox by clustering firm-level strategies along the dimensions of prediction and control.

Frontiers of Entrepreneurship Research publish 2012  PDF Download
Prediction- and Control-Based Strategies in Entrepreneurship: The Role of Information Graciela Kuechle
BEATRICE BOULU-RESHEF
SEAN D. CARR

Research summary Prediction- and control-based strategies are the two main hypotheses of how entrepreneurs deal with uncertainty in theories of entrepreneurship. Prediction-based strategies focus on estimating unknowns via sampling methods, whereas control-based strategies focus on shaping unknowns via proactive behavior. These strategies may lead to different propensities to undertake uncertain prospects, as they differ in terms of cognition and involvement. In an experimental test, we study the conditions under which prediction- and control-based strategies lead subjects to accept bets in ambiguous environments. Individuals who use control methods to mitigate uncertainty are more likely to accept the bet after a favorable outcome compared to those who use predictive methods. These results revert in the presence of unfavorable outcomes. We discuss the implications for entrepreneurship theory and practice. Managerial summary Entrepreneurs often adopt prediction- and control-based strategies in order to reduce uncertainty. Prediction-based strategies focus on gathering information to estimate future outcomes, whereas control-based strategies concentrate on taking actions to create a more favorable environment for the venture. Results from an experimental test show that these strategies can affect behavior differently. In particular, when the decision maker receives favorable information, control-based strategies are more likely to lead to the acceptance of an uncertain prospect than prediction-based strategies. This effect reverts when the decision maker receives unfavorable information. Our findings are valuable for entrepreneurs, investors, and policy makers. Understanding the distinctive impact of strategy on behavior may help entrepreneurs and investors calibrate the potential of a venture, thereby avoiding the misallocation of valuable resources. Copyright © 2016 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2016  PDF Download
Prior Experience and Social Class as Moderators of the Planning-Performance Relationship in China’s Emerging Economy yuli zhang
Jun Yang
Jintong Tang
Kevin Au
HONGZHI XUE

This study advances research on business planning by integrating and reconciling the institutional and strategic planning perspectives to explore the performance implications of both formal and informal business planning. We also examine how an entrepreneur’s prior experience and social class shape the planning-performance relationship. Using a dataset of two waves of interviews with 313 founders in China, we found that both formal and informal business planning can benefit new ventures. Interestingly, as a unique contingency factor in the Chinese context, social class moderates only the link between formal planning and performance, whereas prior work experience moderates the effects of both formal and informal planning on performance. Copyright © 2013 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2013  PDF Download
PRODUCT INNOVATION AND ITS RELATIONSHIP WITH CAUSATION AND EFFECTUATION: THE CASE OF SMALL FIRMS IN THE SERVICE SECTOR (SUMMARY) Gry Agnete Alsos
Tommy Høyvarde Clausen

Inspired by Schumpeter’s (1934) seminal analysis of the importance of entrepreneurs carrying out “new combinations” for economic development, later research has documented that young and small firms is a key source of new product innovations in the economy, and increasingly so (Acs & Audretsch, 2003). However, new and small firms may approach product innovation in different ways, some of them being markedly more innovative than others. Differences may be a result of different strategies or logics adopted by the entrepreneurs in creation and further development of their ventures. This study is motivated by recent research which has suggested that causation and effectuation represent two fundamentally different approaches for how new firms come into existence (Sarasvathy, 2001). Causation process takes a particular effect as given and focuses on selecting between means to create that effect while effectuation process refers to the choice between possible effects that can be created with given means. The purpose of this paper is to further examine the intersection between product innovation, and the logic entrepreneurs follow during business creation.

Frontiers of Entrepreneurship Research publish 2012  PDF Download
Product Innovation Processes in Small Firms: Combining entrepreneurial effectuation and managerial causation H Berends
M Jelinek
I Reymen
R Stultiens

This article reports a multimethod study of product innovation processes in small manufacturing firms. Prior studies found that small firms do not deploy the formalized processes identified as best practice for the management of new product development (NPD) in large firms. To explicate small firms’ product innovation, this study uses effectuation theory, which emerged from entrepreneurship research. Effectuation theory discerns two logics of decision-making: causation, assuming that means are selected to attain goals; and effectuation, assuming that goals are created based upon available means. The study used a process research approach, investigating product innovation trajectories in five small firms across 352 total events. Quantitative analyses revealed early effectuation logic, which increasingly turned toward causation logic over time. Further qualitative analyses confirmed the use of both logics, with effectual logic rendering product innovation resource-driven, stepwise, and open-ended, and with causal logic used especially in later stages to set objectives and to plan activities and invest resources to attain objectives. Because the application of effectuation logic differentiates the small firm approaches from mainstream NPD best practices, this study examined how small firms’ product innovation processes deployed effectuation logic in further detail. The small firms: (1) made creative use of existing resources; (2) scoped innovations to be realizable with available resources; (3) used external resources whenever and wherever these became available; (4) prioritized existing business over product innovation projects; (5) used loose project planning; (6) worked in steps toward tangible outcomes; (7) iterated the generation, selection, and modification of goals and ideas; and (8) relied on their own customer knowledge and market probing, rather than early market research. Using effectuation theory thus helps us understand how small firm product innovation both resembles and differs from NPD best practices observed in larger firms. Because the combination of effectual and causal principles leverages small firm characteristics and resources, this article concludes that product innovation research should more explicitly differentiate between firms of different sizes, rather than prescribing large firm best practices to small firms.

Journal of Product Innovation Management publish 2014  PDF Download
Progress in understanding entrepreneurial behavior Lowell Busenitz
Strategic Entrepreneurship Journal publish 2007  PDF Download
Properties of emerging organizations: An empirical test. Candida Brush
Tatiana Manolova

The process of new venture creation is central to the field of entrepreneurship. The effects of initial organizing have a direct influence on survival, yet empirical examination of the dimensions of emergent organizations is limited. Using longitudinal data on nascent entrepreneurs, this paper empirically tests four properties of emerging organizations-intentionality, resources, boundary and exchange- and their effect on likelihood of continued organizing [Katz, J., Gartner, W.B., 1988. Properties of emerging organizations. Academy of Management Review 13(3), 429–441]. Our results suggest that all four properties are necessary for firm survival in the short-term and those firms that organize more slowly are more likely to continue to organize. Further, nascent ventures in which intentionality preceded the other organizing properties were not significantly more likely to continue in the organizing effort. Our results suggest an extension of the original Katz and Gartner [Katz, J., Gartner, W.B., 1988. Properties of emerging organizations. Academy of Management Review 13(3), 429–441] framework.

Journal of Business Venturing publish 2008
Proposing Social Resources as the Fundamental Catalyst Toward Opportunity Creation NEIL TOCHER
SHARON L. OSWALD
DIANNE J HALL

The growing body of research on the creation view of opportunities suggests that social processes between potential entrepreneurs and interested parties often account for why many technically brilliant business ideas are abandoned sometime between conceptualization and market launch. Surprisingly though, few studies have comprehensively examined the different roles various categories of social resources play at different stages of the opportunity-creation process. Hence, the present article fills this gap by outlining how the unique resources of social capital and social competence facilitate entrepreneurs’ ability to guide imagined ideas through the multistage, path dependent, socially complex opportunity-creation process. Copyright © 2015 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2015  PDF Download
Prospective sensemaking: Strategy-making in a pioneering firm Shubha Patvardhan

I employed a longitudinal, grounded-theory approach to investigate the processes by which firms not only try to “see” the future, but seek to shape it, as well. My investigation of the strategy-making processes in a pioneering firm that is widely acknowledged to have shaped the future of its industry over five decades showed that “creative enactment” – generative, reflexive interventions by which agents attempt to structure the environment towards desired ends – was a pivotal process. The findings help to extend the traditional sensemaking perspective, which is rooted in retrospective processes, to account more fully for prospective or forward-looking activities—especially those intended not merely to anticipate, but also to influence the future. The resulting “forward-looking” sensemaking model highlights not only the importance of creative enactment, but also the significance of “creative rationality” in understanding how firms can work to influence future environments. The resulting “forward- looking” sensemaking model also complements the dominant discourse in strategic management literature, which has historically focused on “fit” and ‘adaption” processes, by emphasizing processes that create the possibility of “shaping” environments.

Academy of Management Proceedings publish 2015  PDF Download
Pull the Plug or take the Plunge: Multiple Opportunities and the Speed of Venturing Decisions in the Australian Mining Industry Rene M. Bakker
Dean Shepherd

Effectively capturing opportunities requires rapid decision-making. We investigate the speed of opportunity evaluation decisions by focusing on firms’ venture termination and venture advancement decisions. Experience, standard operating procedures, and confidence allow firms to make opportunity evaluation decisions faster; we propose that a firm’s attentional orientation, as reflected in its project portfolio, limits the number of domains in which these speed-enhancing mechanisms can be developed. Hence firms’ decision speed is likely to vary between different types of decisions. Using unique data on 3,269 mineral exploration ventures in the Australian mining industry, we find that firms with a higher degree of attention toward earlier-stage exploration activities are quicker to abandon potential opportunities in early development but slower to do so later, and that such firms are also slower to advance on potential opportunities at all stages compared to firms that focus their attention differently. Market dynamism moderates these relationships, but only with regard to initial evaluation decisions. Our study extends research on decision speed by showing that firms are not necessarily fast or slow regarding all the decisions they make, and by offering an opportunity evaluation framework that recognizes that decision makers can, in fact often do, pursue multiple potential opportunities simultaneously.

Academy of Management Journal publish 2015  PDF Download
Putting Entrepreneurship Education Where the Intention to Act Lies: An Investigation Into the Impact of Entrepreneurship Education on Entrepreneurial Behavior ANDREAS RAUCH
WILLEM Hulsink

The growing attention to entrepreneurship education has caused a debate about whether entrepreneurship education can affect entrepreneurial behavior. We use a quasi-experimental design, comparing a MSc entrepreneurship program with a comparison group from a MSc supply-chain management program to test the effectiveness of entrepreneurship education, relying on the theory of planned behavior (TPB). The findings suggest that entrepreneurship education is effective. Specifically, students participating in entrepreneurship education show an increase in attitudes and perceived behavioral control. Furthermore, they have higher entrepreneurial intentions at the end of the program. Finally, entrepreneurial intentions mediate the effect of entrepreneurship education on subsequent behavior associated with the creation of new business ventures. These results suggest that entrepreneurship education emphasizes increasing antecedents of intentions and behavior.

Academy of Management Learning & Education publish 2015  PDF Download
Qualitative Research In Entrepreneurship: Current Research Practices and Suggestions for Future Golshan Javadian
Alka Gupta
Alexander R Knights

Qualitative research has emerged as a popular approach to examining and understanding entrepreneurial phenomena. The present study investigates the state-of-science with regard to qualitative research in entrepreneurship. Specifically, we analyze and synthesize qualitative entrepreneurship research published in top-tier general and specialized journals over the past fifteen years. Articles were carefully coded using a robust multi-attribute framework and examined for impact on the field. Findings reveal that while qualitative research has grown in usage, notable biases and omissions remain in the body of research accumulating in the qualitative tradition of entrepreneurship studies. Implications and directions for future research are discussed.

Academy of Management Proceedings publish 2016  PDF Download
Questions from the Effectuation Conference June 6 & 7, Bodo Norway Stuart Read
Saras Sarasvathy

At the 2016 effectuation conference, participants submitted 14 open questions. These questions derived from conversations at the conference and span research and practice topics. In the effectual spirit, we shared the questions around with the effectuation community and have consolidated responses to these questions in this document, as well as “Two cents from Saras” on every one. We are quick to note that these responses are not definitive answers, but a part of a conversation and an invitation to continue it. We hope you find them useful.

publish 2017  PDF Download
RE-STORYING AN ENTREPRENEURIAL IDENTITY: EDUCATION, EXPERIENCE AND SELF-NARRATIVE (SUMMARY) Susan S Harmeling

In this paper, I consider the potential impact of entrepreneurship education on identity. Over the past twenty years, there has been fervent interest in the prevalence, content, and outcomes of entrepreneurship education programs, but very little attention on the effect of entrepreneurship education on participants’ identities. However, the impact of entrepreneurship education on identity would seem to be a fruitful line of research because, as scholars have noted, entrepreneurship education is different in kind from other types of management education, in that it deals with uniquely personal issues such as the emotions of grief and loss from failure (Shepard, 2004, 2003), individual initiatives geared toward channeling resources and stakeholders to the developing organization (Sarasvathy, 2001, 2008), ethics around the “face” that entrepreneurs present to potential investors (Brenkert, 2009) and the ways in which entrepreneurs deal with both exogenous and endogenous contingency (Honig, 2004, Harmeling, 2009).

Frontiers of Entrepreneurship Research publish 2010  PDF Download
Re-Thinking Entrepreneurial Performance from a Human Development Perspective Ishrat Ali
Saras Sarasvathy

To date, entrepreneurial performance has mostly been measured through economic indicators. In this paper we take a process view of entrepreneurship and argue that a more accurate assessment would incorporate impact on all stakeholders and not only on those who finance the venture. We draw upon research from Entrepreneurial Performance, Stakeholder Theory and Human Development and Capability Approach to present a broad framework that encourages evaluation by exploring changes in stakeholder capabilities.

Academy of Management Proceedings publish 2013
Recognizing Opportunities for Sustainable Development Holger Patzelt
Dean Shepherd

Building on the entrepreneurial action and sustainable development literatures, we highlight how the current explanations of opportunity recognition, based on entrepreneurial knowledge and economic motivation, are insufficient for modeling the recognition of opportunities for sustainable development. Our model suggests that entrepreneurs are more likely to discover sustainable development opportunities the greater their knowledge of natural and communal environments become, the more they perceive that the natural and communal environment in which they live is threatened, and the greater their altruism toward others becomes. We propose that entrepreneurial knowledge plays a central role by moderating these effects.

