Entrepreneurial decision logic profiles and firm performance during crisis: Evidence from Myanmar
Khin Sandar Thein et al.
What the paper says
PURPOSE: This study seeks to identify the decision logic profiles of entrepreneurs and top-level managers and to determine each profile’s association with firm performance. METHODOLOGY: A cross-sectional online survey collected data from members of the Myanmar Young Entrepreneurs’ Association. The K-means cluster analysis was used as a person-centered approach to identify the composition of causation and effectuation-based decision logics. Structural equation modeling was employed to test the relationship between decision profiles, knowledge exploitation and exploration, and firm performance (sales decline). FINDINGS: All the entrepreneurs showed different levels of decision logics, hybridly composed of causation and effectuation. Some entrepreneurs who displayed very high levels of causation and effectuation were named as “active hybridity”; those with moderately high levels of both logics were labelled “moderate hybridity”, some with a low level of causation and the lowest level of effectuation were called “passive planners”, and others with a much low level of causation and low level of effectuation were termed as “passive effectuators” respectively. Moderately hybrid entrepreneurs exhibited slightly lower levels of exploration and exploitation compared to actively hybrid entrepreneurs, while passive planners and passive effectuators showed significantly lower levels of both activities. Additionally, compared with the sales of actively hybrid entrepreneurs, those of passive effectuators showed a statistically significant lower decline, whereas those of passive planners and moderately hybrid entrepreneurs displayed insignificant differences. Although exploration did not show a statistically significant relationship with sales decline, exploitation did. IMPLICATIONS: This study adds to the causation and effectuation literature from a person-centered approach, exploring the association between the different degrees of the composition of decision logics and firm performance. Furthermore, as this research was conducted with decision-makers from companies that faced multiple crises in turbulent times, it serves as a guide for entrepreneurs on how to respond to crises with resilience and sustain their businesses. ORIGINALITY AND VALUE: This is the first study to determine the decision profiles of causation and effectuation logics at an individual level in established firms.
Evidence weight
Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40
| F · citation impact | 0.50 × 0.4 = 0.20 |
| M · momentum | 0.50 × 0.15 = 0.07 |
| V · venue signal | 0.50 × 0.05 = 0.03 |
| R · text relevance † | 0.50 × 0.4 = 0.20 |
† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.