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Article
Publication date: 13 October 2021

Dafnis N. Coudounaris and Henrik G.S. Arvidsson

This study aims to investigate the antecedents of the internationalisation strategy i.e., effectuation, causation and bricolage on the international performance of the firm.

Abstract

Purpose

This study aims to investigate the antecedents of the internationalisation strategy i.e., effectuation, causation and bricolage on the international performance of the firm.

Design/methodology/approach

In total, the study uses 138 peer-reviewed articles on effectuation, causation, effectual/causal decision-making logics and related issues such as the impact of antecedent factors of international strategy (i.e. effectuation, causation and bricolage) on the international performance of the firm.

Findings

Even though the theory of effectuation was formulated in 2001, to a large extent it has still not moved away from the realm of small entrepreneurial firms. The development of effectuation logic has accelerated in recent years, but the bulk of the research still focusses on small entrepreneurial firms rather than on the application of the theory in larger, non-entrepreneurial firms. Furthermore, effectuation theory would benefit from being developed into the realm of psychology and sociology.

Originality/value

This study offers a conceptual model on how effectuation, causation and bricolage influence internationalisation strategy, which, in turn, impacts the international performance of the firm. Furthermore, the study discusses the effectual logic for larger firms. The exponential growth of studies on effectuation during recent years, i.e. 2017 to the first quarter of 2020, shows that researchers have responded to calls by leading authors stating that effectuation theory is a field with great potential for further theoretical developments. This study presents a literature review of the critical issue of the engagement of internationalisation strategies with effectuation, causation, bricolage and the international performance of the firm compared to the earlier literature review for the period 2001–2016 by Matalamäki (2017) and Karami et al. (2019) on effectuation and internationalisation.

Details

Review of International Business and Strategy, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 2059-6014

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Article
Publication date: 23 August 2021

Oliver Kwabena Aggrey, Alfred Kwadwo Djan, Naomi Abena Dei Antoh and Louis Numelio Tettey

This study aims to investigate the effectiveness of causation decision-making and effectual decision-making logic in challenging economic situations within agricultural…

Abstract

Purpose

This study aims to investigate the effectiveness of causation decision-making and effectual decision-making logic in challenging economic situations within agricultural small and medium-sized enterprises in Ghana.

Design/methodology/approach

The authors collect and derive composite variables from effectuation, causation, financial capital availability (FCA) and crisis performance data through a randomized system based on literature precedents. This study analyzes the data using descriptive analysis, confirmatory factor analysis and ordinary least squared regression through STATA 15.

Findings

The authors find that effectual managers are indeed better off during crisis conditions. Also, there is a significant moderation relationship between the effectuation, FCA and crisis performance.

Originality/value

From strategic management and entrepreneurial process standpoint, the effectuation theory thrives within uncertain business environments. This notwithstanding, literature has often focused on hypothetical, uncertain business environments. The authors present plausible evidence of effectual business behavior from a real crisis, from small agriculture firms’ perspectives and an emerging economy context.

Details

Journal of Enterprising Communities: People and Places in the Global Economy, vol. 15 no. 5
Type: Research Article
ISSN: 1750-6204

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Book part
Publication date: 28 August 2020

Virginia Cha, Yi Ruan and Michael Frese

This study enriches the theory of effectuation by discussing the four independent dimensions of effectuation and their relationships with causation. Additionally, we fill…

Abstract

This study enriches the theory of effectuation by discussing the four independent dimensions of effectuation and their relationships with causation. Additionally, we fill the gap in prior literature by showing how entrepreneurial experience moderates the relationship between effectuation and innovativeness of the venture. Our study of 171 practising entrepreneurs regarding their entrepreneurial decision-making logic yielded multiple findings. The authors find that entrepreneurs rely on causation as well as effectuation in their decision-making; the more experienced entrepreneurs are, the more they actually use causation; and entrepreneurial experience moderates the relationship between effectuation and innovativeness of the venture firm.

Details

The Entrepreneurial Behaviour: Unveiling the cognitive and emotional aspect of entrepreneurship
Type: Book
ISBN: 978-1-78973-508-6

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Article
Publication date: 6 January 2021

Jiawen Chen, Linlin Liu and Qingxin Chen

Empirical data on the impacts of entrepreneurial effectuation on firm performance are scattered and controversial. This study conducts a meta-analysis to obtain evidence…

Abstract

Purpose

Empirical data on the impacts of entrepreneurial effectuation on firm performance are scattered and controversial. This study conducts a meta-analysis to obtain evidence on whether and under what conditions effectuation is valuable. A contextual framework is proposed that highlights the boundary condition of the performance impact of effectuation.

Design/methodology/approach

Both the traditional approach of meta-analysis and advanced techniques of Bayesian meta-analytic tests are used to combine numerous studies from varied research contexts.

