Summary Growth Strategies and Organizational Challenges
Week 1..................................................................................................................................................... 2
Lecture 1.1......................................................................................................................................... 2
Brinckmann, J., Grichnik, D., & Kapsa, D. (2010). Should entrepreneurs plan or just storm
the castle? A meta-analysis on contextual factors impacting the business
planning–performance relationship in small firms. Journal of Business Venturing, 25(1),
24-40........................................................................................................................................... 2
Sarasvathy, S.D. (2001). Causation and effectuation: Toward a theoretical shift from
economic inevitability to entrepreneurial contingency. Academy of Management Review,
26(2), 243-263.............................................................................................................................4
Lecture 2.1......................................................................................................................................... 7
Sapienza, H.J., Autio, E., George, G., & Zahra, S.A. (2006). A capabilities perspective on the
effects of early internationalization on firm survival and growth. Academy of Management
Review, 31(4), 914-933...............................................................................................................7
Lu, J.W., & Beamish, P.W. (2004). International diversification and firm performance: The
S-curve hypothesis. Academy of Management Journal, 47(4), 598-609..................................10
Week 2................................................................................................................................................... 12
Lecture 3.1....................................................................................................................................... 12
Klier, H., Schwens, C., Zapkau, F.B., & Dikova, D. (2017). Which Resources Matter How
and Where? A Meta‐Analysis on Firms’ Foreign Establishment Mode Choice. Journal of
Management Studies, 54(3), 304–339...................................................................................... 12
Puranam, P., Singh, H., & Chaudhuri, S. (2009). Integrating acquired capabilities: When
structural integration is (un) necessary. Organization Science, 20(2), 313-328....................... 14
Lecture 4.1....................................................................................................................................... 16
Pisano, G., & Teece, D. (2007). How to capture value from innovation: Shaping intellectual
property and industry architecture. California Management Review, 50(1), 278-296............. 18
James, S. D., Leiblein, M. J., & Lu, S. (2013). How firms capture value from their
innovations. Journal of management, 39(5), 1123-1155...........................................................20
Zobel, A., Lokshin, B., & Hagedoorn, J. (2017). Formal and informal appropriation
mechanisms: The role of openness and innovativeness. Technovation, 59(1), 44-54.............. 22
Week 3................................................................................................................................................... 25
Lecture 5.......................................................................................................................................... 25
Margolis, J.D., & Walsh, J.P. (2003). Misery loves companies: Rethinking social initiatives by
business. Administrative Science Quarterly, 48(2), 268-305....................................................26
Jones, T. M., Harrison, J. S., & Felps, W. (2018). How applying instrumental stakeholder
theory can provide sustainable competitive advantage. Academy of Management Review,
43(3), 371-391...........................................................................................................................29
Bosse, D. A., Phillips, R. A., & Harrison, J. S. (2009). Stakeholders, reciprocity, and firm
performance. Strategic Management Journal, 30(4), 447-456..................................................31
Week 4................................................................................................................................................... 32
Lecture 6.......................................................................................................................................... 32
Minto, B. (1998). Think your way to clear writing. Consulting to Management, 10 (1), 33... 32
Scherer, A., Wünderlich, N. V., & Von Wangenheim, F. (2015). The value of self-service. MIS
quarterly, 39(1),177-200........................................................................................................... 33
Collier, J. E., Breazeale, M., & White, A. (2017). Giving back the “self” in self-service:
customer preferences in self-service failure recovery. Journal of Services Marketing............ 35
Week 5................................................................................................................................................... 36
, Lecture 7.......................................................................................................................................... 36
"Chatterjee, S., & Wernerfelt, B. (1991). The link between resources and type of
diversification: Theory and evidence. Strategic management journal, 12(1), 33-48".............. 38
"Palich, L. E., Cardinal, L. B., & Miller, C. C. (2000). Curvilinearity in the
diversification–performance linkage: an examination of over three decades of research.
Strategic management journal, 23(2), 155-174."...................................................................... 39
SKIPPED: "Andreou, P. C., Louca, C., & Petrou, A. P. (2016). Organizational learning and
corporate diversification performance. Journal of Business Research, 69(9), 3270-3284.".....40
Week 6................................................................................................................................................... 42
Lecture 8.......................................................................................................................................... 42
Sawhney, M., Balasubramanian, S., & Krishnan, V. V. (2004). Creating growth with services.
