Effectuation Transforming Uncertainty into Opportunity Stuart Read Professor

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OK – now – a Triple Feature: Effectual Principles, an Interesting Venture, and Your Data

Causal principles (blue) what is taught in bschool To get started Causal principles (blue) what is taught in bschool Effectual principles (red) the logic of expert entrepreneurs 4

Meet Tom

Goals. Given (based on prediction) Where to Start Goals. Given (based on prediction) Means. The ingredients of new opportunities: Who I am What I know Whom I know

Terracycle Organic fertilizer packaged in used plastic containers

Risk, Return and Resources Expected Return. Calculate upside potential and pursue the (risk adjusted) best opportunity. Affordable Loss. Calculate downside potential and risk no more than you can afford to lose.

From there, expansion into “upcycled” consumer products, using the core principle of affordable loss.

Attitude Toward Others Competition. Set up transactional relationships with customers and suppliers. Partnership. Build your “future” together with customers, suppliers and even prospective competitors. 10

As the Terracycle product range has grown, the firm needed more and more partners to help them “eliminate the idea of waste”

Leverage Surprises. Basis of new opportunities. Avoid Surprises. Leverage Surprises. Basis of new opportunities. 13

Underlying Logic & What to Do To the extent we can predict the future, we can control it.  PLAN To the extent we can control the future, we don’t need to predict it.  CO-CREATE 14

So creating new opportunities looks a lot less like a puzzle with a single and perhaps magical solution…

To a crazy quilt – assembled from the things at hand by the people who commit to working on it.

Effectuation Transforming Uncertainty into Opportunity Stuart Read Professor