ANALYSIS OF THE ENTREPRENEURIAL PROCESS FROM EFFECTUATION AND CAUSATION LOGIC: A CASE STUDY IN TWO COMPANIES FROM MINAS GERAIS

Ferreira, Karina Fernanda Oliveira; Guimarães, Liliane de Oliveira; Salume, Paula Karina; Doyle, Maria Luiza de Fátima Costa Proença

doi:10.5902/1983465964831

Karina Fernanda Oliveira Ferreira

Pontifícia Universidade Católica de Minas Gerais. Belo Horizonte, Minas Gerais, Brazil

http://orcid.org/0000-0003-2427-3735

Liliane de Oliveira Guimarães

Pontifícia Universidade Católica de Minas Gerais. Belo Horizonte, Minas Gerais, Brazil

http://orcid.org/0000-0002-3346-2207

Paula Karina Salume

Universidade Federal de São João del-Rey (UFSJ). Belo Horizonte, Minas Gerais, Brazil.

http://orcid.org/0000-0003-1947-9608

Maria Luiza de Fátima Costa Proença Doyle

Pontifícia Universidade Católica de Minas Gerais. Belo Horizonte, Minas Gerais, Brazil

http://orcid.org/0000-0002-2006-1391

1. Karina Fernanda Oliveira Ferreira Institution: Pontifícia Universidade Católica de Minas Gerais. Belo Horizonte, Minas Gerais, Brazil Biography: Master in Management from Postgraduate Program in Management at Pontifical Catholic University - PUC Minas. Manager at Vallum Engenharia E-mail: karina-fernanda-oliveira@hotmail.com ORCID: https://orcid.org/0000-0003-2427-3735

2. Liliane de Oliveira Guimarães Institution: Pontifícia Universidade Católica de Minas Gerais, Belo Horizonte, Minas Gerais, Brazil. Ph.D from Getúlio Vargas Foundation, São Paulo, Brazil. Professor of the Postgraduate Program in Management at Pontifical Catholic University - PUC Minas E-mail: lilianeog@pucminas.br ORCID: https://orcid.org/0000-0002-3346-2207

3. Paula Karina Salume Institution: Universidade Federal de São João del-Rey (UFSJ). Belo Horizonte, Minas Gerais, Brazil. PhD from the Postgraduate Program in Management - PUC Minas. Professor of the Management and Accounting Sciences at Federal University of São João Del Rey, Minas Gerais. E-mail: paulasalume@hotmail.com ORCID: https://orcid.org/0000-0003-1947-9608

4. Maria Luiza de Fátima Costa Proença Doyle Institution: Pontifícia Universidade Católica de Minas Gerais. Belo Horizonte, Minas Gerais, Brazil. PhD from the Postgraduate Program in Management -t PUC Minas. Professor of the Management Department - PUC Minas. E-mail: mldoyle@uol.com.br ORCID: https://orcid.org/0000-0002-2006-1391

Contribution of authors

Conflict of Interest

The authors have stated that there is no conflict of interest.

Principles	Features
Acceptable loss costs	It consists of testing all possible strategies considering the limited means that have been given from the predetermination of how much loss is acceptable. "The effectuator prefers choices that create more options in the future over those that maximize returns in the present." (Sarasvathy, 2001aSarasvathy, S. D. (2001a). Causation and effectuation: toward a theoretical shift from economic inevitability to entrepreneurial contingency. Academy of Management Review , 26(2), 243-263., p. 252).
Strategic alliances	Focus on forming strategic alliances with stakeholders in order to reduce and/or eliminate uncertainty and build barriers to entry. "Stakeholder pre-commitments make uncertainty irrelevant by "delivering" a future that looks very similar to what was contracted." (Sarasvathy, 2003Sarasvathy, S. D. (2003). Entrepreneurship as a science of the artificial. Journal of Economic Psychology, 24(2), 203-220., p. 210).
Contingency Exploitation	Contingencies that arise unexpectedly over time are best exploited by the process of effectuation.
Controlling an unpredictable future	It focuses on issues of the conflict of an unpredictable future. "To the extent that we can control the future, we need not predict it." (Sarasvathy, 2001aSarasvathy, S. D. (2001a). Causation and effectuation: toward a theoretical shift from economic inevitability to entrepreneurial contingency. Academy of Management Review , 26(2), 243-263., p. 252).

