Entrepreneur and Human Action: Award Winning Researcher Saraswati

Posted on June 7, 2022

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Saras Saraswati, the promoter of entrepreneurial theory of implementation, has just received the prestigious Swedish “Global Award for Entrepreneurial Research”.

Organized since 1996 by the Swedish Foundation for Small Business Research (FSF) and the Swedish Agency for Economic and Regional Growth, the award recognizes researchers who have made significant contributions to entrepreneurial research. Thus he joined great researchers such as Sidney Winter, Shaker Zahra, Kathleen Eisenhard, Scott Shane, Israel Kirzner, William Gartner, William Baumal or even Joltan ACS and David Audrey. In 2016, French economist Philippe Aghion received the award.

The award is the culmination of more than twenty years of efforts to promote a radically different approach for entrepreneurs. But its significance goes beyond that because implementation is, above all, a view of human action and freedom.

Do you know Saraswati?

Born in India, he is now a professor at Darden Business School (Virginia, USA). In the 1990s, he headed a family business that made plastic containers for the oil industry. Business is improving until the floods destroy his factory. He made some big investments there and overnight he lost it (interestingly and like a snub) Risk managersHe was assured that it was in a flood-free area).

After a few weeks of surprise, he moved to the United States, encouraged by his brother who was already living there, without a clear idea of ​​what he was going to do. Through a series of coincidences and adventures, more incredible than each other, which I will tell you one day, I promise, she ended up in Herbert Simon’s office to do her doctorate there. Herbert Simon is quite a unique person: he died in 2001, the father of artificial intelligence, but also the winner of the Nobel Prize in Economics, and through Saraswati, the inspiration behind the implementation. Yes, that’s it!

Saraswati starts with a very simple question, like all the great research questions: How do entrepreneurs create new products, new companies and new markets? The traditional response, a stroke of talent then implemented through a plan, did not satisfy him. So he will observe entrepreneurs what they actually do and understand how they reason when faced with classic problems: how to get started, how to find an idea, a product or customer, how to make a decision, and so on.

He will outline five influential principles in these decisions:

  1. Do what we have
  2. Acceptable damage work
  3. Co-create with stakeholders
  4. Take advantage of the surprises
  5. We want to create the future

These five principles constitute effectiveness.

Effectiveness revolutionizes entrepreneurial thinking because it does not fit perfectly with the dominant example of neo-classical economics, which ignores entrepreneurship. The power of effect is what it describes, what entrepreneurs do, not what we want them to do. Efficacy is not instructive, it doesn’t say “don’t predict”, but “you don’t have to do anything”. It emphasizes enough, not necessarily.

This award is important because, like all cracks, performance has struggled to find its place in the academic arena. Despite having more than 100 articles in the best journals of economics, management and psychology for over 20 years, the principles it laid out aroused the conservation of many researchers, many of whom anchored in a Cartesian paradigm that assumes the future of economics if our present Have enough knowledge. There is no uncertainty, only ignorance.

The world is constantly being created by human choice

Facing a world seen as static because it is known, in contrast functionality preserves the idea of ​​a dynamic and open world, bathed in complex, uncertainty, and constantly generated by human activity and choice (apart from natural phenomena). The future is created with human systems like companies or markets. It’s not already there. So it is not a question of discovering, exploring or predicting the future, which is impossible, but of constructing it. So the future is open, permanently under construction, and this construction is the product of human creative work. This action takes the name of entrepreneurship, science, industry, politics, whatever. When I act, the future is not only unknown, it is unpredictable, because it will be the result of many choices and actions made by actors other than me at the same time.

This world needs to be viewed as non-determinative and permanently constructed, and therefore unpredictable, as Ilya Prigogin, a pioneer physicist in the early 1980’s, had already theorized in science. Her work inspired many economists, but the classic example was as influential as the new example – Saraswati’s work, including Entrepreneur.

Philosophical significance is important: if the world is uncertain, it is open. When it is open, it leaves the possibility of creative human action. In other words, uncertainty is a condition of human freedom, meaning that man is not stuck in an already written future, and above all written by others. In this regard, effect highlights the notion of non-predictive control: if you work to change your context, you do not need to predict. Similarly, the entrepreneur is not the one who corrects the “flaws” of economic actors, as suggested by the entrepreneur’s great researcher Israel Kirzner, because it assumes an absolute standard of truth, which negates effectiveness.

In academic parlance, effectuation promotes a “non-teleological” aspect of the action, meaning that it is no different from the actor. Everything starts from the acting man and everything comes back. There is no need for foresight, no need for ambitious goals, no need to meet any standards, not even for performance standards. All these abstract ideas transform man out of man and the way to end it. Effectiveness reverses this by making the acting human the starting point and the only measure of action, and shows that the goals we set do not have to be a starting point, but can come out of the opposite action. Vision, opportunity, market, product and service, purpose, goal, organization, all these are the fruits of human action.

Entrepreneur for all

Importantly, the simplicity of the principles of effectiveness makes them applicable to everyone. Conversely fictional as an entrepreneur Deuce X machine Or a dreamer and omnipotent superhero, the effect ensures that everyone can act in an entrepreneurial way, which is understood as the possibility of being a partial owner of their destiny.

By changing the influential attitudes of entrepreneurs, efficacy frees up the actions of many people who mistakenly thought that entrepreneurship was not for them. But the work of Saraswati and many other researchers after her goes beyond the single question of entrepreneurship. In his award-winning speech, he also underlined how applicable policies apply to all key questions in human society: organizations, of course, but also countries.

Like all great inventions, the effect questions influential emotional models and so it takes time to establish itself. Academic recognition is now gained by many articles and specialties, the promotion of policy to entrepreneurs is also advancing rapidly, and the Swedish award comes at the crown of this twenty-year effort to fully develop an international community.

Saraswati is not only a great researcher, she is also a very humane person. I had the opportunity to work with him for several years on a research project (with my classmate Dominic Vian). How many times, hanging after a working session, we said to ourselves “Well we’re a little less stupid than before 1h30”. Juicy is a strong mind – talking to him is a ruthless battle without concessions, you get better prepared – but he is also very humane, accessible to a great researcher like a first year student (he usually welcomes his students home after the course and he cooks). . I appreciate the incredible message he sent me a few years ago when I had a major health problem. He is truly one of those people who made the world a better place.

So … of course for his rewards, for his pioneering work and for the tireless support of the entrepreneur for all, but above all কার for whom he is!

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