Entrepreneurship Theory and Practice publish 2011  PDF Download
Reconciling diverse approaches to opportunity research using the structuration theory Mike Chiasson
Chad Saunders

Structuration theory (ST) is used to reconcile six approaches to opportunity research that emphasize either the recognition or formation of entrepreneurial opportunity. While opportunity recognition focuses on the restricting role of business and social structure on entrepreneurial activity, opportunity formation emphasizes the creation of opportunities by the entrepreneur. In contrast to this dichotomy, ST argues that recognition and formation are recursively implicated because it dissolves the dichotomy between structure and agency, thus showing how entrepreneurial action is both enabled and constrained by the conscious selection, imitation, and modification of business scripts by entrepreneurs. The implications for opportunity research and practice are discussed.

Journal of Business Venturing publish 2005
Reflections on the 2010 AMR Decade Award: Delivering on the Promise of Entrepreneurship As a Field of Research Scott Shane

I examine the impact of the 2010 AMR Decade Award article on the entrepreneurship field over the past ten years, identifying aspects of “The Promise of Entrepreneurship As a Field of Research” that have been largely accepted by the field, those that the field has challenged, and those that the field has found to be unclear. I also correct errors made in the earlier work and discuss how the field of entrepreneurship has evolved in response to the publication of the original article.

Academy of Management Review publish 2012  PDF Download
Reflections on the 2010 AMR decade award: Whither the promise? Moving forward with entrepreneurship as a science of the artificial Saras Sarasvathy
S. Venkataraman
Nick Dew
WILLIAM FORSTER

In this article we speak of roads taken and paths yet to be traversed. Over the past decade, entrepreneurship researchers have accumulated considerable work related to opportunities. Here we outline new possibilities opened up by that work and seek to recast entrepreneurship as a science of the artificial in three ways: understanding opportunities as made as well as found, moving beyond new combinations to trans- formations, and developing a new nexus around actions and interactions.

Academy of Management Review publish 2012  PDF Download
Regulatory focus and new venture performance: A study of entrepreneurial opportunity exploitation under conditions of risk versus uncertainty Keith Hmieleski
Baron, Robert A.

Research on cognitive fit suggests that entrepreneurs will be most successful at leading their firms when approaching the entrepreneurial process through the self-regulatory mode that most closely matches the requirements of their environment and its accompanying perspective on the nature of entrepreneurial opportunities. Consistent with the discovery view of entrepreneurial opportunities, it is suggested that a prevention focus will be the most effective self-regulatory mode for entrepreneurs leading their firms within stable industry environments, which are characterized by risk. Building from the creation view of entrepreneurial opportunities, it is argued that a promotion focus will be the most effective self-regulatory mode for entrepreneurs leading their firms within dynamic industry environments, which are characterized by uncertainty. These arguments are tested using a national (United States) random sample of 201 lead entrepreneurs. The findings indicate that in dynamic environments, entrepreneurs’ promotion focus is positively associated with venture performance (i.e., lagged measures of revenue and employment growth), while entrepreneurs’ prevention focus is negatively related to performance in such environments. In both cases, these effects are found to be fully mediated by deviation from firms’ original business concepts. In stable environments, however, no significant relationships between entrepreneurs’ promotion or prevention focus and new venture performance were observed. These results suggest that low cognitive fit (a mismatch between entrepreneurs’ mode of self-regulation and the decision-making context in which they operate) is more damaging in dynamic environments (i.e., a context of uncertainty) than in stable environments (i.e., a context of risk). Copyright © 2009 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2008  PDF Download
Related Debates in Ethics and Entrepreneurship: Values, Opportunities and Contingency Saras Sarasvathy
Susan S Harmeling
R Edward Freeman

In this paper, we review two seemingly unrelated debates. In business ethics, the argument is about values: are they universal or emergent? In entrepreneurship, it is about opportunities – are they discovered or constructed? In reality, these debates are similar as they both overlook contingency. We draw insight from pragmatism to define contingency as possibility without necessity. We analyze real-life narratives and show how entrepreneurship and ethics emerge from our discussion as parallel streams of thought.

Journal of Business Ethics publish 2009
Report on the Seminar on Research Perspectives in Entrepreneurship. Saras Sarasvathy
Journal of Business Venturing publish 2000
Representational Gaps, Information Processing, and Conflict in Functionally Diverse Teams. M Cronin
Laurie Weingart

Functional diversity in teams, while potentially beneficial, increases the likelihood that individual team members will perceive the team’s task differently, leading to gaps between teammates’ interpretations of what is needed for the team to be successful. These representational gaps are likely to create conflict as teammates try to solve what are essentially incompatible problems. Understanding how these general mechanisms work should deepen our understanding of information processing and conflict in diverse teams.

Academy of Management Review publish 2007  PDF Download
Research Strategies for Organizational History: A Dialogue Between Historical Theory and Organization Theory MICHAEL ROWLINSON
JOHN HASSARD
STEPHANIE DECKER

If history matters for organization theory, then we need greater reflexivity regarding the epistemological problem of representing the past; otherwise, history might be seen as merely a repository of ready-made data. To facilitate this reflexivity, we set out three epistemological dualisms derived from historical theory to explain the relationship between history and organization theory: (1) in the dualism of explanation, historians are preoccupied with narrative construction, whereas organization theorists subordinate narrative to analysis; (2) in the dualism of evidence, historians use verifiable documentary sources, whereas organization theorists prefer constructed data; and (3) in the dualism of temporality, historians construct their own periodization, whereas organization theorists treat time as constant for chronology. These three dualisms underpin our explication of four alternative research strategies for organizational history: corporate history, consisting of a holistic, objectivist narrative of a corporate entity; analytically structured history, narrating theoretically conceptualized structures and events; serial history, using replicable techniques to analyze repeatable facts; and ethnographic history, reading documentary sources “against the grain.” Ultimately, we argue that our epistemological dualisms will enable organization theorists to justify their theoretical stance in relation to a range of strategies in organizational history, including narratives constructed from documentary sources found in organizational archives.

Academy of Management Review publish 2014  PDF Download
Resilience of Family Firms: An Introduction James J Chrisman
Jess Chua
Lloyd P Steier

Family firms have long been a prominent feature of the organizational landscape and researchers have found some variations of this organizational form to be more resilient than others. The articles and commentaries in this special issue address some of the bases of this resilience including arranged marriages as a management succession strategy, long-term orientation and multitemporal perspectives, knowledge structures and opportunity identification, and social capital and social exchange. This introduction to the eighth special issue on “theories of family enterprise” discusses the contributions made by the articles and commentaries to our understanding about the resilience of family firms.

Entrepreneurship Theory and Practice publish 2011  PDF Download
Resource integration M Kleinaltenkamp
R J Brodie
P Frow
Hughes T
L D Peters
H Woratschek
Marketing Theory publish 2012
Resource Mobilization in International Social Entrepreneurship: Bricolage as a Mechanism of Institutional Transformation Geoffrey Desa

International entrepreneurs are often confronted with unfavorable normative, regulatory, and cognitive institutional environments. Those entrepreneurial firms that successfully navigate this uneven terrain appear to defy institutional constraint and create economic growth. Yet little is known about how ventures develop in unfavorable institutional environments, particularly in terms of social entrepreneurship. Contrary to the predominant view of resource mobilization, this article finds that social entrepreneurs confronted with institutional constraints engage in bricolage to reconfigure existing resources at hand. In the process, bricolage can act as a legitimating mechanism for institutional change. This article examines how regulatory, political, and technological institutions affect resource-mobilization in 202 technology social ventures from 45 countries. The implications for social entrepreneurship and for institutionally embedded entrepreneurial action are discussed.

Entrepreneurship Theory and Practice publish 2012
RESOURCES AND THE TEAM FORMATION PROCESS (SUMMARY) Isil Yavuz
Hans Rawhouser
Daniel P Forbes
Mary E. Zellmer-Bruhn

In building a new venture management team, do entrepreneurs seek team members to fill specific roles on the team needed to exploit an opportunity? Or do they consider what opportunities they can create, given their current team? Research on new business creation has traditionally favored a “planning” approach in which entrepreneurs recognize business opportunities, identify their goals (possible effects), and then choose the most effective means to achieve their goals by acquiring resources and creating an organization (e.g. Bhave, 1994). But others (e.g. Sarasvathy, 2001) have indicated that some entrepreneurs “effectuate”: that is, they focus primarily on the resources (means) under their control, and then go through a process of finding goals that can be accomplished with those resources. However, relatively little empirical research has addressed the conditions under which an entrepreneur will use planning and/or effectuation processes in the formation of his/her entrepreneurial team. In this study, we ask “what factors determine whether entrepreneurs follow planning or effectuation processes in forming their entrepreneurial teams?”

Frontiers of Entrepreneurship Research publish 2009  PDF Download
Resources in play: Bricolage in the Toy Store(y) TED BAKER

This paper analyzes the “Toy Store(y)” narrative by imagining the words and perspectives of several participants other than those from whose perspective the original story is told. By applying the lens of bricolage to a series of critical events and activities described in the Toy Store(y), I illustrate the theoretical and practical application of prior research findings on both bricolage and improvisation and extend these to make suggestions for useful future research and teaching in these areas.

Entrepreneurial NarrativeGreif Symposium on Emerging Organizations publish 2007  PDF Download
Response to “Research on the Dark Side of Personality Traits in Entrepreneurship: Observations From an Organizational Behavior Perspective” Danny Miller
Entrepreneurship Theory and Practice publish 2016  PDF Download
Response to Arend et al: Co-Creating Effectual Entrepreneurship Research Saras Sarasvathy
Stuart Read
Nick Dew
Rob Wiltbank
publish  PDF Download
Response to Arend, Sarooghi, and Burkemper (2015): Cocreating Effectual Entrepreneurship Research Saras Sarasvathy
Stuart Read
Nick Dew
Rob Wiltbank
Academy of Management Review publish 2016  PDF Download
Response to the Commentaries: The Individual-Opportunity (IO) Nexus Integrates Objective and Subjective Aspects of Entrepreneurship Scott Shane
JONATHAN T ECKHARDT
Academy of Management Review publish 2013  PDF Download
Returns to Angels In Groups Rob Wiltbank
Warren Boeker

Entrepreneurs and investors regularly wonder what the returns are in angel investing. The completion of this research project provides robust data on this subject that has never before been available. Our findings in this study are based on the largest data set of accredited angel investors collected to date, with information on exits from 539 angels. These investors have experienced 1,137 “exits” (acquisitions or Initial Public Offerings that provided positive returns, or firm closures that led to negative returns) from their venture investments during the last two decades, with most exits occurring since 2004. Analysis of the data revealed important details of the investment outcomes for angel investors connected to angel organizations.

publish 2007  PDF Download
RHS, Inc.: Innovation “Guiding” Agriculture Mark Schenkel
Jane Finley
Wade Chumney
Entrepreneurship Theory and Practice publish 2012  PDF Download
RHS, Inc.: Innovation “Guiding” Agriculture Mark Schenkel
Jane Finley
Wade Chumney

RHS, Inc. presents the story of an agricultural equipment business initially founded in 1980 on Rick Heiniger’s personal experience and desire to improve his financial situation during challenging economic times. Having successfully expanded by leveraging technology through innovation over two decades, and most recently through a partnership with another venture, he now faced issues of how best to integrate the two entities to foster continued future successful growth. Despite his continued enjoyment in the process of building new businesses, he also wondered how his role as a leader would need to evolve.

Entrepreneurship Theory and Practice publish 2012
Risk and rationality in entrepreneurial processes Kent D Miller

This study begins with a historical overview of the connection between risk and rationality. It then broadens beyond this historical trajectory by taking entrepreneurship as a point of departure for understanding risk and rationality. Drawing from the research of Littlechild (1986), Buchanan and Vanberg (1991), and Sarasvathy et al. (2003), this study considers three entrepreneurial processes: opportunity recognition, opportunity discovery, and opportunity creation. Associated with each of these processes are unique conceptualizations of risk and rationality, reflected in distinct research streams. The final section of the study considers implications of the process-contingent nature of risk and rationality, and motivates a broadening of the research agenda from entrepreneurial decision making to practices. Copyright © 2007 Strategic Management Society

Strategic Entrepreneurship Journal publish 2007  PDF Download
Risk, Uncertainty, and Entrepreneurship: Evidence from a Lab-in-the-Field Experiment Martin Koudstaal
Randolph Sloof
Mirjam van Praag

Theory predicts that entrepreneurs have distinct attitudes toward risk and uncertainty, but empirical evidence is mixed. To better understand the unique behavioral characteristics of entrepreneurs and the causes of these mixed results, we perform a large ?lab-in-the-field? experiment comparing entrepreneurs to managers (a suitable comparison group) and employees (n = 2,288). The results indicate that entrepreneurs perceive themselves as less risk averse than managers and employees, in line with common wisdom. However, when using experimental incentivized measures, the differences are subtler. Entrepreneurs are only found to be unique in their lower degree of loss aversion, and not in their risk or ambiguity aversion. This combination of results might be explained by our finding that perceived risk attitude is not only correlated to risk aversion but also to loss aversion. Overall, we therefore suggest using a broader definition of risk that captures this unique feature of entrepreneurs: their willingness to risk losses. This paper was accepted by Uri Gneezy, behavioral economics.

