Are Formal Planners More Likely To Achieve New Venture Viability? A Counterfactual Model And Analysis

Greene, Francis J.; Hopp, Christian (2017). Are Formal Planners More Likely To Achieve New Venture Viability? A Counterfactual Model And Analysis Strategic Entrepreneurship Journal, 11(1), pp. 36-60. 10.1002/sej.1245

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This study develops and tests a counterfactual model of the relationship between formal written business plans and the achievement of new venture viability. This is important because extant theory remains oppositional, and there is a practical need to provide guidance to founders on the utility of formal plans. To test our model, we use propensity score matching to identify the impact that founder, venture, and environmental factors have on the decision to write a formal plan (selection effects). Having isolated these selection effects, we test whether or not these plans help founders achieve venture viability (performance effects). Our results, using data on 1,088 founders, identify two key results: (1) selection effects matter in the decision to plan; and (2) it pays to plan.

Item Type:	Journal Article (Original Article)
Division/Institute:	Business School > Business Foundations and Methods
Name:	Greene, Francis J. and Hopp, Christian0000-0002-4095-092X
ISSN:	19324391
Language:	English
Submitter:	Christian Hopp
Date Deposited:	06 Oct 2020 07:04
Last Modified:	29 Sep 2021 02:17
Publisher DOI:	10.1002/sej.1245
Uncontrolled Keywords:	nascent venturing; business plans; formal planning, counterfactual modelling; ropensity score matching; PSED II
ARBOR DOI:	10.24451/arbor.11995
URI:	https://arbor.bfh.ch/id/eprint/11995