Entrepreneurial Orientation In Family Firms Research Articles

Family firm entrepreneurial orientation: the effects of socio-emotional wealth, professionalization and bifurcation bias

PurposeThis paper aims to examine the effects of socio-emotional wealth importance (SEWi) in family firms and family firm-specific HR practices, namely professionalization and bifurcation bias, on their entrepreneurial orientation (EO).Design/methodology/approachThe paper surveyed 133 small and medium-sized family firms in the USA. The respondents were recruited through Prolific Academic.FindingsWhen SEWi is low, a family firm becomes more similar to a non-family firm, thereby enjoying the benefits associated with EO. When SEWi is high, a family firm leverages the unique resources and capabilities specific to family firms. Moderate SEWi levels are associated with lower EO levels. Additionally, the results support the argument that professionalization (involving non-family managers, formalization and decentralization) fosters EO, while bifurcation bias hinders its development.Originality/valueUnlike previous studies, this paper posits a non-linear, U-shaped relationship between SEWi and EO. It contributes to the field by empirically investigating the effects of professionalization and bifurcation bias on EO in family firms.

Family social capital as a mediator between socioemotional wealth and entrepreneurial orientation: evidence from Mexican SMEs

ObjetivoAs relações e conexões das famílias envolvidas nos negócios, ou capital social familiar, têm efeitos positivos e negativos nas empresas familiares. Este artigo investiga o papel mediador das relações sociais dos membros da empresa familiar entre a riqueza socioemocional e a orientação empreendedora das empresas.Desenho/metodologia/abordagemFoi aplicado um inquérito realizado nas quatro principais cidades do México. A amostra foi constituída por 360 PME. A estrutura de pesquisa e a hipótese deste estudo foram testadas usando análise de regressão e a técnica de Modelagem de Equações Estruturais (SEM).ResultadosNosso estudo conclui que a riqueza socioemocional não apenas influencia fortemente a orientação empreendedora das empresas familiares, mas que esse fator também é mediado pela capacidade dessas famílias de desenvolver seu capital social.Originalidade/ValorEste trabalho contribui para a literatura acadêmica sobre empreendedorismo e capital social. Como mediador entre a riqueza socioemocional e a orientação empreendedora, o capital relacional familiar tem recebido pouca pesquisa. Nossos resultados revelam implicações significativas para a gestão de rede e estratégias de capital relacional para PMEs.

Internal social capital and entrepreneurial orientation in family firms: A double-edged sword

Internal social capital and entrepreneurial orientation in family firms: A double-edged sword

ENTREPRENEURIAL ORIENTATION AS A NEW AGGRESSIVE BUSINESS MODEL IN THE FAMILY AND NON-FAMILY FIRMS: A LITERATURE REVIEW

The study aims to define strategic orientations and examine the relationship between entrepreneurial orientation activities and firm performance. For this purpose, the concepts of strategic orientation, entrepreneurial orientation and firm performance are explained in the relevant sections based on the research in the literature. The study used international examples that associate the entrepreneurial orientation of family and non-family companies with firm performance. One of the most important results of the study is that the entrepreneurial orientation of family firms has a weak or non-existent relationship with firm performance. Family businesses tend to be less involved in entrepreneurial orientation activities than non-family companies. Another important result is that entrepreneurial orientation has a more positive effect on the performance of non-family firms than family firms. This study is likely to positively contribute to the literature by providing a new perspective to scientists and administrators and summarizing important resources in one place. The study differs from similar studies as it deals with the relationship between entrepreneurial orientation and firm performance by including family and non-family companies in the process with a holistic approach. Since the samples subject to the study were selected without making any distinction between country, sector and size in this research, the scope is limited. The relationship between entrepreneurial orientation and firm performance could not be determined statistically since the study is qualitative.

