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In a nutshell
Teaching entrepreneurship is evolving from simply just tools and techniques to an entire method – one that teaches students to master uncertainty and create opportunities rather than to predict the unpredictable.
Entrepreneurship is a bit like the black sheep of education disciplines. Unlike most fields, it demands much more from both its students and teachers in terms of hands-on experience and tangible outcomes – expecting graduates to quickly succeed as entrepreneurs. When scholars and policymakers want to find out how well this education is working and what to include in it, the studies they conduct typically focus on the correlation between certain tools and the success rate of students in launching ventures. But this approach isn’t typical of other disciplines, is it? Take science education, for example, where the goal isn’t necessarily to produce majorly successful scientists, but rather to instil a deep understanding of the principles, logic, and rigour that underpin the scientific method. So why shouldn’t entrepreneurship education adopt a similar approach?
Saras Sarasvathy, a leading researcher in the field of entrepreneurship, draws this comparison in her latest paper for the Journal of Management. She points out that the usual approach to entrepreneurship education, with its overemphasis on tools, techniques and frameworks like the lean startup model, and its dependence on time-consuming experiential learning, is actually limiting the students’ ability to navigate the unpredictable realities of entrepreneurship.
This is when Sarasvathy suggests that entrepreneurship take a page out of science education’s book; to focus on teaching a foundational method rather than just specific practical tools, so that they learn to truly think and act entrepreneurially in any situation. However, this doesn’t mean that she thinks the scientific method is what should be primarily taught in entrepreneurship, since the foundations of entrepreneurship are fundamentally different from the scientific method. In essence, Sarasvathy suggests that while the approach to teaching – emphasising underlying principles and methods – should be similar, the content of what is taught must be tailored to the unique nature of entrepreneurship.
Publication Date: June 2024
Author: Saras D. Sarasvathy
Institution: University of Virginia
Study Type: Conceptual/Theoretical Study
Sample Size: Not applicable (theoretical framework)
Research Focus: Development and application of effectuation as an entrepreneurial method, contrasting it with the scientific method and lean startup approach.
Research Methodology: Conceptual analysis and comparison of different methods used in entrepreneurship and their implications for education.
Main Findings: Effectuation is a flexible framework well-suited for navigating uncertainty in entrepreneurship, emphasising action, collaboration, and adaptability over prediction.
Citation: Sarasvathy, S. D. (2024). Lean Hypotheses and Effectual Commitments: An Integrative Framework Delineating the Methods of Science and Entrepreneurship. Journal of Management, 0(0). https://doi.org/10.1177/01492063241236445
That is where her idea of the entrepreneurial method comes in. Contrasting it with the scientific method she outlines the central difference between the two: while science operates within existing purposes and constraints, taking a top-down approach to achieving set goals, the entrepreneurial method is dynamic, looking both up and down the hierarchy of goals. It reshapes, creates, and sometimes even destroys existing goals, allowing entrepreneurs to continuously adapt and innovate in response to changing circumstances. In essence, the scientific method can tell us how the world works – while the entrepreneurial method can tell us how to change it.
Sarasvathy further argues that the theory of effectuation is a particularly well-suited framework to underpin this entrepreneurial method. This theory is extensively documented, but put succinctly, effectuation is about starting with what you have – who you are, what you know, and whom you know – and working with self-selected stakeholders to co-create new opportunities. This approach contrasts sharply with the lean startup methodology, which emphasises hypothesis testing and iterating based on customer feedback, assuming that markets exist and can be discovered through experimentation. Instead of predicting market needs, effectual entrepreneurs shape and adapt the market through their actions and collaborations. By focusing on what they can control, these entrepreneurs can steer their ventures in new and innovative directions, rather than being limited to predetermined paths based on predictions.
This mindset is what Sarasvathy wants entrepreneurship education to teach. A mindset encompassing the fundamental principles and logic of the entrepreneurial method, teaching the students to do what they can with what they have rather than just chasing success metrics. A mindset that equips them not just with tools they need – but with the ability to craft the entire toolbox.
Summary by Elvira Andersson
Keywords: lean startup; effectuation; scientific method; entrepreneurial method; non-predictive control; hypothesis testing; market shaping; experimentation
