Effectuation and causation: Two decision-making logics of INVs at the early stage of growth and internationalisation

Abstract

The purpose of this study is to explore what decision-making logic (effectual or causal) is dominant in the new venture internationalisation process and what influences its changes over time. To this end, we present a case study of a Polish international new venture (INV) operating in the audiobook industry. The study's findings reveal that decision-making logic at the early stage of company growth and internationalisation cannot be assigned to one type of logic, but rather may shift from effectuation to causation and vice versa. Moreover, we argue that INVs may apply two logics simultaneously, depending on the characteristics of the problem space.

Entrepreneurial Level Factors of Early Internationalization: A Cross Country Comparison

“…Founders and managers of current and future INVs from the CEE region may benefit from understanding our results in terms of the confirmed strong role of the personality of the founders, and their potential competitive advantages stemming from the historical entrepreneurial patterns related to developing ventures even in a limitedresources environment (effectuation strategies). This conclusion adds to our understanding of region-specific characteristics of potential INV internationalisation strategies as described by extant literature (Ciszewska & Mlinaric et al 2016;Nowinski & Rialp, 2013).…”

“…The emergence of early internationalized small and medium sized firms called most often international new ventures (INVs) or born globals (BGs) inspired a wave of research that concentrated on developed countries (Mathews & Zander, 2007;Kuivalainen et al, 2010;Gabrielsson & Gabrielsson, 2013), including metaanalyses of the research field (Santos & Barandas, 2015;Choquette et al, 2017;Garcia-Lillo et al, 2017;Dzikowski, 2018), but much less research focused on transition economies like the Central and Eastern European (CEE) countries (Vissak, 2006;Jarosinski, 2012;Nowinski & Rialp, 2013;Ferencikova, 2014;Ciszewska-Mlinaric et al, 2016;Sekliuckiene, 2017;Jarosinski & Mierzejewska, 2017).…”

Effectuation Spectra in Chinese High-Tech Entrepreneurship: Domain-Specific Logic Orientations and Cross-Border M&A

“…The perceived level of ambiguity, as a proxy for uncertainty, is a multidimensional construct and mediates the strategies that entrepreneurs draw from in the pool of domain-specific logic orientations. Our framework may help explain the results of two recent empirical studies that find that entrepreneurs seem to shift between the logics of effectuation and causation (Ciszewska-Mlinaric et al, 2016;Reymen et al, 2015). The implications of context-specific logic orientations for the management of the cross-border M&A process are discussed and imply that heterogeneous and cognitively flexible top-management teams with international experience are beneficial to the integration of the acquired firm, filling a gap in extant research on effectuation and M&A.…”

“…The theory of effectuation is still relatively new and this literature stream is just beginning to unfold: only a small number of empirical papers exist while the theory moves from the novice to an early intermediate stage (Gre´goire, Corbett, & McMullen, 2011). A burgeoning body of research centers on developing or testing the theory of effectuation (Chetty, Ojala, & Leppa¨aho, 2015;Ciszewska-Mlinaric, Obloj, & Wasowska, 2016;Dew, Sarasathy, Read, & Wiltbank, 2009;Honig & Samuelsson, 2009;Read, Song, & Smit, 2009;Roach, Ryman, Makani, Kalantaridis, & Kalantaridis, 2016).…”

Bricolage, effectuation et planification : le cas de la démarche entrepreneuriale d’une EIRP

“…La conversation scientifique au sein de ce champ a montré combien les deux approches du bricolage et de l'effectuation peuvent être pertinentes pour mieux gérer la rareté des ressources et acquérir les capacités stratégiques utiles à la pérennisation de l'organisation dans le temps (Evers et O'Gorman, 2011 ;Gray et Farminer, 2014 ;Garud et Karnøe, 2003 ;Harms et Schiele, 2012). Plus récemment, des recherches insistent sur les liens entre effectuation et planification (Ciszewska-Mlinaric, Obloj et Wasowska, 2016) ou comparent décisions planifiées et décisions non planifiées au cours de processus d'internationalisation (Crick et Crick, 2014). Gray et Farminer (2014) suggèrent en outre qu'il serait intéressant d'évaluer dans quelle mesure les stratégies les plus couramment associées aux phases initiales de la création de EIRP telles que le bricolage ou l'effectuation (Sarasvathy, 2001 ;Gundry, Kickul, Griffiths et Bacq, 2011) sont remplacées par des approches planifiées, plus traditionnelles ou formelles, au fur et à mesure que les entreprises grandissent, mûrissent et éventuellement déclinent.…”