Resilience beyond Metrics: How Hidden Resources in Small Family Firms Challenge the Resource-Based View
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Stefan Märk
Abstract
Family businesses play a key role in economic development and are often analyzed through the Resource-Based View (RBV). However, in small firms, the RBV shows inconsistent explanatory power. This study investigates “hidden resources” such as unpaid family labor and informal commitments, which are typically excluded from financial reporting and RBV metrics. Based on a qualitative case study of a small Austrian family business, findings reveal that nearly 40% of labor is unpaid, artificially inflating profitability indicators. Once accounted for, key financial ratios drop significantly. These hidden contributions also reflect a form of informal resilience – enabling flexible responses to challenges through mobilization of hidden family-based capacities. The study argues that such resilience constitutes a dynamic capability and should be integrated into RBV frameworks. It calls for broader operationalizations of resources and mixed-method approaches to better capture the strategic role of informal, intangible inputs in small family firms.
Abstract
Family businesses play a key role in economic development and are often analyzed through the Resource-Based View (RBV). However, in small firms, the RBV shows inconsistent explanatory power. This study investigates “hidden resources” such as unpaid family labor and informal commitments, which are typically excluded from financial reporting and RBV metrics. Based on a qualitative case study of a small Austrian family business, findings reveal that nearly 40% of labor is unpaid, artificially inflating profitability indicators. Once accounted for, key financial ratios drop significantly. These hidden contributions also reflect a form of informal resilience – enabling flexible responses to challenges through mobilization of hidden family-based capacities. The study argues that such resilience constitutes a dynamic capability and should be integrated into RBV frameworks. It calls for broader operationalizations of resources and mixed-method approaches to better capture the strategic role of informal, intangible inputs in small family firms.
Chapters in this book
- Frontmatter I
- Contents V
- Preface VII
- Strategy Development in the Light of Radical Change: A Perspective on the Evolution and Revolution of Family Businesses 1
- The Importance of VUCA and BANI in Developing Sustainable and Long-term Oriented Strategies in Family Businesses 27
- Employee Resilient Behavior and Its Leadership Prerequisites: Strategies for Founder Generation Family Firms 53
- The Impact of Family Ownership on SME Resilience: A Three-Circle Model Analysis 73
- Implications of Company Succession on Resilience of Small and Medium Size Companies 85
- Passing the Torch: Perceived Risks and Opportunities in Family Business Succession 103
- Convenience Study of Criminal Deviance in the Entrepreneurial Family Business: Husband as Lawyer and Wife as Accountant in the Law Firm 119
- The Adaptive Capacity of Tourism Family Firms – An Owners’ Perspective on Risk Resilience 147
- Corporate Social Responsibility during the COVID-19 Pandemic: Learnings from Austrian Family Businesses 169
- Resilience beyond Metrics: How Hidden Resources in Small Family Firms Challenge the Resource-Based View 183
- The Impact of AI-Induced Downsizing on Family Businesses 201
- List of Contributors
- Index
Chapters in this book
- Frontmatter I
- Contents V
- Preface VII
- Strategy Development in the Light of Radical Change: A Perspective on the Evolution and Revolution of Family Businesses 1
- The Importance of VUCA and BANI in Developing Sustainable and Long-term Oriented Strategies in Family Businesses 27
- Employee Resilient Behavior and Its Leadership Prerequisites: Strategies for Founder Generation Family Firms 53
- The Impact of Family Ownership on SME Resilience: A Three-Circle Model Analysis 73
- Implications of Company Succession on Resilience of Small and Medium Size Companies 85
- Passing the Torch: Perceived Risks and Opportunities in Family Business Succession 103
- Convenience Study of Criminal Deviance in the Entrepreneurial Family Business: Husband as Lawyer and Wife as Accountant in the Law Firm 119
- The Adaptive Capacity of Tourism Family Firms – An Owners’ Perspective on Risk Resilience 147
- Corporate Social Responsibility during the COVID-19 Pandemic: Learnings from Austrian Family Businesses 169
- Resilience beyond Metrics: How Hidden Resources in Small Family Firms Challenge the Resource-Based View 183
- The Impact of AI-Induced Downsizing on Family Businesses 201
- List of Contributors
- Index
