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9TH WORKSHOP ON FAMILY FIRM MANAGEMENT RESEARCH
HELSINKI, FINLAND, MAY 24-25, 2013
===== WORK IN PROGRESS =====
GOVERNANCE AS PRACTICE IN STRATEGIZING IN THE FAMILY BUSINESS:
A LITERATURE REVIEW
============================
Contact details:
Judith van Helvert
Windesheim University of Applied Sciences
Affiliated to Jönköping International Business School (PhD candidate)
PO Box 10090
8000GB Zwolle
The Netherlands
T +31 88 4697189
jmc.beugels@windesheim.nl

2. 2
Governance as Practice in Strategizing in the Family Business:
A Literature Review
1. Introduction
Next to strategic challenges that every organization has to cope with such as pursuing opportunities in
the market, family businesses have to deal with possibly conflicting strategic needs of the family, the
owners and the business. The overlap between these three groups of actors makes family firms like very
complex buildings which cannot and should not be rigidly managed. Planning for shocks in order to
increase the chances for the continuity of the firm only works when shock absorbers are in place
(Astrachan, 2011). Governance mechanisms might function as a specific practice in the strategic process
in family businesses and function as one of such shock absorbers.
Most research that concentrates on governance and its relation to strategy focuses on boards, and
mainly in the setting of large (listed) firms. A literature review performed by Pugliese et al. (2009)
illustrates that research on the contribution of boards to strategy has evolved from normative and
structural approaches (from seventies until nineties) to behavioral and cognitive approaches (since
2000). Additionally, their study shows that the research is characterized by theoretical pluralism and by
empirical inconclusiveness. Generally, boards are in place to ensure that management acts in the best
interests of a firm’s owners (Blumentritt, 2006). Boards are supposed to add value to the firm by
performing different functions or tasks: monitoring and control tasks, a service function and strategic
tasks (Machold & Farquhar, 2013). Service tasks relate to the short term use of board members’
knowledge and skills and the opportunities offered by their network. Strategic tasks relate to setting long
term objectives and plans. Another function of boards which is often mentioned is the enhanced
legitimacy because of the link between the board members and the environmental context of the firm
(source). Pugliese argues that we should try to understand better how boards add value to the firm and
assess the impact of board processes and dynamics on strategy. This can only be realized when we get
closer to the topic of interest and start studying the role of governance in strategizing at the individual
level of analysis.

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Next to ‘formal’ boards, advisory boards seem to be a promising and accessible governance mechanism
for family businesses. In small firms (with revenue of $25 million or less) the service and strategic
functions of boards are considered more important than the monitoring and control task (Forbes &
Milliken, 1999). This is due to the fact that the owner-manager is often one and the same person in these
firms, and therefore the control function becomes less important. Because of the focus on advise on a
structural basis advisory boards can function as a specific practice in strategy. However, research on
advisory boards is very scarce. A study by Blumentritt (2006), as one the exceptions, has shown that a
strong correlation exists between various forms of planning (succession planning and strategic planning)
and the presence of an advisory board. Of course we should verify whether this result holds when we
apply the proposed relationship on different contexts, but this result seems promising. Although not
reflected in the academic interest, advisory boards are a phenomenon seen in practice quite often. This
implies that advisory boards, and their role in strategizing in specific, is a topic worthwhile investigating.
This paper provides a literature review on the role of governance in the strategic process with the aim of
identifying the differences, complements and gaps in research. It works towards a theoretical model or
framework which can be used as a foundation to study the role of advisory boards as a practice in
strategy in the family business. The focus in this paper is on the following research question:
What are the main insights and research findings concerning the role of governance in strategy in the
family business, what are the main gaps in research on this topic and how can this research gap be
addressed?
The next section discusses the main insights and research findings on the main concepts of interest:
governance, goals and the strategic process. These concepts will first be addressed in general and
then specified for the family business context. Section 3 continues be addressing the main research
gaps. Section 4 concludes by discussing the main potential contributions of future research on the use of
advisory boards as a practice in strategizing in the family business.
Keywords: mixed goals, goal attainment, advisory boards, family firm, strategy as practice, governance