Management Science publish 2015  PDF Download
Risking Enchantment: Meaning Making in Entrepreneurial Narratives effectuation

Meaning making is one of the central functions of entrepreneurial narratives. (Garud & Giuliani, 2013). Yet, the research focusing on the topics of meaning and entrepreneurship has existed largely in parallel. In this symposium, we bring together scholars seeking to understand the meaning and meaningfulness of entrepreneurship (Pratt & Ashforth, 2003; Rosso, Dekas, & Wrzesniewski, 2010), extending research on how entrepreneurs communicate and coordinate to include not only sense giving processes as entrepreneurs attempt to secure resources for a business they are attempting to bring into existence, and deeper questions of significance, as entrepreneurs describe why they have chosen what can be a very difficult and demanding career, and how they ensure that the firms they have created contribute to their overall sense of purpose. The collected papers address meaning making in entrepreneurial narratives across a wide range of contexts and at levels ranging from individual entrepreneurs to entire emerging industries. Entrepreneurial Narratives within a Family-Founded VenturePresenter: Melissa Graebner; The U. of Texas at AustinPresenter: Philip T. Roundy; The U. of Texas at AustinPresenter: Suho Han; The U. of Texas at AustinMeaning and Money: A Qualitative Case Study of How Entrepreneurs Find Meaning in Their WorkPresenter: Rohini Jalan; Cornell U.”Selective Incentives, Entrepreneurshuip and Identity : Toward a Behavioral Theory of Collective Action”Presenter: Jeffrey G. York; U. of Colorado, BoulderPresenter: Saras D. Sarasvathy; U. of VirginiaPresenter: Isobel O’Neil; The U. of NottinghamDeep Impact: the Creation of New Firms and Technologies as a Mean to Leave a LegacyPresenter: Matthew J. Fox; Duke U.

Academy of Management Proceedings publish 2015
Robustness of the Theory of Planned Behavior in Predicting Entrepreneurial Intentions and Actions Teemu Kautonen
Marco van Gelderen
Matthias Fink

This analysis demonstrates the relevance and robustness of the theory of planned behavior in the prediction of business start-up intentions and subsequent behavior based on longitudinal survey data (2011 and 2012; n = 969) from the adult population in Austria and Finland. By doing so, the study addresses two weaknesses in current research: the limited scope of samples used in the majority of prior studies and the scarcity of investigations studying the translation of entrepreneurial intentions into behavior. The paper discusses conceptual and methodological issues related to studying the intention–behavior relationship and outlines avenues for future research.

Entrepreneurship Theory and Practice publish 2015  PDF Download
Roots radical – place, power and practice in punk entrepreneurship Sarah Louise Drakopoulou Dodd

The significance continues to grow of scholarship that embraces critical and contextualized entrepreneurship, seeking rich explorations of diverse entrepreneurship contexts. Following these influences, this study explores the potentialized context of punk entrepreneurship. The Punk Rock band Rancid has a 20-year history of successfully creating independent musical and related creative enterprises from the margins of the music industry. The study draws on artefacts, interviews and videos created by and around Rancid to identify and analyse this example of marginal, alternative entrepreneurship. A three-part analytic frame was applied to analysing these artefacts. Place is critical to Rancid’s enterprise, grounding the band socially, culturally, geographically and politically. Practice also plays an important role with Rancid’s activities encompassing labour, making music, movement and human interactions. The third, and most prevalent, dimension of alterity is that of power which includes data related to dominance, subordination, exclusion, control and liberation. Rancid’s entrepreneurial story is depicted as cycles, not just a linear journey, but following more complicated paths ? from periphery to centre, and back again; returning to roots, whilst trying to move forwards too; grounded in tradition but also radically focused on dramatic change. Paradox, hybridized practices, and the significance of marginal place as a rich resource also emerged from the study.

Entrepreneurship & Regional Development publish 2014  PDF Download
Rule-Based Reasoning for Understanding Opportunity Evaluation David W Williams
Matthew S Wood

Much research on opportunity in entrepreneurship and related fields centers on the origin of opportunities and the actions individuals take to exploit opportunities. However, our understanding of how individuals evaluate opportunities remains fragmented, with research spanning fields of study and using different terminology for similar concepts. Building on recent research suggesting that rule-based reasoning underpins how individuals evaluate opportunities, we integrate and synthesize the literature on opportunity evaluation and suggest rule-based reasoning as an overarching theoretical framework to understand opportunity evaluation across fields of study. Specifically, we illuminate how environmental factors, opportunity-related cues, and individual differences coalesce as one uses these factors as judgment rules to discern the personal attractiveness of an opportunity. Further, we explain how managers and entrepreneurs individuate opportunities, demonstrating why different individuals apply different rules and thus view similar opportunities differently. We conclude with implications of rule-based reasoning for opportunity evaluation across a broad set of management disciplines and offer directions for future research.

The Academy of Management Perspectives publish 2015  PDF Download
SARASVATHIAN EFFECTUATION AND WEICKIAN ENACTMENT IN THE ENTREPRENEURIAL OPPORTUNITY PROCESS (SUMMARY) Sanjay Bhowmick

In the face of uncertainty entrepreneurs effectuate opportunities (Sarasvathy, 2001, 2008). The entrepreneurship literature also suggests that entrepreneurial opportunities are ‘enacted’ (Carter et al., 1996; Gartner et al., 2003), drawing ostensibly from the sensemaking literature of Weick (1979; 1995; 2005 with Sutcliffe & Obstfeld). Are the two concepts related? This theoretical paper explores the similarities, complementarities and differences between Sarasvathian effectuation and Weickian enactment with respect to entrepreneurial opportunity formation, bringing clarity and aiming at concept parsimony in entrepreneurship research.

Frontiers of Entrepreneurship Research publish 2010  PDF Download
Schumpeter’s ‘conduct model of the dynamic entrepreneur’: scope and distinctiveness Anthony Endres
Christine Woods

Schumpeter formulated a ‘conduct model’ of entrepreneurial behaviour. Received wisdom has emphasised the economic functions of Schumpeter’s entrepreneur, neglecting behavioural aspects. Schumpeter’s model is examined; it posits a continuum of behaviours which are ‘entrepreneurial’, that rely on socially situated, tacit knowledge and are expressions of conscious, subjective rationality. Schumpeter’s model excluded unconscious optimisation and decision rules derived from bounded rationality. Comparisons are drawn with modern neoclassical, Austrian, and the older behavioural characterisations of entrepreneurial behaviour. The newer ‘effectuation’ model of entrepreneurial behaviour is also contrasted with Schumpeter’s approach. We find, among other things, that modern Schumpeterian economics associated with Nelson and Winter is not a natural continuation of Schumpeter’s model. However, some developments in neo-Schumpeterian economics, including the effectuation model deriving from the older behavioural tradition, are congruent with both the original ‘conduct model’ and Schumpeter’s directions for further research.

Journal of Evolutionary Economics publish 2010
Search and discovery by repeatedly successful entrepreneurs J O Fiet
W I Norton
V G Clouse

This article examines the use of a model of search by entrepreneurs; for decades they have been advised to remain alert but now, new approaches are more open to effectuation and creation. However, so far none provides guidance regarding how to improve search effectiveness. We report upon a phenomenological investigation of Fiet’s model of constrained, systematic search which offers a prescriptive alternative. In order to test the latter’s effectiveness, 10 participants who started 47 ventures were interviewed. The article presents evidence of its use by these repeatedly successful entrepreneurs, finds support for the model and discusses its limitations and contributions.

International Small Business Journal publish 2013
Selected variation: the population-level implications of multistage selection in entrepreneurship JONATHAN T ECKHARDT
MICHAEL P. CIUCHTA

This article examines the population level implications of microlevel theories of entrepreneurship. The actions of those who seek to organize opportunities, as well as the hurdles that they must overcome to successfully exploit them, give rise to an evolutionary multistage selection process. The article indicates that the consideration of selection events leads to a more complete understanding of the entrepreneurial process and how microlevel theories influence important outcomes in entrepreneurship. Other theoretical and empirical implications of staged selection for research in entrepreneurship are discussed. Copyright © 2008 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2008  PDF Download
Selection and Return in Angel Investments Saras Sarasvathy
Rob Wiltbank

In this paper, we argue that the decision processes used by angels and VCs differ in their cognitive content and overall logic, and that this difference impacts their returns differentially. More precisely, while VCs tend to use a causal approach based on predictive rationality, angels are more effectual and make their choices based on the logic of non-predictive control. This suggests a primary hypothesis for differentials in returns to the two types of investors – i.e., the theory of effectuation predicts that while angels may or may not obtain a higher overall rate of return than VCs, they will obtain a higher hit rate (proportion of investments that survive and succeed). The paper also provides a substantial review of extant theories of private equity financing.

Babson Conference publish 2002  PDF Download
Self-regulation and moral awareness among entrepreneurs. Peter Bryant

Moral awareness underpins moral reasoning and ethical decision making. This mixed methods study investigates a critical feature of these phenomena among entrepreneurs, namely the influence of social cognitive self-regulation on moral awareness. Results suggest that entrepreneurs with stronger self-regulatory characteristics are more morally aware and relate such awareness to maintaining personal integrity and building inter-personal trust. In contrast, entrepreneurs with weaker self-regulatory characteristics appear less morally aware overall, and focus primarily on moral issues relating to failure and loss. I conclude the paper by discussing the implications for future research and practice.

Journal of Business Venturing publish 2009  PDF Download
Seminar on research perspectives in entrepreneurship (1997) Saras Sarasvathy
Journal of Business Venturing publish 2000
Separated by a Common Language? Entrepreneurship Research Across the Atlantic Candida Brush
Tatiana Manolova
LINDA F EDELMAN

While recent inventories and assessments of the entrepreneurship field examine the focus, purpose, and methods, one area receiving less attention is the outcome or dependent variable. The outcome variable is of critical importance in scholarship, as it is a leading indicator of the cumulative nature of the scholarship in our field. This paper reviews 389 articles published over the past 3 years in four top entrepreneurship journals; two published in the United States and two published in Europe. It classifies the scholarship by theoretical underpinnings, independent variables, dependent variables, and then looks at the variation in these by origin of the journal. Results indicate that entrepreneurship researchers are using a wide variety of dependent variables, that the most popular unit of analysis is the firm, and that performance, broadly defined, is the most popular dependent variable. Implications for future research are discussed.

Entrepreneurship Theory and Practice publish 2008  PDF Download
Serendipity in entrepreneurship Nick Dew

This paper addresses the concept of serendipity in entrepreneurship, defined as search leading to unintended discovery. It conceptually delineates serendipity, showing how it is related to the entrepreneurship literature on prior knowledge and systematic search. The paper also discusses how serendipitous entrepreneurship relates to some aspects of evolutionary theory, socio-economic institutions, and social psychology. It is suggested that serendipity may be a quite prevalent feature of entrepreneurship and thus has implications for both research and practice.

Organization Studies publish 2009  PDF Download
Should entrepreneurs plan or just storm the castle? A meta-analysis on contextual factors impacting the business planning-performance relationship in small firms Jan Brinckmann
Dietmar Grichnik
Diana Kapsa

Entrepreneurship research engages in an intense debate about the value of business planning. Prior empirical findings have been fragmented and contradictory. This study contributes insights to the business planning discussion by following an evidence-based research approach. We conduct a meta-analysis on the business planning–performance relationship and specifically focus on contextual factors moderating the relationship. Results indicate that planning is beneficial, yet contextual factors such as newness of the firms and the cultural environment of firms significantly impact the relationship. Based on this evidence, we propose a concomitant and dynamic approach that combines planning and learning.

Journal of Business Venturing publish 2010  PDF Download
Should I stay or should I go? Career choice intentions of students with family business background Thomas Zellweger
Philipp Sieger
Frank Halter

Personal and motivational patterns of intentional founders have been researched in great depth; however, antecedents to career choices of intentional successors have been conspicuously missing in entrepreneurship research. By drawing on theory of planned behavior, we investigate how intentional founders, successors, and employees differ in terms of locus of control and entrepreneurial self-efficacy as well as independence and innovation motives. We find that transitive likelihood of career intent depends on degree of entrepreneurial self-efficacy and the independence motive. Unexpectedly, we see that high levels of internal locus of control lead to a preference of employment, which challenges traditional entrepreneurship research and suggests that the feasibility of an entrepreneurial career path does not automatically make it desirable. Our findings suggest that students with family business background are pessimistic about being in control in an entrepreneurial career, but optimistic about their efficacy to pursue an entrepreneurial career.

Journal of Business Venturing publish 2011  PDF Download
Should We Require Every New Venture to Be a Hybrid Organization? Jeffery McMullen
Benjamin J. Warnick

Critics of entrepreneurial capitalism have argued that entrepreneurship creates dysfunction in individuals, families, communities, and society because entrepreneurs neglect social and environmental dimensions of value in favour of financial value creation. By way of contrast, hybrid organizations, such as Benefit Corporations, are created explicitly to address social and environmental objectives in addition to their financial objective. Therefore, in this paper we explore the consequences of a world of blended value in which every new venture is required to be a hybrid organization. In doing so, we reveal the boundary conditions of current social criticism levied against entrepreneurship and suggest that blended value may best be relegated to the role of ideal or guideline as opposed to normative or legal obligation.

Journal of Management Studies publish 2016  PDF Download
Siding with the Angels – Business Angel Investing: Promising Outcomes and Effective Strategies Rob Wiltbank

After entrepreneurs develop an opportunity, and use up their own resources, they often turn to business angel investors for early investment to keep the venture growing. At this point in the development of new ventures the risk of failure is significant; many aspects of the business including customer relationships, pricing strategy, talent, and other key factors are quite unclear. Yet there are a growing number of investors known as ‘business angels’ willing to invest at this point. They have become an increasingly important source of equity finance over the last decade for new and nascent businesses as venture capital investors are not able to accommodate a large number of small deals with their attendant due diligence and oversight needs. Business angels are now prominent co- investment partners in the early-stage market. Understanding why investors would involve themselves in anything so risky is important, given the contribution of innovative start-up businesses to the economy. Although there is no comprehensive survey of business angel activity available, an estimated 4,000 to 6,000 business angels were investing up to £1 billion annually by 2000. Despite their increasing importance, little is known about the outcomes of business angel investment and returns in the UK. Mason and Harrison5 conducted the first attempt to identify the returns and characteristics of the UK business angel investors, pointing out the lack of evidence on the outcomes of investments by business angels. They suggested that this “represents a significant gap in our knowledge and understanding of an important segment of the venture capital market”.

