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Exploring the Relationship Between Family Involvement and Innovative Capability in Chinese Family SMEs: The Role of HR Redundancy

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  • Kaiyang Sun
  • Rumintha Wickramasekera
  • Alvin Tan

Abstract

The aim of this research is to investigate the relationship between family involvement and innovative capability in Chinese family small-medium sized enterprises (SMEs). Although previous studies based on the behavior agency model have investigated how financial factors could influence the relationship between family involvement and innovative capability, there is a dearth of studies with an emphasis on the impact of non-financial factors. Notably, the moderating role played by family firms’ human resource (HR) redundancy in this relationship has not been sufficiently explored in the literature. Our research analyzed secondary data of Chinese family SMEs listed in the China Stock Market and Accounting Research (CSMAR) database. Standard multiple regression and moderated multiple regressions were conducted to test the main and moderating effects, respectively. According to the results of our study, the three dimensions of family involvement (ownership, management, and governance) have a negative influence on Chinese SMEs innovative capability, but this influence can be partially moderated by HR redundancy. Based on the socio-emotional wealth (SEW) perspective, this research contributes to family business literature by addressing previously noted research gaps in related studies.

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  • Kaiyang Sun & Rumintha Wickramasekera & Alvin Tan, 2022. "Exploring the Relationship Between Family Involvement and Innovative Capability in Chinese Family SMEs: The Role of HR Redundancy," SAGE Open, , vol. 12(2), pages 21582440221, May.
    • Handle: RePEc:sae:sagope:v:12:y:2022:i:2:p:21582440221099531
    DOI: 10.1177/21582440221099531
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