Generational Diversity as a Moderator for the Relationship Between Absorptive Capacity and Innovation Performance at Family Firms

Abstract

The objective of this research study involves analyzing the capacities of family firms to absorb relevant information about the external environment and to incorporate this into their innovation-focused activities before then consequently analyzing the repercussions for innovation performance. This furthermore seeks to grasp whether, and to what extent, the generational diversity in the firm’s management represents a valuable resource. In order to obtain these objectives, we opted for a quantitative study with the data collected by a questionnaire sent out by email to the managers of Brazilian firms, specifically those with their headquarters in the state of Rio Grande do Sul and registered with the Rio Grande do Sul Industrial Federation. The results of this study provide recognition of ACAP as an important predictor of FF innovation performance. In particular, the findings suggest that the potential absorptive capacity (PACAP) generates a positive and significant effect on the realized absorptive capacity (RACAP). We may also report the positive and significant effect of PACAP on the incremental innovation performance and, similarly, for the RACAP influence on the radical innovation performance. Contrary to that expected, however, the results point to generational diversity in the management of the FF which is not a significant moderator between ACAP and innovation performance.