How can family-owned Mittelstand firms use their unique resources to master the digitalization age? The role of family historical, venture, and collaborative capital

Julia de Groote, Jonas Soluk, Sarah-Larissa Laue, Marius Heck and Nadine Kammerlander

Business Horizons, 2023, vol. 66, issue 1, 133-152

Abstract: Family-owned Mittelstand firms have often been characterized as Janus-faced, meaning they can have two contrasting sides when it comes to innovation. On one side, they are technology leaders—especially in niche markets. On the other side, they can be slow adopters, deeply rooted in tradition. Digitalization is one of the biggest innovation challenges to firms of all sizes and ownership types. Research and observations in business practice show that while some family-owned Mittelstand firms master digitalization despite limited resources and traditional industries, others lag dangerously behind. So, how can family-owned Mittelstand firms prepare for a digital future, and which familial idiosyncrasies might help them? Based on current observations and interview data, we propose a framework for how these firms can use their unique resources to tackle challenges related to digitalization. To be successful in a digital world, they must leverage their family historical capital, family collaborative capital, and family venture capital. We highlight why and how these capital types should be linked to fully leverage their potential.

Keywords: Family firms; Digital business; Innovative business; Venture capital; Mittelstand firms (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:eee:bushor:v:66:y:2023:i:1:p:133-152

DOI: 10.1016/j.bushor.2022.04.001

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