Entrepreneurial action: Exploitation decisions under conditions of uncertainty

Research output: Contribution to conferencePaper

Abstract

We explore opportunity exploitation decisions made under varying conditions of uncertainty. Employing conjoint analysis, we decompose 2,880 exploitation decisions nested within a sample of technology entrepreneurs. We conceptualize uncertainty as a multidimensional construct, and focus our analysis on the entrepreneurs' likelihood of exploiting an opportunity by going forward with a new product launch given varying combinations of state, effect and response uncertainty. As conventional wisdom suggests, generally we find that the entrepreneurs' willingness to exploit declines moving from low to high levels of uncertainty. However, we also find that the 'type' of uncertainty matters; response uncertainty represents the most impactful impediment to opportunity exploitation. Further, we find evidence that the magnitude of the exploitation (i.e. small, incremental launch vs. broad, large-scale launch) significantly moderates the relationship between the entrepreneurs' willingness to act and uncertainty, suggesting that entrepreneurs may prefer uncertainty reduction strategies, to profit maximizing ones. We discuss implications and insights from our finding for both theory and practice.

Original languageEnglish (US)
DOIs
StatePublished - 2008
Event68th Annual Meeting of the Academy of Management, AOM 2008 - Anaheim, CA, United States
Duration: Aug 8 2008Aug 13 2008

Other

Other68th Annual Meeting of the Academy of Management, AOM 2008
CountryUnited States
CityAnaheim, CA
Period8/8/088/13/08

Keywords

  • Entrepreneurial decision-making
  • Opportunity
  • Uncertainty

ASJC Scopus subject areas

  • Management of Technology and Innovation
  • Management Information Systems

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  • Cite this

    McKelvie, A., Gustafsson, V., & Haynie, J. M. (2008). Entrepreneurial action: Exploitation decisions under conditions of uncertainty. Paper presented at 68th Annual Meeting of the Academy of Management, AOM 2008, Anaheim, CA, United States. https://doi.org/10.5465/ambpp.2008.33641760