A Study of the Relationships Between Generation, Market Orientation, and Innovation in Family Firms

Abstract

This study focuses on market orientation in family-owned firms. Market orientation is influenced by organizational characteristics and is at the same time a key antecedent of innovation. Since the generation in control largely shapes the family firm’s organization, the authors examine the relationships between the generation in control, market orientation, and innovation. Using regression analysis, the study demonstrates that later generations show a lower level of market-oriented behavior, that the positive relationship between market orientation and innovation is maintained in a family firm sample, and that the generation in control influences innovation through its influence on market orientation.