JOURNAL HIGHLIGHTS

By Barry List

“How Do New Ventures Evolve? An Inductive Study of Archetype Changes in Science-Based Ventures,”
by Tina C. Ambos and Julian Birkinshaw, Organization Science, Vol. 21, No. 6.

Those engaged in entrepreneurship research often dwell on a key question: What is the evolutionary process of a start-up, given that most fail and that a large part of the evolutionary research focuses not on entrepreneurial attempts but on the history of large, established companies. The authors address the question through theory surrounding archetypes.

The authors report four key findings:

1. There are three distinct archetypes manifest in their sample of new ventures – capability driven, market driven and aspiration driven.
2. New ventures transformed from one archetype to another as many as three times over the period of study. The authors didn’t observe a model taking ventures linearly from stage to stage; they saw progressive and retrogressive steps, with a new archetype often a direct reaction to the prior one.
3. The process of transition between archetypes was triggered by the gap between entrepreneurs’ old interpretive scheme and the emerging reality for the venture rather than through specific changes in the external business environment.
4. The authors identified two distinct forms of transition – sustaining transitions, like a fork in the road, in which the new venture built on whatever capabilities and relationships had been created in the previous period to move forward; and disruptive transitions, in which the new venture had to move backward by dropping some the capabilities and relationships created previously, before moving forward.

“High Leverage Interventions: Three Cases of Defensive Action and Their Lessons for OR/MS Today,”
by David C. Lane, Operations Research, Vol. 58, No. 6.

The author combines military history and O.R. theory in this examination of key military moments when scientists using operations research, or its precursor, played a major role in defense of their countries. The cases studied include the classic story of PMS Blackett’s crystallization of operations research as he helped plan the air defense of Britain in WWII; American Jay Forrester’s use of Blackett’s methods and newly developing computers to create the SAGE system of air defenses to spot potential Soviet bombers attacking during the Cold War; and a unique step back to the time of Ancient Rome to examine Archimedes’ use of modeling and data analysis to aid the military in defending Syracuse during the Second Punic War. In each case Lane looks at the historical context and the individual’s other achievements, and describes the contribution’s relationship to operations research.

In Blackett’s case, for example, Lane provides a good refresher on how analyzing the newly developed radar and integrating its identification of enemy planes from a lengthy distance, as the Nazi bombers approached London, and when they were nearly over the target helped the military thwart what could have been a decisive attack. Here, Lane emphasizes that early O.R. took a much more holistic and less mathematical modeling approach.

Lane also considers features that the cases share and describes them in terms of contemporary operations research methodology; he is particularly critical of modern operations researchers whose work is so theoretical that they fail to collaborate with real-life decision-makers. Lane offers a critical appraisal of O.R. and a set of potential ways of strengthening it. Despite criticism, his overall conclusion is that the cases are examples to build on and that operations researchers still have the ability to do work that wins battles and saves lives.

“Darden’s Luckiest Student: Lessons from a High Stakes Risk Experiment,”
by Samuel E. Bodily and Phillip E. Pfeifer, Decision Analysis, Vol. 7, No. 4.

As behavioral economics and related experimentation continues to fascinate through the work of Duke University’s Dan Ariely and colleagues, Samuel E. Bodily and Phillip E. Pfeifer of University of Virginia’s Darden School describe a related class exercise. In two different academic terms, students faced the possibility of being chosen as the only one to receive the opportunity to participate in a lottery consisting of equally likely outcomes of zero and the cash equivalent to one semester’s tuition at the Darden School. Before knowing who was chosen, students were asked to declare the price at which they would choose a fixed dollar offer over the lottery. The cap-off for the boldest student was making the “Deal or No Deal” choice between two briefcases: one containing a full semester’s tuition and the other completely empty. In addition to motivating students to study decision analysis, the authors used these class exercises to examine factors affecting the behavior of people facing lotteries involving high stakes.

Barry List (barry.list@informs.org) is the director of communications for INFORMS.