Causality, effectiveness and business performance: A fuzzy approach

Document Type : Research Paper

Authors

1 Department of new business, Faculty of Entrepreneurship , University of Tehran

2 Department of new business. Faculty of Entrepreneurship. The University of Tehran.

3 A faculty member of Technical and Vocational University

4 Ph.D. student in the Faculty of Entrepreneurship, University of Tehran

Abstract

Effectiveness and causality as two fundamental decision logics of growing research areas in the field of entrepreneurship. The purpose of this paper is to investigate the effect of causality and dimensions of effectiveness (experimentation, tolerable losses, flexibility and pre-commitment) on business performance with a fuzzy approach. In this study, in addition to causally examining the necessary and sufficient conditions in the formation of business performance, effective combinations of causality and dimensions of effectiveness in the formation of business performance have been investigated. This research is applied from the perspective of the purpose and the data are collected by descriptive-correlation method. The statistical population of the study, according to the statistics of Tehran Computer Guild Organization, includes 170 startup businesses in Tehran that have been operating for three years. Based on Cochran's formula, a statistical sample of 118 was calculated, 120 samples were collected by random sampling method and analyzed by fsQCA3 and SPSS24 software. According to the findings, among the various causes and dimensions of effectiveness, one dimension is a necessary condition and five dimensions are sufficient conditions for business performance. Finally, two types of complex and complex causal pathways were identified, each of which introduced four different combinations of causation and effect-making dimensions in the direction of business performance.

