IDEAS home Printed from https://ideas.repec.org/a/spr/intemj/v13y2017i1d10.1007_s11365-016-0411-x.html
   My bibliography  Save this article

How do entrepreneurs think they create value? A scientific reflection of Eric Ries’ Lean Startup approach

Author

Listed:
  • Dennis Lyth Frederiksen

    (Aalborg University)

  • Alexander Brem

    (University of Southern Denmark)

Abstract

The means with which entrepreneurs create and capture value can be difficult to get a comprehensive picture of. Looking at the tools they use can offer insights, and in this context, the book “The Lean Startup” by Eric Ries has received a tremendous amount of attention. Supposedly, many entrepreneurs have read the book and may have followed his advice. Hence, we investigate the merits and characteristics of the methods detailed by Ries through a comparison with leading theories and empirical evidence found in the scientific literature. The results indicate that overall the methods find considerable backing and can in parts be recognized under already established constructs. Heavy use of effectuation-logic is evident throughout the book, with a clear and explicit emphasis on experimentation over long-term planning. The paper closes with a discussion of the possible broader implications of the methods and effectuation, including the potential impact on corporate strategy.

Suggested Citation

  • Dennis Lyth Frederiksen & Alexander Brem, 2017. "How do entrepreneurs think they create value? A scientific reflection of Eric Ries’ Lean Startup approach," International Entrepreneurship and Management Journal, Springer, vol. 13(1), pages 169-189, March.
    • Handle: RePEc:spr:intemj:v:13:y:2017:i:1:d:10.1007_s11365-016-0411-x
    DOI: 10.1007/s11365-016-0411-x
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s11365-016-0411-x
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s11365-016-0411-x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Nicholas Dew & Saras D. Sarasvathy & Stuart Read & Robert Wiltbank, 2008. "Immortal firms in mortal markets?," European Journal of Innovation Management, Emerald Group Publishing Limited, vol. 11(3), pages 313-329, August.
    2. Vanessa Ratten, 2014. "Future research directions for collective entrepreneurship in developing countries: a small and medium-sized enterprise perspective," International Journal of Entrepreneurship and Small Business, Inderscience Enterprises Ltd, vol. 22(2), pages 266-274.
    3. Ivan Light & Léo–Paul Dana, 2013. "Boundaries of Social Capital in Entrepreneurship," Entrepreneurship Theory and Practice, , vol. 37(3), pages 603-624, May.
    4. Brettel, Malte & Mauer, René & Engelen, Andreas & Küpper, Daniel, 2012. "Corporate effectuation: Entrepreneurial action and its impact on R&D project performance," Journal of Business Venturing, Elsevier, vol. 27(2), pages 167-184.
    5. Chandler, Gaylen N. & DeTienne, Dawn R. & McKelvie, Alexander & Mumford, Troy V., 2011. "Causation and effectuation processes: A validation study," Journal of Business Venturing, Elsevier, vol. 26(3), pages 375-390, May.
    6. William R. Kerr & Ramana Nanda & Matthew Rhodes-Kropf, 2014. "Entrepreneurship as Experimentation," Journal of Economic Perspectives, American Economic Association, vol. 28(3), pages 25-48, Summer.
    7. Werhahn, Dorothea & Mauer, René & Flatten, Tessa C. & Brettel, Malte, 2015. "Validating effectual orientation as strategic direction in the corporate context," European Management Journal, Elsevier, vol. 33(5), pages 305-313.
    8. Julian E. Lange & Aleksandar Mollov & Michael Pearlmutter & Sunil Singh & William D. Bygrave, 2007. "Pre-start-up formal business plans and post-start-up performance: A study of 116 new ventures," Venture Capital, Taylor & Francis Journals, vol. 9(4), pages 237-256, April.
    9. Dahlander, Linus & Gann, David M., 2010. "How open is innovation?," Research Policy, Elsevier, vol. 39(6), pages 699-709, July.
    10. Svenja C. Sommer & Christoph H. Loch & Jing Dong, 2009. "Managing Complexity and Unforeseeable Uncertainty in Startup Companies: An Empirical Study," Organization Science, INFORMS, vol. 20(1), pages 118-133, February.
