Successful entrepreneurs minimize risk. (April 2013)

• Record Type: Journal Article
• Authors: Murmann, Johann Peter; Sardana, Deepak
• Is Part Of: Australian journal of management. Volume 38:Number 1(2013)
• Page Start: 191
• Page End: 215
• Publication Date: 2013-04
• Subjects: entrepreneurial decision making -- entrepreneurial risk taking -- new ventures -- performance -- theory; Management -- Periodicals; Management -- Australia -- Periodicals; Business enterprises -- Finance -- Periodicals; Industrial management -- Australia -- Periodicals; 330
• DOI: 10.1177/0312896212444114
• Languages: English
• ISSNs: 0312-8962

Abstract

Many scholars see entrepreneurs as action-oriented individuals who use rules of thumb and other mental heuristics to make decisions, but who do little systematic planning and analysis. We argue that what distinguishes successful from unsuccessful entrepreneurs is precisely that the former vary their decision-making styles, sometimes relying on heuristics and sometimes relying on systematic analysis. In our proposed framework, successful entrepreneurs assess their level of expertise and the level of ambiguity in a particular decision context and then tailor their decision-making process to reduce risk.