Temporal Depth & Directionality: Competitive Advantage for Sustainable Family Enterprises
DOI:
https://doi.org/10.24310/ejfb.14.1.2024.18462Keywords:
Family business, Sustainability, Strategy, Competitive Advantage, Long-term OrientationAbstract
Firms seeking to embed sustainability into their core business strategy face inherent tensions of managing conflicting goals of performing on economic, social, and environmental dimensions, in the short- and long-term. Hahn et al., (2014) argue that managers that view these tensions as a paradox may consider radical strategies but end up adopting prudent strategies because they are unable to implement workable solutions due to higher awareness of uncertainty and risks. We argue that subjective interpretation of temporal depth and directionality influences the adoption of sustainable development strategies. Firms with long-term orientation that adopt an overarching vision, structures to incorporate diverse perspectives, and guardrails to prevent tunnel vision, are better positioned to balance financial and non-financial goals. Multi-generational family enterprises with aspirations for transgenerational continuity draw selectively upon their historic past to prepare for success in distant future. When focused on balancing wealth creation for their families and communities, they have the potential to unleash creativity and innovation for a sustainable competitive advantage.
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