In the inaugural issue of the Journal of Family Business Strategy, Mattias Nordqvist and Leif Melin argued for the benefit of a ‘Strategy-as-Practice’ perspective for family business strategy research (Nordqvist & Melin, 2010). In this paper, we draw upon a contemporary conversation with Professor Leif Melin, to purposefully revisit and reflect on this promise. What was the promise, has it come to pass, and what might the future hold? Following the conversation with Leif, considered one of the founding fathers of this research stream, we review and discuss extant literature that has applied a practice theory perspective to family business. We call attention to practice theory approaches for the family business community and illustrate the benefits of researching family businesses with practice theory perspectives. Having taken stock, we then suggest research opportunities to further advance this avenue. Finally, we reflect on the past, present, and future of researching family practices to continue the advancement of family business strategy research led by this journal over the past 15 years.
The analysis of inbound open innovation (IOI) offers a promising avenue for family businesses (FBs) to reconcile the preservation of family values with technological advancement. This study advances the debate on whether FBs outperform non-FBs in leveraging IOI for product innovation. Drawing on data from 522 Spanish manufacturing firms (2008-2017), we examine how FBs' unique characteristics and socioemotional goals shape their ability and willingness to innovate. To clarify differences in product innovation between FBs and non-FBs, we distinguished between external acquisition and collaboration partnerships as different types of IOI, alongside familial resources and socioemotional motivations. Our findings show that FB status negatively moderates the relationship between external acquisition and product innovation, but positively moderates the link between collaboration partnerships and product innovation. The results suggest that FBs excel in product innovation when collaborating but lag behind non-FBs when they independently leverage the acquired external technology. Our research broadens the ability-willingness paradox, highlighting the need for both conditions to explain external acquisition and collaboration as drivers of product innovation.
This conceptual paper develops a process model of psychological contract formation for family and non-family employees, addressing calls for more dynamic and context-sensitive approaches to understanding employment relationships in family firms. Although the construct of the psychological contract has been widely drawn upon by scholars to examine employment relationships in myriad work contexts, little is known about how these contracts are formed in family-owned firms. Drawing on organisational socialisation and social exchange research, we propose a dual-pathway process model of psychological contract formation that distinguishes how family and non-family employees create psychological contracts during the pre-entry and post-entry stages of socialisation. Consequently, we illustrate the nature of these differences by focusing on the unique architecture of their respective psychological contracts, namely six specific underlying properties or features: tangibility, scope, stability, time frame, exchange symmetry, and contract level. By theorising the mechanisms through which employment expectations are constructed in family firms, this paper advances a psychological contract perspective on family and non-family exchange relationships in family firms.
Explorative learning is crucial for firms’ long-term success; however, academic knowledge of the implications of socioemotional wealth (SEW) of founding family influence in publicly listed firms remains limited to small and medium-sized enterprises and survey-based studies. This study addresses this gap by investigating the nexus between founding family influence in public firms and the tendency to engage in exploration. Specifically, we analyze family-founded S&P 500 firms, hypothesizing and investigating the effect of founding family influence on firms’ relative exploration orientation via a longitudinal content analysis. We determine that while founding family influence negatively affects firms’ relative exploration orientation, the presence of a family founder CEO does not significantly strengthen this effect, and a nonfounding family CEO (i.e., a CEO from a distinct family to the founding family) mitigates this negative relationship. This study contributes to the research on founding family influence, SEW and organizational learning.
Empirical studies comparing productivity between family and non-family firms have produced contradictory results, which traditional managerial theories have struggled to explain. To address this research gap, we employ a context-theorizing approach to explore whether the quality of local institutions and place connections influence the productivity of family firms vis-& agrave;-vis their non-family counterparts. We develop a theoretical model that integrates corruption-trust theory and place attachment theory to examine the impact of the local context on both family and non-family firms. Our findings, based on a sample of Italian manufacturing firms, reveal that family firms are more productive than non-family counterparts in low-quality institutional contexts. However, this advantage diminishes as the quality of local institutions improves. Contrary to expectations, place attachment is negatively associated with productivity on average. This negative association is concentrated among non-family firms, whereas family firms appear largely unaffected. For family firms, the impact of place attachment is contingent on institutional quality. In low-quality institutional environments, place attachment further reduces the productivity of family firms, suggesting a lock-in effect. In contrast, in high-quality institutional contexts, place attachment becomes a source of productivity advantage for family firms.
Family business branding has traditionally focused on the corporate family business brand, overlooking the family itself as a branded entity. This study introduces the business family brand as an interrelated yet distinct human brand that emerges when a family’s business background is revealed, intertwining personal and corporate brand dimensions. We develop a conceptual framework theorizing how business family brands are formed and managed across the levels of identity, image, and reputation. Building on these three foundational brand dimensions, we elaborate on the brand’s unique human characteristics, outline guiding questions for its management, and discuss the dual branding opportunities and tensions arising between business and family branding considerations. To substantiate our theorizing, we complement our conceptual work with an empirical exploration of the general reputation of business families, enabling business families to assess the alignment between external stakeholder perceptions and their identity and intended image. The findings show that while business family reputation shares associations with corporate family business brands (e.g., traditional, local), it also evokes distinct perceptions (e.g., wealth, arrogance). By introducing and conceptualizing the business family brand, this research moves beyond the traditionally business-centered perspective on family business branding, offers practical guidance for managing business family brands, and opens diverse avenues for future research.
