Individual Reflection
Entrepreneurship involves finding a promising business idea and figuring out the risks
associated with it. This process often includes two approaches: causation and effectuation.
Causation involves the process of planning and executing your business idea. You begin with
a pre-determined goal and a set of available resources. After that you try to figure out the
optimal path to achieve the given goal. In this approach, the need for the product or service is
clear, the goal is set, and the main task is to secure the necessary resources. On the other
hand, Effectuation stands for what is known as effectual reasoning. You start off with a given
set of resources. These allow you to emerge contingently over time from the imagination and
aspirations you have. This procedure also requires asking yourself who you are, what you
now and who you know. When coming up with an idea, you must focus on certain principles
including maintaining affordable loss, building up strategic partnerships, stressing the
leveraging of contingencies and controlling an unpredictable future. It is important to keep a
good balance between using these principles and knowing when to apply which principle.
In my new venture team, we first came up with an idea during the entrepreneurship game,
through making use of causation. We started by figuring out similar interests everyone shared
and problems we all struggled with within that area of interest. The problem we attempted to
solve was offering people an easy, accessible way of buying sustainable-friendly foods.
While trying to solve this problem and generating multiple alternatives we quickly decided
that the solutions we came up with were too ambitious for our new venture project. Looking
back at the situation, I am considering that the problem we agreed on was approachable
enough, but we might have not put enough effort into trying to find a viable solution for it.
For example, we could have tried to target a certain niche of customers with our service.
At our next meet up, we went through the process of effectual reasoning. Trying to figure out
which resources we had access to, we ended up doing research on DIY-Projects. Through an
online video, we learned the easy steps of recycling a glass bottle into a drinking glass. The
glass bottles we were going to collect for free from any people we knew, but we had to buy a
glass cutter. We then had all the resources needed and the production costs limited to our
time, effort and the glass cutter. These factors were the only risk of losses we had to take.
It was good that we had to come up with a pitch for our business, because that was when we
noticed there was nothing desirable about our product. Therefore, we had to make use of
Causation. We asked ourselves who would be interested in buying a drinking glass. We had
to find a way to make a boring drinking glass special, therefore desirable for customers and
we had to decide on a target group. That was when I noticed that we messed up on trying to
find a product for the potential customers but instead we came up with a business idea that
sounded easy and fun for us personally. Trying to make our product stand out we noticed that
our production process was more eco-friendly than the normal production of a drinking glass,
so we decided to market it as a sustainability product. Nonetheless, we still must find ways to
make our glasses unique to create desirability.
In conclusion, I learned that the process entrepreneurship requires seizing opportunities and
taking calculated risks. Once our team had tried to come up with an idea through Causation
we quickly gave up and ended up deciding on a business where we will now still need to
figure out how to create actual value for the customer.