Boosting Entrepreneurial Success through Decision Weaving

Source: aainayyahm via Wikimedia Commons

Bringing about positive change is not easy.  The path to meaningful and desired innovation is often an uphill one that calls on us, and our teams, to make decisions, decisions, decisions.  Small, medium, and large decisions.  Today we may need to decide between one opportunity and another, how to handle this persistent business snag, and what to do about that emergent difficulty.  

Each decision makes demands on our attention and thinking.  We need to gather (ferret out) information, put pieces together, make sense of the emerging patterns, all the while keeping track of what each newly learned fact, possibility, or interpretive slant means for our goals and aspirations.  

And it’s not just the large attentional load of identifying, finding, and integrating incoming factual information.  There’s how we feel about what we learn that also must be dealt with.  The weighing and balancing is shot through with feelings of excitement, or enthusiasm, or anxious tuggings and doubts.  Is it possible?  Am I (or the team) reading this situation quite as it is?  What if the other route – the one we’re choosing not to take – is really the best one?  What really should our strategy be?  

We’re here in the heart of the process of both forming – and finding – a strategy.  This is what any new entrepreneurial endeavor must creatively grapple with.

An in-depth research dive into venture strategy creation

Two researchers at the University of North Carolina at Chapel Hill and Stanford University joined forces to take an in-depth look at the creative process of forming and finding an entreprenurial strategy

To begin, the researchers began by identifying several new entrepreneurial ventures in different domains: culinary experiences, home services, and parking technology.  They started following the ventures (small, privately owned, professionally funded young firms) about one year after the firms were founded, and continued to follow them in four waves of data collection at 6–9 month intervals, as the ventures created, learned, experimented, and changed their strategies. 

The researchers collected and combed through many different sources of data: interviews with the top management team and other informants such as investors, archival data from company websites, social media, and the venture’s own records.  Obtaining data from multiple sources, and in real time, gave a bigger picture of the landscape of opportunities – and problems – at a given moment in time, and how those opportunities/problems were evaluated and perceived by different stakeholders. 

The magic of sequential focus – plus stepping stones

So what did all this in-depth delving into entrepreneurial strategy reveal?

Two key insights emerged. 

(1) Ventures that later proved to be successful did not try to do everything at once.  Rather, successful ventures largely concentrated their time and efforts in one of the main areas of the enterprise at a time, sometimes for many months at a time.  This is what the researchers called “sequential focus.” 

Once “good enough” performance was reached in one (foregrounded) domain, then the team’s focus moved to a different previously backgrounded domain, before again circling back to the initial domain at a later point.  

But sequential focus was not the only important finding.  

(2) There were smaller, low-cost, opportunistic background moves called, by the researchers, “stepping stones.”  Successful venture teams were passively observing and peripherally learning incidental things in the nonfocal domain and taking small steps there, if that step could be readily accomplished.

Sequential focus, interleaved with the practice of stepping stones, together creates a mode of strategy formation/creation that the researchers captured with the description of “decision weaving.” 

Schematic of decision weaving with its sequential focus and stepping stones. Source: W. Koutstaal.

What sequential focus gives us

The cognitive costs of switching between even only two simple tasks are well-known.  Yet the cognitive costs of switching may be even higher when, rather than simple tasks, the switching is between complex multidimensional projects or components of a project.  

Without sequential focus, a team may end up, “doing a lot of things poorly” (p. 2295).  Or in the words of another failed venture leader, without it, a team may find themselves locked into a reactive mode, reacting with little time for thought, planning, or understanding, in “a constant pendulum, it’s just shifting back and forth and we’re always slightly out of balance” (p. 2302).

Sequential focus provides the needed leeway for learning.  It gives the mental time and space for drawing connections between actions and consequences, for exercising systematic controlled thought, and for developing one’s mental model of those connections of the then-in-focus domain.  Without a too-early stretching for perfection, sequential focus creates an essential buffer of flexibility, enabling resilient adaptation to changing circumstances.  

At the same time, stepping stones – temporarily placing some parts of what we need to do into the background of our thinking – provides the benefits of psychological distance (seeing the forest, not only the trees). It also allows space for purposively taking relatively easy, low-resource opportunistic actions and engaging in low-cost learning.   

References

Bendoly, E., Swink, M., & Simpson, W. P. III (2014).  Prioritizing and monitoring concurrent project work: Effects on switching behavior.  Production and Operations Management, 23, 847–860. doi: 10.1111/poms.12083

Ott, T. E., & Eisenhardt, K. M. (2020).  Decision weaving: Forming novel, complex strategy in entrepreneurial settings.  Strategic Management Journal, 41, 2275–2314. doi: 10.1002/smj.3189

Vandierendonck, A., Liefooghe, B., & Verbruggen, F. (2010).  Task switching: Interplay of reconfiguration and interference control.  Psychological Bulletin, 136, 601–626.  doi: 10.1037/a0019791