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2. Literature review
2.1 Role of governance in strategy
2.1.1 How do boards contribute to strategy?
Carpenter & Westphal (2001) propose that the added value of boards in strategic decision making
depends on the specific knowledge, skills and networks that board members bring in. It is not simply the
number of network ties that board members bring in, but the meaningful contribution of these ties that
really matters. Similarly, Forbes and Milliken (1999) have argued that the ‘effectiveness’ of boards
depends on their cognitive output which is their task performance and its ability to continue working
together (cohesiveness). These two board level outcomes, task performance and cohesiveness are
influenced by three board processes: effort norms (shared beliefs regarding the level of effort that each
individual is expected to put forward toward a task), cognitive conflict (task oriented differences in
judgment among group members) and the process by which the board uses its knowledge and skills.
Using a cognitive perspective, Rindova (1999) argues that the added value of boards lies in valuable
problem solving expertise which indeed leads to a cognitive contribution to the strategic decision making
process. This contribution increases when the complexity and uncertainty in which the firm operates is
high. The contribution is specified by Rindova into three cognitive tasks that should be performed along
with the firm’s managers: scanning (which leads to a higher volume and range of information collected),
interpretation (which leads to external, requisite and representative variety) and choice (which leads to
consensus through negotiation). She argues that these effects of directors’ participation leads to higher
decision quality.
2.1.2 Levels of involvement
Depending on a number of factors, boards can be involved in strategic decision making on different
levels. They can evaluate ‘final’ proposals or they can take part in the process during which the strategic
proposal is set up. Based on qualitative data, McNulty and Pettigrew developed the model shown in
Figure 1, which shows that part-time board members are able to influence processes of strategic choice,
change and control by both shaping the ideas that form the content of strategy and the methodologies
and processes by which those ideas evolve. The model even suggests that board members are capable of
exercising control over management when engaging in strategy. Earlier studies (Demb & Neubauer,
1992; Grumbar & Kelly, 1993; both in McNulty & Pettigrew, 1999) have shown that directors’ opinions

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differed as to whether boards should have an initiating role, an approving role or a decision making role
in strategy. McNulty and Pettigrew (1999) identified a number of factors that condition the involvement
of non-executive board members in strategic decision making: the norms in the organization about
corporate governance, the history and the performance of the firm, the process of and the conduct at
board meetings and the informal dialogue amongst company directors between board meetings.
Taking strategic
decisions
Shaping strategic decisions Shaping the content, context
and conduct of strategy
Definition Influence is exerted
inside the boardroom
at the end of the
capital investment
decision process.
Influence occurs early in the decision process as
part-time board members shape the preparation of
capital investment proposals by executives.
Influence is continuous and not
confined to decision episodes.
Board
Behavior
Inside the
boardroom, boards
take decisions to
either accept, reject
or refer capital
investment
proposals.
Consultation with part-time board members by the
executive, either formally or informally, whilst a
capital investment proposal is being prepared
enables board members to test ideas, raise issues,
question assumptions, advise caution and offer
encouragement. Executives ‘sieve’ capital
investment proposals in anticipation of the need
for board approval.
The board develops the context
for strategic debate, establishes
a methodology for strategy
development, monitors strategy
content and alters the conduct
of the executive in relation to
strategy.
Board
involvement
All boards take
strategic decisions.
Some boards shape strategic decisions. A minority of boards shape the
context, content and conduct of
strategy.
Figure 1: Levels of part-time board member involvement in strategy
Source: McNulty & Pettigrew (1999)
2.1.3 Strategic behavior of the board
Hendry and Kiel performed a literature review on the role of the board in firm strategy in 2004 and
identified that the normative literature is very clear on the role that boards need to play in strategy,
assuming that there is a clear link between the board’s involvement in strategy and organizational
effectiveness. This role should involve counsel and advise to the CEO, initiation of strategic analyses and
bringing in strategic alternatives (Zahra & Pierce, 1989). However, in 2010 Hendry et al. came with a
follow up study, taking a strategy as practice (SAP) perspective on the strategic role of boards. This study
built on a distinction between different ways of strategizing, as identified by Jarzabkowski (2005), that
boards use in their interaction with management. Jarzabkowski used the SAP perspective in describing 2
different but complementary strategizing practices employed by top managers: procedural and
interactive strategizing. Procedural strategizing relates to formal administrative practices and diagnostic
controls embedded within routine practices such as strategic plans, budgets, reviews and performance
targets to provide structure to the development and execution of strategy in firms. Its strength lies in
maintaining existing strategies and its main weakness is that it may tend towards inertia (the focus of
strategizing becomes the procedural practices themselves rather than the strategic goal or direction of