    11. Brinckmann, Jan & Grichnik, Dietmar & Kapsa, Diana, 2010. "Should entrepreneurs plan or just storm the castle? A meta-analysis on contextual factors impacting the business planning-performance relationship in small firms," Journal of Business Venturing, Elsevier, vol. 25(1), pages 24-40, January.
    12. Paul Nightingale & Alex Coad, 2014. "Muppets and gazelles: political and methodological biases in entrepreneurship research," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 23(1), pages 113-143, February.
    13. Suseno, Yuliani & Ratten, Vanessa, 2007. "A theoretical framework of alliance performance: The role of trust, social capital and knowledge development," Journal of Management & Organization, Cambridge University Press, vol. 13(1), pages 4-23, March.
    14. John Hauser & Gerard J. Tellis & Abbie Griffin, 2006. "Research on Innovation: A Review and Agenda for," Marketing Science, INFORMS, vol. 25(6), pages 687-717, 11-12.
    15. Greg Fisher, 2012. "Effectuation, Causation, and Bricolage: A Behavioral Comparison of Emerging Theories in Entrepreneurship Research," Entrepreneurship Theory and Practice, , vol. 36(5), pages 1019-1051, September.
    16. Alexander Becker & Dodo zu Knyphausen-Aufseß & Alexander Brem, 2015. "Beyond traditional developmental models: a fresh perspective on entrepreneurial new venture creation," International Journal of Entrepreneurial Venturing, Inderscience Enterprises Ltd, vol. 7(2), pages 152-172.
    17. Stefan H. Thomke, 1998. "Managing Experimentation in the Design of New Products," Management Science, INFORMS, vol. 44(6), pages 743-762, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Boyoung Kim & Hyojin Kim & Youngok Jeon, 2018. "Critical Success Factors of a Design Startup Business," Sustainability, MDPI, vol. 10(9), pages 1-15, August.
    2. Chengbin Wang & Min Dai & Yongyan Fang & Chuanfeng Liu, 2022. "Ideas and methods of lean and agile startup in the VUCA Era," International Entrepreneurship and Management Journal, Springer, vol. 18(4), pages 1527-1544, December.
    3. Brem, Alexander & Bilgram, Volker & Marchuk, Anna, 2019. "How crowdfunding platforms change the nature of user innovation – from problem solving to entrepreneurship," Technological Forecasting and Social Change, Elsevier, vol. 144(C), pages 348-360.
    4. Newbert, Scott L. & Tornikoski, Erno T. & Augugliaro, Jeff, 2020. "To get out of the building or not? That is the question: The benefits (and costs) of customer involvement during the startup process," Journal of Business Venturing Insights, Elsevier, vol. 14(C).
    5. König, Marc & Ungerer, Christina & Baltes, Guido & Terzidis, Orestis, 2019. "Different patterns in the evolution of digital and non-digital ventures' business models," Technological Forecasting and Social Change, Elsevier, vol. 146(C), pages 844-852.
    6. Faiez Ghorbel & Wafik Hachicha & Younes Boujelbene & Awad M. Aljuaid, 2021. "Linking Entrepreneurial Innovation to Effectual Logic," Sustainability, MDPI, vol. 13(5), pages 1-13, March.
    7. Hegeman, Puck D. & Sørheim, Roger & Landström, Hans & Saether, Erik Andreas, 2024. "Corporate angels: A new breed of investors in the funding landscape for technology-based start-ups," Technovation, Elsevier, vol. 134(C).
    8. Antonopoulou, Katerina & Begkos, Christos, 2020. "Strategizing for digital innovations: Value propositions for transcending market boundaries," Technological Forecasting and Social Change, Elsevier, vol. 156(C).
    9. Alberto Peralta & Javier Carrillo‐Hermosilla & Fernando Crecente, 2019. "Sustainable business model innovation and acceptance of its practices among Spanish entrepreneurs," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 26(5), pages 1119-1134, September.
    10. Mai, Nhat Chi, 2021. "A Comprehensive Model for Idea Evaluation at Early-Stage Level (Pre-Seed)," OSF Preprints axngj, Center for Open Science.
    11. Ghezzi, Antonio, 2020. "How Entrepreneurs make sense of Lean Startup Approaches: Business Models as cognitive lenses to generate fast and frugal Heuristics," Technological Forecasting and Social Change, Elsevier, vol. 161(C).
