Examining entrepreneurial orientation’s dimensions – performance relationship in Saudi family businesses

Abstract

Purpose The purpose of this paper is to contribute to family firm and entrepreneurship literature by providing an examination of how family involvement in management (FIM) moderates the relationship between entrepreneurial orientation (EO)’s dimensions and family firm performance (FFP). Design/methodology/approach Through a survey study, the research was developed using a sample of 175 family firms in Saudi Arabia to test the proposed hypotheses using hierarchical linear regression. Findings The findings revealed a strong positive and significant linkage of proactiveness and FIM with FFP, but, no significant relationship between innovativeness and risk-taking with FFP. However, when FIM contingencies were hypothesized, a new significant influence from the interaction between risk-taking and FIM on FFP was found. Research limitations/implications The main limitation lies in the fact that it is not possible to claim generalization of findings to family firms in other emerging or transitional countries as the research is focused on Saudi family firms. Theoretical and practical implications are discussed in order to produce new knowledge on EO of family firms and to help these firms not consider FIM as an impediment to the development of resources and capabilities necessary to the promotion of entrepreneurial activities within their operations. Originality/value There is a contribution to the literature on EO by showing that EO construct and its dimensions have great generality within family firms in a transitional context.