How can family businesses survive disruptive industry changes? Insights from the traditional mail order industry

Abstract

The present study investigates how family firms respond to disruptive industry changes. We aim to investigate which factors prevent or support family firms’ adoption of disruptive innovations in their industry and which mechanisms lead to more or less successful coping with disruptive change. Our analysis is based on 24 qualitative interviews with top executives and on secondary data from an industry in which disruptive innovations dramatically changed the way business was generated. The industry in question is the mail order industry, which, in its early days, disrupted the retail business. When the Internet and, with it, ecommerce started to disrupt the industry in the late 1990s, the industry was characterized by a high proportion of family firms and a low level of innovativeness. While incumbent firms had been very successful for decades, most of them were confronted with serious turbulence when new entrants started changing the face of the industry. Our findings show that different factors impact reactions to disruptive industry change in two different phases, namely, opportunity recognition and opportunity implementation. While some of the influencing factors are determined by industry factors, family influence may function for better or worse for incumbent firms. Specifically, we find that in firms with a family disruptor, a family member in a powerful position who drives the adoption of the new technology, hindrances can be overcome and firms tend to show more successful strategies when reacting to the disruptive industry change.

May I have your attention, please? An investigation on opening effectiveness in e-mail marketing

“…This requires synchronization among multiple areas of the company (IT, sales, marketing, e-commerce, etc. ), an objective that might be more difficult to attain for traditional companies than for pure online players (de Groote et al 2020 ).…”

Ambidextrous structures paving the way for disruptive business models: a conceptual framework

“…In particular, rigid hierarchical structures favor routine-based processes, which are less suitable for disruptive business models (DaSilva et al 2013;Wan et al 2015;Rohn et al 2021). Similarly, cultural inertia restrains "out-of-the-box" thinking, stifles creativity, and diminishes risk-taking as incumbents fear cannibalizing their existing, successful business model (Ahuja and Lampert 2001;Velu and Stiles 2013;de Groote et al 2021). In addition, cultural inertia increases the inability to overcome outdated mental models.…”

“…As a result, hierarchical structures designed purely to exploit the successful business, as well as insufficient autonomy of business units, impede creative and innovative processes (Domínguez Escrig et al 2020;Iranmanesh et al 2021). This ultimately hinders incumbents from exploring new opportunities and thus from developing disruptive business models (Kammerlander et al 2018;de Groote et al 2021).…”

“…The ongoing digital transformation, ever-changing consumer demands, and environmental uncertainties are driving companies to explore new, innovative ways to sustain competitive advantages over the long run (Christensen et al 2018;Iranmanesh et al 2021;Trischler and Li-Ying 2022). While incremental or sustaining innovations are necessary for a company's revenues and market share, disruptive innovations provide companies the best chance of surviving market shifts (Govindarajan and Trimble 2005;de Groote et al 2021). Harnessing the economic value of disruptive innovations requires new forms of value creation, value proposition, and value capture, and thus a business model as a lever to disrupt markets and industries (Teece 2010;Matzler et al 2018;Kraus et al 2020).…”

Managing A Family Business In Modern Conditions

“…Research on development and support of small and medium-sized business in the Russian Federation is conducted be Ashmarina and Murzagalina (2021), Ashmarina and Pavlova (2020), Troshina et al (2021) etc. Issues of sustainability of family business are considered by Ahn et al (2021), de Groote et al (2020. Various aspects of family business development are studied by Ingram et al (2020), Mazzi (2011), Rachmawati et al (2020).…”