Tampere University of Technology

TUTCRIS Research Portal

Effectuation as a frame for networking decisions: the case of a Finnish information technology start-up

Research output: Chapter in Book/Report/Conference proceedingConference contributionScientificpeer-review


Original languageEnglish
Title of host publicationProceedings of International Workshop on Software- intensive Business: Start-ups, Ecosystems and Platforms (SiBW 2018)
Number of pages15
Publication statusPublished - 2018
Publication typeA4 Article in a conference publication
EventInternational Workshop on Software-intensive Business: Start-ups, Ecosystems and Platforms - VTT Ydinturvatalo, Espoo, Finland
Duration: 3 Dec 20183 Dec 2018

Publication series

ISSN (Electronic)1613-0073


ConferenceInternational Workshop on Software-intensive Business
Abbreviated titleSiBW2018
Internet address


Effectuation is an emerging theory framework for managerial decision-making, particularly in the context of start-ups. It attempts to capture the nature of managerial decision-making in circumstances where the essential business artefacts, like markets, customers or business model, do not exist yet or are undergoing a revolutionary transformation. This study focuses on applying the effectuation theory to inter-organizational relationship building in the early phases of network formation. According to the theory, effectual processes are characterized by four main principles: 1) a focus on projects where the loss, in worst-case-scenario, is affordable 2) a focus in a short-term experiment to identify opportunities 3) control over an unpredictable future 4) a focus on cooperation to control the future. In this article, the subject is approached by considering those four principles and capturing the acts that manifest them in practice. The findings show that all four principles of ef-fectuation are detectable in the early relationship building. The case compa-ny uses effectual processes to balance the uncertainty of the environment and to capture the arising opportunities. Furthermore, the case results sug-gest a tendency to adopt more systematic processes towards collaborators, as the business transforms into more stable one. The results complement previ-ous research by illustrating the manifestations of four principles of effectua-tion in inter-organizational acts in practice. Further research should be de-voted to revealing the diverse and versatile multidimensional nature effectu-al and causal models toward collaborator selection and processes that mani-fest them, instead of the current dichotomy of predictive and non-predictive strategies toward collaborators.

Publication forum classification

Field of science, Statistics Finland