Effect of environmental dynamism on entrepreneurial orientation in family firms: the moderating role of informal institutions

PurposeThe aim of this paper is to investigate the effects of environmental dynamism on different EO dimensions in family firms. The authors also examine the moderating role of national culture (uncertainty avoidance and in-group collectivism) and the level of family control and influence in fostering/hindering this relationship.Design/methodology/approachA survey was conducted among 1,143 family firms from twenty-eight countries. The authors developed and tested hypotheses through a fixed-effects regression analysis.FindingsThe findings suggest that environmental dynamism has a positive effect on all three EO dimensions. Analysis reveals a positive moderating role of family control and influence and negative moderating roles of in-group collectivism and uncertainty avoidance.Practical implicationsThe findings imply that family firm managers should carefully interpret the influence of their national culture on family firm behavior. More specifically, family firms in dynamic environments should consider the importance of the national culture in which they are embedded. Those operating in high uncertainty avoidant and highly collectivist cultures should take proactive steps to cultivate a corporate entrepreneurial culture. On the other hand, the family should not undermine the effect of its control and influence. In dynamic environments, family control and influence may be a competitive advantage in reinforcing entrepreneurial orientation.Originality/valueThe study contributes to the literature on EO in family firms by expanding the previous research on the antecedents of EO and examining moderation effects of culture and family control and influence across a broad multi-country sample. In contrast with the common findings regarding the effect of family logic on EO, the study shows the strengthening role of family control and influence in the relationship between environmental dynamism and EO. The authors show that culture as an informal institution may also play a critical role in hindering/strengthening the relationship between environmental dynamism and EO.

Dual innovation of the business model: the regulatory role of entrepreneurial orientation in family firms

PurposeFamily farms are seen as a powerful force for rural development, and they are gaining more and more research attention. This study aims to explore the relationship between the social networks of family farms and the dual innovation of the family farm business model from the perspective of entrepreneurial orientation.Design/methodology/approachUsing a questionnaire survey of 169 family farms in Qingdao, China, descriptive and inferential statistics were used to analyze the data collected. The study hypothesis was tested using inferential tests (regression analysis).FindingsThe study results show that innovative, efficiency- and novelty-based business models facilitated by social networks have a favorable and significant impact on the performance of family farms. Furthermore, the relationship between social networks and new business model creation is positively influenced by an entrepreneurial orientation.Originality/valueThis study is distinctive in that it examines the mechanisms underlying family farm growth from an entrepreneurial standpoint, classifying family farm social networks for the first time into social, market and governmental categories and looking at their impact on the creation of new business models. In addition, it looks into the relationship between the innovation and social network aspect of the family farm business model from an entrepreneurial perspective, offering fresh insight into this connection. It also examines the family farm business model’s connection to innovation and social networks from an entrepreneurial standpoint, providing new insight into this relationship.

How Family and a Migrant Background Influence Family Entrepreneurship: Findings from a Systematic Literature Review

This article aimed to survey the literature on the authenticity and influence of family and migration in the context of family entrepreneurship with the goal of highlighting thematic trends within the existing literature, mapping and outlining existing knowledge in the field, and recommending future research directions. The method used in this study is a systematic literature review approach consisting of five stages. Out of the 320 articles indexed in Web of Science’s Core Collection in 2014–2020, 64 were selected and studied extensively. Additionally, NVivo software Windows (Student License) software—Windows (12-month Student License) was used to examine the most frequently researched thematic areas by analysing the occurrence of the keywords in the articles concerned. The study provides an overview of six major research streams on the influence of family and migration background within the context of family entrepreneurship: (a) the influence of family on the entrepreneurial orientation of family firms, (b) the socio-cultural influence of family in family entrepreneurship, (c) family influence in corporate family enterprises, (d) family influence in family-governed firms, (e) the influence of gender within family entrepreneurship and (f) the influence of the family in the context of migrant-run family entrepreneurship. However, the survey was only conducted in the Web of Science database and only focused on work written in English, limiting the range of studies that were analysed. Thus, multilingual teams could expand the research by studying non-English texts and identifying studies in other scholarly databases.