Keywords

References

باقرصاد، وجیه؛ داوری, علی، عزیزی،محمد،. (1398). تحلیل فازی رابطه ابعاد اکوسیستم کارآفرینی با رقابت‌پذیری. فصلنامه علوم مدیریت ایران، 14(55)، 107-129
قیصری، وحید، طالبی، کامبیز و ایمانی پور، نرگس. (2015). نقش تفکر کارآفرینانه بر راهبردهای رشد در کسب‌وکارهای کوچک و متوسط. فصلنامه علمی پژوهشی توسعه کارآفرینی, 8(2)، 195-214.‎
Baker, T., & Nelson, R. E. (2005). Creating something from nothing: Resource construction through entrepreneurial bricolage. Administrative Science Quarterly, 50(3), 329–366.
Beckman, C., Eisenhardt, K., Kotha, S., Meyer, A., & Rajagopalan, N. (2012). TECHNOLOGY ENTREPRENEURSHIP. 93, 89–93.
Berends, H., Jelinek, M., Reymen, I., & Stultiëns, R. (2014). Product innovation processes in small firms: Combining entrepreneurial effectuation and managerial causation. Journal of Product Innovation Management, 31(3), 616–635.
Blauth, M., Mauer, R., & Brettel, M. (2014). Fostering creativity in new product development through entrepreneurial decision making. Creativity and Innovation Management, 23(4), 495–509.
Cai, L., Guo, R., Fei, Y., & Liu, Z. (2017). Effectuation, Exploratory Learning and New Venture Performance: Evidence from China. Journal of Small Business Management, 55(3), 388–403.
Chandler, G. N., DeTienne, D. R., McKelvie, A., & Mumford, T. V. (2011). Causation and effectuation processes: A validation study. Journal of Business Venturing, 26(3), 375–390.
Chandler, G. N., Detienne, D. R., & Mumford, T. V. (2007). Causation and effectuation: measurement development and validation. Frontiers of Entrepreneurship Research. 27, 1-13..
Chenhall, R. H., & Langfield-Smith, K. (2007). Multiple Perspectives of Performance Measures. European Management Journal, 25(4), 266–282.
Crilly, D. (2011). Predicting stakeholder orientation in the multinational enterprise: A mid-range theory. Journal of International Business Studies, 42(5), 694–717.
Deligianni, I., Voudouris, I., & Lioukas, S. (2017). Do Effectuation Processes Shape the Relationship Between Product Diversification and Performance in New Ventures? Entrepreneurship: Theory and Practice, 41(3), 349–377.
Dew, N., Read, S., Sarasvathy, S. D., & Wiltbank, R. (2008). Outlines of a behavioral theory of the entrepreneurial firm. Journal of Economic Behavior and Organization, 66(1), 37–59.
Dew, N., Read, S., Sarasvathy, S. D., & Wiltbank, R. (2009). Effectual versus predictive logics in entrepreneurial decision-making: Differences between experts and novices. Journal of Business Venturing, 24(4), 287–309.
Fisher, G. (2012). Effectuation, causation, and bricolage: A behavioral comparison of emerging theories in entrepreneurship research. Entrepreneurship: Theory and Practice, 36(5), 1019–1051.
Gabrielsson, J., & Politis, D. (2011). Career motives and entrepreneurial decision-making: Examining preferences for causal and effectual logics in the early stage of new ventures. Small Business Economics, 36(3), 281–298.
Gabrielsson, P., & Gabrielsson, M. (2013). Industrial Marketing Management A dynamic model of growth phases and survival in international business-to-business new ventures : The moderating effect of decision-making logic. Industrial Marketing Management, 42(8), 1357–1373.
Galkina, T., & Atkova, I. (2020). Effectual Networks as Complex Adaptive Systems: Exploring Dynamic and Structural Factors of Emergence. Entrepreneurship: Theory and Practice, 44(5), 964–995.
Grégoire, D. A., & Cherchem, N. (2019). A structured literature review and suggestions for future effectuation research. Small Business Economics, 54(3), 621–639.
Hauser, A., Eggers, F., & Güldenberg, S. (2019). Strategic decision-making in SMEs: effectuation, causation, and the absence of strategy. Small Business Economics, 54(3), 775–790.
Karami, M., Wooliscroft, B., & Mcneill, L. (2019). Effectuation and internationalisation : a review and agenda for future research. Small Business Economics, 55(3), 777–811.
Kraus, S., Ribeiro-Soriano, D., & Schüssler, M. (2018). Fuzzy-set qualitative comparative analysis (fsQCA) in entrepreneurship and innovation research – the rise of a method. International Entrepreneurship and Management Journal, 14(1), 15–33.
Kristinsson, K., Candi, M., & Sæmundsson, R. J. (2016). The Relationship between Founder Team Diversity and Innovation Performance: The Moderating Role of Causation Logic. Long Range Planning, 49(4),464–476.
Laskovaia, A., Shirokova, G., & Morris, M. H. (2017). National culture, effectuation, and new venture performance: global evidence from student entrepreneurs. Small Business Economics, 49, 687–709.
Mayer-Haug, K., Read, S., Brinckmann, J., Dew, N., & Grichnik, D. (2013). Entrepreneurial talent and venture performance: A meta-analytic investigation of SMEs. Research Policy, 42(6–7), 1251–1273.
Murphy, G. B., Trailer, J. W., & Hill, R. C. (1996). Measuring performance in entrepreneurship research. Journal of Business Research, 36(1), 15–23.
Pacho, F. T., & Mushi, H. (2020). The effect of effectuation set of means on new venture performance: flexibility principle as a mediating factor. Journal of Entrepreneurship in Emerging Economies.
Peng, X. B., Liu, Y. L., Jiao, Q. Q., Feng, X. Bin, & Zheng, B. (2020). The nonlinear effect of effectuation and causation on new venture performance: The moderating effect of environmental uncertainty. Journal of Business Research, 117, 112–123.
Ragin, C. C., Strand, S. I., Rubinson, C., Drass, K., & Davey, S. (2008). USER’S GUIDE TO Fuzzy-Set / Qualitative Comparative Analysis - for pc program,1–91.
Read, S., Sarasvathy, S. D., Dew, N., & Wiltbank, R. (2016). Dialogue. Academy of Management Review, 41(3), 528–536.
Read, S., Song, M., & Smit, W. (2009). A meta-analytic review of effectuation and venture performance. Journal of Business Venturing, 24(6), 573–587.
Ruiz-Jiménez, J. M., Ruiz-Arroyo, M., & del Mar Fuentes-Fuentes, M. (2020). The impact of effectuation, causation, and resources on new venture performance: novice versus expert entrepreneurs. Small Business Economics.
Sarasvathy, S. D. (2001). Causation and Effectuation: Toward a Theoretical Shift from. Academy of Management Review, 26(2), 243–263.
Sarasvathy, S. D., & Dew, N. (2008). Is effectuation lachmannian? A response to Chiles, Bluedorn, and Gupta (2007). Organization Studies, 29(2), 239–245.
Sarasvathy, S., Kumar, K., York, J. G., & Bhagavatula, S. (2014). An Effectual Approach to International Entrepreneurship: Overlaps, Challenges, and Provocative Possibilities.Entrepreneurship: Theory and Practice,38(1),71–93.
Shane, S., & Venkataraman, S. (2000). The promise of entrepreneurship as a field of research. Academy of Management Review, 25(1), 217–226.
Smolka, K. M., Verheul, I., Burmeister–Lamp, K., & Heugens, P. P. (2016). Get it together! Synergistic effects of causal and effectual decision–making logics on venture performance. Entrepreneurship Theory and Practice, 42(4), 571-604.
Sullivan Mort, G., Weerawardena, J., & Liesch, P. (2012). Advancing entrepreneurial marketing: Evidence from born global firms. European Journal of Marketing, 46, 542–561.
Vanderstraeten, J., Hermans, J., van Witteloostuijn, A., & Dejardin, M. (2020). SME innovativeness in a dynamic environment: is there any value in combining causation and effectuation? Technology Analysis & Strategic Management, 32(11), 1277-1293
Venkatraman, N., & Ramanujam, V. (1986). Measurement of Business Performance in Strategy Research: A Comparison of Approaches. The Academy of management review, 11(4), 801-814.
Yu, X., Tao, Y., Tao, X., Xia, F., & Li, Y. (2018). Managing uncertainty in emerging economies: The interaction effects between causation and effectuation on firm performance. Technological Forecasting and Social Change, 135, 121-131. 

Files

Share

How to cite

Statistics