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Effectuation heuristics for the incumbent firm

Vliek, Koen (2015) Effectuation heuristics for the incumbent firm.

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Abstract:In order to find effectuation heuristics for the incumbent firm, an action research study has been applied. This research distinguishes in two ways: 1) Actionable guidelines based on the effectual logic are created, for actually using effectuation. So far effectuation was only analyzed retrospectively. 2) In an uncertain environment, the heuristics are applied to an incumbent firm, contributing to a recently opening field of research: effectuation in the corporate context. The research question ‘How can effectuation heuristics be applied in the incumbent firm?’ is answered by means of the following heuristics, designed for use in the incumbent firm. 1M.: Make a pool of resources: map your company’s and your employee’s means. 2M.: Create an organizational structure which incorporates the pool of resources and stimulates and rewards employee’s effectual behaviour. 3M.Find creative ways to use the available means to the company’s advantage. 4M. Experiment with different products and/or business models to see what works best. 5A. Invest/ risk only what can be afforded to lose. 6A. Select opportunities based on minimization of risks and costs. 7A. Use creative ways of financing, or getting resources. Use bootstrapping. 8L. Use potential setbacks or external threats as advantageous as possible. 9L. Add new information to your pool of resources and check if new opportunities arise. 10Q. Perceive new actors on the market as potential partners, and approach them very early on in order to jointly co-create the future. 11Q. In order to reduce risks, start partnerships, with partners that are willing to commit from the onset. 12Q. Use pre-commitments from partners, suppliers, customers and employees as often as possible. 13Q. Aim to insure that gains and risks in new as well as existing partnerships are shared fairly. 14Q. When a partnership is established, combine your pools of resources and make use of the synergetic effect.
Item Type:Essay (Master)
Clients:
NextSelect, The Netherlands
Faculty:BMS: Behavioural, Management and Social Sciences
Subject:85 business administration, organizational science
Programme:Business Administration MSc (60644)
Link to this item:http://purl.utwente.nl/essays/68800
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