Does familial decision control affect the entrepreneurial orientation of family firms? The moderating role of family relationships

Drawing on the theory of socioemotional wealth (SEW), we propose that family relationships have implications for entrepreneurial orientation (EO) through enhancing energy and reducing stress, and that this is especially important when family decision-making is not inclined towards EO. Survey data from 528 family firms, collected from across China, generally supports our model, which in turn explains the heterogeneity behind family firms’ priorities and routines. The results indicated that family decision control negatively affects a firm’s EO, while family cohesion and adaptability play a negative moderating role in this relationship. Our findings help explain how family provides a powerful source of motivation that can boost EO in the family business, offering meaningful implications for research on entrepreneurship.

Entrepreneurial orientation in family firms: the effects of long-term orientation

PurposeThis paper aims to shed light on the relationship between long-term orientation (LTO) and the dimensions of entrepreneurial orientation (EO) in family firms while adopting a stewardship perspective.Design/methodology/approachA survey of the top managers of family firms in Iran's science and technology parks was conducted, and partial least squares structural equation modeling (PLS-SEM) was used to analyze the collected data.FindingsThe research results showed that LTO has a positive effect on innovativeness and proactiveness and a negative effect on riskiness. Therefore, family firms' LTO pays off by enhancing their EO.Practical implicationsIn today's competitive world, EO is gradually becoming an inevitable necessity in many industries. Executives who want their firms to have a high level of performance should pay special attention to entrepreneurial behaviors. The present research informs the family firms' managers and practitioners to be long-term oriented to embrace more innovativeness and proactiveness, and less riskiness.Originality/valueSo far, the relationship between the LTO and entrepreneurial characteristics of family firms has remained ambiguous; this research is one of the first studies investigating this relationship.

Influence of Socio-emotional Wealth on Entrepreneurial Orientation in Family Firms: A Bibliometric Analysis and Systematic Review

This article explores the effects of socio-emotional wealth on the family firms’ entrepreneurial orientation. The family firms aspire to attain economic goals and maintain family control and influence over their firms. These conflicting goals may become detrimental to their entrepreneurial orientation and firm performance. Against the background of the heterogeneity of family firms, this article deliberates on the effects of socio-emotional wealth on entrepreneurial orientation. This article has explored the research trajectories and themes of socio-emotional wealth and entrepreneurial orientation research discourse by adopting the methods of bibliometric analysis and systematic review research protocol. This article reviews the findings of the research discourse on the relationship between socio-emotional wealth and entrepreneurial orientation. In particular, this article inquires whether family firms’ entrepreneurial orientation decreases because they are concerned about preserving their socio-emotional wealth and, if so, under what conditions. This article also makes practical recommendations for using the desire to meet non-economic goals judiciously. This article provides insights into how family firms can change their business strategies to synthesize the much-needed entrepreneurial orientation to preserve their socio-emotional wealth.

Employee Silence and Entrepreneurial Orientation in Small and Medium-Sized Family Firms

This paper aims to assess differences between employees of family and non-family firms regarding their levels of employee silence and their perceptions of the company’s entrepreneurial orientation. Moreover, focusing on family firms, we assess the relationship between the levels of employees’ silence and their perceptions of the firm’s entrepreneurial orientation. The empirical evidence is provided by a sample of 245 Portuguese employees, 117 employees of family firms, and 128 of non-family firms, who responded to a questionnaire that included employee silence and entrepreneurial orientation measures. Results reveal that family firms’ employees show higher levels of employee silence but perceive their companies as less entrepreneurially oriented than employees of non-family companies. In addition, our results do not support the idea that there is a relationship between the levels of employee silence and the employee’s perception of the company’s entrepreneurial orientation. This paper offers initial insights into the debate on the relationship between the levels of employee silence and the employee’s perception of the company’s entrepreneurial orientation in family firms.

