Broad Search, Deep Search, and the Absorptive Capacity Performance of Family and Nonfamily Firm R&D

Abstract

This study investigates how family and nonfamily firms learn. Specifically, it asks whether family influence fosters or hinders the transformation of the potential absorptive capacity augmented by research and development (R&D) into the realized absorptive capacity embodied by innovation outcomes. The conceptual model posits that family influence will enhance the absorptive capacity performance of R&D regarding exploitative innovations that tend to result from deep external search yet diminish the absorptive capacity performance of R&D regarding exploratory innovations that tend to result from broad external search. Regression analyses using a sample of 346 Dutch manufacturing small and medium-sized enterprises largely support the hypothesized model.