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Does practice make micro-entrepreneurs perfect? An investigation of expertise acquisition using effectuation and causation

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Abstract

This paper reports on a study testing whether and how the use of effectuation and causation logics influences deliberate practice in businesses started by microfinance borrowers (“micro-entrepreneurs”) in Sri Lanka. Using mixed methods, we surveyed clients of a large Sri Lankan microfinance institution and deepened findings from the survey through 24 interviews. In this way, we identified specific patterns of relationships between principles of the two logics and five elements of deliberate practice identified in the expertise literature from cognitive science. We found that both effectual and causal logics (but not effectuation alone) facilitate deliberate practice, an important result since deliberate practice could be expected to help micro-entrepreneurs gain business and entrepreneurial expertise. We also found interesting patterns in the links among effectuation and causation and specific elements of deliberate practice. In particular, one effectuation principle—acknowledging and leveraging the unexpected—impacted all five elements of deliberate practice, suggesting that learning to manage uncertainty is a central task—perhaps the central task—in becoming an entrepreneur. By contrast, causation influenced elements of deliberate practice linked to “venture-building” or “entrepreneuring,” and not the more personal elements linked to seeing oneself as an entrepreneur. As expected from the literature on expertise, deliberate practice was more likely to occur in earlier stages of venturing by younger, less-experienced entrepreneurs. Findings not only offer avenues for future research into deliberate practice in entrepreneurship but also suggest new ways for microfinance institutions to help their clients move toward entrepreneurial expertise.

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Acknowledgements

The authors gratefully acknowledge both the editors’ and reviewers’ insightful comments and suggestions; several of which have been incorporated into the paper.

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  1. Department of Management, Marketing and Entrepreneurship, UC Business School, University of Canterbury, Christchurch, New Zealand

    Nadeera Ranabahu

  2. School of Management, Operations and Marketing, Faculty of Business, University of Wollongong, Wollongong, Australia

    Mary Barrett

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  1. Nadeera Ranabahu
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Correspondence to Nadeera Ranabahu.

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Table 5 Statements used in the deliberate practice scale and factor loadings
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Table 6 Main interview questions
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Ranabahu, N., Barrett, M. Does practice make micro-entrepreneurs perfect? An investigation of expertise acquisition using effectuation and causation. Small Bus Econ 54, 883–905 (2020). https://doi.org/10.1007/s11187-019-00157-6

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