Entrepreneurial orientation in family firms: a generational perspective

• Published in: Small business economics Vol. 38; no. 1; pp. 33 - 49
• Main Authors: Cruz, Cristina, Nordqvist, Mattias
• Format: Journal Article
• Language: English
• Published: Boston Springer 01.01.2012; Springer US; Springer Nature B.V
• Subjects: Assets; Business and Management; Business management; Business structures; Chief executive officers; Competitiveness; Determinants; Economic activity; Economic theory; entrepreneurial orientation; Entrepreneurs; Entrepreneurship; Environmental technology; Family firms; Family owned businesses; Financial management; generation; Generations; Growth industries; Industrial Organization; Innovations; Intergenerational relations; Investors; life-cycle; Management; Microeconomics; Modelling; Perception; Perceptions; Risk taking; Small & medium sized enterprises-SME; Studies; Entrepreneurial orientation; L26; Generation; Small and medium-sized enterprises (SMEs); M1; Family businesses; M10
• ISSN: 0921-898X; 1573-0913; 1573-0913
• DOI: 10.1007/s11187-010-9265-8

We adopt a generational perspective to investigate entrepreneurial orientation (EO) in family firms. We test a model that determines how the influence on EO of external factors and internal factors differs in first-, second-and third-and-beyond-generation family firms. We argue that while the founder is vital in the first generation, EO is more subject to interpretations of the competitive environment in the second generation and that in the third generation and beyond, access to non-family resources drives EO to a greater extent. Our findings show that perceptions of the competitive environment and EO correlate differently in family firms, depending on the generation in charge, and it is generally stronger in second-generation family firms. Further, we find that non-family managers on the top management team makes a positive difference for EO only in the third-generation and beyond family firms. The significance of nonfamily investors' on EO is particularly strong in thirdgeneration-and-beyond firms.