NESTA / British Angels Business Association publish 2009  PDF Download
Signifying Williamson’s Contribution to the Transaction Cost Approach: An Agent-Based Simulation of Coasean Transaction Costs and Specialization Per L. Bylund

This article simulates Ronald Coase’s transaction cost approach to firm organizing using agent-based modelling, and contextualizes and contrasts it with a division-of-labour/specialization view of the firm that Coase challenged and sought to replace. The simulation tests the firm formation process based on the different implications of transaction costs and specialization as drivers of integration, focusing especially on Coase’s rejection of specialization as an explanation for integration in the firm. The results show little support for, and suggest an important shortcoming to, Coase’s transaction cost theory. My findings thereby indicate a potential relationship between the specialization theory and Williamson’s Transaction Cost Economics, especially the latter’s emphasis on co-specialization through relationship-specific investments, which helps shed light on TCE’s significant influence in the theory of the firm literature.

Journal of Management Studies publish 2015  PDF Download
Simon on Altruism, Near Decomposability, and Design: Extensions on a Behavioral Theory of Strategic Management Saras Sarasvathy
Mie Augier

This paper develops a view of strategic management that is based on the ideas of Herbert Simon in particular, and insights from the behavioral theory of the firm in general. Building on certain well-received elements of his work in strategy, we add implications from his other (rather under-studied) work, especially on altruism, near-decomposability, and design. Each of these fills an important gap at the individual, organizational, and environmental levels of analysis in mainstream strategic management theorizing today. We argue that these three extensions, when integrated, can re-shape future scholarship in strategic management in a manner consistent with key results both from the dynamic capabilities view, and the resource based view.

LINKS Conference Copenhagen publish 2002  PDF Download
SIMULATING THE CLASH OF EFFECTUAL AND CAUSAL PROCESSES: INVESTIGATING CONDITIONS & BOUNDARIES FOR MARKET SUCCESS (SUMMARY) Jan Schlueter
Malte Brettel

Since Sarasvathy’s seminal publication (2001), research on the effectuation theory has proceeded to detailing elements, differentiation from extant theories, and lately first empirical investigations (e.g., Sarasvathy & Dew, 2008). Initial studies linking effectuation to performance in specific environments such as new ventures or business angel investments have shown empirical evidence of a positive performance impact (e.g., Wiltbank et al., 2008; Read et al., 2009). However, limited progress has been made in comprehensively investigating the critical question under what circumstances which strategy provides particular advantages and disadvantages (Sarasvathy, 2001), leaving requirements and boundaries for normative superiority still largely unknown (Chandler et al., 2009). In order to investigate this issue, we examine a set of conditions and success factors for effectual vs. causal artifact creation by employing agent-based simulation experiments. This study examines effectual and causal processes in the formal environment of computer simulation. We model the strategies and an environment including performance measures and uncertainty elements and assess performance for different uncertainty levels. More specifically, we seek to formally investigate specific boundaries of the “effectual problem space” (Sarasvathy, 2001) for an artifact creation task (Sarasvathy & Dew, 2005) and a pay-off landscape driven by fit with market preferences.

Frontiers of Entrepreneurship Research publish 2011  PDF Download
Simultaneous Experimentation as a Learning Strategy: Business Model Development Under Uncertainty Petra Andries
KOENRAAD DEBACKERE
Bart Van Looy

Ventures operating under uncertainty face challenges defining a sustainable value proposition. Six longitudinal case studies reveal two approaches to business model development: focused commitment and simultaneous experimentation. While focused commitment positively affects initial growth, this commitment and lack of variety jeopardize long-term survival. Simultaneous experimentation implies lower initial growth levels, but facilitates long-term survival by enacting variety in a resource-effective manner. This article enriches organizational learning theory by demonstrating that not only distant search but also simultaneous experimentation results in variety. Moreover, simultaneous experimentation implies effectual behavior and reconciles the apparent juxtaposition between ‘action’ and ‘planning.’ Copyright © 2013 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2013  PDF Download
Social Bricolage: Theorizing Social Value Creation in Social Enterprises Di Domenico MariaLaura
Helen Haugh
Tracey, Paul

Current theorizations of bricolage in entrepreneurship studies require refinement and development to be used as a theoretical framework for social entrepreneurship. Our analysis traces bricolage’s conceptual underpinnings from various disciplines, identifying its key constructs as making do, a refusal to be constrained by limitations, and improvisation. Although these characteristics appear to epitomize the process of creating social enterprises, our research identifies three further constructs associated with social entrepreneurship: social value creation, stakeholder participation, and persuasion. Using data from a qualitative study of eight U.K. social enterprises, we apply the bricolage concept to social entrepreneurial action and propose an extended theoretical framework of social bricolage.

Academy of Management Conference Entrepreneurship Theory and Practice publish 2010  PDF Download
Social Capital and Venture Development in a Low-Trust Environment Julia Ivy
Joanne Larty
Sarah Jack

This study investigates the relevance of social capital for entrepreneur-actor relationships in the development of sustainably operating ventures in the low-trust environment. The study reveals the following: (a) social capital can serve as an asset, access to opportunities, protection, or be a danger for ventures; (b) entrepreneurs are highly selective in whom they deal with; (c) their selectivity is framed with the “whom can I trust” and “whom I should know” justification; (d) they apply verification for continuing adjustment of the entrepreneur-actor relationship strategies to social and economic reality of venture operations. The study presents five strategies of entrepreneur-actor relationships in a low-trust environment.

Academy of Management Proceedings publish 2014
Social Enterprise Emergence from Social Movement Activism: The Fairphone Case ONA AKEMU
Gail Whiteman
Steve Kennedy

Effectuation theory invests agency – intention and purposeful enactment – for new venture creation in the entrepreneurial actor(s). Based on the results of a 15-month in-depth longitudinal case study of Amsterdam-based social enterprise Fairphone, we argue that effectual entrepreneurial agency is co-constituted by distributed agency, the proactive conferral of material resources and legitimacy to an eventual entrepreneur by heterogeneous actors external to the new venture. We show how in the context of social movement activism, an effectual network pre-committed resources to an inchoate social enterprise to produce a material artefact because it embodied the moral values of network members. We develop a model of social enterprise emergence based on these findings. We theorize the role of material artefacts in effectuation theory and suggest that, in the case, the artefact served as a boundary object, present in multiple social words and triggering commitment from actors not governed by hierarchical arrangements.

Journal of Management Studies publish 2016  PDF Download
Social Entrepreneurs as Institutionally Embedded Entrepreneurs: Toward a New Model of Social Entrepreneurship Education ANNE-CLAIRE PACHE
IMRAN CHOWDHURY

Building upon recent developments in entrepreneurship education, we propose a novel framework for social entrepreneurship education founded upon a conception of social entrepreneurs as entrepreneurs embedded in competing institutional logics. Our model, in addition to teaching students “about” social entrepreneurship to allow them to acquire the knowledge and expertise required to successfully engage in social entrepreneurial activities, proposes to educate students “for” social entrepreneurship, by allowing them to acquire the skill of bridging three distinct and sometimes competing institutional logics: the social-welfare logic, the commercial logic, and the public-sector logic. To achieve this goal, we propose that social entrepreneurship education needs to make students aware of these different logics, to allow them to enact these competing logics and to enable them to combine logics when necessary to create innovative hybrid strategies. We explore how this overall strategy can be achieved by highlighting how various pedagogical tools can be adapted to contribute to each step.

Academy of Management Learning & Education publish 2012  PDF Download
Social Entrepreneurship: A Critique and Future Directions M. Tina Dacin
Peter A. Dacin
Tracey, Paul

Work on social entrepreneurship constitutes a field of study that intersects a number of domains, including entrepreneurial studies, social innovation, and nonprofit management. Scholars are beginning to contribute to the development of this new discipline through efforts that attempt to trace the emergence of social entrepreneurship as well as by comparing it to other organizational activities such as conventional entrepreneurship. However, as a nascent field, social entrepreneurship scholars are in the midst of a number of debates involving definitional and conceptual clarity, boundaries of the field, and a struggle to arrive at a set of relevant and meaningful research questions. This paper examines the promise of social entrepreneurship as a domain of inquiry and suggests a number of research areas and research questions for future study.mi

Organization Science publish 2011  PDF Download
Social interaction via new social media: (How) can interactions on Twitter affect effectual thinking and behavior? Eileen Fischer
Becky Reuber

Social interaction plays a central role in effectuation processes, yet we know little about the implications for effectuation when an entrepreneur interacts via particular channels such as social media. To address this gap, our paper uses an inductive, theory-building methodology to develop propositions regarding how effectuation processes are impacted when entrepreneurs adopt Twitter. Twitter is a microblogging platform that can facilitate a marked increase in interaction. We posit that Twitter-based interaction can trigger effectual cognitions, but that high levels of interaction via this medium can lead to effectual churn. We also posit that there is one factor, perceived time affordability, that predicts the level of social interaction in which an entrepreneur engages via Twitter. Further, we propose two factors that moderate the consequences of social interaction through Twitter. These factors are community orientation and community norm adherence. Implications for our understanding of effectuation, of social interaction, and of the impact of social media on entrepreneurial firms are discussed.

Journal of Business Venturing publish 2011  PDF Download
Social networks and opportunity recognition: A cultural comparison between Taiwan and the United States RONG MA
YEN CHIH HUANG
ODED SHENKAR

This paper investigates the moderating effect of national cultural contexts on the relationship between social networks and opportunity recognition. Data obtained from Taiwan and the United States support the proposition that cultural contexts, specifically the individualism-collectivism dimension, moderate the relationship between tie strength, structural holes, and opportunity recognition. Results indicate that in the United States, tie strength is negatively associated with opportunity identification and structural holes are positively associated with opportunity identification; whereas in Taiwan we find the opposite. The results also show that the interaction effect between bridging ties and tie strength on opportunity recognition varies depending on the cultural context. Copyright © 2011 John Wiley & Sons, Ltd.

Strategic Management Journal publish 2011  PDF Download
Social structure, reasonable gain, and entrepreneurship in Africa GERARD GEORGE
reddi kotha
PRITI PARIKH
TUFOOL ALNUAIMI
ABUBAKR S. BAHAJ

In the context of desperate poverty, characterized by households at subsistence level that experience economic loss and social fracture, explanations for why individuals undertake entry into entrepreneurship are limited. We find that individuals rely on their social relationships to enable entrepreneurial activities that have the potential to create a reasonable income gain. In a sample of 1,049 households in rural Kenya, we test whether the disintegration of social structure attenuates entrepreneurial behavior. When coupled with factors such as income loss, gender of the household head, and access to communal resources, social structure plays a pivotal role in entrepreneurial action. We propose that the search for reasonable income gain is a key driver of entrepreneurial action at subsistence levels, thereby adding to behavioral explanations of entrepreneurship. Copyright © 2015 John Wiley & Sons, Ltd.

Strategic Management Journal publish 2016  PDF Download
Social trust and angel investors’ decisions: A multilevel analysis across nations Zhujun Ding
Kevin Au
Flora Chiang

Abstract The decisions made by angel investors are embedded in and influenced by their institutional settings. This paper advances a multilevel model of the direct and indirect effects of social trust on individuals’ angel-investment decisions. It is postulated that two dimensions of social trust, namely the level and radius, can enhance information transmission, collaboration, and sanctioning mechanisms within a society. Consequently, they facilitate angel investment and moderate the relationship between it and individual factors. A multilevel model of data from 191,907 individuals across 25 countries shows that individuals in countries with a high level of trust are more likely to make angel investments. Whereas both the level of trust and the radius of trust are found to heighten the positive relationship between an individual’s perceived entrepreneurial skills and angel investment, it is interesting to note that these factors weaken the relationship between the perception of new business opportunities and angel investment. These direct and moderating effects are robust after controlling for wealth, cultural values, and other factors. This study contributes to the crossover between research on entrepreneurship and social-trust research.

Journal of Business Venturing publish 2015  PDF Download
Socially Situated Cognition: Imagining New Opportunities for Entrepreneurship Research Ronald Mitchell
Randolph-Seng Brandon
J. Robert Mitchell
Academy of Management Review publish 2011  PDF Download
Some reflection on research ‘Schools’ and geographies Per Davidsson

Reflecting on real and perceived differences between European and North American research cultures, I challenge views that ?European? research is under appreciated or discriminated against, and caution against isolationist European positions. Instead, I argue that although no distinctive and coherent European tradition or culture really exists, there may be elements of the prevalent research culture that can be turned into an advantage for Europe-based and/or European-trained researchers in helping to influence and improve one, global research conversation. Of course, a range of sub-communities and sub-conversations will and should exist, but there is no reason for these to be based on geography.

Entrepreneurship & Regional Development publish 2013  PDF Download
Stakeholders and Marketing Capabilities in International New Ventures: Evidence from Ireland, Sweden and Denmark Natasha Evers
Svante Andersson
Martin Hannibal
Journal of International Marketing publish 2012  PDF Download
Start-Up Difficulties in Early-Stage Peripheral Clusters: The Case of IT in an Emerging Economy Edward Kasabov

This paper studies the link between firm-level predicaments in high-technology start-ups and collective, cluster-level dynamics in early-stage peripheral locations. We investigate, first, the manner in which high-technology start-ups in early stage peripheral clusters accumulate and utilize resources; second, ways in which managers in start-up businesses and public sector officials work around inadequacies in order to move forward clusters composed mostly of high-technology start-ups; and third, the influence of such experiences on the development of clusters. Empirical findings from three IT clusters in Vietnam reveal resource inadequacies, private sector actors’ inability to resolve such shortcomings, entrepreneurial passivity, risk aversion, and lack of confidence in governmental initiatives. These findings and the comparison with earlier studies about start-up difficulties in other high-technology peripheral locations form the basis for a theoretical framework of high-technology start-up difficulties in early-stage peripheral clusters.

Entrepreneurship Theory and Practice publish 2015  PDF Download
Start-Up Social Ventures: Blending Fine-Grained Behaviors From Two Institutions for Entrepreneurial Success Aparna Katre
Paul Salipante

Social entrepreneurs develop market-driven ventures to produce social change; some succeed while others fail. This research advances our understanding of start-up behaviors of ventures that span nonprofit and for-profit institutional boundaries. A rigorous qualitative study of 23 social ventures reveals that entrepreneurs employ a blend of nonprofit and business venture behaviors, suggesting the importance of contextual factors. Only selective behaviors from each institution differentiate the successful from the struggling ventures. But while the higher level organizing tasks and activities of successful and struggling ventures may appear similar, fine-grained analyses of their behaviors show stark differences, emphasizing the need for such analyses.

