We are carrying out research about the antecedents and effects of technological innovation. Our results indicate that family firms are less efficient in turning innovation inputs, such as R&D intensity, into continuous technological innovation outcomes. However, they are more efficient in obtaining sustained performance from technological innovation outcomes. How would you explain this apparent contradictory finding?
In my opinion this discrepancy is explained:
1. The traditional family values in business, I mean, that before the family decides to involving economic resources passed more time than non-family firms
2. if engaged in new developments that power the whole family involved
3. Family business in Poland's most frequently involved in technological innovation with the use of funds from the EU. But before you decide to thoroughly analyzing opportunities and risks associated with it.
Dear Julio,
we presented a meta-analysis at the Academy of Management Annual Meeting last year in which we excactly argue that innovation input is lower in family firms but innovation output is higher. Evidence from more than 100 studies from more than 40 countries confirm this view.
If you want, I can send you the working paper version (e-mail address needed).
best
Nadine
they are more efficient in obtaining sustained performance from technological innovation outcomes. How would you explain this apparent contradictory finding?
I'd gess it happens because once the implementation is decided (by the Family), they have less barriers, less effort to convince anyone. Having, usually, a low-decision-sharing profile, the managers (Family) just say people what to do, imposing their will, and things get done.
Having read Nadine and Ewa, I assume that the european situation can be a particular case due to the fund available through EU agencies. Nevertheless, having been working with south american familiar SMEs as a consultant for some time now, I think that you should think about these topics:
- How being a Familiar Enterprise (FE) is an important driving force towards innovation. May be some of Nadine inputs can help you with this. But even if being an FE gives you a better output in innovation, that doesn't mean that FEs are, as a whole, more innovative than regular firms.
- You should really try to stress the european perspective. May be the characteristics of european FE are different because of being competing in Europe and having access to tools that are different in other contexts.
- May be, if you still think of aiming your effort towards FE as a whole, a sector o local approach might be more enlightening as can show special behaviours or driving forces that may result in some kind of better performance in innovation.
Good luck Julio, and I will be waiting for the, surely, innovative outcomes of your research.
Thanks for your answers! We have analyzed 551 firms with data from 2000 and 2012. They are Spanish Manufacturing firms. We believe that family firms they are less efficient turning R&D inputs into technological innovation outcomes because of they have have limits regarding the quality and quantity of human capital. On the other hand, we think that they are able to make the most technological innovation outcomes to generate sustained performance because of they put their whole social capital to work once they have obtained innovation outcomes. Do you agree with these findings?
I have made similar research in the context of China.
Rather than comparing with non-family business, my research pay attention to the family involvement (corporate governance) and its effect on the efficiency of R&D input. In my opinion, it is hard to say whether the family business is more innovative, only if taking some family-context variables into consideration.
very good question,according to agency theory,family business have less agency lock circle,thus the executive effect is very fast,meanwhile as owner,they pay attention cost strategy ,hence ,they use less R&D input,however, they have less waste and rent of right,just as good steel use on edge of sword
Your question is incomplete. It asks whether family firms are more innovative but does't give a comparator - is this compared to large multinationals, local co-operatives or non-profit firms, for example.
In addition, there are 'family firms' wherein families run large manufacturing plan, others where they run a small hotel. You need to consider size, sector, and scope.
Finally, I'd say you need to consider what type of innovation we are talking about: is it product design, working practice, diversity policy, investment strategy. You get my drift: My research into small business innovation showed that the costs of innovation were a difficulty for small firms. 'Costs of quality' can also give a slow reward for the family small business. Good luck.
Thanks Ronald. Our research is focused in Spanish manufacturing firms with different sizes. With this question I would like to analyze in depth why family firms should have a different behavior in comparison with non family firms, controlling by size and age, managing resources such as R&D expenses to generate technological innovation outcomes. Moreover, we are asking to ourselves why it would be useful for theory and practice.
Dear Julio,
I think that familiar firms are different organization if we compare them with no familiar ones. But I think these differences are much more connected to other kind of questions, like human resources and social capital management.
If you want you can take a look on a paper we published two years ago:
DOI: http://dx.doi.org/10.12712/rpca.v8i2.464
Best, Emil Hoffmann.
Here, you can find the results of our work published about this topic. Thanks for your contributions.
http://managementink.wordpress.com/
Thanks for your anwers. Really we were comparing small and medium family-managed firms and we compared them with non-family managed firms. In our model we controlled by size, age,...
We were focused in technological innovation (product and process innovation). However, we are now testing it separating product and process innovation and consideraing not only R&D expenses but R&D staff and even relationships with universities, suppliers,... as other possible inputs of innovation. I will tell you the results sooner than later...