Abstract:

This study leverages several emerging pieces of literature on strategic ownership, Sustainable Business Model Innovation (SBMI) and family business, to explore how ownership competence influences SBMI implementation in family SMEs in Oman. To address the research questions, the study employs ownership competence by Foss et al. (2021) and a judgment-based approach (Foss and Klein, 2012). Three ownership competences are utilised: matching competence, which refers to the family owner’s ability to theorise about valuable resource arrangements and cognitively imagine a way for implementing them, governance competence, which involves developing effective governance structures to coordinate incentives, and timing competence, which is knowing when to invest and divest from resources. This study explores how these competences, along with family owners’ judgment, influence the decision-making process for SBMI implementation. It adopts a qualitative research design, employing multiple case studies of family SMEs in Oman and draws upon narrative inquiry.

The synthesis of family business literature indicates a limited understanding of how family SME owners' competence and judgment influence SBMI decisions. The examination of how matching, governance, and timing competences manifest within family SMEs reveals that recent work looks at ownership competence in family businesses from a technical perspective, such as education and experience, and remains largely focused on listed family firms or economic value creation decision-making. Alternatively, this study adopts a dynamic view of family ownership, its competence and judgment, providing a better understanding of the micro-foundations of decision-making for SBMI in family SMEs. Furthermore, the literature review indicates that implementing SBMI requires owners' competence and judgment, which influence decision-making in family SMEs differently from other ownership types. Specifically, the synthesis reveals that although SBMI is strategically challenging, family SMEs can allocate resources to SBMI activities effectively when ownership competence and judgment are present. Competent family owners leverage their skills and knowledge to identify an SBMI archetype that aligns with both the SME's current business model innovation and the family's strategic goals.

This study has the potential to make three distinct contributions. Theoretically, it extends ownership competence theory and the JBA to the context of family SMEs, revealing the nature of their dimensions through the peculiarities of family SMEs in Oman. Empirically, it addresses calls for research in non-Western contexts and provides new insights into how ownership competence influences SBMI decisions. Methodologically, the study advances the field by adopting a micro-foundational lens paired with a qualitative abductive approach.

Please choose your submission type: Developmental Paper

Primary Track: Strategy

Keywords: strategy;nonmarket strategy;resources and capabilities;Strategy

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Ms. Maryam Al Farsi