Entrepreneurship Theory and Practice publish 2012  PDF Download
Strategic Decision-Making of a Born Global: A Comparative Study From Three Small Open Economies N Nummela
S Saarenketo
P Jokela
S Loane

This paper extends current understanding on international growth process of born global firms from the perspective of strategic decision-making. The data were collected from three software companies in Finland, Ireland and Israel both in real-time and retrospectively, and data triangulation was employed to increase the validity of the findings. With a longitudinal approach, we captured the dynamics of the post-entry international growth process and the critical events that act as decision-making triggers. The decision-making of born global firms seems to be characterised by alternating periods of causation- and effectuation-based logics. Triggers for amending the logic include, for example, change of key persons and the search for external funding. Co-existence of the two decision-making logics is possible, due to different degrees of uncertainty in market and technology or multiple decision-makers involved. The contribution of the study is threefold: first, it addresses gaps in international entrepreneurship research by describing how born global firms make strategic decisions and who are involved in the decision-making. Second, it identifies critical incidents which trigger a change in the decision-making process of a born global firm. Third, it provides alternative insights to why decision-making logic may change or why two decision-making logics may co-exist.

Management International Review publish 2014
Strategic Entrepreneurial Networks effectuation

The purpose of this panel is to pool scholars of repute in the field of entrepreneurship and strategy to raise several questions that could be of interest in advancing research on Strategic Entrepreneruial Networks.

Academy of Management Proceedings publish 2013
Strategic Entrepreneurship at Universities: Academic Entrepreneurs’ Assessment of Policy Programs Holger Patzelt
Dean Shepherd

In this article we draw on goal-setting theory to analyze how and why entrepreneurs perceive the usefulness of policy programs aimed at facilitating the development of academic ventures. Using a conjoint study and data on 3,136 assessments nested within 98 academic entrepreneurs, we find that access to finance offered by a policy program is central and enhances the entrepreneurs’ perceived benefits of other policy measures such as providing access to nonfinancial resources (networks, business knowledge) and reducing administrative burdens, but diminishes the perceived benefits of offering tax incentives for new ventures. Our results extend the literature on academic entrepreneurship and entrepreneurs’ assessments of government policy measures. For policy makers, our study suggests that the simultaneous launch of policy measures may be perceived by academic entrepreneurs as particularly beneficial for fostering the development of their young ventures.

Entrepreneurship Theory and Practice publish 2009  PDF Download
Strategic Entrepreneurship: Creating Value for Individuals, Organizations, and Society Michael A Hitt
R Duane Ireland
David Sirmon
Cheryl A. Trahms

The foci of strategic entrepreneurship (SE) are broad and rich, building on research from multiple disciplines such as economics, psychology, and sociology, along with other subdisciplines in management including organizational behavior and organization theory. Herein, we examine the contributions of strategic management and entrepreneurship to SE. Building on a previous model of SE, we develop an input-process-output model to extend our understanding of the SE construct. We examine the resource inputs into SE, such as individual knowledge and skills. In addition, we explore the resource orchestration processes that are important for SE and the outcomes, including creating value for customers, building wealth for stockholders, and creating benefits for other stakeholders, especially for society at large. Individual entrepreneurs also benefit through financial wealth, but other outcomes such as personal satisfaction and fulfillment of personal needs (e.g., self-actualization) may be of equal or even greater importance. Therefore, we incorporate in the model of SE multilevel outcomes that motivate entrepreneurs.

The Academy of Management Perspectives publish 2011  PDF Download
Strategic entrepreneurship: entrepreneurial strategies for wealth creation Michael A Hitt
R Duane Ireland
S. MICHAEL CAMP
DONALD L SEXTON

Entrepreneurship involves identifying and exploiting entrepreneurial opportunities. However, to create the most value entrepreneurial firms also need to act strategically. This calls for an integration of entrepreneurial and strategic thinking. We explore this strategic entrepreneurship in several important organizational domains to include external networks and alliances, resources and organizational learning, innovation and internationalization. The research in this special issue examines both traditional (e.g., contingency theory, strategic fit) and new theory (e.g., cultural entrepreneurship, business model drivers). The research also integrates, extends, and tests theory and research from entrepreneurship and strategic management in new ways such as creative destruction (discontinuities), resource-based view, organizational learning, network theory, transaction costs and institutional theory. The research presented herein provides a basis for future research on strategic entrepreneurship for wealth creation. Copyright © 2001 John Wiley & Sons, Ltd.

Strategic Management Journal publish 2001  PDF Download
Strategic repertoire variety and new venture growth: The moderating effects of origin and industry dynamism BARBARA LARRANETA
Shaker A. Zahra
JOSELUIS GALAN GONZALEZ

New ventures (companies eight years or younger) face an important choice in attempting to achieve growth: Should they follow “strategic simplicity” by relying on a few similar competitive actions, or emphasize “strategic variety” by implementing multiple different competitive actions? Data from 140 new ventures in Spain suggest that new ventures benefit from pursuing strategic variety, especially when their industries are highly dynamic. Further, although new ventures in general gain from strategic variety in highly dynamic industries, independently owned ventures achieve higher growth rates than their corporate counterparts. Copyright © 2013 John Wiley & Sons, Ltd.

Strategic Management Journal publish 2014  PDF Download
Strategic thinking: intelligent opportunism and emergent strategy–the case of Strategic Engineering Services Steven Pattinson

This case study focuses on strategic thinking and opportunistic approaches to business growth and diversification. It begins by examining the recent purchase of ‘Quickcover’, a remote-controlled sports pitch covering system, by engineering company Strategic Engineering Services and the company’s current dilemma – whether to continue to develop this type of product, or sell it and concentrate on its existing engineering services business. In recent years, Strategic Engineering Services has moved away from traditional heavy engineering and diversified into related areas such as engineering services, oil and gas industry recruitment, plant and equipment hire, instrument calibration and project management. The case considers the relationship between strategic thinking and entrepreneurial approaches to opportunity recognition, exploring the concept of intelligent opportunism as an approach that enables entrepreneurs to develop emergent strategies and take advantage of new opportunities. It explores these concepts in the context of the current dilemma of Strategic Engineering Services.

The International Journal of Entrepreneurship and Innovation publish 2016  PDF Download
Strategy and Entrepreneurship: Outlines of an Untold Story Saras Sarasvathy
S. Venkataraman

In their 1994 book, Rumelt, Schendel, and Teece identify four fundamental issues that comprise a research agenda in strategic management: (1) How do firms behave? (2) Why are firms different? (3) What limits the scope of the firm? (4) What determines success or failure in international competition? In answering the four questions stated above, economics and strategic management theories generally tend to focus on rational decision making (whether unbounded or bounded and linear or non-linear) based on causal reasoning and the logic of prediction. Based on effectual reasoning and the logic of control, we provide alternative answers to these four fundamental issues in strategy. These new answers together connect strategy and entrepreneurship in a new synthesis.

Handbook of Strategic Management publish 2001  PDF Download
Strategy and Entrepreneurship: Outlines of an untold story. Saras Sarasvathy
S. Venkataraman

In his book “Invention,” Professor Norbert Wiener (1993), commenting on the relative importance accorded to individuals and institutions in historical narratives of science and inventions, asks us to imagine Shakespeare’s “Romeo and Juliet” without either Romeo or the balcony. The story is just not the same. He likens much of the study of the economic history of science and accounts of inventions as “all balcony and no Romeo.” The balcony for Norbert Weiner captures the context in which the story unfolds – the culture, the institutions, the constraints and the catalysts that move the plot forward and thicken it. Romeos, for Weiner, play the leading parts in the story, because there is a strong fortuitous element to inventions and there is no inevitability that a possible discovery will be made at a given time and space. Take away either one, Romeo or the balcony, and the whole story falls apart. In a similar vein, we would liken studies of strategy to “all balcony and no Romeo.” But if we accuse strategy of being “all balcony and no Romeo,” strategy scholars could legitimately accuse entrepreneurship of being “all Romeo and no balcony.” In this paper we wish to suggest a point of view from entrepreneurship that will allow strategy scholars to accommodate more Romeos in their stories. Although these two fields have much to offer each other (trade in balconies and Romeos), they have developed largely independent of each other. We wish to suggest that entrepreneurship has a role to play in strategy theory and that strategy theory enriches our understanding of the entrepreneurial process, although this latter aspect will not be the focus of this paper.

publish 2001
STRATEGY FORMATION OF ENTREPRENEURIAL TEAMS: A LONGITUDINAL STUDY IN NASCENT VENTURES (SUMMARY) Dietmar Grichnik
Jan Brinckmann
Diana Kapsa

Explanations for how entrepreneurs deal with uncertainty and develop their strategies can be found in two streams of literature: the entrepreneurial strategy literature and the entrepreneurial cognition literature. Recent research in these fields suggests that focusing on the individual level of the nascent entrepreneur and taking a cognition-based approach might be beneficial for understanding first-time strategy formation. Our study is concerned with one central question concerning first-time formation of a strategic mindset at the individual level. How does a strategic mindset come into existence at early stages of the entrepreneurial process? We analyze whether and how strategic mindsets come into existence focusing on three aspects: the extent of prediction orientation (Wiltbank et al., 2006; Sarasvathy, 2001), the extent to which the entrepreneur focuses on risk limitation as opposed to return maximization, i.e. the risk-return orientation (Sarasvathy et al., 1998; Sarasvathy, 2007; Dew et al., 2008; Sarasvathy, 2003), and the extent of strategic flexibility (Nicholls-Nixon, Cooper, 2000).

Frontiers of Entrepreneurship Research publish 2009  PDF Download
Strategy making, novelty and analogical reasoning – commentary on Gavetti, Levinthal, and Rivkin (2005). Moshe Farjoun

This commentary responds to and builds upon a recent article about the role of analogical reasoning in strategy making (Gavetti, Levinthal, and Rivkin, 2005). Based on conceptual and formal analysis, the authors state that in complex and novel contexts, analogical reasoning may be superior to two established models: rational choice and local incremental search. I show that given an alternative conceptualization of the strategy-making context and main models, analogical reasoning is not necessarily superior. Furthermore, in novel and complex contexts, this model and other approaches such as mental experimentation can play a larger role, particularly in inventing effective strategies. I further extend the analysis by considering some boundary conditions in which analogical reasoning and its alternatives best apply, exploring the idea that blending and adapting several search strategies may be more effective than using only one method, such as analogical reasoning, and advancing new directions for empirical research. Copyright © 2008 John Wiley & Sons, Ltd.

Strategic Management Journal publish 2008  PDF Download
Structure from Chaos: The Creation of Libyan Civil Society nada basir
ellen auster

We explore the resources, actors and processes involved in the rapid emergence of civil society in Libya after the fall of a dictator regime. We conceptualize this context as one of institutional chaos, where political oppression suppressed civil society institutions, and the revolution then created an upheaval, a moment of instability and unpredictability. A multi-level process framework emerged from the findings, highlighting the important role of institutional brokers, actors embedded in multiple established institutions and the emerging field. These institutional brokers link actors and also transform ideas from other fields. We found that brokers engaged in a process of creative translation, recombining, transposing, and recasting institutional resources from other fields. However, once the resources were at play in the emerging field, brokers faced resistance, a not-invented-here syndrome. To overcome this barrier, brokers engaged in collaborative transmission, creating spaces to develop shared meanings and practices with grassroots organizations. This research contributes to our understanding of institutional work required in different contexts, and addresses a grand challenge of our time-creation of civil society after extreme political oppression.

Academy of Management Proceedings publish 2016  PDF Download
Studying the Origins of Social Entrepreneurship: Compassion and the Role of Embedded Agency Matthew Grimes
Jeffery McMullen
TIMOTHY J. HARGRAVE
Toyah L. Miller
Academy of Management Review publish 2013  PDF Download
Succession Narratives in Family Business: The Case of Alessi Elena Dalpiaz
Tracey, Paul
Nelson Phillips

One of the most significant challenges facing family firms is how to successfully manage succession from one generation of leaders to the next. In this paper, we contribute to existing understandings of this complex and difficult process by exploring how successors use family business succession narratives to legitimate their succession. Building on a case study of Alessi, a family-owned Italian design firm, we draw on the literature on organizational narratives to develop a framework for understanding family business succession narratives and present a typology of some of the narrative strategies that can be used during succession. We conclude with a discussion of the theoretical and practical ramifications of a narrative view of succession in family firms.

Entrepreneurship Theory and Practice publish 2014  PDF Download
Sustainability-driven entrepreneurship: Principles of organization design Bradley D. Parrish

Concern about whether the social–ecological processes that provide for human wellbeing can be sustained has given rise to sustainable development as a broad social goal. As a dynamic force for change, entrepreneurship is increasingly expected to contribute to this goal. This article reports on the results of an intensive empirical study investigating the organization design expertise necessary for sustainability-driven entrepreneurs to succeed in a competitive market context. Results reveal five principles of organization design that diverge in important ways from the conventional principles of entrepreneurship, suggesting the expertise required for venture success differs depending on entrepreneurial values and motives.

Sustainable Development and Entrepreneurship publish 2010  PDF Download
Sustainable development and entrepreneurship: Past contributions and future directions. Jeremy Hall
Gregory Daneke
Michael Lenox

This article discusses the emerging research concerned with sustainable development and entrepreneurship, which is the focus of this special issue of the Journal of Business Venturing. Entrepreneurship has been recognized as a major conduit for sustainable products and processes, and new ventures are being held up as a panacea for many social and environmental concerns. However, there remains considerable uncertainty regarding the nature of entrepreneurship’s role and how it may unfold. We begin with an overview of sustainable development and the role of entrepreneurship and outline recent contributions exploring this role. We then summarize the papers presented in this special issue and conclude with suggestions for further research.