In the current globalized economy, digital transformation is a major challenge faced by manufacturing companies, and family firms are no exception to this reality. Although digital transformation has been posited as necessary for firms to achieve higher innovation outputs, research into how it affects manufacturing family firms remains scarce. To shed new light on this question, this study analyzes how digital transformation drives innovation and how the generation in charge of the family firm shapes this relationship. We test the proposed hypotheses using survey data from 319 manufacturing family firms from a developed economy (Spain) and an emerging economy (Ecuador). The results indicate that, overall, digital transformation has a positive influence on the innovation of small- and medium-sized manufacturing family firms. However, the results vary depending on the generation that manages the firm: younger generations in leadership positions have a positive influence on the relationship between digital transformation and innovation in Spanish family firms but not in Ecuadorian family firms. These results highlight the importance of considering different institutional contexts.
This article puts forward a concept of the organization as a mind-like, intelligent entity capable of efficiently responding to environmental stimuli. Such an entity-centric view offers a more coherent theoretical basis for predicting the ways in which different organizational factors may shape organizational behavior. We apply this logic to the context of sustainability in family firms, where previous research shows mixed results, possibly due to the omission of confounding factors such as organizational age. Using large-scale data and spaceborne-validated AI metrics on sustainability, we find that both organizational age and family influence independently exhibit negative relationships with sustainability outcomes. We discuss the implications for future theorizing and suggest avenues for further research in management, family business, and the broader exploration of human and artificial agency in organizations.
This study investigates conflict markers that occur during online communication in business families. Our findings identified eleven different markers that point to escalating conflict. We not only confirmed the applicability of Gottman’s conflict markers (1994) to the business family realm, we also identified unique markers in the realm of digital communication as well as specific markers in the context of business families. Implications and future research directions are discussed.
The global climate crisis has proven to be a defining challenge of our age, exacerbated by lackluster efforts to address it. This neglect is in part due to the long-term nature of its consequences for victims who are typically unspecified, anonymous, or distant. Many ESG initiatives are subject to similar biases against choices favoring outcomes that are temporally and socially distant. We examine how such biases may affect ESG decisions in family firms, looking in turn at the influence of familial, firm, and contextual factors on environmental, social and governance outcomes. Greater attention to these temporal and social biases may help to disentangle findings and inform future research on the ESG initiatives of family firms.
A family business succession involves more than just a change in control. Drawing from plant succession ecology, a new model reconceptualizes generational changes as cycles of disruption, adaptation, and renewal. Integrating the pioneer-climax with the dynamic equilibrium model demonstrates how family firms balance innovation with legacy preservation. Succession is not a fixed sequence but a rhythm of strategic shifts influenced by internal and external factors. Five mechanisms capture enduring continuity: adaptive governance, leadership selection based on vetted competencies, institutionalized innovation, disruption as a renewing force, and dynamic equilibrium. These findings combine ecological resilience with governance at the firm level, expanding family business theory. Other implications include governance designed to absorb shocks, creating position pipelines based on merit, and embedding mechanisms to foster innovation within established traditions. Testing the framework across industries and cultures, integrating it with empirical models of resilience, and examining macro or technological drivers of shifts in succession outcomes would further advance this research.
Technology adoption in family firms (FFs) often brings unique challenges, particularly in multigenerational contexts where generational differences shape decision-making and strategic priorities. This study examines the dynamics of cognitive conflicts arising during technology adoption in FFs, focusing on their sources, amplification mechanisms, resolution strategies, and long-term reconciliation processes. Using a qualitative multiple-case study of seven agricultural FFs in Southern Italy, the findings highlight generational differences in risk perception, resource allocation, and managerial vision as crucial antecedents of conflict. Conflict resolution strategies, such as translational roles played by younger family members, the formation of internal alliances, and decision postponement during heightened tensions, are identified as critical enablers of successful technology adoption. This research advances understanding of the interplay between generational dynamics and innovation processes in FFs, contributing to family business and conflict management literature. Practical implications emphasize the importance of fostering intergenerational dialogue, leveraging knowledge-sharing mechanisms, and engaging external stakeholders to navigate the complexities of technology adoption effectively. The study concludes by calling for further research to explore these dynamics across different industries and cultural contexts to enhance the transferability of the findings.
This study investigates how values are co-created, transformed, and sustained across generations in business families by introducing the concept of family value composites-dynamic configurations of shared values shaped through intergenerational interaction. Challenging the traditional view of values as static assets transmitted top-down, we adopt a processual and dialogical lens to explore how values evolve in lived family-business contexts. Based on 23 interviews across eight Austrian business families and using theory elaboration, we identify four key relational processes-mutual recognition, negotiation, adoption, and reinterpretation-that structure value co-creation. These processes lead to two outcomes: value continuity and value inversion, which together form coherent yet evolving family value composites. Our findings reconceptualize value transmission as dialogical co-creation, highlighting how younger generations engage critically with inherited values, sustaining some while reconfiguring others. The study contributes to family business theory by linking developmental and organizational perspectives and offers practical implications for succession and governance by emphasizing the importance of relational engagement in building enduring, meaningful family legacies.
