Zoltán Soma Kárpáti and Borbála Szüle
As the knowledge-based theory of the firm suggests, integrating leadership knowledge from non-family sources may be paramount in building competitive advantage, and leadership…
Abstract
Purpose
As the knowledge-based theory of the firm suggests, integrating leadership knowledge from non-family sources may be paramount in building competitive advantage, and leadership knowledge is an invaluable resource in building successful firms. In the volatile business environment, AI developments are among the key drivers of several thorough transformations, so the possible relationship between top management business talent and AI readiness has become essential. Our paper examines this link in the family business context, analyzing the possible mediation role of firm professionalization.
Design/methodology/approach
The paper adopted a quantitative research approach. Data about Hungarian family firms were collected during March and April 2024. The authors used structural equation modeling, and results with and without controlling for a firm size and sector effect were compared. The final sample size contained 112 family firms.
Findings
The research findings suggest that the identified personal professionalization subdimensions have different mediation roles in the relationship between external knowledge integration in top management teams and AI readiness. Without including the control variables, the personal development and competence absorption subdimensions fully mediate this relationship, and the delegation subdimension does not have a significant mediation role. These two mediation effects become significantly weaker with the inclusion of firm size and sector control variables.
Research limitations/implications
The results highlight the importance of competence absorption and development in family firms, especially when preparing for AI integration into business processes. In addition, the findings also emphasize that firm size may have a significant role in creating an AI-compatible business environment.
Originality/value
This paper aims to integrate the evolving field of firm professionalization with research on the effects of family involvement in corporate leadership. Professionalization dimensions are defined, and mediation roles of personal professionalization subdimensions are examined concerning the relationship between external knowledge integration in top management teams and AI readiness. The paper also highlights several new research directions that may enhance understanding the relationship between family leadership involvement and corporate outcomes.
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Keywords
Zoltán Kárpáti, Adrienn Ferincz and Balázs Felsmann
The purpose of this paper is to identify different types of resource and capability configurations among Hungarian family and nonfamily firms and explore which compositions can be…
Abstract
Purpose
The purpose of this paper is to identify different types of resource and capability configurations among Hungarian family and nonfamily firms and explore which compositions can be considered competitive. In a rivalrous, dynamic world, understanding which sets of resources and capabilities lead to a higher level of competitiveness is vital.
Design/methodology/approach
This paper is based on a quantitative competitiveness survey carried out between November 2018 and July 2019 in Hungary. The authors used the Firm Competitiveness Index (FCI) to measure competitiveness and the resource-based view (RBV) approach to understand which configurations of resources and capabilities are responsible for a higher level of competitiveness based on 32 variables. An exploratory factor and cluster analysis were conducted to analyze the ownership's effect on firm competitiveness. The final sample size contained 111 companies, of which 53 were identified as family and 58 as nonfamily firms.
Findings
Factor analysis reveals five factors determining resources and capabilities: “operational,” “leadership,” “knowledge management,” “transformation” and “networking.” Based on these factors, the cluster analysis identified five groups in terms of types of family and nonfamily firms: “Lagging capabilities,” “Knowledge-based leadership,” “Innovativeness and transformation-oriented management,” “Relationship-oriented management” and “Business operation-oriented management.” Results show that nonfamily businesses focus on operational and leadership capabilities, reaching a higher FCI than family businesses, which are likely to invest more in their networking, transformation and knowledge management capabilities.
Originality/value
By defining the different configurations family and nonfamily firms rely on to reach competitiveness, the paper applies an essential element to the Hungarian and Middle Eastern European contexts of family business research. The findings contribute to developing family business literature and point out specific resources and capabilities family firms should focus on to shift toward reaching a higher level of professionalization and competitiveness. The characterization of different types of competitiveness comparing family and nonfamily firms enables the firms to assess customized implications.