    12. Ghezzi, Antonio, 2019. "Digital startups and the adoption and implementation of Lean Startup Approaches: Effectuation, Bricolage and Opportunity Creation in practice," Technological Forecasting and Social Change, Elsevier, vol. 146(C), pages 945-960.
    13. Mansoori, Yashar & Karlsson, Tomas & Lundqvist, Mats, 2019. "The influence of the lean startup methodology on entrepreneur-coach relationships in the context of a startup accelerator," Technovation, Elsevier, vol. 84, pages 37-47.
    14. Pouria Goldasteh & Morteza Akbari & Afsaneh Bagheri & Ali Mobini, 2022. "How high-tech start-ups learn to cross the market chasm?," Journal of Global Entrepreneurship Research, Springer;UNESCO Chair in Entrepreneurship, vol. 12(1), pages 157-173, December.
    15. Krammer, Sorin, 2021. "Navigating The New Normal: Which Firms Have Adapted Better To The Covid-19 Disruption?," MPRA Paper 109485, University Library of Munich, Germany.
    16. Ebersberger, Bernd & Kuckertz, Andreas, 2021. "Hop to it! The impact of organization type on innovation response time to the COVID-19 crisis," Journal of Business Research, Elsevier, vol. 124(C), pages 126-135.
    17. Nadja Hatzijordanou & Nicolai Bohn & Orestis Terzidis, 2019. "A systematic literature review on competitor analysis: status quo and start-up specifics," Management Review Quarterly, Springer, vol. 69(4), pages 415-458, November.
    18. Marco Cantamessa & Valentina Gatteschi & Guido Perboli & Mariangela Rosano, 2018. "Startups’ Roads to Failure," Sustainability, MDPI, vol. 10(7), pages 1-19, July.
    19. Silvia Sanasi, 2023. "Entrepreneurial experimentation in business model dynamics: Current understanding and future opportunities," International Entrepreneurship and Management Journal, Springer, vol. 19(2), pages 805-836, June.
    20. Krammer, Sorin M.S., 2022. "Navigating the New Normal: Which firms have adapted better to the COVID-19 disruption?," Technovation, Elsevier, vol. 110(C).
    21. Giones, Ferran & Brem, Alexander & Berger, Andreas, 2019. "Strategic decisions in turbulent times: Lessons from the energy industry," Business Horizons, Elsevier, vol. 62(2), pages 215-225.
    22. Rosca, Eugenia & Agarwal, Nivedita & Brem, Alexander, 2020. "Women entrepreneurs as agents of change: A comparative analysis of social entrepreneurship processes in emerging markets," Technological Forecasting and Social Change, Elsevier, vol. 157(C).
    23. Chengbin, Wang & Hongbin, Wang & Min, Dai & Yongyan, Fang, 2022. "Lean Startup Approaches(LSAs): Convergence, Integration and Improvement," Technological Forecasting and Social Change, Elsevier, vol. 179(C).
    24. Azlina Mohamad & Adriana Mohd Rizal & Suzilawati Kamarudin & Musli Sahimi, 2022. "Exploring the Co-Creation of Small and Medium Enterprises, and Service Providers Enabled by Digital Interactive Platforms for Internationalization: A Case Study in Malaysia," Sustainability, MDPI, vol. 14(23), pages 1-24, December.
    25. Eric Christian Brun, 2019. "Understanding a Business Incubator as a Start-Up Factory: A Value Chain Model Perspective," International Journal of Innovation and Technology Management (IJITM), World Scientific Publishing Co. Pte. Ltd., vol. 16(03), pages 1-28, May.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Marko Matalamäki & Tero Vuorinen & Elina Varamäki & Kirsti Sorama, 2017. "Business Growth in Established Companies; Roles of Effectuation and Causation," Journal of Enterprising Culture (JEC), World Scientific Publishing Co. Pte. Ltd., vol. 25(02), pages 123-148, June.
    2. Yi Jiang & Charles-Clemens Rüling, 2019. "Opening the Black Box of Effectuation Processes: Characteristics and Dominant Types," Entrepreneurship Theory and Practice, , vol. 43(1), pages 171-202, January.
    3. Katrin M. Smolka & Ingrid Verheul & Katrin Burmeister–Lamp & Pursey P.M.A.R. Heugens, 2018. "Get it Together! Synergistic Effects of Causal and Effectual Decision–Making Logics on Venture Performance," Entrepreneurship Theory and Practice, , vol. 42(4), pages 571-604, July.
    4. Tobias Frese & Ingmar Geiger & Florian Dost, 2020. "An empirical investigation of determinants of effectual and causal decision logics in online and high-tech start-up firms," Small Business Economics, Springer, vol. 54(3), pages 641-664, March.