Findings

Meta-analytic results show that effectuation generally has a positive impact on firm performance, and is context-dependent, leading to stronger performance for older firms and firms in high-tech industries and emerging countries.

Originality/value

The findings provide important implications for entrepreneurs who are considering applying effectuation. This study highlights that effectuation is context-dependent and the performance implications of effectuation are contingent on contextual factors at organizational, industrial and institutional levels. This study extends the contextual understanding of the effectuation–performance relationship.

Details

International Journal of Entrepreneurial Behavior & Research, vol. 27 no. 3
Type: Research Article
ISSN: 1355-2554

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Article
Publication date: 20 November 2020

Phillip McGowan, Chris Simms, David Pickernell and Konstantios Zisakis

The purpose of this paper is to consider the impact of effectuation when used by small suppliers within key account management (KAM) relationships.

Abstract

Purpose

The purpose of this paper is to consider the impact of effectuation when used by small suppliers within key account management (KAM) relationships.

Design/methodology/approach

An exploratory longitudinal case study approach was used to examine a single small supplier operating in the snack foods sector of the UK foods industry, as it entered into a new KAM relationship with a major retailer and undertook four new product development projects.

Findings

Findings suggest effectuation may positively moderate the ability of a small supplier to enter into a KAM relationship by enabling it to obtain resources and limit risk. However, once within the relationship, the use of effectuation may negatively impact success by increasing the potential for failure to co-create new product development, leading to sub-optimal products, impacting buyer confidence and trust. Furthermore, a failed KAM relationship may impact other customers through attempts to recover revenues by selling these products, which may promote short-term success but, in the long-term, lead to cascading sales failure.

Research limitations/implications

It cannot be claimed that the findings of just one case study represent all small suppliers or KAM relationships. Furthermore, the case presented specifically concerns buyer-supplier relationships within the food sector.

Practical implications

This study appears to suggest caution be exercised when applying effectuation to enter into a KAM relationship, as reliance on effectual means to garner required resources may lead to the production of sub-optimal products, which are rejected by the customer. Additionally, a large customer considering entering into a KAM relationship with a small supplier should take care to ensure their chosen partner has all resources needed to successfully deliver as required or be prepared to provide sufficient support to avoid the production of sub-optimal products.

Originality/value

Findings suggest the use of effectuation within a KAM relationship has the potential to develop a dark side within business-to-business buyer-supplier relationships through unintentional breaches of trust by the selling party.

Details

Journal of Business & Industrial Marketing, vol. 36 no. 7
Type: Research Article
ISSN: 0885-8624

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Article
Publication date: 16 April 2020

Zelong Wei and Linqian Zhang

In spite of the significance of the strategic change, its high rate of failure inspires us to explore how to successfully enact new strategic change in a different…

Abstract

Purpose

In spite of the significance of the strategic change, its high rate of failure inspires us to explore how to successfully enact new strategic change in a different environment. Based on strategy as practice perspective and effectuation theory, this study aims to extend extant literature by identifying two approaches performing strategic change (e.g. causation strategic change or effectuation strategic change) and investigating their effects on firm performance and also boundary conditions (e.g. market uncertainty or technological uncertainty).

Design/methodology/approach

Based on a data set from 238 firms in China, the authors empirically test the hypotheses through regression analysis.

Findings

The findings indicate that causation and effectuation strategic changes can promote firm performance. However, the roles of the two approaches vary with the external environment. Specifically, market uncertainty strengthens while technological uncertainty weakens the positive effect of causation strategic change. In contrast, technological uncertainty strengthens the positive effect of effectuation strategic change on firm performance.

Originality/value

This study extends research literature of strategic change by identifying causation and effectuation strategic changes and investigating how their roles vary with market uncertainty and technological uncertainty. The findings guide firms to adopt a fit approach to perform a strategic change in different external environments.

Details

Chinese Management Studies, vol. 14 no. 3
Type: Research Article
ISSN: 1750-614X

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Article
Publication date: 4 September 2020

Frida Thomas Pacho and Hellena Mushi

This study aims to examine the effect of the effectuation set of means on new venture performance in the context of Tanzania’s emerging economy. To determine how new…

Abstract

Purpose

This study aims to examine the effect of the effectuation set of means on new venture performance in the context of Tanzania’s emerging economy. To determine how new ventures, benefit from the effectuation set of means experienced entrepreneurs possess, this study examines the role of the flexibility principle of effectuation as a key mediator.

Design/methodology/approach

The research is quantitative in nature, and a survey questionnaire was used to get data from five cities of Tanzania. In total, 350 samples obtained for analysis. The hierarchical regression and structural equation modeling were used for testing the hypotheses.

Findings

The effectuation set of means is affirmed to have a positive effect on new venture performance. The flexibility principle plays a partial mediating role in the relationship between the effectuation set of means and new venture performance.

Originality/value

This empirical evidence contributes to the progress of the theory of effectuation and also provides managerial guidelines for entrepreneurs who operate their new ventures and face uncertain business environments.

