Innovation through Tradition and Export Intensity: The Moderating Role of Family Influence

Delving into the firm’s tradition to innovate can be a relevant strategy to boost export intensity, imbuing new products with uniqueness and authenticity that foreign customers appreciate. Nevertheless, it also entails risks, thus generating tensions that firms need to navigate. We propose that the effects of delving into the firm’s tradition to innovate are contingent on the context in which the innovation strategy is pursued, and that in the relationship with export intensity, family involvement in the firm is beneficial in terms of management but not ownership. Based on an international sample of 146 listed firms in the automotive and pharma/biotech industries over 14 years, we find that family ownership has a negative moderating effect on the relationship between delving into the firm’s tradition to innovate and export intensity, while family management positively moderates this relationship. Our results have important implications for both theory and practice. We advance the mainly qualitative literature on innovation through tradition in family firms by distinguishing different types of family governance, providing new insights into how family firms manage the paradox between tradition and innovation. Moreover, we contribute to the family firm internationalization literature by taking into account the influence that family members can exert on the innovation-export relationship rather than their direct effect on export intensity. Finally, we add to the internationalization literature by highlighting the role of mature knowledge in gaining a competitive advantage in foreign markets.