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the business). Interactive strategizing on the other hand, involves interaction between top management
and other actors involved in strategizing in order to generate shared, negotiated frameworks of meaning
leading to the development and execution of strategy in organizations. At the same time, it involves a
form of normative control because interactive strategizing frames actions that contribute to legitimized
activity as legitimate while those that detract from it as not. Its strength lies in reinterpreting existing
strategies, reasserting their importance within the business and realigning activities and policies with
goals. Its weakness is that the build frameworks of meaning are not durable, they must be continuously
reconstructed. Hendry et al. (2010) propose that the use of either procedural or interactive strategizing
is influenced by three factors and the interaction between them: the strategic stance of the board, the
power (im)balance between the board and management and the perception of practice legitimacy. They
conclude that to perform the strategic task well as a board, it should deal with three challenges:
collective agreement on strategic stance is critical (maintain the current strategy or strive for strategic
change), boards need to understand the relative power between themselves and management, and they
need to understand the perceived legitimacy of each strategizing type on the part of individual directors
and managers. Dealing with these challenges automatically leads to reflexivity; it provides a way of
discussing and changing the way in which a board engages in strategy such that this engagement fits the
organization’s context better.
In a recent qualitative study, Machold & Farquhar (2013) have studied the patterns of activities and tasks
that are performed by boards and how these are influenced by changes in the organization and the
environmental context. They found that in relation to time spent on monitoring and control tasks,
boards spend little time on service and strategic tasks. Moreover, they found that those boards that
perform a wide range of tasks also are more open to changes in tasks. So based on what is needed by the
situation at hand, time is spent on control, service or strategy. In addition, in case on environmental
changes, more time is spent on financial control and strategic issues.
2.1.4 Role of governance in strategy in the family business
Although the literature above focuses entirely on the role of boards as governance mechanism, other
options are available to family businesses. In the introduction the added value of advisory boards, as a
‘light’ version of the formal board, has shortly been discussed. Both advisory boards and boards can be
considered to be specific governance mechanisms for the business or the owner-manager, but with the
focus on the business. Actors that take part in these boards should be aware of the special position of

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the owner-family members and their influence on the strategic decision making processes. Due to their
ownership, family members enjoy certain control rights. Moreover, the strategic decision making process
in the family business is possibly influenced by three specific propensities derived from the ownership
position: parsimony, personalism and particularism. Parsimony relates to the family’s personal wealth
that is at stake when making strategic decisions. Personalism refers to the personalization of authority in
the family business; the ultimate authority resides in the person of the owner-manager. Particularism
stems from the tendency of owner-managers to view the business as ‘our business’ which possibly leads
to particularistic criteria used in the strategic decision making process, such as nepotism or altruism
(Carney, 2006). These propensities lead to certain advantages such as speed in decision making and the
development of specific resources such as social capital. However, they also involve disadvantages like
limits on value creation because of capital and management constraints. By studying boards in nonprofit
organizations, Stone (1991) found that informal approaches to strategizing can be found in organizations
where the mission of the organization is synonymous with the personal goals of members. Informal
approaches to strategizing are also used in organizations that are more inward than outward looking.
These findings can possibly be compared to the situation of the family business in which family members
relate their individual preferences to the mission of the business and in which the approach to
strategizing can be often characterized as informal and ad hoc.
Next to (advisory) boards, specific family governance mechanisms can be used, such as family
constitutions or family councils, to lay down and hold on to the family strategy in relation to the
business. These kind of family governance mechanisms can also be used to monitor owners and
managers on behalf of the family (Uhlaner et al., 2007). In addition to formal or contractual governance
mechanisms, firms or individuals can also engage in relational governance. Indeed, Knapp et al. (2013)
introduce the role of individual and organizational identity tactics in managing the boundaries between
the family and the business. These tactics would be some kind of governance mechanism for the
individual actors to deal with the separation or overlap between the two systems. Social boundary
management, as these tactics are indicated in this study, can act as a complement to the more formal
governance mechanisms.

