The Clash between Creativity and Tradition in the Financial Governance of Family Businesses

ABSTRACT: This paper aims at the theoretical modeling of the clash between innovation and tradition based on the culture of the manager in the family firm. Our analysis of theoretical and empirical work confirms that, contrary to what is commonly believed, managerial innovation and family traditions are by no means contradictory but rather complementary. Thus, despite their attachment to cultural values, family firms can successfully implement change without threatening the stability and durability of the family heritage. This theoretical result gives rise to a model to be tested in the framework of our research program, which allows us to determine the key factors of the reconciliation of the traditional with the innovative for a better response to the requirements of the market dynamics in a context of crisis. KEYWORDS: family businesses, financial goals, family goals, culture, innovation, family traditio