Knowledge Integration and Dynamic Organizational Adaptation in Family Firms

Abstract

The speed of change in competitive environments has prompted firms to develop processes directed at enabling organizational adaptation. This is captured by the concept of dynamic capabilities. We focus on a particular form of business organization, that is, the family firm. Specifically, we argue that knowledge integration—a dynamic capability through which family members' specialized knowledge is recombined—guides the evolution of capabilities. We present a general framework illustrating factors that affect knowledge integration in family firms. We conclude that only those family firms that are able to effectively integrate individual family members' specialized knowledge will be successful in dynamic markets by changing their capabilities over time.