Innovation in Small Family Businesses

Innovation in Small Family Businesses

Sylvie Laforet

Innovation in Small Family Businesses explores how innovation is developed and carried out in small family-owned businesses, the factors underpinning it, and the innovation drivers and barriers in these firms’ context. Sylvie Laforet also offers suggestions on how innovation can be fostered and perhaps, sustained in small family-owned businesses and discusses the government’s role in this. The book makes an important contribution to the theoretical development of family firms’ and small businesses’ innovation.

Chapter 2: Culture, structure, leadership, business goals, orientation and innovation

Sylvie Laforet

Subjects: business and management, entrepreneurship, family business, organisational innovation, innovation and technology, organisational innovation


This chapter examines how organizational culture affects innovation in small family firms (SFF), based on Aycan et al. (2000) and other authors’ wide definition of organizational culture, mainly comprising aspects of business strategy, business external/internal/long-versus short-term orientation, coordination and control, processes, structure and leadership. The chapter focuses on these broad aspects of organizational culture as well as the family firm culture and investigates which culture enhances, and which inhibits innovation in small family firms, as well as on the issue of vision and developing a culture of innovation in SFF. It also examines whether there is a difference between family and non-family firms in structure (that is, centralization versus decentralization), management leadership and development of owner’s leadership skills, and other pertinent issues such as business continuity, business goal and strategic orientation. It concludes on the aspects that drive or have a large impact on innovation in small family firms. The research findings are based on data gathered through mailed structured questionnaires of 500 random family business owners from various sectors across the UK. The findings distinguish between more and less innovative SFF, and young and old SFF.

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