Generational Involvement in the Top Management Team of Family Firms: Exploring Nonlinear Effects on Entrepreneurial Orientation

Abstract

The present study contends that an inverted U-shaped relationship exists between generational involvement-i.e., the number of family generations simultaneously involved in the family-firm top management team (TMT)-and entrepreneurial orientation (EO). Drawing on the upper echelons theory, we conceive generational involvement as a proxy of knowledge diversity in multigenerational family TMTs. We argue that while moderate levels of generational involvement stimulate task-related constructive conflicts for EO, increased kinship distance and relationship conflicts led by high levels of generational involvement are likely to undermine this potential advantage by damaging the relational context for EO. Our hypothesis is confirmed on a data set of 199 family firms. © 2012 Baylor University.