Do strategy choices matter for nascent firms? A study on effectuation and causation impacts on new ventures outcomes

Principal Topic : Nascent entrepreneurship has drawn the attention of scholars in the last few years (Davidsson, 2006, Wagner, 2004). However, most studies have asked why firms are created focussing on questions such as what are the characteristics (Delmar and Davidsson, 2000) and motivations (Carter, Gartner, Shaver & Reynolds, 2004) of nascent entrepreneurs, or what are the success factors in venture creation (Davidsson & Honig; 2003; Delmar and Shane, 2004). In contrast, the question of how companies emerge is still in its infancy. On a theoretical side, effectuation, developed by Sarasvathy (2001) offers one view of the strategies that may be at work during the venture creation process. Causation, the theorized inverse to effectuation, may be described as a rational reasoning method to create a company. After a comprehensive market analysis to discover opportunities, the entrepreneur will select the alternative with the higher expected return and implement it through the use of a business plan. In contrast, effectuation suggests that the future entrepreneur will develop her new venture in a more iterative way by selecting possibilities through flexibility and interaction with the market, affordability of loss of resources and time invested, development of pre-commitments and alliances from stakeholders. Another contrasting point is that causation is ''goal driven'' while an effectual approach is ''mean driven'' (Sarasvathy, 2001) One of the predictions of effectuation theory is effectuation is more likely to be used by entrepreneurs early in the venture creation process (Sarasvathy, 2001). However, this temporal aspect and the impact of the effectuation strategy on the venture outcomes has so far not been systematically and empirically tested on large samples. The reason behind this research gap is twofold. Firstly, few studies collect longitudinal data on emerging ventures at an early enough stage of development to avoid severe survivor bias. Second, the studies that collect such data have not included validated measures of effectuation. The research we are conducting attempts to partially fill this gap by combining an empirical investigation on a large sample of nascent and young firms with the effectuation/causation continuum as a basis (Sarasvathy, 2001). The objectives are to understand the strategies used by the firms during the creation process and measure their impacts on the firm outcomes. Methodology/Key Propositions : This study draws its data from the first wave of the CAUSEE project where 28,383 Australian households were randomly contacted by phone using a specific methodology to capture emerging firms (Davidsson, Steffens, Gordon, Reynolds, 2008). This screening led to the identification of 594 nascent ventures (i.e., firms that are not operating yet) and 514 young firms (i.e., firms that have started operating from 2004) that were willing to participate in the study. Comprehensive phone interviews were conducted with these 1108 ventures. In a likewise comprehensive follow-up 12 months later, 80% of the eligible cases completed the interview. The questionnaire contains specific sections designed to distinguish effectual and causal processes, innovation, gestation activities, business idea changes and ventures outcomes. The effectuation questions are based on the components of effectuation strategy as described by Sarasvathy (2001) namely: flexibility, affordable loss and pre-commitment from stakeholders. Results from two rounds of pre-testing informed the design of the instrument included in the main survey. The first two waves of data have will be used to test and compare the use of effectuation in the venture creation process. To increase the robustness of the results, temporal use of effectuation will be tested both directly and indirectly. 1. By comparing the use of effectuation in nascent and young firms from wave 1 to 2, we will be able to find out how effectuation is affected by time over a 12-month duration and if the stage of venture development has an impact on its use. 2. By comparing nascent ventures early in the creation process versus nascent ventures late in the creation process. Early versus late can be determined with the help of time-stamped gestation activity questions included in the survey. This will help us to determine the change on a small time scale during the creation phase of the venture. 3. By comparing nascent firms to young (already operational) firms. 4. By comparing young firms becoming operational in 2006 with those first becoming operational in 2004. Results and Implications : Wave 1 and 2 data have been completed and wave 2 is currently being checked and 'cleaned'. Analysis work will commence in September, 2009. This paper is expected to contribute to the body of knowledge on effectuation by measuring quantitatively its use and impact on nascent and young firms activities at different stages of their development. In addition, this study will also increase the understanding of the venture creation process by comparing over time nascent and young firms from a large sample of randomly selected ventures. We acknowledge the results from this study will be preliminary and will have to be interpreted with caution as the changes identified may be due to several factors and may not only be attributed to the use/not use of effectuation. Meanwhile, we believe that this study is important to the field of entrepreneurship as it provides some much needed insights on the processes used by nascent and young firms during their creation and early operating stages.

Attack of the creationist reverberators! Or: the end of the world (as we know it)

This special issue of Popular Communication examines the impact of the global financial crisis and recession on differnt aspects of global and regional media and the cultural industries, changing practices of media production, as well as media consumption, and the interplay of economic challenges and technological change.

Identifying important success factors in new venture creation

This paper seeks to uncover the factors that lead to a successful entrepreneurial experience and or venture. Findings of interest in this paper include: • A venture’s initial aspirations are a double edged sword. Ambition may lead to improved performance by striving to reach harder goals. Harder goals are more difficult therefore this may lead to some dissatisfaction, and possibly abandonment of the venture. • Venture legitimacy is important to establish where possible. Firms that formalize their legal form are more successful, as are those set up a shop-front in order to makes sales. • Increased use of technology and higher levels of novelty does not guarantee success early on. Firms of this nature have longer processes, and attempting to create brand new markets is difficult to achieve. At the same time developing your own technology and securing this intellectual property is important for success. • Having goals to work towards and business planning may be useful, but only if the plan is actively revised. Just having a business plan does not matter. Business plans are more useful as a thinking tool than as a blueprint for action. It is the process of thinking through while reviewing the plan that provides the benefit, not following its instruction to the letter.

