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Harvesting Family Firms' Organizational Social Capital: A Relational Perspective

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  • Shaker A. Zahra

Abstract

Organizational social capital (OSC), the goodwill and resources companies gain from their relationships with other companies, enables family firms to assemble the resources (especially knowledge) necessary for successful adaptation. Connecting with new ventures, the vanguard of radical change, is a priority for family firms seeking to achieve survival, profitability and growth. Yet, new ventures are often not well known and their networks are poorly structured, making access to them difficult. Using the relational perspectives on interorganizational relationships, this study proposes that family firms can employ their OSC to reach new ventures. Family firms can invest in these ventures, build profitable business relationships and alliances with them, as well as assist in governing their operations. Data from 779 companies show that family firms are in better positions to harvest their large OSC stocks to connect with new ventures. The results underscore the value of OSC as an important relational resource for family firms.

Suggested Citation

  • Shaker A. Zahra, 2010. "Harvesting Family Firms' Organizational Social Capital: A Relational Perspective," Journal of Management Studies, Wiley Blackwell, vol. 47(2), pages 345-366, March.
    • Handle: RePEc:bla:jomstd:v:47:y:2010:i:2:p:345-366
    DOI: 10.1111/j.1467-6486.2009.00894.x
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