How is effectuation effectual? The role of artifact decomposition in enabling non-predictive control

Effectuation theory seeks to explain how entrepreneurs act under Knightian uncertainty through non-predictive control. However, the mechanism through which this control operates remains unclear, and the theory has been criticized for being akin to a random walk. This paper addresses this issue by integrating effectuation theory with a design science perspective on entrepreneurship. We conceptualize venture creation as the iterative design of an artifact whose structure evolves through decomposition and recomposition. Drawing on the property of near-decomposability, we propose that the artifact provides the structural continuity linking successive entrepreneurial actions while enabling localized change. Within this framework, the principles of effectuation operate as design mechanisms that guide how subsystems are created, protected, integrated, and recombined during artifact transformation. This perspective explains how entrepreneurial action can be non-predictive yet non-random. By connecting effectuation principles, the evolving artifact, and near-decomposability, this paper contributes to effectuation theory and advances entrepreneurship as a design science.