    5. Igor Laine & Tamara Galkina, 0. "The interplay of effectuation and causation in decision making: Russian SMEs under institutional uncertainty," International Entrepreneurship and Management Journal, Springer, vol. 0, pages 1-37.
    6. Wenwen An & Charles-Clemens Rüling & Xin Zheng & Jianqi Zhang, 2020. "Configurations of effectuation, causation, and bricolage: implications for firm growth paths," Small Business Economics, Springer, vol. 54(3), pages 843-864, March.
    7. Igor Laine & Tamara Galkina, 2017. "The interplay of effectuation and causation in decision making: Russian SMEs under institutional uncertainty," International Entrepreneurship and Management Journal, Springer, vol. 13(3), pages 905-941, September.
    8. Fischer, Denise & Greven, Andrea & Tornow, Mark & Brettel, Malte, 2021. "On the value of effectuation processes for R&D alliances and the moderating role of R&D alliance experience," Journal of Business Research, Elsevier, vol. 135(C), pages 606-619.
    9. Cherbib, Jihene, 2024. "Exploring the interplay between entrepreneurial orientation, causation and effectuation under unexpected covid-19 uncertainty: Insights from large French banks," Technological Forecasting and Social Change, Elsevier, vol. 200(C).
    10. Yu, Xiaoyu & Tao, Yida & Tao, Xiangming & Xia, Fan & Li, Yajie, 2018. "Managing uncertainty in emerging economies: The interaction effects between causation and effectuation on firm performance," Technological Forecasting and Social Change, Elsevier, vol. 135(C), pages 121-131.
    11. Koller, Sonia & Stephan, Ute & Ahmetoglu, Gorkan, 2022. "Ecological rationality and entrepreneurship: How entrepreneurs fit decision logics to decision content and structure," Journal of Business Venturing, Elsevier, vol. 37(4).
    12. Maryia Akulava & Maribel Guerrero, 2023. "Entrepreneurial gendered ambidexterity in Belarusian SMEs," The Journal of Technology Transfer, Springer, vol. 48(6), pages 1919-1944, December.
    13. Shirokova, Galina & Morris, Michael H. & Laskovaia, Anastasiia & Micelotta, Evelyn, 2021. "Effectuation and causation, firm performance, and the impact of institutions: A multi-country moderation analysis," Journal of Business Research, Elsevier, vol. 129(C), pages 169-182.
    14. Gry Agnete Alsos & Tommy Høyvarde Clausen & René Mauer & Stuart Read & Saras D. Sarasvathy, 2020. "Effectual exchange: from entrepreneurship to the disciplines and beyond," Small Business Economics, Springer, vol. 54(3), pages 605-619, March.
    15. Jessica Alzamora-Ruiz & María Fuentes-Fuentes & Myriam Martinez-Fiestas, 2021. "Together or separately? Direct and synergistic effects of Effectuation and Causation on innovation in technology-based SMEs," International Entrepreneurship and Management Journal, Springer, vol. 17(4), pages 1917-1943, December.
    16. Mumford, Jonathan Van & Zettinig, Peter, 2022. "Co-creation in effectuation processes: A stakeholder perspective on commitment reasoning," Journal of Business Venturing, Elsevier, vol. 37(4).
    17. Pascal Henninger & Alexander Brem & Ferran Giones & Peter M. Bican & Christine Wimschneider, 2019. "Effectuation Vs. Causation: Can Established Firms Use Start-Up Decision-Making Principles To Stay Innovative?," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 24(01), pages 1-32, January.
    18. Alexander McKelvie & Gaylen N. Chandler & Dawn R. DeTienne & Anette Johansson, 2020. "The measurement of effectuation: highlighting research tensions and opportunities for the future," Small Business Economics, Springer, vol. 54(3), pages 689-720, March.
    19. Sebastian Markus Szambelan & Yi Dragon Jiang, 2020. "Effectual control orientation and innovation performance: clarifying implications in the corporate context," Small Business Economics, Springer, vol. 54(3), pages 865-882, March.
    20. Magdalena Markowska & Dietmar Grichnik & Jan Brinckmann & Diana Kapsa, 2019. "Strategic orientations of nascent entrepreneurs: antecedents of prediction and risk orientation," Small Business Economics, Springer, vol. 53(4), pages 859-878, December.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:intemj:v:13:y:2017:i:1:d:10.1007_s11365-016-0411-x. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.