Journal of Business Venturing publish 2010  PDF Download
Sustaining Actor Engagement During the Opportunity Development Process YULIYA SNIHUR
B. SEBASTIAN REICHE
ERIC QUINTANE

Research summary Recent entrepreneurship research has examined how opportunities are developed, highlighting the engagement of external actors. However, we know little about how entrepreneurs should interact with external actors to sustain their engagement. Since opportunity development is a process that unfolds over time, sustaining actor engagement is critical because it enables continued feedback and access to actors’ resources. We present a process model that explains how entrepreneurs can sustain external actor engagement through two iterative phases: translation and transformation. We also propose that entrepreneurs can sustain actor engagement by structuring the timing of interactions and by modifying actors’ perceptions of the time available for novel opportunity development. We conclude with an agenda for future research on actor engagement and entrepreneurs’ temporal capabilities. Managerial summary To develop business opportunities, entrepreneurs require support, feedback, and other resources from different groups of individuals (actors), such as customers, business partners, investors, and regulators. We explain how entrepreneurs should continue to interact with these actors throughout the development period to secure sustained access to resources. Entrepreneurs need to present the business opportunity to actors in an engaging way, and subsequently integrate the feedback received during development of the project. Sustaining engagement from actors involves an iterative process through which the business opportunity is communicated and transformed. Entrepreneurs can influence actors’ engagement by choosing how and when to interact with them. We highlight time and actor feedback as important resources that can be used by skillful entrepreneurs to increase the odds of opportunity development success. Copyright © 2016 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2017  PDF Download
Swinging a double-edged sword: The effect of slack on entrepreneurial management and growth Steve W Bradley
Johan Wiklund
Shepherd Dhliwayo

Resource slack represents a double-edged sword, simultaneously fueling and hindering growth. Drawing on Penrose’s growth theory and Stevenson’s entrepreneurial management theory, we have developed and tested a conceptual model that provides a more nuanced account of the resource slack-growth relationship. Using a large dataset spanning six years, we have found that slack has a positive direct effect on growth but a negative effect on entrepreneurial management, and that entrepreneurial management has a positive effect on growth. Our empirical and conceptual findings are important to the development of firm growth theory and explicate causal mechanisms transforming slack into firm-level outcomes.

Journal of Business Venturing publish 2011  PDF Download
Team Conflict contributing to Entrepreneurial Learning: understanding conflict as positive within an Effectual Problem Space C Butler
K Middleton

The impact of team conflict seems to depend upon context. Entrepreneurship literature suggests that learning from diverse perspectives in teams can contribute to entrepreneurial action (Harper 2008; West III, 2007; Williams-Middleton, 2010), while management literature has shown that conflict in teams often negatively affects creativity (Jehn et al., 2010). Recent research streams suggest that entrepreneurial learning might be better understood by applying an effectual logic perspective, instead of causal logic (Sarasvathy and Venkataraman, 2011). This causes us to question whether conflict is experienced similarly in entrepreneurial versus managerial teams. We suggest negative consequences of team conflict found in management literature may be due to the causal logic underlying this literature, and thus not readily applicable to entrepreneurial learning. Through exploring relationships between team work, team conflict, and effectuation, we propose that positive learning outcomes can emerge from experience of team conflict within an effectual and uncertain problem space.

International Entrepreneurship and Management Journal publish 2014
TEAMS IN THE ENTREPRENEURIAL PROCESS: AN INPUT-MEDIATOR-OUTPUT-INPUT (IMOI) APPROACH. CHIEN-SHENG RICHARD CHAN

The article presents an analysis of the ways in which entrepreneurial team dynamics are affected by factors such as environmental uncertainty and changes in team composition. A discussion of related research is provided, along with a set of propositions and hypotheses related to such studies. Recommendations for entrepreneurial team leadership are proposed. It is argued that optimal outcomes can best be achieved by focusing on the controllable aspects of both internal and external conditions. The importance of distinguishing between optimizing for initial conditions and optimizing for an established venture is stressed.

Academy of Management Proceedings publish 2009  PDF Download
TECHNOLOGY & INNOVATION MANAGEMENT Conference Paper Abstracts. effectuation

The article presents abstracts concerning issues related to technology and innovation management. They include “A Collective Action Model of Strategic Responses to the Mandatory Adoption of Open Document Format,” “A Dialectical Model of Organizational Loose Coupling: Modularity, Integration, and Innovation,” and “A Dynamic Capabilities Perspective on Innovation Management Practices.”

Academy of Management Proceedings publish 2007
Technology-Market Combinations and the Identification of Entrepreneurial Opportunities: An Investigation of the Opportunity-Individual Nexus Dean Shepherd
Denis Gregoire

Although prior research has highlighted that individuals differ in their ability to identify opportunities for entrepreneurial action, little attention has been paid to the effects that differences among opportunities may have on their initial identification. Integrating theoretical work on the nature of entrepreneurial opportunities with cognitive science research on the use of similarity comparisons in making creative mental leaps, we develop a model of opportunity identification that includes both the independent effects of an opportunity idea’s similarity characteristics and the interaction of these characteristics with an individual’s knowledge and motivation. We test this model with a within-subject experiment in which we asked two samples of entrepreneurs to form beliefs about opportunity ideas for technology transfer. Results indicate that the superficial and structural similarities of technology-market combinations impact the formation of opportunity beliefs and that individual differences in prior knowledge and entrepreneurial intent moderate these relationships. In addition to casting light on cognitive reasons why some entrepreneurial opportunities may be more or less difficult to identify, our theorizing and findings point toward reasoning strategies that may facilitate the identification of multiple (and potentially more valuable) opportunities, not only for new technologies, but also for new products, services, and/or business models.

Academy of Management Journal publish 2012  PDF Download
Testing management theories: critical realist philosophy and research methods Kent D Miller
Eric W. K. Tsang

This study identifies the practical and philosophical difficulties associated with testing strategic management and organization theories. Working from a critical realist perspective, we affirm the importance of falsification and verification efforts for progress in theory development. We advocate a four-step approach for advancing theory testing that prioritizes identifying and testing for the presence and effects of hypothesized causal mechanisms, rather than solely focusing on correlational methods to jointly test the set of effects composing a theoretical system. Going beyond prior critical realist writings, we provide practical guidance for deploying established research methods to test management theories. Copyright © 2010 John Wiley & Sons, Ltd.

Strategic Management Journal publish 2011  PDF Download
Text-analytic measurement of effectuation and causation orientations among small and global business managers. Helge Helmersson
J Mattsson

We demonstrate how one can measure overall quality in texts gathered from interviews by means of PERTEX text analytic method. We compare text analytic measures and content for locally active Scandinavian small business managers and globally operating Indian IT managers when recapitulating the reasons behind company growth. Using Ward’s clustering method (J Am Stat Assoc 58:236–244, 1963) on a binary matrix for connections between textual components, we suggest using the ESS value from clustering to calculate AFFI as an overall measure of quality. By further splitting the AFFI into three sub-components we are also able to display the degree of fragmentation, focus and integration in the text. We show how AFFI measures differ between managers with a causation or effectuation orientation irrespective of their role as small business manager or as an established global manager. Hence, we posit that effectuation and causation orientations may be generic characteristic of managers in general.

Quality & Quantity publish 2012
The “heart” of entrepreneurship: The impact of entrepreneurial action on health and health on entrepreneurial action Holger Patzelt
Dean Shepherd

Abstract Health is one of the most important topics in society. By exploring issues related to health we can gain a deeper understanding of the critical antecedents and consequences of entrepreneurial action. Specifically, we take a psycho-social perspective on health and our knowledge of the entrepreneurship literature to begin a conversation about, and hopefully stimulate research on, how heath (of the entrepreneur and/or others) impacts entrepreneurial action and how entrepreneurial action creates (or diminishes) value (through the health of the entrepreneur and or others). We hope this article stimulates scholars’ curiosity on one of society’s most critical issues.

Journal of Business Venturing Insights publish 2015  PDF Download
The Academy of Management Meeting Chicago 1999. effectuation
Academy of Management Proceedings publish 1999  PDF Download
The age-effect of financial indicators as buffers against the liability of newness Johan Wiklund
Thomas Baker
Shepherd Dhliwayo

This paper builds on the liabilities of newness literature to suggest that accounting information is important for new firms. Using a sample of over 30,000 companies followed during their first 7†years of existence, we find evidence that financial indicators mitigate the liability of newness and that this buffering effect is stronger the younger the organization. These results represent three primary contributions to the literature. First, our conceptualization of accounting measures as indicators of external (creditworthiness enhancing legitimacy) as well as internal (targets for management) buffers to the liabilities of newness provides a novel way of viewing these constructs and explains why they are important to new firms despite their uncertainty and opacity. Second, we theoretically justify and empirically validate that these constructs are more important the younger the new firm is, which runs counter to the common wisdom of these constructs in the entrepreneurship literature. Third, we identify buffers against failure for new firms that are generalizable across industries.

Journal of Business Venturing publish 2010  PDF Download
The analysis of the impact of Causation and Effectuation approaches on decision-making of IT startups Olessya Vorontsova

This dissertation investigates the impact of two alternative ways of thinking: effectuation and causation logics on decision-making and strategic management in startup companies that operate in IT sector. Based upon the theory of effectuation introduced by Sarasvathy (2001), this study provides a critical examination of five effectual principles: bird-in-hand, affordable loss, patchwork quilt, lemonade and pilot-in-the-plane at the edge of their effect on new venture performance. Using a multiple case-study methodology, this study aims to provide an in-depth analysis of the following research issue of effectual reasoning deliberated through the primary data and, answers following research question How do entrepreneurs perceive the contribution of an effectuation logic in defining a viable and successful strategy when compared to a traditionalplanned or causal logic? The findings suggest that effectuation and causation logics are often combined to overcome startup’s top challenges throughout a lifecycle; while there are still some stages where adoption of effectuation reasoning might enhance startup success. We also provided a startup typology with regards to the level of favorability to effectual reasoning and opened a discussion towards the results and hypotheses of prior studies on effectuation and entrepreneurial expertise, market newness level. Overall, the theoretical insights derived from the process-and-context analysis of this study have important practical implications for entrepreneurs looking for adequate and efficient decision-making strategy.

publish 2016  PDF Download
The best of both worlds: how rural entrepreneurs use placial embeddedness and strategic networks to create opportunities Steffen Korsgaard
Richard Ferguson
Johan Gaddefors

Entrepreneurial activities are strongly influenced by the context in which they occur. It is therefore imperative to understand how different contexts enable entrepreneurs to create opportunities. In this paper, we focus on the spatial context of rural entrepreneurs and explore how the rural context impacts on their opportunity creation. Based on a multiple case study, we find that rural entrepreneurs mix what we refer to as placial embeddedness ? an intimate knowledge of and concern for the place ? with strategically built non-local networks, i.e. the best of two worlds. Notably, the entrepreneurs seek to exhaust the localized resource base before seeking out non-local resources. Our findings thus contribute to our understanding of entrepreneurship in context and challenge future research to explore how different forms of contexts are bridged in different settings to create varieties of entrepreneurial activities.

Entrepreneurship & Regional Development publish 2015
The Central Question in Entrepreneurial Cognition Research 2007. Ronald Mitchell
Lowell Busenitz
Barbara Bird Barbara Bird
Connie Marie Gaglio
Jeffery McMullen
Eric Morse
Brock Smith

In this article, we take note of advances in the entrepreneurial cognition research stream. In doing so, we bring increasing attention to the usefulness of entrepreneurial cognition research. First, we offer and develop a central research question to further enable entrepreneurial cognition inquiry. Second, we present the conceptual background and some representative approaches to entrepreneurial cognition research that form the context for this question. Third, we introduce the articles in this Special Issue as framed by the central question and approaches to entrepreneurial cognition research, and suggest how they further contribute to this developing stream. Finally, we offer our views concerning the challenges and opportunities that await the next generation of entrepreneurial cognition scholarship. We therefore invite (and seek to enable) the growing community of entrepreneurship researchers from across multiple disciplines to further develop the “thinking–doing” link in entrepreneurship research. It is our goal to offer colleagues an effective research staging point from which they may embark upon many additional research expeditions and investigations involving entrepreneurial cognition.

Entrepreneurship Theory and Practice publish 2007  PDF Download
The co-evolution of institutional entrepreneurship: A tale of two theories. Desirée F. Pacheco
Jeffery York
Thomas J. Dean
Saras Sarasvathy

This article provides a review and analysis of institutional entrepreneurship research with a focus on the emergence of this literature within two largely divergent streams: sociology-based institutional theory and economics-based institutional economics. The authors completed a review of 141 articles from these concurrent, but unlinked, research streams to understand how their integration might contribute to the further understanding of institutional entrepreneurship. Each stream is reviewed on its respective approaches to the following topics: the nature of the institutional entrepreneur, the types of institutions addressed, the determinants of institutional entrepreneurship, the mechanisms used in the process, and the empirical focus of each stream. The article recommends greater assimilation of the two streams and discusses specific opportunities for conceptual integration. Finally, the article offers an agenda for incorporating entrepreneurship research into the study of institutional entrepreneurship. Findings from this review suggest that while institutional economics focuses mostly on the antecedents and outcomes of institutional entrepreneurship, the institutional theory perspective is more concerned with the process and mechanisms that drive such change. The authors also suggest that entrepreneurship theory can greatly advance our understanding of institutional entrepreneurship by informing whether and how opportunities for institutional change are recognized, discovered, and created, as well as by providing insights on the antecedents and mechanisms of such activity. Most important, integrating the unique perspectives and domains of institutional theory, institutional economics, and entrepreneurship research in the study of institutional entrepreneurship provides substantial opportunity for expanding our understanding of the concept and its implications.

