Radical Innovation in Family Firms: A Systematic Analysis and Research Agenda

Abstract

Purpose – Investigation of family firm radical innovation is burgeoning but far less prevalent than studies of family firm innovation in general. Concurrently, studies repeatedly report that family firms exhibit mostly conservative and incremental innovation rather than more radical ones. This is unfortunate because without radical innovation, family firms risk a competency trap in which long-term competitiveness is lost to more innovative rivals. This situation has led to urgent calls among scholars to explicitly acknowledge the heterogeneity of family firm innovation and to understand the conditions for family firm radical innovation. Design/methodology/approach – A systematic review of 51 papers categorized into four scholarly conversations build the foundation for a critical discussion of each line of inquiry. Findings – This study analyzes 51 leading articles and identify four persistent theoretical positions: (1) RBV and capabilities, (2) agency and stewardship, (3) behavioral agency and socioemotional wealth, and (4) the ability and willingness paradox. The authors identify key research problems and research questions needing urgent scholarly and present a framework that captures their complementary and competing assumptions to enable rigorous future research. Originality/value – To galvanize and spearhead future research efforts, this paper provides a critical analysis of the current understanding of family firm radical innovation with a specific emphasis on the theoretical assumptions at the core of existing investigations and the 8 most important research questions in need of answers.