Uncertainty Types and Transitions in the Entrepreneurial Process

Packard, Mark D.; Clark, Brent B.; Klein, Peter G.

doi:10.1287/orsc.2017.1143

Cited by 274 publications

(222 citation statements)

References 105 publications

(119 reference statements)

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“…Packard et al () note that entrepreneurs face a double‐sided uncertainty problem. First, there is uncertainty about ends.…”

Section: The Context Of Entrepreneurial Judgmentmentioning

confidence: 99%

“…As Packard et al () point out, there are different paths for navigating these landscapes. One approach is to start by restricting the set of possible outcomes, and then focus on the most effective means to achieve the desired outcomes – analogous to the mainstream entrepreneurship literature's idea of discovering and evaluating, and then exploiting profit opportunities.…”

Section: The Context Of Entrepreneurial Judgmentmentioning

confidence: 99%

“…Moreover, exercising judgment is not the same as being lucky (or unlucky), though both judgment and luck are distinct from ‘rational’ decision‐making under probabilistic risk. See Foss and Klein (: chapter 4) and Packard et al () for more on these issues.…”

mentioning

confidence: 99%

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The Context of Entrepreneurial Judgment: Organizations, Markets, and Institutions

Foss

Klein

Bjørnskov

2019

J Management Studies

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141

157

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The economics and management literatures pay increasing attention to the technological, competitive, and institutional environment for entrepreneurship. However, less is known about how context influences the judgment of entrepreneurs. Focusing on the emerging judgment‐based approach to entrepreneurship, we argue that economics can say much about how the organizational, market, and institutional context shapes entrepreneurial judgment. We describe entrepreneurs as individuals who deploy scarce, heterogeneous resources to service customer preferences at a profit. Because of uncertainty, this process is essentially experimental, and context influences the experimental process. Thus, entrepreneurs will seek to design the internal organization of the firm so that it facilitates internal experimentation. Moreover, the market or task environment determines the need for experimentation (e.g., how fast do consumer preferences change, how does technology evolve, which assets are available at which terms, etc.). Finally, the institutional environment influences, for example, the transaction costs of acquiring and divesting assets as firms adjust their boundaries through ongoing commercial experimentation.

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“…Packard et al () note that entrepreneurs face a double‐sided uncertainty problem. First, there is uncertainty about ends.…”

Section: The Context Of Entrepreneurial Judgmentmentioning

confidence: 99%

Section: The Context Of Entrepreneurial Judgmentmentioning

confidence: 99%

See 1 more Smart Citation

The Context of Entrepreneurial Judgment: Organizations, Markets, and Institutions

Foss

Klein

Bjørnskov

2019

J Management Studies

Self Cite

141

157

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“…Among the different cases of innovative entry discussed above, there is a tacit scale of uncertainty‐bearing (McMullen & Shepherd, ; Packard, Clark, & Klein, ). Let us begin with the easiest case: an incumbent seeks arbitrage rents by taking advantage of a market imperfection for a strategic resource.…”

Section: A Two‐period Model Of Value Capture As Entrepreneurial Rentsmentioning

confidence: 99%

“…Expectations about profits may be driven primarily by the uncertain price effects in attribute space. However, the firm has a vast number of observations on competitor prices and reactions; the situation is one of modest risk, not (Knightian or epistemic) uncertainty (Alvarez, Afuah, & Gibson, ; Packard et al, ).…”

Section: A Two‐period Model Of Value Capture As Entrepreneurial Rentsmentioning

confidence: 99%

An economic model of strategic entrepreneurship

Westgren

Wuebker

2019

Strategic Entrepreneurship

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Research Summary How do new entrants create and capture value in established industries? Starting from the foundations of neoclassical economics, we model entrepreneurial entry and competition as occurring simultaneously in production technology space and product attribute space. Our model's central feature is to disaggregate entrepreneurial rents into four components: arbitrage, innovation, organization, and uncertainty‐bearing. This permits us to model the nature of value creation from a common analytical platform, and to measure value capture as a set of distinct rent streams available to multiple stakeholders over time. Managerial Summary Although there is broad consensus that the essence of entrepreneurship is the creation and capture of new value, both scholars and practitioners have struggled to connect this basic exhortation to the entrepreneurial process. This paper argues that returns to entrepreneurial action can be generated through four main mechanisms: innovation, uncertainty‐bearing, new business models, or inter‐industry arbitrage—either uniquely, or in combination. Examining these mechanisms for value creation together reveals implications for how best to organize and manage the entrepreneurial process so that that returns to entrepreneurial action can be appropriated equitably.

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Identifying business opportunities for sustainable development: Longitudinal and experimental evidence contributing to the field of sustainable entrepreneurship

et al. 2020

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Which factors facilitate the identification of business opportunities for sustainable development? To answer this question, we develop a process model of sustainable opportunity identification. We argue that sustainable opportunity identification is a process with transitions from problem to solution identification and from solution to sustainable opportunity identification. Moreover, the transitions are facilitated by two factors—awareness of adverse consequences and entrepreneurial attitude—providing motivation and direction in the process. We tested our model in a field study (N = 107) and two experiments (N = 53 and N = 69). Our findings show that awareness of adverse consequences and entrepreneurial attitude influence the process of sustainable opportunity identification, explaining under which conditions people are more likely to identify business opportunities for sustainable development. Our study thus contributes to the field of sustainable entrepreneurship.

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Uncertainty Types and Transitions in the Entrepreneurial Process

Abstract: for their support and thoughtful comments on previous drafts of this paper.

Cited by 274 publications

References 105 publications

The Context of Entrepreneurial Judgment: Organizations, Markets, and Institutions

The Context of Entrepreneurial Judgment: Organizations, Markets, and Institutions

An economic model of strategic entrepreneurship

Identifying business opportunities for sustainable development: Longitudinal and experimental evidence contributing to the field of sustainable entrepreneurship

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