From prototype to exploitation : mobile services for patients with chronic lower back pain

Many research and development projects that are carried out by firms and research institutes are technology-oriented. There is a large gap between research results, for instance in the form of prototypes, and the actual service offerings to customers. This becomes problematic when an organization wants to bring the results from such a project to the market, which will be particularly troublesome when the research results do not readily fit traditional offerings, roles and capabilities in the industry, nor the financial arrangements. In this chapter, we discuss the design of a business model for a mobile health service, starting with a research prototype that was developed for patients with chronic lower back pain, using the STOF model and method. In a number of design sessions, an initial business model was developed that identifies critical design issues that play a role in moving from prototype toward market deployment. The business model serves as a starting-point to identify and commit relevant stakeholders, and to draw up a business plan and case. This chapter is structured as follows. We begin by discussing the need for mobile health business models. Next, the research and development project on mobile health and the prototype for chronic lower back pain patients are introduced, after which the approach used to develop the business model is described, followed by a discussion of the developed mobile health business model for each of the STOF domains. We conclude with a discussion regarding the lessons that were learned with respect to the development of a business model on the basis of a prototype.

New country market feasibility analyses

Opportunity screening is also known as feasibility testing, which is the process of assessing whether a particular business opportunity is within the capacity of either an entrepreneur or an intrapreneur, and also whether it can create sustainable revenues. As the funnel diagram shows, the number of opportunities diminishes as we move to the right through the diagram. This is because not every idea identified in the opportunity identification stage as potentially interesting, and then framed into a business opportunity in the opportunity development stage, will satisfy the formal and informal screening criteria. The informal screening process occurs in all stages of the development process. For example, not every idea that has been identified will be converted into a business opportunity; similarly, not every business opportunity progresses to a feasibility test. Subsequently, only the best business opportunities are screened, and only the very best of those screened then progress to the business plan step.

Strategic planning for long-term financing of Pacific leatherback conservation and recovery:Proceedings of the Bellagio Sea Turtle Conservation Initiative, Terengganu, Malaysia; July 2007

On 17-20 July 2007, 45 experts on sea turtles, fisheries, conservation and finance from 10 countries convened at the Bellagio Sea Turtle Conservation Initiative workshop in Terengganu to focus on methods to save the imperiled Pacific leatherback from extinction. The group developed a strategic plan to guide the prioritization and long term financing of Pacific leatherback turtle conservation and recovery objectives. Participants identified critical conservation actions and agreed that a business plan is urgently needed to reverse the trajectory towards extinction of the Pacific leatherback. The conservation actions prioritized by the participants encompassed protecting nesting beaches including eggs and nesting females; reducing direct and indirect turtle take in coastal fisheries; and strengthening regional and sub-regional cooperation. The group committed to work together on fundraising and implementation of these urgent conservation actions. This report presents outputs and the plan that was produced from the workshop.

TickTASKER, un nuevo proyecto empresarial en el entorno TIC

Business Plan Tick TASKER

MW, Medical Watches

My project is a business plan about the set up of a company and the development of a new and innovative product aimed for the elders. I decide do this project when I discover that one of the more important needs that have the elders is to remember the medicines that they have to take. I thought that a good way could be through a smart watch. My watch have an only function, is a cheap device, easy to use, easy to understand and easy to set up, because the elders usually do not know to use complex electronics devices. There are other similar smart watches and other devices but do not have the necessary characteristics to be a good reminder for elders. My watch is centred to improve the life of the elders, but my product could also be useful for ill people who have to take many medicines during the day. After realizing this business plan, I have proved that my company is viable in the environment and profitable in the market.

Changes in innovation styles - comprehensive study of the changes in innovation styles to identify the causes and effects of different influencing factors and capabilities to create a general innovation pattern.

