Planning effectual growth: a study of effectuations and causation in nascent firms

Jeroen Kraaijenbrink, Tiago Ratinho, Arend J. Groen

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Abstract

Two main contrasting approaches are used in the entrepreneurship literature to explain how new ventures strategize: causal/planned strategies and effectual/emergent strategies. In this study, we explore the use of these strategies within micro and small firms. Our results show that larger companies typically used more planned strategies while simultaneously relying on effectual mechanisms. We observe that companies operating in known markets, anchoring their business ideas on experience and having a strong growth intention grow larger. This suggests that causal and effectual mechanisms can co-exist and lead to growth when combined. Theoretical and practical implications of these findings are discussed.
Original languageEnglish
Pages-
Publication statusPublished - 8 Jun 2011
EventBabson College Entrepreneurship Research Conference, BCERC 2011 - Whitman School of Management, Syracuse University, Syracuse, United States
Duration: 8 Jun 201111 Jun 2011

Conference

ConferenceBabson College Entrepreneurship Research Conference, BCERC 2011
Abbreviated titleBCERC
CountryUnited States
CitySyracuse
Period8/06/1111/06/11

Keywords

  • METIS-280439
  • IR-77524

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    Kraaijenbrink, J., Ratinho, T., & Groen, A. J. (2011). Planning effectual growth: a study of effectuations and causation in nascent firms. -. Paper presented at Babson College Entrepreneurship Research Conference, BCERC 2011, Syracuse, United States.