924: The Synergistic Effect of Causation and Effectuation on New Venture’s Innovation (15863)

The entrepreneurial process is highly uncertain, making it challenging for a single decision-making approach to effectively navigate. In this study, we contribute to the discussion on strategic decision-making logics by examining the interplay between causation and effectuation, detailing their individual and interactive impacts on the innovation of new ventures. Utilizing three rounds of surveys of 404 founding team members from 91 new ventures, we find that innovation of new ventures benefits from the synergy of causation and effectuation. The founding team’s boundary-spanning behavior mediates the relationship between this synergistic effect and innovation of new ventures. Accounting for various expressions of boundary-spanning behavior, this mediation effect strengthens as the founding team’s trust increases. We provide valuable insights for decision making and strategic behavior for founding teams to enhance the innovation of new ventures.

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