The Psychological Foundations of Management in Family Firms: Emotions, Memories, and Experiences

Exploring the psychological foundations of management in family firms is necessary to understand why they formulate and implement strategies differently from nonfamily firms, and why and how family firm behavior varies across different family firms. Picone et al. (2021. The psychological foundations of management in family firms: Values, biases, and heuristics. Family Business Review, 34(1), 12-32) have proposed a conceptual framework for the psychological foundations of management in family business, examining how the values, biases, and heuristics of family firm members affect strategic decision-making and family firm outcomes. Drawing on this framework, we examine emotions, memories, and experiences in family firms, disentangling “what we know” from “what we should know”, and offering some relevant questions to advance the field.

Excessive Ties in Entrepreneurship Can Hurt: How Excess Entrepreneurial Ties Bring Negative Effects to the Firm

Entrepreneurial ties are a critical resource for development and survival of entrepreneurial firms; however, the mechanism of how entrepreneurial ties affect entrepreneurial performance remains unclear. This study advances existing research on social ties and entrepreneurship through investigating how entrepreneurial ties exert a curvilinear impact on entrepreneurial performance via absorptive capacity, and the curvilinear effect of entrepreneurial ties is contingent on environmental complexity. The present study uses a dyadic dataset of 223 entrepreneurs from creativity industries in China to examine hypotheses. The results show that entrepreneurs’ ties have an inverted U-shaped impact on entrepreneurial performance. We also partially find that this inverted U-shaped relationship is mediated by absorptive capacity. Finally, we also find that this inverted U-shaped relationship is steeper when environmental complexity is high, and this inverted U-shaped relationship turns into an almost positive linear when environmental complexity is low. Overall, these results contribute to a deeper understanding of how and when entrepreneurial ties lead to a curvilinear impact on firm outcomes.