Journal of Management publish 2010
The Coevolution of Institutional Entrepreneurship: A Tale of Two Theories Saras Sarasvathy
Desirée F. Pacheco
Jeffery York
Thomas J. Dean

This article provides a review and analysis of institutional entrepreneurship research with a focus on the emergence of this literature within two largely divergent streams: sociology-based institutional theory and economics-based institutional economics. The authors completed a review of 141 articles from these concurrent, but unlinked, research streams to understand how their integration might contribute to the further understanding of institutional entrepreneurship. Each stream is reviewed on its respective approaches to the following topics: the nature of the institutional entrepreneur, the types of institutions addressed, the determinants of institutional entrepreneurship, the mechanisms used in the process, and the empirical focus of each stream. The article recommends greater assimilation of the two streams and discusses specific opportunities for conceptual integration. Finally, the article offers an agenda for incorporating entrepreneurship research into the study of institutional entrepreneurship. Findings from this review suggest that while institutional economics focuses mostly on the antecedents and outcomes of institutional entrepreneurship, the institutional theory perspective is more concerned with the process and mechanisms that drive such change. The authors also suggest that entrepreneurship theory can greatly advance our understanding of institutional entrepreneurship by informing whether and how opportunities for institutional change are recognized, discovered, and created, as well as by providing insights on the antecedents and mechanisms of such activity. Most important, integrating the unique perspectives and domains of institutional theory, institutional economics, and entrepreneurship research in the study of institutional entrepreneurship provides substantial opportunity for expanding our understanding of the concept and its implications.

Journal of Management publish 2010  PDF Download
The Cognitive Perspective in Entrepreneurship: An Agenda for Future Research Denis Gregoire
Andrew Corbett
Jeffery McMullen

Despite its many achievements, scholarship at the intersection of entrepreneurship and cognition has focused primarily on the consequences of what happens when an entrepreneur benefits from various cognitive characteristics, resources, or other dispositions. As such, cognitive research in entrepreneurship continues to suffer from narrow theoretical articulations and weak conceptual foundations that lessen its contribution to the managerial sciences. To address these issues, we draw from extant work on the nature and practice of cognitive research to develop a systematic approach to study entrepreneurship cognition. To further articulate this agenda, we assess the state of the field by content-analysing entrepreneurship cognition articles published between 1976 and 2008. We find that, although it has investigated many relevant variables, research on entrepreneurship cognition has failed to fully articulate key conceptual features of the cognitive perspective. Building on these observations, we propose concrete strategies and research questions to augment the contribution of entrepreneurship cognition research, and advance this research beyond its current focus on ‘cognitive consequences’. In particular, we illustrate the scholarly potential of disentangling the various antecedents of entrepreneurship cognition, of studying the process interactions between cognitive resources and mental representations, and of exploring the operation of entrepreneurship cognition across levels of analysis.

Journal of Management Studies publish 2011  PDF Download
THE CONCEPT OF SUSTAINABLE ENTREPRENEURSHIP: A CONCEPTUAL FRAMEWORK AND EMPIRICAL ANALYSIS. IOANNIS N. KATSIKIS
LIDA P. KYRGIDOU

We introduce the concept of “sustainable entrepreneurship” (SE). Since the field of business success lies on three distinctive levels, we argue that SE provides a holistic approach for organizational strategic development. Our case study exhibits how SE can be materialized and offer opportunities for doing well by doing good.

Academy of Management Proceedings publish 2007  PDF Download
The contrasting interaction effects of improvisational behavior with entrepreneurial self-efficacy on new venture performance and entrepreneur work satisfaction Keith Hmieleski
Andrew Corbett

Although improvisation is often considered to be an elemental component of entrepreneurship, little work has been done to evaluate factors that influence the relationship of entrepreneur improvisational behavior with important outcome variables. In an attempt to partly fill this gap, the current study examines the moderating effect of entrepreneurial self-efficacy on the relationship of founders’ improvisational behavior with both the performance of their startups and their individual level of work satisfaction using a national (United States) random sample of 159 entrepreneurs. In alignment with our predictions, improvisational behavior was found to have a positive relationship with new venture performance (i.e., sales growth) when exhibited by founders who were high in entrepreneurial self-efficacy, whereas improvisational behavior was found to have a negative relationship with new venture performance when exhibited by founders who were low in entrepreneurial self-efficacy. Contrary to our expectations, entrepreneurial self-efficacy was found to have a negative moderating effect on the relationship between entrepreneur improvisational behavior and work satisfaction.

Journal of Business Venturing publish 2008
The creation view of opportunities at the base of the pyramid Misagh Tasavori
Reza Zaefarian
Pervez N. Ghauri

This research aims to understand how multinational corporations (MNCs) enter the base of the pyramid (BoP) by adopting the creation view of opportunities. We employ actor?network theory and explore the key actors, the process and the opportunity development that enable MNCs to tackle the relative poverty of the BoP market. Our qualitative exploratory case study illustrates that, at the BoP, MNCs have to involve beneficiary stakeholders such as non-governmental organizations and BoP communities. In this process, they should be open to modifying their business model continuously to build awareness about the product among the poor and ensure affordability, availability and acceptability. At the BoP, opportunities do not exist in the external environment and they should be developed by identifying and addressing the real needs of the poor, enhancing their quality of life and being patient about earning a profit. This research contributes to the entrepreneurship literature by expanding the creation perspective of opportunities and provides implications for the managers of companies targeting the BoP market.

Entrepreneurship & Regional Development publish 2015  PDF Download
The Distinctive and Inclusive Domain of Entrepreneurial Cognition Research. Ronald Mitchell
Lowell Busenitz
Theresa Lant
Patricia McDougall
Eric Morse
Brock Smith

Through mapping both distinctive and inclusive elements within the domain of entrepreneurial cognition research, we accomplish our task in this introductory article to Volume 2 of the Special Issue on Information Processing and Entrepreneurial Cognition: to provide a fitting backdrop that will enhance the articles you will find within. We develop and utilize a “boundaries and exchange” concept to provide a lens through which both distinctive and inclusive aspects of the entrepreneurship domain are employed to frame this special issue.

Entrepreneurship Theory and Practice publish 2004  PDF Download
The downside of being ‘up’: entrepreneurs’ dispositional positive affect and firm performance Naveen Reddy

Previous research indicates that dispositional positive affect (DPA) is related to many beneficial outcomes (e.g., enhanced career success, development of high-quality social networks, improved performance on many tasks). Past research, however, has not directly investigated three crucial issues: (1) Are there limits to these beneficial effects? (2) Is dispositional positive affect related to firm performance as well as to individual entrepreneur performance? (3) Are the effects of entrepreneurs’ DPA moderated by specific variables? The present study provides evidence relating to these issues. Findings indicate significant relationships between entrepreneurs’ DPA and two measures of firm performance (product innovation and sales growth rate). However, there are indeed limits to these effects, such that beyond certain upper bounds, further increments in entrepreneurs’ DPA are associated with declines in firm performance. These effects are moderated by firm size, such that the negative effects of entrepreneurs’ DPA are stronger in small firms than in comparatively larger ones. Results contribute to the development of theory for understanding the role of entrepreneurs’ affect in the entrepreneurial process. More generally, they contribute to ongoing efforts to understand how founding entrepreneurs influence the subsequent development and growth of their firms. Copyright © 2011 Strategic Management Society.

Strategic Management Journal publish
The Economic Implications of Exaptation Saras Sarasvathy
Nick Dew
S. Venkataraman

Accounts of economic change recognize that markets create selective pressures for the adaptation of technologies in the direction of customer needs and production efficiencies. However, non-adaptational bases for technological change are rarely highlighted, despite their pervasiveness in the history of technical and economic change. In this paper the concept of exaptation – a feature co-opted for its present role from some other origin – is proposed as a characteristic element of technological change, and an important mechanism by which new markets for products and services are created by entrepreneurs. Exaptation is shown to be a missing but central concept linking the evolution of technology with the entrepreneurial creation of new markets and the concept of Knightian uncertainty.

publish 2004  PDF Download
THE ECONOMIC IMPLICATIONS OF EXAPTATION Saras Sarasvathy

Accounts of economic change recognize that markets create selective pressures for the adaptation of technologies in the direction of customer needs and production efficiencies. However, non-adaptational bases for technological change are rarely highlighted, despite their pervasiveness in the history of technical and economic change. In this paper the concept of exaptation – a feature co-opted for its present role from some other origin – is proposed as a characteristic element of technological change, and an important mechanism by which new markets for products and services are created by entrepreneurs. Exaptation is a missing but central concept linking the evolution of technology with the entrepreneurial creation of new markets and the concept of Knightian uncertainty.

publish 2004
The economics of strategic opportunity JERKER DENRELL
Christina Fang
Sidney G Winter

As emphasized by Barney (1986), any explanation of superior profitability must account for why the resources supporting such profitability could have been acquired for a price below their rent-generating capacity. Building upon the literature in economics on coordination failures and incomplete markets, we suggest a framework for analyzing such strategic factor market inefficiencies. Our point of departure is that a strategic opportunity exists whenever prices fail to reflect the value of a resource’s best use. This paper examines the challenges of imputing a resource’s value in the absence of explicit price guidance and suggests the likely characteristics of strategic opportunities. Our framework also suggests that the discovery of strategic opportunity is often a matter of ‘serendipity’ and access to relevant idiosyncratic resources. This latter observation provides prescriptive advice, although the analysis also explains why more detailed guidance has to be firm specific. Copyright © 2003 John Wiley & Sons, Ltd.

Strategic Management Journal publish 2003  PDF Download
THE EFFECTS OF EFFECTUAL LOGIC: NASCENT ENTREPRENEURIAL PERFORMANCE AND EFFECTUATION (INTERACTIVE PAPER) WILLIAM FORSTER
Jeffery York

This study is motivated by the need for empirical evidence of the use of effectual logic (Sarasvathy, 2001) by nascent entrepreneurs. Although there have been several empirical studies of the use of effectual logic in specific industries (Dew, 2003 ; Wiltbank & Sarasvathy, 2002), there has been limited research examining the use of effectual reasoning by nascent entrepreneurs in varying industries. We seek to contribute to the literature by investigating the effects of the use of effectual logics in the very early, nascent stage of new ventures. In order to investigate the linkages between effectual logic and success, we utilized five principles of effectual thinking, and three common measures of entrepreneurial success. By looking separately at the five principles and three measures of success, we are able to show how the various components of effectual logic impact each measure of success for nascent ventures. These insights contribute both theoretically and practically to the field of entrepreneurship by providing empirical linkages between some applications of effectual logic and venture success.

Frontiers of Entrepreneurship Research publish 2008  PDF Download
The effects of embeddedness on the entrepreneurial process Sarah Jack
ALISTAIR R. ANDERSON

This paper uses Giddens’ theory of structuration to develop the conception of entrepreneurship as an embedded socio-economic process. The qualitative examination of the actions of rural entrepreneurs finds that embeddedness plays a key role in shaping and sustaining business. Being embedded in the social structure creates opportunity and improves performance. Embedding enabled the entrepreneurs to use the specifics of the environment. Thus, both recognition and realisation of opportunity are conditioned by the entrepreneurs’ role in the social structure.

Qualitative methods in entrepreneurial research publish 2002  PDF Download
The effects of opportunities and founder experience on new firm performance JOHN C DENCKER
Marc Gruber

Much prior research in entrepreneurship has focused on the role of the founder’s knowledge in affecting new firm performance. Yet, little is known about how and why the entrepreneurial opportunity itself shapes outcomes in this arena. We begin filling in this critical gap in the literature by examining how the riskiness of the opportunity not only affects start-up performance, but also conditions the relevance of the founder’s distinct knowledge endowments. Analyses of a sample of 451 new firms show that the riskier the opportunity, the greater the performance of the start-up, above and beyond founder characteristics. Moreover, the value of founder knowledge is relative to the type of opportunity exploited: high-risk opportunities favor founders with managerial experience, whereas low-risk opportunities favor founders with industry experience. Copyright © 2014 John Wiley & Sons, Ltd.

Strategic Management Journal publish 2015  PDF Download
The Effects of Perceived Control on Venture Capitalist Investment Decisions: A Configurational Perspective Will Drover
Matthew S Wood
G. Tyge Payne

Drawing on agency and configurations theories, this study examines how perceived level of control over the entrepreneur influences venture capitalist (VC) decision making. We model the direct effects of perceived control and the interactive effects of control with entrepreneurial prestige and opportunity attractiveness to determine how various combinations of factors influence VCs’ willingness to invest. We test our conceptualizations using conjoint analyses of 552 VC investment decisions. The results show that perceived control is directly related to investment likelihood, but different configurations of control, entrepreneur prestige, and opportunity attractiveness result in different outcomes. Our findings support a configurational perspective of VC decision making.

Entrepreneurship Theory and Practice publish 2014  PDF Download
The Emergence of Evidence-Based Entrepreneurship MICHAEL FRESE
Denise M. Rousseau
Johan Wiklund
Entrepreneurship Theory and Practice publish 2014  PDF Download
The entrepreneur–environment nexus: Uncertainty, innovation, and allocation Jeffery York
S. Venkataraman

We build upon a recent stream of research that has proposed entrepreneurship as a solution to, rather than a cause of, environmental degradation. Our proposition is that under certain conditions entrepreneurs are likely to supplement, or surpass, the efforts of governments, NGOs and existing firms to achieve environmental sustainability. Entrepreneurs can contribute to solving environmental problems through helping extant institutions in achieving their goals and by creating new, more environmentally sustainable products, services and institutions. Our model illustrates how entrepreneurs 1) address environmental uncertainty, 2) provide innovation and 3) engage in resource allocation to address environmental degradation.

