Cycles in causation and effectuation: A case study of four metal-music ventures Laura Laaksonen
[email protected] Aalto University School of Economics Antti Ainamo
[email protected] IASM / Sociology, University of Turku Toni-Matti Karjalainen
[email protected] Aalto University School of Economics 1 In this paper we apply the entrepreneurial effectuation theory (Sarasvathy 2001) and theories in expertise (Read & Sarasvathy 2005) in an empirical study in a particular context: musicianship as a form of entrepreneurship in the popular music industry. We apply the theories and empirical evidence in our framework by using a qualitative case study to analyze four ventures, four Finnish music groups. Based on the analysis we find extensions on Sarasvathy’s (2001) and Read and Sarasvathy’s (2005) work on three levels. First we find that the causation process is more typical in the “deliberate practice” (Read & Sarasvathy 2005) that forms the foundation for superior expert practice, which is a requirement for building novel and authentic cultural products. Secondly, we find that in the beginning of the business activities, these ventures are more effectual, when the situation tends to be resource-poor. We also find that even though the companies’ core teams are relatively small, once the business grows and the number of international partners increases the business processes and decision- making becomes inevitabely more causation driven. 2 INTRODUCTION Effectuation, as conceptualized by Sarasvathy (2001), is an alternative process of decision making in comparison to the dominant one of causation in management literature. To study processes of both causation and effectuation, we examine in this paper entrepreneurial ventures whose existence springs from childhood dreams of the founders, on the one hand, and from the tightly knit experiences of these founders and their band members, on the other hand.