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.

This research examines how entrepreneurial orientation (EO) influences international performance (IP) of the firm taking into account the moderating effect of decisionmaking rationality (DR) on the EO-IP association. Such an investigation is significant because it considers the interplay of strategic decision-making processes supported by the bounded rationality concept in the entrepreneurship field. Drawing from a study on activities of 216 firms in the USA and UK, the evidence suggests that DR positively moderates the EO-IP association. The findings suggest that managers can improve IP by combining EO with rational (analytical) processes in their strategic decisions.

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