On the Resource Foundations and Triggers of Lucky Events
Dr Martin Bliemel, UNSW
8th Nov 2012 12:30 pm - 01:30 pm The Darlington Centre Room 6
Principal Topic (300-400 words)
This study takes an inductive approach to different contingencies that create lucky events for entrepreneurs. By comparing the resource base (internal versus external) and trigger (exogenous versus endogenous) of 39 lucky events, I reveal a 2x2 categorization scheme. Each category is described by a different ethos and related to a different type of activity. This study expands the scope of serendipity research (Dew, 2009), contributes to research regarding the ability to anticipate events and outcomes (Isabella, 1990), research on opportunity recognition (Kaish & Gilad, 1991; Baron, 2006; Ozgen & Baron, 2007), effectuation theory (Sarasvathy, 2001) and exaptation (Dew, Sasarvathy & Venkataraman, 2004, Chandra & Yang, 2011).
Method (200-300 words)
This is an inductive study, in the spirit of grounded theory development (Glaser & Strauss, 1967), in which themes emerge from interviews while comparing them to the extant literature. Data were collected in the form of interviews using a Life History approach (McAdams, 1993). The interviews elicited stories about significant events in the life history of the venture as perceived by the entrepreneur. Of the over 200 significant events in the evolution of 27 ventures, I focus on 39 stories in which the entrepreneurs describe the event in terms of luck. Building on a working definition of luck - a contingent event with better than expected outcomes - I contrast and compare these 39 stories using case study methods (Eisenhardt, 1989; Yin, 1994) to reveal two dominant types of contingencies: the trigger and the foundation. Triggers are categorized whether the event has endogenous or exogenous origins, and the foundation is categorized whether the event was contingent on prior internal resources (including knowledge) or one or more external resources. The latter foundation includes coincidences of multiple (interrelated) external resources unexpectedly becoming available to the entrepreneur.
The 39 stories are categorized according to the trigger and foundation to reveal four archetypes of lucky events (experimenting, trend watching, pitching, and social networking). The categorization shows that most lucky events are based on resources and related opportunities that unexpectedly become available through the entrepreneur's network; i.e., fewer events are based on experiments or other forms of knowledge generation done by the entrepreneur in isolation. Roughly half the events have exogenous (or endogenous) triggers. Interestingly, four stories are combinations of two of the four archetypes of lucky events, and can thus be interpreted as exceptionally lucky events. Analysis of the words chosen by the entrepreneurs to describe their luck shows inconsistent use of the words luck, serendipity, chance, circumstance, fortune, coincidence, happenstance, and ¿¿¿out of the blue'. Perhaps mirroring the lack of an agreed upon definition of luck in the literature. Entrepreneurs use these words and descriptions interchangeably.
Results and Implications (300-400 words)
The implications of the findings in this study and the literature indicate that there are significant benefits to increasing exposure to opportunities by networking in general, as well as by ¿¿¿shooting for the moon' in targeted pitches. While one cannot predict what the outcome will be, one can at least expect that there will be an outcome. However, such implications must also be taken in light of the opportunity costs involved in over-exploring opportunities, and not developing internal resources. This research synthesizes recent developments in effectuation theory, exaptation and opportunity recognition and expands these areas by being more explicit about the unpredictable nature of many entrepreneurial events.
Martin Bliemel is a Lecturer in Innovation and Entrepreneurship, and joined the School of Management (formerly the School of Strategy and Entrepreneurship) at the Australian School of Business, UNSW, in 2009. Since 2010, he is also the Director of the Centre for Innovation and Entrepreneurship (CIE) at UNSW. The CIE's administers the newly revised Diploma in Innovation Management, an inter-faculty undergraduate diploma, unique to UNSW, with an emphasis on experiential learning.
Prior to his PhD he worked as a mechanical engineer in one of Canada's 50 Best Managed companies, completed his MBA at Queen's University, ran a non-profit organization, and started a business consulting firm specializing in technology commercialization. For 5 years, he was also a mentor with New Ventures Business Competition (Canada's largest business plan competition) and a presentation room manager at the Angel Forum (Canada's oldest angel network). Martin draws on these experiences for his research on entrepreneurial networks of high-tech entrepreneurs, and their evolution. Additional research interests include industry emergence with focus on the bio-nano industry, and innovation systems. New projects include investigation of the motivations and aspirations of entrepreneurs, and the role of luck and reactivation of dormant ties.
Martin is a Visiting Scholar in our Discipline (through to the end of 2012), and can be found in room 441 working on revise-and-resubmissions to Entrepreneurship: Theory & Practice and the Journal of Business Venturing, while also pursuing new submissions to these journals and more.
THURSDAY THE 8TH NOVEMBER
12:30 pm - 13:30 pm
The Darlington Centre Room #6