An investigation in innovation management and entrepreneurial management is conducted in this thesis. The aim of the research is to explore changes of innovation styles in the transformation process from a start-up company to a more mature phase of business, to predict in a second step future sustainability and the probability of success. As businesses grow in revenue, corporate size and functional complexity, various triggers, supporters and drivers affect innovation and company's success. In a comprehensive study more than 200 innovative and technology driven companies have been examined and compared to identify patterns in different performance levels. All of them have been founded under the same formal requirements of the Munich Business Plan Competition -a research approach which allowed a unique snapshot that only long-term studies would be able to provide. The general objective was to identify the correlation between different factors, as well as different dimensions, to incremental and radical innovations realised. The 12 hypothesis were formed to prove have been derived from a comprehensive literature review. The relevant academic and practitioner literature on entrepreneurial, innovation, and knowledge management as well as social network theory revealed that the concept of innovation has evolved significantly over the last decade. A review of over 15 innovation models/frameworks contributed to understand what innovation in context means and what the dimensions are. It appears that the complex theories of innovation can be described by the increasing extent of social ingredients in the explanation of innovativeness. Originally based on tangible forms of capital, and on the necessity of pull and technology push, innovation management is today integrated in a larger system. Therefore, two research instruments have been developed to explore the changes in innovations styles. The Innovation Management Audits (IMA Start-up and IMA Mature) provided statements related to product/service development, innovativeness in various typologies, resources for innovations, innovation capabilities in conjunction to knowledge and management, social networks as well as the measurement of outcomes to generate high-quality data for further exploration. In obtaining results the mature companies have been clustered in the performance level low, average and high, while the start-up companies have been kept as one cluster. Firstly, the analysis exposed that knowledge, the process of acquiring knowledge, interorganisational networks and resources for innovations are the most important driving factors for innovation and success. Secondly, the actual change of the innovation style provides new insights about the importance of focusing on sustaining success and innovation ii 16 key areas. Thirdly, a detailed overview of triggers, supporters and drivers for innovation and success for each dimension support decision makers in putting their company in the right direction. Fourthly, a critical review of contemporary strategic management in conjunction to the findings provides recommendation of how to apply well-known management tools. Last but not least, the Munich cluster is analysed providing an estimation of the success probability of the different performance cluster and start-up companies. For the analysis of the probability of success of the newly developed as well as statistically and qualitative validated ICP Model (Innovativeness, Capabilities & Potential) has been developed and applied. While the model was primarily developed to evaluate the probability of success of companies; it has equal application in the situation to measure innovativeness to identify the impact of various strategic initiatives within small or large enterprises. The main findings of the model are that competitor, and customer orientation and acquiring knowledge important for incremental and radical innovation. Formal and interorganisation networks are important to foster innovation but informal networks appear to be detrimental to innovation. The testing of the ICP model h the long term is recommended as one subject of further research. Another is to investigate some of the more intangible aspects of innovation management such as attitude and motivation of mangers. IV

A study of the benefits of retrofitting cardiovascular exercise equipment of a gym with human energy harvesting technology

Gemstone Team HEAT (Human Energy Acquisition Technology)

Resources, experience and perseverance in entrepreneurs' perceived likelihood of success in an emerging economy

This paper introduces new results obtained from a statistical investigation into a 3071-observation data set collected from a Vietnamese nationwide entrepreneurship survey. From established relationships, such factors as preparedness, financial resources and participation in social networks are confirmed to have significant effects on entrepreneurial decisions. Entrepreneurs, both financially constrained and unconstrained, who have a business plan tend to start their entrepreneurial ventures earlier. Also, financial constraints have a profound impact on the entrepreneurial decisions. When perceiving the likelihood of success to be high, an entrepreneur shows the tendency for prompt action on business ideas. But when seeing the risk of prolonging the waiting time to first revenue, a prospective entrepreneur would be more likely to wait for more favorable conditions despite the vagueness of "favorable". Additionally, empirical computations indicate that there is a 41.3% probability that an extant entrepreneur who is generating revenue sees high chance of success. Past work and entrepreneurial experiences also have positive impacts on both the entrepreneurial decisions and perceived chance of success.

Existenzgründung und Beratung: ( I ) Gewinnschwellenanalyse

Die wirtschaftspolitische Förderung von Existenz- und besonders Unternehmensgründungen zielt auf die Schaffung von Wertschöpfung und damit von Einkommen, Nachfrage und Wachstum im Kontext regionaler Mikrokreisläufe. In diesem Zusammenhang besteht die Aufgabe der Existenzgründungsberatung im Hinblick auf die Gründungsplanung und die nachfolgende Gründungsrealisierung in der Vermeidung oder Minimierung der Gründungsrisiken. Diese Risiken werden hier anhand des modifizierten Modells der Gewinnschwellenanalyse (Break – Even - Analyse) aufgezeigt und in ihren Konsequenzen erläutert. Zugleich wird erkennbar, wie sie vermieden oder minimiert werden können. Und eine phasenorientierte, am Projektmanagement orientierte praktische Vorgehensweise, in deren Mittelpunkt der Geschäftsplan (Business Plan) steht, gewährleistet die nötige Systematik, die begleitende Qualitätssicherung und die betriebswirtschaftliche Steuerung des mehrjährigen Gründungsprozesses.

Implementação de uma marca de produção e distribuição de citrinos biológicos: Orange made in Algarve

Trabalho de projeto apresentado à Escola Superior de Comunicação Social como parte dos requisitos para obtenção de grau de mestre em Publicidade e Marketing.

Plano de negócios para a criação de empresa de produção hortícola

Trabalho de projeto apresentado ao Instituto Politécnico do Porto para obtenção do Grau de Mestre em Gestão das Organizações, Ramo de Gestão de Empresas Orientador: Professor Doutor Orlando Manuel Martins Marques de Lima Rua

Plano de Negócio para a aplicação mobile Nutri Consult

Trabalho de projeto apresentado à Escola Superior de Comunicação Social como parte dos requisitos para obtenção de grau de mestre em Publicidade e Marketing.