Logic	Category	References
Effectuation	Means of access: who they are, what they know, who they know.	Sarasvathy (2001aSarasvathy, S. D. (2001a). Causation and effectuation: toward a theoretical shift from economic inevitability to entrepreneurial contingency. Academy of Management Review , 26(2), 243-263.), (2001bSarasvathy, S. D. (2001b). Effectual reasoning in entrepreneurial decision-making: existence and bounds. Academy of Management Proceedings, 26(1), 1-6.), (2003Sarasvathy, S. D. (2003). Entrepreneurship as a science of the artificial. Journal of Economic Psychology, 24(2), 203-220.), (2008Sarasvathy, S. D. (2008). Effectuation: elements of Entrepreneurial Expertise. Cheltenham: Edward Elgar.); Read and Sarasvathy (2005Read, S., & Sarasvathy, S. D. (2005). Knowing what to do and doing what you know: effectuation as a form of entrepreneurial expertise. The Journal of Private Equity, 9(1), 45-62.); Sarasvathy and Dew (2005Sarasvathy, S. D., & Dew, N. (2005). New market creation through transformation. Journal of Evolutionary Economics, 15(5), 533-565.); Sarasvathy, Dew, Read and Wiltbank (2007Sarasvathy, S. D., Dew, N., Read, S., & Wiltbank, R. (2007). Effectual entrepreneurial expertise: existence and bounds. Dudley Kanox Library: Carifornia, USA.); Dew, Read, Sarasvathy and Wiltbank (2008); Dew, Read, Sarasvathy and Wiltbank (2009Dew, 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.); Read, Dew, Sarasvathy, Song and Wiltbank (2009Read, S., Dew, N., Sarasvathy, S. D., Song, M., & Wiltbank, R. (2009). Marketing under uncertainty: the logic of an effectual approach. Journal of Marketing, 73(3), 1-18.).
	Clarity in the initial objectives.
	Acceptable loss costs.
	Strategic alliances with stakeholders.
	Contingency exploitation.
	Controlling an unpredictable future.
Causation	Identifying an opportunity.	Bygrave (1937Bygrave, W. D. (1997). The portable MBA in entrepreneurship. (2nd). New York: John Wiley.); Gartner (1985Gartner, W. B. (1985). A conceptual framework for describing the phenomenon of new venture creation. Academy of Management Review , 10(4), 696-706.); Hisrich (1998Hisrich, R.D., & Peter, M.P. (1998). Entrepreneurship. (4ª Ed.). Boston: Irwin McGraw-Hill,); Labrecque, Borges, Simard and Filion (2005aLabrecque, J.-H., Borges, C., Simard, G., Filion, L. J. (2005a) Recherche sur la création d’entreprises: données - partie A. Montreal: HEC Montreal. Recuperado em 15 mar 2020, de Recuperado em 15 mar 2020, de http://expertise.hec.ca/chaire_entrepreneuriat/wp-content/uploads/ 2005-09-ceje18-34-donneesa.pdf http://expertise.hec.ca/chaire_entrepren... ), (2005bLabrecque, J.-H., Borges, C., Simard, G., Filion, L. J. (2005b) Recherche sur la création d’entreprises: données - partie B. Montreal: HEC Montreal .); Baron and Shane (2007Baron, R. A., & Shane, S. A. (2007). Empreendedorismo: uma visão do processo. São Paulo: Cengage Learning.); Read, Dew, Sarasvathy, Song and Wiltbank (2009Read, S., Dew, N., Sarasvathy, S. D., Song, M., & Wiltbank, R. (2009). Marketing under uncertainty: the logic of an effectual approach. Journal of Marketing, 73(3), 1-18.); Kotler and Keller (2012Kotler, P., & Keller, K. L. (2012). Administração de marketing. (14a ed.). São Paulo: Pearson.Labrecque, ); Hisrich, Peters and Shepherd (2014Hisrich, R. D., Peters, M. P., & Shepherd, D. A. (2014). Empreendedorismo. (9a ed.). Posto Alegre: AMGH.); Dornelas (2016Dornelas, J. C. A. (2016). Empreendedorismo: transformando ideias em negócios (6a ed.). Rio de Janeiro: Atlas.).
	Conducting competitive analysis and market research.
	Development of a business plan.
	Acquire appropriate resources and stakeholders.
	Adaptation to the environment.