This study investigates the perceptions private equity (PE) investors have of family firms and how these perceptions affect their investment decisions. We conducted a conjoint analysis using primary data concerning 1656 decisions made by 207 PE investors (Study 1), and additional post hoc data concerning 1672 decisions made by 209 PE investors (Study 2). Our analysis explores how perceived potential for value-creation influences the likelihood of an investment target being identified as a family firm, and the subsequent investment decisions. The results indicate that perceiving a firm to be a family firm significantly increases the likelihood of investment. This increase is driven by positive assessments of value-creation potentials, such as margin growth potential, multiple expansion potential, and cash conversion potential. Furthermore, we find that the deal experiences of PE investors moderate these baseline relationships, highlighting the crucial role of investor characteristics in shaping perceptions and investment decisions with regard to family firms.
Given the significant role of family firms worldwide, their access to bank financing to fund growth and operations is crucial for the global economy. Through a systematic literature review analyzing 126 empirical articles published between 1998 and 2023, this study focuses on the determinants of bank financing use on the one hand and bank financing conditions on the other hand. In this article, we disentangle the diversified and evolving research domain of family business bank financing, uncover what might explain the conflicting findings in extant research, and discuss how scholars could move this field forward. Guided by behavioral theories, we present promising directions for future research by identifying gaps considering the role of the business family in the decision-making process regarding bank finance use and conditions.
Understanding conflict in family businesses is a complex but essential study area for practitioners and academics. To enhance theoretical precision and provide practical insights, this article presents a comprehensive framework of family business conflict that integrates perspectives from the family business, organizational, management, psychology, and political science literature, as well as practitioner expertise. Highlighting important and often overlooked aspects of family business conflict, this study examines the circumstances of conflict (the who, what, where, why, when, and how) and provides a robust conceptualization of conflict dynamics in the unique family business setting. Through three illustrative examples of prominent family firms that have experienced conflict, the study demonstrates the value of the framework as a tool for understanding, theorizing, and effectively managing conflict.
Family firm succession has received considerable academic attention, focusing on various topics such as the actors involved, process models, surrounding contexts, and process outcomes. A systematic literature review was conducted to provide updated field assessments. Our analysis identifies two core research streams: succession candidates and process models. We reveal the distinctions between family and non-family succession candidates within four sets of antecedents connected to performance and socioemotional wealth outcomes. In addition, we identified various succession process models that led to different process understandings. By comparing and synthesizing previous studies, we propose a succession process model that incorporates the aforementioned antecedents as vital explanatory variables in the succession process. These antecedents trigger and shape the resulting gatekeeping events between the process phases. We argue that the interrelations among the phases, their content, and their gatekeepers lead to different succession outcomes. Our insights enhance the understanding of successful succession and post-succession outcomes in family firms.
The aim of this study is to understand if the idiosyncrasies of family firms affect the likelihood of successfully recovering from financial distress through a debt restructuring proceeding. Relying on the mixed-gamble logic of the behavioral agency model, we hypothesize that family small and medium-sized enterprises (SMEs) have greater chances of resolving financial distress than non-family SMEs, as the former are driven by the preservation of long-term socioemotional wealth. Our findings suggest that family ownership and control, as well as family involvement, are positively associated with the likelihood of successful debt restructuring. This study highlights that the unique emotional attachment family executives have to their business enhances their motivation and capabilities, making them more effective than their non-family counterparts at resolving financial distress through debt restructuring.
We draw from the Circumplex Model in family science to develop the Business-Owning Family Adaptability and Cohesion (BOFAC) scale to measure interpersonal family dynamics in family businesses. The BOFAC scale consists of two sub-scales: cohesion (7 items) and adaptability (8 items). We followed accepted scale development procedures, including conceptualization, item generation (based on 14 interviews with family business stakeholders), model specification (using a sample of 245 family business stakeholders), evaluation and refinement, and validation, relying on a sample of 144 family business CEOs and other constituents. Our findings show high reliability and validity. Compared to other existing family dynamics scales, BOFAC is directly tied to the family business context; it is short, easy to administer (self-report), and freely available to family business scholars (non-copyrighted).
Corporate venturing initiatives are crucial for the survival, profitability, and growth of family firms. Although research on corporate venturing in family firms has expanded significantly over the past decades, it remains fragmented and conceptually inconsistent. To address these gaps, this systematic literature review comprehensively maps and integrates the existing research on corporate venturing in family firms, focusing on antecedents, intervening factors, outcomes, and their interrelationships. The review specifically considers the intertwined family, ownership, and business levels that together form the social system in which corporate venturing is embedded. Based on this analysis, the review offers several recommendations and suggests potential directions to advance the field further.
