Effectuation

Effectuation

Elements of Entrepreneurial Expertise

New Horizons in Entrepreneurship series

Saras D. Sarasvathy

To effectuate is to engage in a specific type of entrepreneurial action. It has special importance for situations where the future is truly unknowable or human agency is of primary importance. In Effectuation, Saras Sarasvathy explores the theory and techniques of non-predictive control for creating new firms, markets and economic opportunities.

Appendix 2: Protocol from E5

Saras D. Sarasvathy

Subjects: business and management, entrepreneurship

Extract

This company could make a few people very rich, but it cannot . . . I don’t think it could ever be a huge company. The basic concept is a business simulator . . . startup simulator . . . so . . . in the same way in a jet simulator you can hop in and fly something electronically and not blow it up . . . so you can hop into a business situation and practice and get a lot of reflexes built up and thought processes built up up front. So . . . a successful launch of the first product with a big marketing sales push to penetrate as many different markets as we could . . . might have a successful second product. For example, you could have a product which is how to succeed, prosper, grow and get promoted within a large company. Making an equivalent product for the quote organization person as opposed to the entrepreneur would give you market of everybody with aspirations at IBM, AT&T, Exxon etc. etc. so . . . That product could be a follow-on product . . . the research would be similar, the product development would be similar, and so the production part would be equivalent and some of the same marketing channels would also work. You could make another product, would be, for students. How do I graduate in the top 10 per cent of your class at Stanford, or Harvard or Yale. And there . . . you could simulate the learning process in the classroom. And research traits that tend to make you successful or not. Study habits that tend...

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