The paper sheds new light on innovation performance of family firms and the interlink
between business administration, family governance and innovation output. Paradoxically,
family firms seem to innovate less, despite their ability to innovate more. Family
firms are heterogeneous and face a triple efficiency requirement in order to survive
the competition: different approaches highlight that efficient business administration
/ management quality, efficient family governance as well as efficient innovation
management are all needed. Research at the intersection of these three areas is rare
and only a few empirical studies deal with the influencing factors behind innovation
in family firms. In this paper we investigate the influence of management quality
and governance on innovation performance of Hungarian family firms by using empirical
data. The paper concludes with advices that can be given to policy makers to support
family businesses.