Journal of Business Venturing publish 2010  PDF Download
The entrepreneurial journey as an emergent hierarchical system of artifact-creating processes Paul D. Selden
Denise E. Fletcher

Abstract Entrepreneurial ‘process’ perspectives explain the events of an entrepreneurial journey in terms of mechanisms, such as ‘effectual logic’, ‘bricolage’, ‘dynamic creation’, ‘opportunity tension’ and ‘enactment’. Process theorists, however, have not as yet developed an analytical framework that explains an entrepreneurial event in relation to the entrepreneurial journey as the unit of analysis. Building on Sarasvathy’s (2003, 2008) and Venkataraman et al.’s (2012) conception of entrepreneurship inquiry as a ‘science of the artificial’ (Simon, 1996), we explain how this research gap can be addressed by conceptualizing the entrepreneurial journey as an ‘emergent hierarchical system of entrepreneurial artifact-creating processes’. From this perspective, entrepreneurial events can be explained in relation to the endogenous dynamics of prior patterns of artifact emergence. We discuss some research implications of focusing on artifact emergence as a key unit of analysis in process theory development.

Journal of Business Venturing publish 2015  PDF Download
The Entrepreneurial Organization of Heterogeneous Capital* Kirsten Foss
NICOLAI J FOSS
Peter G. Klein
Sandra K. Klein

abstract  Transaction cost, property rights, and resource-based approaches to the firm assume that assets, both tangible and intangible, are heterogeneous. Arranging these assets to minimize contractual hazards, to provide efficient investment incentives, or to exploit competitive advantage is conceived as the prime task of economic organization. None of these approaches, however, is based on a systematic theory of capital heterogeneity. In this paper we outline the approach to capital developed by the Austrian school of economics and show how Austrian capital theory provides a natural bridge between theory of entrepreneurship and the theory of the firm. We refine Austrian capital theory by defining capital heterogeneity in terms of subjectively perceived attributes, the functions, characteristics, and uses of capital assets. Such attributes are not given, but have to be created or discovered by means of entrepreneurial action. Conceiving entrepreneurship as the organization of heterogeneous capital provides new insights into the emergence, boundaries, and internal organization of the firm, and suggests testable implications about how entrepreneurship is manifested.

Journal of Management Studies publish 2007  PDF Download
The entrepreneurship of resource-based theory Sharon Alvarez
Lowell Busenitz

This paper examines the relationship between resource-based theory and entrepreneurship and develops insights that advance the boundaries of resource-based theory and begin to address important questions in entrepreneurship. We extend the boundaries of resource-based theory to include the cognitive ability of individual entrepreneurs. Entrepreneurs have individual-specific resources that facilitate the recognition of new opportunities and the assembling of resources for the venture. By focusing on resources, from opportunity recognition to the ability to organize these resources into a firm and then to the creation of heterogeneous outputs through the firm that are superior to the market, we help identify issues that begin to address the distinctive domain of entrepreneurship.

Journal of Management publish 2001  PDF Download
THE ESSENCE OF ENTREPRENEURIAL LEARNING (SUMMARY) Magdalena Markowska

Learning is often assumed to be inherent in the entrepreneurship process (Corbett, 2005). Researchers agree that the entrepreneurial learning is experiential in nature (Cope, 2005; Politis, 2005). It has been shown that with experience entrepreneurs are more likely to act effectually and/or adapt their dominant logic to the nature of the task (Dew at al., 2009; Gustavsson, 2004). Acting effectually is thus what makes entrepreneurs entrepreneurial (Sarasvathy, 2001). Therefore, the entrepreneurial learning can be conceptualized as a process of development of effectual logic. To put it simply, effectuation is the outcome of the learning process. In this process, perceived control motivates individuals to engage in action (Bandura, 2001). The choice of the behavior relies on and is congruent with entrepreneurs’ salient identity. In particular, it has been argued that individuals show prevalence for either professional or managerial identity. However, how these orientations influence the self-regulatory processes and the prevailing decision making logic in the entrepreneurship process has not been researched so far. Thus, the purpose of the paper is to develop a conceptual framework illustrating the factors determining the process of development of effectual logic.

Frontiers of Entrepreneurship Research publish 2010  PDF Download
The Essence of Strategic Leadership: Managing Human and Social Capital Michael A Hitt
R Duane Ireland

A new type of strategic leadership is required to help firms successfully navigate the dynamic and uncertain environment in which they compete today. The strategic leadership needed in 21st century firms is involved with building company resources and capabilities with an emphasis on intangible human capital and social capital. Human capital is the firm’s repository of valuable knowledge and skills; social capital provides access to critical resources. Both are significant contributors to achievement of a competitive advantage. Leaders must effectively manage these important resources for the firm. Management of these resources involves evaluating current resource stocks and making changes such as adding (e.g., developing or acquiring externally) and deleting (e.g., layoffs) human resources and external relationships. To create value, the resources must be configured to develop capabilities that can be leveraged in ways to create competitive advantages. The dimension of strategic leadership we describe here is called effectuation. This new type of approach to leadership has important implications for management scholars and practitioners.

publish 2002  PDF Download
The Evolution of Entrepreneurial Competencies: A Longitudinal Study of University Spin-Off Venture Emergence Einar Rasmussen
Simon Mosey
MIKE WRIGHT

This paper aims to better understand the development of entrepreneurial competencies to create new ventures within the non-commercial academic environment. We build upon the evolutionary perspective considering where resources come from to help define these competencies and explain their paths of development. The study follows the creation and early growth of four university spin-offs within the UK and Norway. We identified three competencies of opportunity refinement, leveraging, and championing that appeared crucial for the ventures to gain credibility. Although selected competencies were inherent within the academic founders, the specific competencies for venture creation had to be developed or acquired. This was achieved iteratively through entrepreneurial experience and accessing competencies from disparate actors such as industry partners and equity investors. Propositions are offered to guide future empirical research based upon our framework.

Journal of Management Studies publish 2011  PDF Download
The evolution of interorganizational relationships in emerging ventures: An ethnographic study within the new product development process Tucker J Marion
Kimberly A Eddleston
John H. Friar
David Deeds

Abstract Emerging ventures rarely have the resources they need, which often force them to reach beyond their boundaries to access these resources. While the field has acknowledged how critical external relationships are in the emergence process, we lack an understanding of how these relationships evolve. Drawing on fourteen longitudinal case studies, this article begins to fill that gap by examining how emerging ventures use interorganizational relationships to discover, develop, and commercialize new products. We found that emerging ventures tended to establish outsourcing relationships early and that many outsourcing relationships progressed into alliances. This suggests that these early relationships are dynamic, evolve through the emergence process, and may be critical to the successful emergence of a venture. We also discovered that many entrepreneurs developed strong socioemotional bonds with their alliance partners. Unexpectedly, our study revealed that in many cases these socioemotional bonds clouded the entrepreneur’s judgment of the partner’s abilities and led to problems that threatened the venture’s survival.

Journal of Business Venturing publish 2015  PDF Download
The Fine ‘Science’ of Entrepreneurial Decision-Making Deniz Ucbasaran
Journal of Management Studies publish 2008  PDF Download
The formation of opportunity beliefs: overcoming ignorance and reducing doubt Dean Shepherd
Jeffery McMullen
P. Devereaux (Dev) Jennings

Although (opportunity) beliefs are becoming increasingly recognized as fundamental to understanding entrepreneurial cognition and strategic action, little is understood about the mechanisms that are responsible for the formation and evolution of these beliefs. Introducing the mechanisms of gists, matching, and updating from philosophy’s and psychology’s coherence theory, we propose a theoretical framework to explain how third-person opportunity beliefs (beliefs that one has recognized an opportunity for someone with the right knowledge and motivation) are formed and how they evolve to become first-person opportunity beliefs (beliefs that one has recognized an opportunity for himself or herself). We conclude by examining how the model contributes to literatures ranging from entrepreneurial cognition and action, to strategic myopia and organizational attention, to opportunity recognition, discovery, and creation. Copyright © 2007 Strategic Management Society.

Strategic Entrepreneurship Journal publish 2007  PDF Download
THE FRIEDMAN VS. FREEMAN CONTROVERSY – AN EMPIRICAL INVESTIGATION WITH EARLY STAGE VENTURES (INTERACTIVE PAPER) Ishrat Ali
Saras Sarasvathy

Milton Friedman argued that managers benefit their organization the most when they act for benefit of the shareholders. Ed Freeman and other stakeholder scholars argue back that to ensure long term sustainability, managers not only need to satisfy shareholder demands but they need to consider the impact of their actions on multiple stakeholder groups. Shareholder vs. stakeholder orientation and its importance for long term sustenance is a hotly debated topic. We expand on this debate by investigating value creation modalities in two different types of early stage ventures.

Frontiers of Entrepreneurship Research publish 2012  PDF Download
The Future of Entrepreneurship Research Johan Wiklund
Per Davidsson
Audretsch, David B.
Karlsson, Charlie
Entrepreneurship Theory and Practice publish 2011  PDF Download
The Impact of Collective Optimism on New Venture Creation and Growth: A Social Contagion Perspective Aaron H Anglin
Aaron F McKenny
Jeremy C Short

Social contagion research suggests that individual decision making is shaped by collective, social processes. We extend the entrepreneurial optimism literature by arguing that collective optimism—the shared, positive expectations about future outcomes—is salient to key entrepreneurial outcomes. We test our position by examining how fluctuations in U.S. collective entrepreneurial optimism influence venture creation and growth using 1993–2010 NFIB entrepreneurial optimism data. Results indicate that collective entrepreneurial optimism exhibits a curvilinear relationship with venture creation and growth, which is moderated by environmental dynamism. We validate the NFIB measure by constructing an alternative measure of collective entrepreneurial optimism using media reports.

Entrepreneurship Theory and Practice publish 2016  PDF Download
The Impact of Environment and Entrepreneurial Perceptions on Venture-Creation Efforts: Bridging the Discovery and Creation Views of Entrepreneurship LINDA F EDELMAN
Yli-Renko, Helena

Recent literature has highlighted two conflicting theories of entrepreneurship. In the “discovery” perspective, objective environmental conditions are considered to be the source of entrepreneurial opportunities and thus drivers of subsequent entrepreneurial action. The “creation” view, in contrast, is based on entrepreneurial perceptions and socio-cognitive enactment processes. While empirical studies have separately utilized each of these perspectives, few attempts have been made to integrate insights from both theories to empirically examine the interrelationships among environmental conditions, entrepreneurial perceptions, entrepreneurial action, and outcomes. In this article, we explicate the roles that both objective environmental conditions and entrepreneurial perceptions of opportunity and resource availability play in the process of firm creation. Utilizing longitudinal data on nascent entrepreneurs, we find that as hypothesized, entrepreneurs’ opportunity perceptions mediate between objective characteristics of the environment and the entrepreneurs’ efforts to start a new venture. Contrary to our expectations, we do not find a similar mediating effect for perceived resource availability. These findings have important implications for further theory development in entrepreneurship as well as for practice and education in the field.

Entrepreneurship Theory and Practice publish 2010  PDF Download
The impact of family support on young entrepreneurs’ start-up activities LINDA F EDELMAN
Tatiana Manolova
Galina Shirokova
Tatyana Tsukanova

Abstract In this paper, we use a social support perspective and hypothesize that the scope of start-up activities is positively associated with two types of instrumental family support, financial and social capital. We further argue that the effect of instrumental family support is enhanced by the level of emotional support, in the form of family cohesiveness. To test our hypotheses, we draw from the 2011 Global University Entrepreneurial Spirit Students’ Survey (GUESSS), a survey of university students from 19 countries. We focus on those nascent entrepreneurs who are in the process of starting their new venture (n = 12,399). Our findings indicate that family social capital is positively associated with the scope of start-up activities, family financial capital is negatively associated with the scope of start-up activities, and family cohesiveness amplifies the effect of family social capital on the scope of start-up activities. Theoretical, practitioner, and public policy implications are discussed.

Journal of Business Venturing publish 2016  PDF Download
The Importance of Slack for New Organizations Facing ‘Tough’ Environments Steve W Bradley
Dean Shepherd
Johan Wiklund

Strategy-based models centre on the management of unique and valuable resources to take advantage of specific market opportunities. Less examined in this approach are the roles of slack resources in the process of generating firm value – particularly for new firms in ‘tough’ environments where fewer opportunities are available. Using a cohort panel of 951 new manufacturing firms over nine years, our findings provide evidence for the importance of financial slack resources in understanding opportunity generation and also for reconciling theoretical arguments regarding the slack resource–performance link. We find that while financial slack does provide buffering capacity (in hostile and dynamic environments), and flexibility for experimentation (in munificent and dynamic environments) as suggested by prior theory, the most positive relationship between financial slack and performance for new firms was in low discretion environments (hostile and stable environments) – where firms need to develop their own opportunities. The implications of these findings for theory are discussed.

Journal of Management Studies publish 2011  PDF Download
The influence of an industry’s capital-intensity on the decision-making of entrepreneurs with regards to effectuation and causation: an empirical analysis Manuel Ernst

The concept of effectual and causal thinking in entrepreneurial decision-making has been an emerging field for theoretical and empirical considerations in the past 15 years. Since the original introduction by Sarasvathy (2001), literature has proven that different approaches of decision-making have been observed in different people, depending on both external (environmental) and internal (cognitive) influences. In this analysis, a distinct focus is set on the influence of financial risk in entrepreneurial decisions, whether entrepreneurs follow one specific decision-making logic when particularly exposed to questions regarding risk. This paper takes the idea that environmental factors affect an entrepreneur’s notion in decision-making and analyzes the particular influence of the industry in which the venture operates. Industries are distinguished by the capital that is required in order to enter them and to start with operational activities. The analysis is conducted with a sample of 69 German entrepreneurs than founded their companies not longer than five years ago. Within both capital-intensive and less capital-intensive industries, a clear propensity towards one specific decision-making approach could be identified; yet, the same approach for both industry types. A univocal tendency towards one logic within an industry type would lead to the assumption that the industry is influential, however, none of the examined industry types shows a considerably stronger tendency towards causation than the other. Therefore, the industry of a venture cannot be identified as the driving influence in decision-making processes. It is expected that other factors have an influence on the decision-making logic of an entrepreneur as well.

publish 2016  PDF Download
The influence of causation and effectuation logics on targeted policies: the cases of Singapore and Israel D Kaufmann

We examine the causation and effectuation logics for implementing targeted biotechnology policies using two case