MIT Sloan Management Review, 45(2), 34..............................................................................44
Huikkola, T., & Kohtamäki, M. (2017). Solution providers’ strategic capabilities. Journal of
Business & Industrial Marketing, 32(5)....................................................................................46
Week 1
Lecture 1.1
Resources-based theory: makes a difference in competing with other firms. Considers competition as
a benefiting from non-substitutable resources.
Growth strategies should be resilient (and help build resources). A company should be able to be
resilient to fast-growing and changing environments. Being able to survive difficult times.
Meta-analyse: a study of study. You can take characteristics of the different studies to better
understand different circumstances.
Meta-analysis—it combines findings from different studies to give a strong overall picture. By
considering the size and direction of each study, it creates a powerful and accurate summary that's
more reliable than looking at studies individually. This helps researchers see the big picture, avoid
biases, and get smarter insights for future studies.
Brinckmann, J., Grichnik, D., & Kapsa, D. (2010). Should entrepreneurs plan or just storm the
castle? A meta-analysis on contextual factors impacting the business planning–performance
relationship in small firms. Journal of Business Venturing, 25(1), 24-40.
Business Planning: see what is the effect (positive/negative) of organizational performances. How
does it add to performance?
Research gap:
Two opposing theoretical perspectives.
● BP fosters firms’ development due to increased decision speed and more efficient resource
utilization. Goal setting fosters the identification of effective steps to realize these goals.
, ● BP prevents dedicating time to activities such as acquiring resources or organizational
development. BP can lead to cognitive rigidities, organizational inertia, and limited strategic
flexibility.
Research aim
● The paper analyzes the general relationship
between BP and performance.
● The paper analyzed specific
planning-context
● It also focuses on the circumstances when
BP leads to better performance → 3
contextual moderators
○ the development stage (newness)
of the firm. Firms Age
■ New vs established small
firms
■ H2: BP increases benefits
more for established small
firms than for new small firms
○ the form of business planning (Planning outcome vs process)
■ Not significant
○ the cultural context (e.g. uncertainty avoidance)
■ H4: BP has a greater effect on performance in cultures with low UA than in
cultures with a high UA
Uncertainty: Mercedes vs Tesla
State uncertainty: captures uncertainty about future conditions of the environment.
Effect uncertainty: concerns the inability to predict how future conditions of the environment will
affect the organization. ‘How will this effect the organisation’
Response uncertainty: regards unknown response options and consequences that different responses
will have. ‘What is the best way/how to respond’
Business planning involves the prediction of future conditions, a determination of effects that future
conditions will have on the firm, the development of strategies in light of evolving environmental
conditions, and an assessment of the expected outcomes of these strategies.
Business planning (BP) is generally valuable for creating value, even for small businesses with
limited resources, but its benefits vary. Contrary to common belief, it's not a must-have for new firms,
especially when faced with high uncertainty and limited information. Additionally, if a business is in a
high uncertainty avoidance (UA) environment, sticking too strictly to a plan might limit flexibility
and the ability to seize unexpected opportunities. The benefits of business planning come from both
its symbolic value and the learning experiences it provides, but for startups, the impact is significant,
though relatively small.
For startups it is better to storm the castle. The effect is there, it is significant. But it is a little effect.
For a firms initial years, it's suggested that focusing on basic business planning activities is enough
during a company's early years. Instead, it's crucial to allocate resources to activities that gather
,information, reduce uncertainty, and promote learning. Long pre-planning activities that aren't
connected to market interaction and feedback might actually be harmful. Being mentally prepared and
open to adjusting business plans is key, and closely sticking to a plan doesn't guarantee success.
However, there are some limitations to consider. The studies might not always distinguish between
new and established small firms, which could affect the findings. Also, using Hofstede's
four-dimensional concept of culture might oversimplify cultural diversity and complexity. While
meta-analysis can show the strength of a relationship, it can't prove causation, emphasizing the
importance of having solid theoretical foundations in research.