Principles	Company X	Company Y
Cost of acceptable losses	Abandonment of stable professional career;	Abandonment of stable professional career;
	Abandonment of financial stability;	Abandonment of financial stability;
	Search for quality of life;	Search for quality of life;
	Search for future financial result.	Search for future financial result.
Strategic alliances	Partnerships with suppliers;	Partnerships with suppliers.
Strategic alliances	Partnerships with customers.	Partnerships with suppliers.
Contingency Exploitation	Difficulty in obtaining credit in the market;	Crisis in the country;
	Borrowing from relatives;	Expansion of service provision in other states.
	Reinvestment of profits in the company.
Controlling an unpredictable future	Partnerships with suppliers (price and deadline);	Partnerships with suppliers (price, deadline and quality);
Controlling an unpredictable future	Partnerships with clients (works).	Labor management.

Effectual Process Steps	Company X	Company Y
Means of access	Civil engineering background;	Years of experience and skills in the industry;
	Experience and information coming from previous work;	Experience and information coming from previous work;
	Possible clients, suppliers and employees; etc.	Portfolio of customers and suppliers; etc.
What can I do?	Acting in a niche (small works) that was not served by companies in the civil engineering sector.	Act with the differential of people management in the outsourcing market.
Interacting with people I know	Direct "word of mouth" contact with customers, suppliers and acquaintances.	Direct "word of mouth" contact with the portfolio of customers and suppliers they had.
Get commitments from partners	Establishment of partnerships with suppliers and fixed customers.	Establishment of partnerships with suppliers.
New objectives/New means	Expansion planning for other types of civil works.	Expansion planning for other types of service provision, such as armed surveillance.
Causal Process Steps	Company X	Company Y
Identify an opportunity	Acting in a niche (small works) that was not served by companies in the civil engineering sector.	Act with the differential of people management in the outsourcing market.
Conduct competitive analysis and market research	Not conducted.	Not conducted.
Conduct competitive analysis and market research	Only the market experience of the entrepreneurs was used at this stage.	Only the market experience of the entrepreneurs was used at this stage.
Develop a business plan	A generic business plan was prepared with the assistance of a consultancy.	Not carried out.
Develop a business plan		The entrepreneurs did not consider it necessary or a priority.
Acquire resources and stakeholders	Establishment of partnerships with suppliers and fixed customers;	Establishment of partnerships with suppliers;
Acquire resources and stakeholders	They did not acquire sufficient financial resources to open the business, investing their own resources and those of family members.	Did not acquire sufficient financial resources to open the business, seeking with friends.
Adapting to the environment	Expansion planning for other types of civil works.	Contracts with short periods and in other states began to be closed.

[1] 1. Karina Fernanda Oliveira Ferreira Institution: Pontifícia Universidade Católica de Minas Gerais. Belo Horizonte, Minas Gerais, Brazil Biography: Master in Management from Postgraduate Program in Management at Pontifical Catholic University - PUC Minas. Manager at Vallum Engenharia E-mail: karina-fernanda-oliveira@hotmail.com ORCID: https://orcid.org/0000-0003-2427-3735

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ANALYSIS OF THE ENTREPRENEURIAL PROCESS FROM EFFECTUATION AND CAUSATION LOGIC: A CASE STUDY IN TWO COMPANIES FROM MINAS GERAIS

ANÁLISE DO PROCESSO EMPREENDEDOR A PARTIR DAS LÓGICAS EFFECTUATION E CAUSATION: UM ESTUDO DE CASO EM DUAS EMPRESAS MINEIRAS

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