How governance mechanisms in family firms impact open innovation choices: A fuzzy logic approach

Abstract

The inbound open innovation (OI) process consists of the opening of the innovation funnel to the contribution of external partners, with the aim of tapping into their knowledge. This opportunity is particularly valuable for family firms (FFs), which often have insufficient resources. However, the literature on the OI behaviour of family firms is not conclusive. Indeed, both the behavioural theory (BT) and the resource‐based view (RBV) posit negative and positive outcomes regarding openness choices in FFs. We claim that these contrasting results can be reconciled if, according to the literature, FFs are seen as a heterogeneous breed, whose differences are determined by different levels of participation of non‐family members in the governance mechanisms. Indeed, non‐family members can act in favour of OI. However, previous literature has failed to satisfactorily grasp the nuances of this heterogeneity. We suggest that it is necessary to adequately operationalize the heterogeneity concept by means of fuzzy logic. We conducted a survey on 178 Italian FFs. Results show that the involvement of non‐family members affects the extent to which firms draw on knowledge from external partners. Specifically, the higher the involvement of non‐family members, the more there is collaboration with vertical partners along the supply chain.

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