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2.2 Goals
2.2.1 A mix of goals in family businesses
Financial performance is or should be an important goal for every business. Firms need to be profitable
enough to survive in their market. However, for most family businesses, financial performance is only
one of a diverse set of goals (Chrisman et al., 2012; Chrisman & Patel, 2012; Gedajlovic et al., 2012;
Kotlar & De Massis, 2013; Zellweger et al., 2013). Next to economic goals, family businesses typically
have goals that center on the family. These goals arise from the emotional value related to the
ownership of the family firm, the relative importance of social capital in relationship to financial goals,
and the emphasis that family businesses place on the creation and conservation of socio emotional
wealth (SEW) for the family (Chrisman et al., 2012). When the family is strongly involved in the business
by ownership and management positions it is possible, but not necessary, that the business behaves in a
fashion that is different from non-family businesses. When the family has reasons to use its influence, for
example because of a transgenerational family control intention or a high family commitment, the
presence of family centered non-economic (FCNE) goals becomes more likely (Chrisman et al., 2012).
Furthermore, family firms could also strive for nonfinancial goals to the benefit of nonfamily
stakeholders. This is caused by the concern for corporate reputation (Zellweger et al., 2013). Examples of
such goals include responsible employment practices, good relationships with suppliers and customers
etc. This mix of goals between economic and noneconomic goals and family centered goals and non-
family centered goals can be used to distinguish family businesses from non-family businesses, but also
to differentiate between different types of family businesses.
2.2.2 Implications for strategy
Mixed goals may have an influence on the strategic orientation of businesses as well as on their
behavior. For example, because family firms attempt to avoid any threats to their SEW (bron) and the
propensity for parsimony (Carney, 2006), they tend to be risk averse. At the same time, when these
family centered goals are long term in nature, the strategic time horizon lengthens, by which decision
makers become less risk averse according to the myopic loss aversion (Chrisman & Patel, 2012).
Apparently, the type of goals has an explicit or implicit influence on the behavior of individual actors
engaged in the strategic process and on the process itself.

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Little is known about how mixed goals are balanced and translated in a business strategy. Very recently,
Kotlar and De Massis (2013) have shown that in the context of the family business familial social
interactions are more effective than professional interactions in managing goal diversity toward the
formation of collective commitment among family members to family centered goals. They identified
two stages through which members interact about goal divergence: (1) bargaining via negotiations or
disputes and (2) stabilization (how they formulate the goals) which resulted in stronger commitment.
Their study empirically shows that communication about individual preferences between different family
members involved is extremely important to reach consensus on family centered goals. It would be
interesting to take the study of Kotlar and De Massis (2013) a step further and find out how family
centered goals are balanced with other goals and how non-family members or even outside stakeholders
affect this process. Underlying questions include for example how the interactions between (dominant)
coalitions influence goal formation processes and whether the goals of founders and their successors
differ.
2.3 Strategy
2.3.1 Strategy-As-Practice perspective
Most strategy researchers have viewed strategy as something that organizations have (Johnson et al.,
2007). Also in the field of family firm research this view has led to numerous quantitative studies on the
relation between firm- or industry level effects on performance (e.g. Eddleston et al., 2008; Miller et al.,
2012). There are a number of limitations with respect to these studies and their implications on strategy
for private family firms. The first concern relates to the methodology used; most empirical studies are
quantitative studies that fail to explain what strategy actually entails. It remains for example unclear
which strategic tools are used by which actors, for which purposes, and in which situations. A second
limitation is that the output variables used in most studies relates to financial performance. However, as
indicated in the section before, growth, continuity and maintenance of socio-emotional wealth are goals
that are also often mentioned by family firms (e.g. Sharma et al., 2004; Gómez-Mejía, 2007).
To understand the strategic process in family firms, it is important to take a step back and use a micro-
level approach to study strategy as suggested by leading scholars in the strategy research field (e.g.
Whittington, 2006; Johnson et al., 2003; Johnson et al., 2007; Nordqvist & Melin, 2010; Jarzabkowski &
Spee, 2009). A research approach that pays attention to the micro processes and detailed activities of

