Talk by Jax Kirtley, Boston University, Questrom School of Business
Scholars have examined how decision makers struggle to process an abundance of information and the role of heuristics and biases in making choices, but how firms make decisions when information does not exist is less explored. With a longitudinal field study of 93 strategic decisions across seven early stage entrepreneurial firms pioneering hardware in nascent energy and cleantech industries, we examined what triggered strategic decisions and how choices about strategic change were made without key information. We found entrepreneurial firms used premises about their firms as inputs to decision making in place of missing information, primarily maintaining those premises and retaining current strategy. Only when premises were violated by problems or, more often, expanded by unanticipated opportunities, did firms choose strategy exit or strategic change.