Advising Entrepreneurs: Optimal Recommendation of Alternatives

Zeya Wang, Morvarid Rahmani, Karthik Ramachandran
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Abstract

Problem definition: Facing emergent business challenges, entrepreneurs often seek guidance from experienced advisors. When multiple alternatives could potentially solve the entrepreneur’s problem, advisors can lead the entrepreneur’s exploration by choosing which alternative(s) to suggest and in what sequence. Methodology/results: We develop a dynamic game-theoretic model that captures the sequential interaction between an advisor and an entrepreneur. The advisor chooses how to recommend alternative solutions, and the entrepreneur chooses which solution to try. The trial’s success depends on the viability of a solution and the entrepreneur’s execution capability. When a trial of a recommended solution fails, the belief about the viability of the solution is updated. Managerial implications: Our analysis reveals that the advisor should strategically recommend alternatives based on the entrepreneur’s execution capability, trial costs, and correlation between alternatives (among other factors). When the trial of the first alternative fails, the advisor should readily offer a new alternative if the entrepreneur’s capability is either very high or very low. Otherwise, the advisor should encourage the entrepreneur to try the same solution multiple times. In order to motivate and sustain the entrepreneur’s exploration over time and across solutions, the advisor may find it optimal to recommend inferior solutions before superior ones (e.g., when trial costs are different or the entrepreneur can improve her capability with experience) or recommend multiple solutions simultaneously (e.g., when there is correlation between alternatives).Supplemental Material: The online appendix is available at https://doi.org/10.1287/msom.2022.0361 .
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为企业家提供建议:备选方案的最佳推荐
问题定义:面对新出现的商业挑战,创业者往往会寻求经验丰富的顾问的指导。当多个备选方案可能解决创业者的问题时,顾问可以引导创业者进行探索,选择建议哪些备选方案以及建议的顺序。方法/结果:我们建立了一个动态博弈论模型,以捕捉顾问与创业者之间的顺序互动。顾问选择如何推荐备选解决方案,企业家则选择尝试哪种解决方案。试验成功与否取决于解决方案的可行性和企业家的执行能力。当推荐方案的试验失败时,关于方案可行性的信念就会更新。管理意义:我们的分析表明,顾问应根据企业家的执行能力、试验成本和替代方案之间的相关性(以及其他因素),战略性地推荐替代方案。当第一个备选方案的试验失败时,如果创业者的能力很高或很低,顾问应随时提供新的备选方案。否则,顾问应鼓励创业者多次尝试相同的解决方案。为了激励和维持创业者在不同时间和不同方案之间进行探索,顾问可能会发现,在推荐优方案之前推荐劣方案(例如,当试验成本不同或创业者可以通过经验提高能力时)或同时推荐多个方案(例如,当备选方案之间存在相关性时)是最佳选择:在线附录见 https://doi.org/10.1287/msom.2022.0361 。
本文章由计算机程序翻译,如有差异,请以英文原文为准。
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