The impact of a crisis on entrepreneurial orientation of family firms: The role of organisational decline and generational change

This article critically analyses entrepreneurial orientation (EO) in family firms after a major crisis, to investigate how firms with equal initial levels of EO reach different levels over time. Based on two alternative hypotheses (stability and convergence), we analysed whether the EO of family firms remains intact, strengthens, or weakens after a crisis. Based on an examination of a database of 151 family firms collected in 2004 and 2017, our findings reveal that compared to firms with higher pre-crisis EO levels, those with lower levels saw a larger increase post crisis. Furthermore, unlike the latter group, the former was able to maintain high pre-crisis levels even after the crisis. In addition, we also we found this relationship between pre-crisis and post-crisis EO levels to be influenced by two key periodic discontinuities, namely, organisational decline and generational change contingencies. These findings advance our understanding of temporal aspects of EO and heterogeneous entrepreneurial behaviour among family firms with significant implications for both theory and practice.

Time Perspective and Entrepreneurial Orientation in Family Firms: Some Theoretical Propositions

In this theoretical article, we highlight the central role of an important dimension of psychological time related to individual experiences and perceptions of the past, present, and future—time perspective (or TP)—in influencing the entrepreneurial orientation (EO) of family firms. To do so, we draw on the TP, entrepreneurship, and family business literatures and provide insight into how a CEO’s TP influences family firm engagement in entrepreneurial activities. Family firm specifics also play important roles in the TP-EO relationship. We propose that (1) the positive TP of the family firm CEO (i.e., past-positive, present-hedonistic, and future TP) has positive effects on family firm EO; (2) the negative TP (i.e., past-negative and present-fatalistic TP) has negative effects on family firm EO, but these effect are mitigated by family firm specifics; and (3) the effects of EO on the subsequent TP of the CEO (and other family members) are based on previous TP and are likely to be moderated by the feeling of being instrumental and positive affect, family support, and perseverance. Last, we discuss some implications for theory and research.

Entrepreneurial orientation and innovation success in family firms

There is a general agreement that entrepreneurial orientation can significantly improve firms' performance, for both family and non-family firms. With regard to the relationship between entrepreneurial orientation and the family status of a firm, there is some controversy in the literature. Traditionally, family firms have been considered more conservative and risk-adverse than non-family firms and, therefore, with less entrepreneurial orientation. However, some recent studies show that family firms do also take risks. This paper analyses entrepreneurial orientation of family firms in comparison with non-family firms, and suggests that the relationship between entrepreneurial orientation and performance, in particular when it is measured as new products success, is higher for family firms than for non-family firms. Using a sample of 268 firms (family and non-family), this paper tests its hypotheses. Findings show that there are not differences between family firms and non-family firms regarding entrepreneurial orientation. More important, they provide support to our proposition that the family status positively moderates the link between entrepreneurial orientation and new products success.

Bridging the micro-macro gap: A multi-layer culture framework for understanding entrepreneurial orientation in family firms

Prior research on the antecedents of entrepreneurial orientation (EO) in family firms heavily relied on structural family-level characteristics but neglected the contribution of the business system. This may inhibit the current debate as it limits our understanding of the organizational mechanisms through which “familiness” is translated into EO. To elaborate the adolescent theory of EO in family firms and motivate future work on the topic, this article seeks to bridge the micro (family)-macro (firm-level EO) gap by introducing a multi-layer culture framework. Using an interpretivist single case study design, the theoretical utility of that framework is demonstrated by capturing the lived experiences of both family and nonfamily managers involved in shaping the organizational culture of a second-generation German family firm. The model that emerged from the analysis of archival and ethnographic interview data cuts across analytical levels and illustrates, in a fine-grained manner, how the identified cultural concepts operate and interact to stimulate EO. Specifically, it shows that family values of altruism and preservation are translated into EO by an organizational culture characterized by long-term and involvement orientation as well as psychological safety and empowerment climates. The model further uncovers the specific underlying processes of cultural transmission, such as building a quasi-family, demonstrating servant leadership behaviors, providing a written self-image, and applying value-based recruitment principles.