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the strategic process is referred to as the Strategy-As-Practice (SAP) perspective, also known as
strategizing. This perspective is defined as “a concern with what people do in relation to strategy and
how this is influenced by and influences their organizational and institutional context” (Johnson et al.,
2007). It relates to “the detailed processes and practices which constitute the day-to-day activities of
organizational life and which relate to strategic outcomes” (Johnson et al., 2003). This approach looks at
strategy as patterns of activities and argues for a focus on strategy making as it occurs through the
actions, interactions, and negotiations of multiple actors (Floyd et al., 2011). As noted by Nordqvist
(2011), the SAP perspective is important for two reasons: (1) to develop accurate theoretical concepts on
family firms that are based on a theoretical and methodological approach that takes into account the
details of the processes through which strategy is formed, and (2) to pay sufficient attention to family
members as social actors and their interaction because of their influential role in strategy formation.
One of the main advantages of the SAP perspective is that it tries to overcome the dichotomies often
made in strategy research, for example content versus process, change versus steady state, planned
versus emergent, formation versus implementation. Indeed, as argued by Whittington (2007), SAP
should not be limited to studying the process as opposed to strategy content. “Strategy-as-Practice’s
fascination with the phenomenon of strategy itself takes it beyond traditional Process perspectives”.
Also, its unit of analysis is not restricted to organizational level processes. Instead, the focus lies on trying
to understand the everyday activities of the individual engaged in strategy and relating these to the
context in which the individual operates. Additionally, SAP is sensitive to the temporal nature of strategy,
exploring sequences and episodes, outcomes and products, and the interrelationships using an
assortment of methodologies and a multidisciplinary approach (Floyd et al., 2011). Jarzabkowksi and
Spee (2009) summarize the SAP agenda is follows: first to make connections between micro-phenomena
studied in practice-based research and more macro phenomena, and second to move beyond rich
descriptions of phenomena to substantiate outcomes of SAP research. The underlying question that
needs to be answered here is what outcomes are applicable?
The SAP perspective is relatively new. Since 2005, a growing number of studies within the field of family
firm research views strategy as a social practice. The empirical research that is available on strategizing in
family firms provides indications of the actors that engage in strategizing (Nordqvist & Melin, 2008), in
which arenas they engage in strategizing (Nordqvist, 2011), and the practices of strategic planning in
family firms (Nordqvist & Melin, 2010).

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2.3.2 Strategy as Practice in the family business
To understand strategizing in the family firm, Hall et al. (2006) come up with a number of theoretical
perspectives, amongst which the role perspective. Individual actors, as members of social systems, have
their own goals, values, beliefs, norms, interaction styles and time horizons because of their role in the
social setting (Ashforth, 2001 in Hall et al., 2006). Following this line of reasoning, individual actors within
family firms can be expected to have their own specific goals depending on their position in the firm (e.g.
owner, manager of employee). Another perspective discussed by Hall et al. (2006) is the values
perspective. The values perspective implies that actors are subject to particular conditions of the family
firm such as social norms from the family that provide guidance and boundaries in the strategic process.
This raises questions such as what goals do individual actors within family firms have and how do they
make their goals explicit? To what extent do goals of the actors at different positions vary? How are the
interests of the firm, the family and the owners balanced and managed? Jarzabkowski and Spee (2009)
have provided a literature review on studies within the SAP field, using the following three research
parameters: (1) practitioners, those actors that do the work of strategy, (2) practices, the multilevel
(organization, sector, society) tools through which strategic work is done such as traditions and norms
and procedures for thinking and acting, and (3) praxis, the flow of activity in which strategy is
accomplished. The perspectives suggested by Hall et al. (2006) and the research parameters suggested
by Jarzabkowski and Spee (2009) can be used as starting points in carrying out research using the SAP
perspective.
3. Research gap
After having studied and weighed various insights and research findings on the role of governance in
strategy, the goals in the family business, and the strategy as practice perspective, this section continues
by addressing the main research gaps concerning these topics. These gaps relate to (1) the processes
through which mixed goals are managed and translated into organizational actions and policies, (2) the
way in which we study the effectiveness of these processes, (3) the link between different levels of
analysis, and lastly (4) the role of governance in these processes. These gaps and the relevant questions
that are to be answered will be shortly elaborated on below.

