Old but Sold? Innovation Through Tradition Strategy for Export and the Role of Family Involvement

Despite the notable body of research, the family firm (FF) internationalization literature has overlooked the role of innovation strategies in explaining FFs' export performance. We focus on the innovation through tradition (ITT) strategy-specifically, the degree to which a firm leverages its firm-specific, mature (i.e., past) knowledge in the innovation search and recombination process. This strategy is particularly relevant for FFs as it can have ambivalent effects on export performance. On the one hand, it may ease the liability of foreignness; on the other, it could exacerbate it, creating tensions that firms must carefully navigate. Drawing from the socioemotional wealth perspective, we argue that FFs will be more prone to adopt an ITT strategy. However, the extent to which they will be able to reap the advantages or suffer the constraints of such a strategy for export depends on the particular type of family governance. Specifically, we contend that family managers will have a positive moderating effect on the relationship between the degree to which a firm leverages firm-specific mature knowledge and export intensity thanks to their direct involvement and operational control over innovation activities. Conversely, family owners lacking this direct involvement will have a negative moderating effect on this relationship. Our analyses, based on a global longitudinal sample of 134 listed firms in the automotive and pharma/biotech industries observed from 2008 to 2020, support our hypotheses. Our results contribute to the nexus of the FF internationalization and FF innovation literature streams, the ITT research in FFs, and the broader internationalization literature.