Getting family firm diversification right: A configurational perspective on product and international diversification strategies

Cornelius Hafner and Ulrich Pidun

Journal of Family Business Strategy, 2022, vol. 13, issue 1

Abstract: This study aims to identify the key success factors of the two dominant types of family firm diversification strategies: product and international diversification. Drawing on the extant family business literature, we study how factors at the firm level—performance vulnerability, generational stage, and management professionalization—combine to determine the choice and, more importantly, the success of the family firm’s diversification strategy. Our empirical study is conducted on a new proprietary dataset collected for 102 unrelated product and international diversification decisions of large, closely held German family firms. While both theory and practice often regard product and international diversification strategies as two means to the same end (such as growth, risk diversification, firm survival, and family employment opportunities), we find that they are anything but perfect substitutes. In fact, the results of the fuzzy-set qualitative comparative analysis highlight that the conditions leading to successful product diversification differ significantly from those for successful international diversification, particularly with regard to the family’s involvement in the management of the firm. Based on our results, we derive practical recommendations for family business owners considering product and/or international diversification strategies.

Keywords: Family firm; Family business; Product diversification; International diversification; fsQCA (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S1877858521000371
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:fambus:v:13:y:2022:i:1:s1877858521000371

Ordering information: This journal article can be ordered from
http://www.elsevier.com/wps/find/journaldescription.cws_home/719791/bibliographic
http://www.elsevier. ... 719791/bibliographic

DOI: 10.1016/j.jfbs.2021.100456

Access Statistics for this article

Journal of Family Business Strategy is currently edited by J.H. Astrachan

More articles in Journal of Family Business Strategy from Elsevier
Bibliographic data for series maintained by Catherine Liu ().