Understanding dynamics of strategic decision-making in venture creation : a process study of effectuation and causation

I.M.M.J. Reymen, P. Andries, J.J. Berends, R. Mauer, U. Stephan, J.C. Burg, van

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Abstract

The process of new venture creation is characterized by the need to decide and take action in the face of uncertainty. Especially in the context of technology-based ventures uncertainty is substantial, posing difficulties for strategic decision-making based on prediction and planning. As alternative, more flexible and adaptive decision-making logics are being advanced. This study draws upon effectuation and causation as examples of planning-based and flexible decision-making logics, and investigates dynamics in the use of both logics. The study applies a longitudinal process research approach to investigate strategic decision-making in new venture creation over time. Combining qualitative and quantitative methods, we analyze 385 decision events across nine technology-based ventures. Our observations suggest a hybrid perspective on strategic decision-making, demonstrating how effectuation and causation logics are combined, and how entrepreneurs’ emphasis on these logics shifts and re-shifts over time. From our data, we induce a dynamic model which extends the literature on strategic decision-making in venture creation, illustrating how external and venture conditions - including not only uncertainty but also resource position and stakeholder pressure - lead to changes in venture scope, and thereby to shifts in the use of decision-making logics.
Original languageEnglish
Pages (from-to)351-379
JournalStrategic Entrepreneurship Journal
Volume9
Issue number4
DOIs
Publication statusPublished - Dec 2015

Fingerprint

Strategic decision making
Logic
Causation
Venture creation
Effectuation
Venture
Decision making
Uncertainty
New venture creation
Planning
Entrepreneurs
Prediction
Qualitative methods
Process research
Stakeholder pressures
Quantitative methods
Resources

Keywords

  • decision making
  • effectuation
  • new venture creation
  • uncertainty
  • process research

Cite this

Reymen, I.M.M.J. ; Andries, P. ; Berends, J.J. ; Mauer, R. ; Stephan, U. ; Burg, van, J.C. / Understanding dynamics of strategic decision-making in venture creation : a process study of effectuation and causation. In: Strategic Entrepreneurship Journal. 2015 ; Vol. 9, No. 4. pp. 351-379.
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Understanding dynamics of strategic decision-making in venture creation : a process study of effectuation and causation. / Reymen, I.M.M.J.; Andries, P.; Berends, J.J.; Mauer, R.; Stephan, U.; Burg, van, J.C.

In: Strategic Entrepreneurship Journal, Vol. 9, No. 4, 12.2015, p. 351-379.

Research output: Contribution to journalArticleAcademicpeer-review

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