Moderating Effects on Entrepreneurial Orientation in a Professional Family Firm

University essay from Lunds universitet/Företagsekonomiska institutionen

Abstract: Thesis purpose: The purpose of this study is to examine what factors moderates or influence the entrepreneurial orientation. Our study provides a unique context that was examined. Argued by theory, moderators vary according to different contexts. Subsequently, we want to confirm some of the moderators discussed in literature and research what other context specific moderators that exist. Furthermore, the relationship and strength between EO and the moderators will be discussed from a contextual perspective. Our study attempts to validate and test knowledge using various scientific articles and applying them to our unique context. Furthermore, our results add knowledge to theory and enhance the understanding of professional family firms, EO, and the moderating factors. Additionally, this body of work will suggest future research areas where theory can benefit from additional research. We aspired to achieve this by gathering in-depth data from interviews across various departments and hierarchical levels. Further, we use internal documents and observation to guide our study. The case-company’s unique attributes prompted us to investigate the phenomenon and serves for exemplary findings, analysis, and conclusions. 3 Methodology: A case study design was used at a host company to examine in-depth contextual moderators to EO. Nine interviews with various departments and position levels provided for a rich data collection. The overall approach was qualitative using empirical and theoretical data. Furthermore, the research consisted of inductive and deductive elements. A thorough literature review was conducted to comprehend themes, create a tool and the research question. Moreover, the theoretical tool was used to analyze relationships between EO, the professional family firm and moderators. The delimitations excluded the effect of EO on performance. Theoretical perspectives: The theoretical perspectives of the thesis are entrepreneurial orientation, family firms and lastly the influencing factors or so called moderators. “Entrepreneurial orientation (EO) refers to the strategy making process that provides organizations with the basis for entrepreneurial decisions and actions” (Rauch, Wiklund, Lumpkin, & Frese, 2009, p. 762). The construct can be broken down into three different dimensions referred to as: Risk-taking, Proactiveness and Innovativeness (Miller D. , 1983). It is argued that EO is an important determinant of company performance (Zahra & Garvis, 2000). The family firm is distinguished by ownership share, company objectives, and family involvement in management (Westhead & Howorth, 2007). This study focuses on the professional family firm. The professional family has low family involvement in management, close family ownership, and a mixture between family and financial business objectives. The moderating factors influence the levels of EO either positively, negatively, or neutrally. We distinguish between organizational factors (internal) (Carney, 2005) and environmental (external) (Zahra & Garvis, 2000). Conclusions: The result of this study was the discovery of two novel findings in the professional firm context namely: Regulations and compliance and size and growth of the business. The two above-mentioned moderators were empirically proven to affect EO in the professional family firm. Furthermore, we validated and assessed a number of other moderators as well, indicating the strength and effect on EO. This study has developed the academic understanding of EO, professional family firms, and moderators. Lastly, this paper illuminated additional research areas which could be pursued by future researchers.

  AT THIS PAGE YOU CAN DOWNLOAD THE WHOLE ESSAY. (follow the link to the next page)