Organizational Capabilities, Business Strategic Orientation, and Performance in Family and Non-family Businesses in a sub-Saharan African Economy

Abstract

The study compares the impact of the interactions between organizational capabilities and business strategic orientation on performance for micro and small family businesses (FBs) and non-family businesses (NFBs). We use data from 207 FBs and 293 NFBs from Ghana to test our hypotheses. The findings indicate that the impact of the interaction between managerial capabilities and cost strategy on performance was more beneficial for FBs than NFBs. Moreover, the influence of the interaction between marketing capabilities and cost leadership strategy on performance was more detrimental to FBs than NFBs. Furthermore, the impact of the interaction between marketing capabilities and differentiation strategy on performance was greater for NFBs than FBs. The findings show that while FBs benefit more by leveraging managerial capabilities to pursue the cost leadership strategy, NFBs benefit more by leveraging marketing capabilities to implement the differentiation strategy. Implications are discussed.