Logics and Rationalisations Underpinning Entrepreneurial Decision Making

Natalia Vershinina, Rowena Barrett, Peter McHardy

Research output: Contribution to journalArticlepeer-review

11 Citations (Scopus)
175 Downloads (Pure)


In this article we explore what logics do expert entrepreneurs use when faced with a critical incident threat.
Attempts have been made to define “entrepreneurial logic”. We are influenced by Sarasvathy’s work on high performance entrepreneurs, which finds that when faced with uncertainty, entrepreneurs employ unconventional logic. However, later research acknowledges social contexts, where entrepreneurs operate. We develop a typology of decision making logics that takes into account the situation of crisis. We have interviewed 7 expert entrepreneurs who faced crisis and despite this are successfully operating businesses. We adopted a critical incidents methodology.
We find that experienced entrepreneurs tend towards causal logic when ‘the stakes are high’ and the decision may affect the survival of their business so they weigh up options before acting, and tend to seek advice from trusted ‘others’ within their network before or after they have made a decision. A
mixture of causal and intuitive logic is evident in decisions dealing with internal business problems.
Research limitations / implications:
The decisions entrepreneurs make shape and define their business and their ability to recover from crisis. If researchers can develop an understanding of how entrepreneurs make decisions – what information they draw upon, what support systems they use and the logic of their decision making and rationalisation – then this can be used to help structure support.
By exploring decision making through critical incidents we offer an innovative way to understand context rich first hand experiences and behaviours of entrepreneurs around a focal point.
Original languageEnglish
JournalJournal of Small Business and Enterprise Development
Issue number1
Early online date5 Jan 2017
Publication statusE-pub ahead of print - 5 Jan 2017


  • Entrepreneur
  • Decision Making
  • Rationalisation
  • Logic
  • Rationality
  • Effectuation
  • Intuition

ASJC Scopus subject areas

  • General Business,Management and Accounting
  • Strategy and Management


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