Strategic Change in Family Firms: Antecedents and consequences of strategic change from a change readiness perspective (R-9695)

To survive, closely held family firms - the dominant organizational form in Flanders and economically very important - face a mounting pressure to adapt to increasingly rapidly changing competitive environments. However, many of these organizations are often found to be strategically inert and conservative. An open key question for academics and policy makers is under which conditions family firms can overcome inertial forces and reach successful strategic changes. This project aims to reach four central scientific objectives which emerged from four important gaps in the literature that will be addressed in four scientific work packages. These objectives are summarized as: • Cognition: We will investigate how and when Management Control Systems (MCS) influence a family firm's information sourcing and knowledge management processes in such a way that new strategies are discovered, initiated, and subsequently successfully implemented. Main questions are: Do family businesses need different MCS in different stages of the strategy process? Is the relationship between MCS' characteristics, knowledge management, capacity building and strategic change context dependent? What are the antecedents of external knowledge sourcing activities by family firms? Which combination of internal knowledge building and external knowledge sourcing leads to knowledge generation that is supportive of strategic change and stimulates change readiness? • Affect: We will examine how socioemotional wealth preservation, learning frames, "affect climate" and organizational learning culture impacts upon readiness for strategic change in family firms. We will especially focus on the affective dimension. Central questions are: How do actors in family firms develop readiness for strategic change and what are key influences and catalysts? How do learning frames influence individual cognitive and affective change readiness? How does the framing of new situations by leaders influence readiness for change and others' framing activities? How does team psychological safety develop and influences group cognitive and affective readiness for change? What (enabling/hindering) roles do leaders play? • Governance structures: This part of the project will examine the interactions between family firm's ownership, management and board and the influence of these interrelated family governance mechanisms on strategic change in family firms. Key questions are: How do the interrelationships of top management teams and boards influence strategic change in family firms? What is the role of family governance mechanisms and how do they interact with other governance structures in facilitating strategic change? What is the role of contextual factors? • Resources: We will investigate the role and impact of financing constraints in the strategic change process from a supply as well as demand side perspective. Alternative financing sources to initiate and implement strategic change, and potential bottlenecks, will be researched. Intergenerational differences will also receive attention. Investigating strategic change from these different perspectives provides an encompassing scientific framework of strategic change and change readiness in family firms, which is the basis for the many valorization actions of the project. Discussions with the different stakeholder groups revealed numerous valorization possibilities for this project. Public policy advisory and preparatory bodies will employ the results to propose and create a more munificent environment for firms to embark on strategic change. Societal organizations will use the insights to increase their members' effectiveness when these members monitor, advise and provide human and financial resources to firms. Employers' network organizations will use the results to educate their members better on the barriers and drivers of strategic change. Following up on these different valorization potentials, this project has unique valorization objectives for each of the three stakeholder groups involved.

Keywords:Family firms

Disciplines:Business economics, Business management, Organisational management