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3.1 Strategic process
Over the last few years, research has provided insight into the goal structure in family businesses and its
antecedents. However, we know very little of how organizations (try to) realize these goals. Through
which processes goals are translated into organizational actions and policies are questions that remain
unanswered. How, when, and why are goals adopted and formulated? How are goals managed and
balanced in strategic decision making? How do actors involved in strategy identify, evaluate and marshal
resources to exploit opportunities in pursuit of those goals? To what extent is this a conscious activity or
is this something being done based on intuition? How does the mix of goals influence managerial choices
regarding the types of capabilities and resources to build as well as the means through which these are
nurtured and developed? How does the mix of goals influence strategic time horizons of organizational
decision makers?
3.2 Effectiveness
As explained in the section on strategy, the SAP perspective aims to identify strategic outcomes, so that
we can assess the effectiveness of different practices used. It is important that we should adopt a
broader perspective of value creation than just by considering financial performance (Uhlaner et al.,
2007). Setting goals or objectives is not an end in itself. They should be the guidelines or anchor points in
the strategic decision making process. Performance or value creation should therefore be considered in
light of the goals set by the business. The following questions can be thought of in assessing the
effectiveness of strategic activity. What do individual actors and groups of actors do in trying to reach
the mix of goals? Which practices are helpful in achieving goals? How and under which circumstances are
these practices used? How do different actors with different backgrounds (owners, managers, family
members, non-family members) or groups of actors influence the use of practices?
3.3 Link between different levels of analysis
The adoption of goals and the process towards the achievement of goals is likely to be influenced by
individuals, by different groups of actors (owners, family, managers), the organizational context and
society. SAP theorists aim to respect these different levels of analysis and are interested in the
relationships between them. Only by looking at different levels of analysis, crucial factors in strategizing
such as the motivation for strategizing of the managing director or the relationships of trust between the
actors involved and the influence of these factors on the attainment of goals can be identified. Or in
other words: “It is important that fine-grained studies are located in the wider context” (Johnson et al.,

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2003). Whittington (2006) argues that the practice turn in strategy research is incomplete because
researchers concentrate either on the intra-organizational level or on the extra organizational level.
“Advancing strategy practice research requires a more integrated view” (Whittington, 2006). Questions
that are unanswered include what is the impact of context-specific factors such as national setting and
firm characteristics on the strategic process and the attainment of goals? How do social fields or systems
define the practices used that enable strategic activities of individuals? How do new practices develop?
3.4 Role of governance in strategy
Until now, governance research has insufficiently explained why, how and when governance practices
may have a supporting role in the strategic process. Governance practices can be considered as vehicles
that provide structure and discipline in strategic processes (Huse, 2007). Whereas Hendry et al. (2010)
provide insights into the behavioral aspects of how boards work with management on strategy, they do
not make a link with strategic outcomes. Future research needs to address the link between governance
and strategic outcomes, in order to assess the effectiveness of its use in strategy. We need to explore
empirically whether and how governance adds value to firms by their involvement in strategy. How do
power relationships between the governance mechanism and the owner-manager influence this
process? To what extent does the governance mechanism participate in the strategic decision making, or
in other words, how does the level of involvement of governance influence strategy? How do outside
members who have a role in governance affect goal adoption in FF? Does this lead to differences in
performance?
4. Contribution of future studies
To work on the research gaps as discussed above, it would be worthwhile to study the role of
governance in strategy in private family firms in more detail. The SAP perspective enables us to study the
strategic activities at a micro level, while locating the activities in a wider context. By using the research
parameters of praxis, practices and practitioners we should be able to integrate these different levels of
analysis. We should seek to explain the ‘embedded agency’ as argued by Floyd et al. (2011): individuals
and groups who are subject to but who also influence and enact their own organizational and
institutional contexts.

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Figure 2: Graphic representation of variables of interest
A longitudinal study with a qualitative research
design would be considered most appropriate in
order to gain insight in strategic activities, in goal
attainment, and the relationships and dynamics
between the actors involved. Figure 2 shows a
graphic representation of the variables of interest
and their relation to the context in which it should
be studied.
As is shown in Figure 2, I propose to study the role of advisory boards as a specific governance
mechanism. Motivated by the fact that advisory and service functions of boards are most relevant in
private family firms and the notion that the practical interest in this specific governance mechanism is
not yet reflected in the academic interest, I argue that it is worthwhile to investigate. It is a more
accessible and sometimes less formal way of bringing expertise and professionalism to the firm.
The academic research on strategy in private family firms has come to a point, where researchers have
provided highly mixed empirical evidence. Several scholars have looked at the differences between
family firms and non-family firms with respect to strategic management and most of them have
concluded that the family firm is a special case of strategic management (Chua et al, 2003; Sharma et al.,
1997). However, these studies have not examined why family firms are different and how family
involvement influences strategy. In addition, the majority of studies on strategy in general, but also
specifically for family firms, have ignored strategic activities on a micro level. “The mainstream literature
has not arrived at this detailed level, but instead stayed at a more general macro level when investigating
strategy” (Hall et al., 2006). With the proposed research model, one is able to advance the family firm
and strategy practice research field to a more integrated view of micro-level phenomena in the context
of the family firm. Furthermore, the family firm context is an ideal context to study the phenomenon of
goal diversity. This provides an opportunity for family firm researchers to convey the findings to other
more general research disciplines.

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