Leadership, management control systems and innovation: Evidence in family businesses

Resumen

This study investigates how the interaction between leadership style and the management control system (MCS) manifests in product and process innovation practices in family business (FB), considering the variability in understandings and practices related to innovation. The gap addressed concerns the need for a more analytical understanding of how different leadership styles present in the family firm environment interact with the MCS, manifesting themselves in product and process innovation practices. The study provides insights into how leadership and the MCS may denote different product and process innovation practices, contributing both to the literature on innovation in FBs and, from a practical perspective, by highlighting how these elements can foster the continuity and sustainability of FBs. The impact of this research on the field lies in expanding the scope of investigation into the interaction between leadership styles and MCSs, highlighting how these elements, together, are articulated to promote innovation practices in the FB context. An exploratory-descriptive qualitative study was conducted, grounded in an interpretive approach, guided by semi-structured interviews with 15 managers of family-owned food businesses. The results reveal two distinct groups of FBs. The first, focused on the business essence (business orientation), is characterized by innovation practices driven by internal needs and opportunities, with a predominance of referent, expert, and participative leadership styles, associated with the use of belief, diagnostic, and interactive control systems. The second, focused on the market (market orientation), which presents innovation practices guided by external trends, with an autocratic leadership style and greater emphasis on limits and diagnostic control levers. The study contributes by demonstrating how distinct leadership styles, in interaction with the levers of management control, are manifested in innovation practices in FBs.