From family commitment to entrepreneurial orientation: exploring the role of cultural mechanisms in mature family firms

Abstract

At a stage of life cycle maturity, the unique advantages of family influence are often outweighed by organizational conditions of conflict, risk-aversion, and inertia which makes it difficult to exploit entrepreneurial opportunities. Guided by the proposition that a positive culture enables the entrepreneurial spirit to be preserved over time, this study focuses on examining the cultural dynamics between family and business social systems to advance our understanding of the heterogeneity of mature family firms in terms of entrepreneurial orientation (EO). Specifically, it bridges the link between family commitment and firm-level EO by considering long-term orientation and stewardship climate to operate as organizational culture mechanisms. From a quantitative study of 208 family firms, the findings provide evidence for EO to be supported by the proposed serial mediation process. A family’s strong commitment toward the business thus seems to stimulate EO only when passing through long-term-oriented priorities among the firm’s dominant coalition and an organizational environment characterized by collective stewardship.