Title: Dynamic capabilities and intergenerational growth in the family business: the role played by director rotation

Authors: Xiangqian Yu; Xiang Ao; Yu Weng; Zhenying Pan; Zheng Xu

Addresses: School of Business, Wenzhou University, Wenzhou, 325035, China ' School of Business, Wenzhou University, Wenzhou, 325035, China ' School of Business, Wenzhou University, Wenzhou, 325035, China ' School of Business, Wenzhou University, Wenzhou, 325035, China ' School of Business, Wenzhou University, Wenzhou, 325035, China

Abstract: Director rotation mechanism can effectively solve the problem of control of family business and enhance dynamic capabilities. This paper selects the case of TaiLi, which lasted for nearly 40 years, as the object of study, and develops the theoretical basis for the alternation between turn-taking mechanism and inter-family business. The research shows that the rotation mechanism facilitates a peaceful corporate climate for family businesses, where managers can expand, share, transfer and innovate knowledge through rotation. The family business upgrades the mechanism of turning around and continuously enhances a series of dynamic capacities such as internal learning ability, resource integration ability and environmental adaptation ability, achieves intergenerational growth of family-owned businesses through the continuous emergence of heterogeneous resources. This paper establishes an analytical paradigm of turning around family business and enterprise dynamic capabilities, which can provide practical implications for the sustainable and healthy development of family businesses and managers' knowledge innovation.

Keywords: family business; director rotation; knowledge innovation; governance innovation; enterprise dynamic capabilities.

DOI: 10.1504/IJKMS.2023.127326

International Journal of Knowledge Management Studies, 2023 Vol.14 No.1, pp.90 - 112

Received: 11 Nov 2021
Accepted: 06 Apr 2022
Published online: 30 Nov 2022 *