Sarasvathy, S.D. (2001). Causation and effectuation: Toward a theoretical shift from economic
inevitability to entrepreneurial contingency. Academy of Management Review, 26(2), 243-263
Processes of causation and effectuation: Definition:
- Causation processes take a particular effect as given and focus on selecting between means
to create that effect. (Managerial thinking) → logic of prediction
- Effect is given.
- Choose between means to achieve the given effect
- Selection criteria based on expected return
- Effect dependent: choice of means is driven by characteristics of the effect of decision
maker wants to create and his knowledge of possible means.
- Excellent at exploiting knowledge
- Useful in linear and independent environments
- Focus on predictable aspects of an uncertain future
- To the extent we can predict the future, we can control it.
- Effectuation processes take a set of means as given and focus on selecting between possible
effects that can be created with that set of means. (Entrepreneurial thinking) → logic of
control
- Only some means or tools are given
- Choose between possible effects that can be created with given means
- Selection criteria based on affordable loss or acceptable risk
- Actor dependent: given specific means, choice of effect is driven by characteristics of
the actor and his ability to discover and use contingencies (=refer to possible future
events or circumstances that are uncertain or may happen, but their occurrence is not
guaranteed)
- Excellent at exploiting contingencies
- Explicit assumption of dynamic, nonlinear and ecological environments
- Focus on the controllable aspects of an unpredictable future
- To the extent we can control the future, we do not need to predict it
Causation: This traditional approach assumes entrepreneurs have a predetermined goal and work to
achieve it by identifying and exploiting opportunities. It relies on a predictive, linear, and analytical
mindset, emphasizing market research and analysis. E.g. The chef needs to cook dinner. The host
, selects a menu. Chef makes a list of ingredients, shops for them, and makes dinner. → Process of
causation. Selecting a effective way to reach the goal (cooking dinner)
Causation processes are excellent at exploiting knowledge.
Causation processes focus on the predictable aspects of an uncertain future. (“To the extent that we
can predict the future, we can control it”)
Effectuation: In contrast, effectuation suggests that entrepreneurs start with their available resources
and expertise and adapt their goals based on these resources. It emphasizes experimentation, learning
from the market, and creating opportunities rather than predicting them. Effectuation is characterized
by a ‘bird in hand’ principle, focusing on what entrepreneurs have, who they are and whom they
know. E.g. the host asks the chef to look in the cupboard for possible ingredients for dinner. Chef
needs to imagine possible menus based on the given ingredients and focuses on preparing one of
many possible meals. → process of effectuation.
● The process of effectuation allows entrepreneurs to create one or more several possible effects
irrespective of the generalized end goal with which she started.
● Effectuation processes are excellent at exploiting contingencies.
● Effectuation processes focuses on the controllable aspects of an unpredictable future. (“to the
extent that we can control the future, we do not need to predict it.’)
The paper illustrates these concepts through real-world business examples and thought experiments. It
also discusses how effectuation theory connects with existing entrepreneurial theories and empirical
evidence.
The arguments from both perspectives- unbounded rationality and bounded rationality-can be
summarized as follows:
● If the decision makers believe they are dealing with a measurable or relatively predictable
future, they will tend to do some systematic information gathering and invest some effort on a
reasonable analysis of that information, within certain bounds.
● Similarly, if they believe they are dealing with relatively unpredictable phenomena, they will
try to gather information through experimental and iterative learning techniques aimed at first
discovering the underlying distribution of the future. \
● This logically implies that the decision makers' underlying beliefs about the future
phenomena that impact a particular decision can be deduced by examining the types of
heuristics and logical approaches they use in making the decision.
Key takeaways from the paper include:
● Effectuation challenges the traditional view of entrepreneurship that heavily relies on
causation.
● Entrepreneurs often use a mix of both paradigms, but effectuation can be especially relevant
in uncertain and dynamic environments.
● Effectuation encourages entrepreneurs to leverage their unique skills and networks to create
value in innovative ways.
● Effectuation is particularly relevant for scenarios with high uncertainty, such as startups.
● Causation emphasizes goal-setting and planning, while effectuation embraces the “affordable
loss” mindset.
● Entrepreneurs can blend elements of both approaches based on their context and preferences.