Entrepreneurial orientation in family firms: New drivers and the moderating role of the strategic involvement of the board

In this study, we examine new drivers that generate a disposition toward entrepreneurial activity in family firms and how the strategic involvement of the board of directors (SIBD) moderates the relationships between these drivers (image of the firm, willingness to change, and access to financial resources) and entrepreneurial orientation (EO). Using a sample of 230 family small and medium-sized enterprises (SMEs), our results confirm that a good family firm image and willingness to change may be powerful tools that stimulate a firm to develop entrepreneurial activities. The negative relationship between access to financial resources and EO may relate to the false belief that financial resources help firms be more creative and to maintaining family control of the firm and the socioemotional endowment. Contrary to our expectations, we also find that the SIBD negatively influences the relationship between the above drivers and EO, pointing to the need for more open boards of directors in family SMEs in order to develop and implement entrepreneurial strategies. JEL Classification: L2, M1

Entrepreneurial Orientation and the Family Firm: Mapping the Field and Tracing a Path for Future Research

Despite several calls for the further study of entrepreneurial orientation in family firms, we still have a fragmented understanding of this topic, whose full potential has yet to be reached. To shed new light on this issue, this article first maps the family business field by carrying out a systematic review and content analysis of the 78 articles identified at the confluence of entrepreneurial orientation and family firms. Our study describes and critically assesses previous research as well as the conclusions reached. Second, this article identifies the main research gaps and provides a path for future investigations.

Examining entrepreneurial orientation’s dimensions – performance relationship in Saudi family businesses

PurposeThe purpose of this paper is to contribute to family firm and entrepreneurship literature by providing an examination of how family involvement in management (FIM) moderates the relationship between entrepreneurial orientation (EO)’s dimensions and family firm performance (FFP).Design/methodology/approachThrough a survey study, the research was developed using a sample of 175 family firms in Saudi Arabia to test the proposed hypotheses using hierarchical linear regression.FindingsThe findings revealed a strong positive and significant linkage of proactiveness and FIM with FFP, but, no significant relationship between innovativeness and risk-taking with FFP. However, when FIM contingencies were hypothesized, a new significant influence from the interaction between risk-taking and FIM on FFP was found.Research limitations/implicationsThe main limitation lies in the fact that it is not possible to claim generalization of findings to family firms in other emerging or transitional countries as the research is focused on Saudi family firms. Theoretical and practical implications are discussed in order to produce new knowledge on EO of family firms and to help these firms not consider FIM as an impediment to the development of resources and capabilities necessary to the promotion of entrepreneurial activities within their operations.Originality/valueThere is a contribution to the literature on EO by showing that EO construct and its dimensions have great generality within family firms in a transitional context.

Entrepreneurial Orientation in Family Firms: Looking at a European Outermost Region

This study addresses a current debate in the family business literature involving the extent to which the family business context hinders or promotes entrepreneurial behavior. The empirical evidence is provided by 155 small-sized firms, 82 family-controlled and 73 nonfamily-controlled, operating in an outermost region, the Autonomous Region of the Azores. This study analyzes the differences between family and nonfamily firms in regard to entrepreneurial orientation and how it is influenced by family participation. Results show that there are differences in entrepreneurship orientation and in two of its three dimensions, while revealing that family participation is negatively associated with entrepreneurial orientation and its three dimensions.

Psychological ownership, knowledge sharing and entrepreneurial orientation in family firms: The moderating role of governance heterogeneity

Adopting a stewardship perspective and relying on a sample of 93 Spanish family firms, we emphasize the importance of psychological ownership as a primary determinant of entrepreneurial orientation in terms of proactiveness, innovativeness and risk taking. We also suggest that the relationship between psychological ownership and entrepreneurial orientation is mediated by knowledge sharing. Finally, we assess the potential moderating roles of heterogenous governance conditions in terms of the generation in control, generational involvement and family involvement in the top management team with regard to the relationship between psychological ownership and knowledge sharing. Research and managerial implications are shared in the concluding section.