Details

Journal of Entrepreneurship in Emerging Economies, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 2053-4604

Keywords

Content available
Article
Publication date: 20 December 2019

Suzi Elen Ferreira Dias, Edson Sadao Iizuka and Eduardo Pinto Vilas Boas

The purpose of this paper is to understand the theoretical discussion of effectuation since the seminal paper in 2001 and to propose an agenda for future studies.

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1341

Abstract

Purpose

The purpose of this paper is to understand the theoretical discussion of effectuation since the seminal paper in 2001 and to propose an agenda for future studies.

Design/methodology/approach

Systematic literature review and content analysis of 71 papers.

Findings

Most papers performed a replication of the concepts empirically, and few studies proposed to understand theoretical aspects of effectuation, among them, some authors presented theoretical advances to improve the approach and others participated in an ongoing debate that shows there is no consensus on whether the approach is theory or if considered, appears to be under construction at a rudimentary level or being questioned.

Research limitations/implications

The method requires authors to make choices, so the database used and the criteria defined for searching papers that were analyzed are the main limitations of this research.

Practical implications

The authors suggest that researchers, teachers and practitioners use effectuation analytically and reflectively.

Social implications

The authors present and analyze the current theoretical debate on effectuation. Results suggest the need for new discussions about the concepts, as well as new theoretical efforts of the researchers to analyze the potentialities and limitations of this approach.

Originality/value

Among empirical and applied research, with replications of the concepts of effectuation, this research contributes to a theoretical discussion based on a systematic literature review, seeking to bring new reflections about this approach. Additionally, the authors present an agenda of theoretical gaps for the development of future research.

Details

Innovation & Management Review, vol. 17 no. 1
Type: Research Article
ISSN: 2515-8961

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Article
Publication date: 31 July 2017

Marko Juhani Matalamäki

The purpose of this paper is to address the stages of development of effectuation theory and highlight the progression from the early years’ conceptual articles to the…

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2192

Abstract

Purpose

The purpose of this paper is to address the stages of development of effectuation theory and highlight the progression from the early years’ conceptual articles to the recent empirical papers, characterized by specific, measurable research questions.

Design/methodology/approach

In total, 81 peer-reviewed academic journal articles featuring effectuation as a main subject were analyzed using Scandura and Williams’ (2000) modified version of McGrath’s typology of research strategies. The framework of Edmonson and McManus (2007) is employed to evaluate the maturity of the research program.

Findings

The main outcome is to introduce four main streams linked to effectuation theory in the current scientific dialogue: innovation and product development, internationalization, effectuation and causation simultaneously, and entrepreneurial expertise.

Research limitations/implications

The current study is reliant on retrospective data, which might influence the accuracy and completeness of this study, which typically leads to rationalized versions of history-associated causal decision making.

Practical implications

This study illustrates why effectuation theory should no longer be associated only with new ventures and startups. The majority of recent studies have presented the results of effectuation logic in the context of established companies.

Social implications

This follow-up review presents evidence that effectuation research has moved on from the nascent to the intermediate stage of development. Furthermore, the results indicate that it has already begun its transition toward the mature stage of development.

Originality/value

This study reveals the ongoing spirited battle between the convergent and divergent groups involved in the scientific debate around effectuation theory.

Details

Journal of Small Business and Enterprise Development, vol. 24 no. 4
Type: Research Article
ISSN: 1462-6004

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Article
Publication date: 14 August 2017

Franziska Günzel-Jensen and Sarah Robinson

Since Sarasvathy’s (2001) research on decision-making logics of expert entrepreneurs, effectuation has become a cornerstone in entrepreneurship education. Effectuation is…

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1130

Abstract

Purpose

Since Sarasvathy’s (2001) research on decision-making logics of expert entrepreneurs, effectuation has become a cornerstone in entrepreneurship education. Effectuation is not only subjectified in entrepreneurship education, but has also become conceptualized as a method in the learning process. The purpose of this paper is to explore how students, who are novice entrepreneurs, react to working effectually and which barriers they face when applying effectual decision-making logics in a university course.

Design/methodology/approach

A student-centered process course in entrepreneurship with 142 students provides a unique opportunity to explore the phenomena. Participant/teacher observations, written and oral work from the students and finally formal and informal written evaluations of the course by the students provide comprehensive data.

Findings

The authors find that students experience three barriers to using effectuation. These are: noviceness, regarding the project as a “school project,” perceived lack of legitimacy of both the instructors and the process.

Originality/value

The contribution of this study is threefold: first, to contribute to the understanding of the applicability of effectuation for novice entrepreneurs in the classroom; second, to articulate the factors that hinder entrepreneurial learning when effectuation is used in a process course; and third, to shed light on the importance of contextual factors for individual learning.

Details

Education + Training, vol. 59 no. 7/8
Type: Research Article
ISSN: 0040-0912

Keywords

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