Slack resources as anchors or accelerators in strategic changes: family ownership as a moderator

Abstract

Whether slack resources inhibit or facilitate SMEs to introduce strategic changes is an unresolved question. We investigate how different bundles of financial and human resource (HR) slack relate to strategic changes, and how this relation is influenced by the presence of family majority ownership. We survey 654 private Belgian SMEs and find, in line with the slack-as-resources for change perspective, that non-family-owned SMEs introduce the fewest strategic changes when they bundle low levels of financial slack with low levels of HR slack, while they undertake the most strategic changes when they bundle high levels of financial slack with low levels of HR slack. Family ownership moderates this relationship, as strategic decision-making in family-owned SMEs follows the behavioral agency model. As such, the effect of slack resources in family-owned firms is best described by the slack-as-a-buffer perspective, and the bundle of high levels of financial slack with low levels of HR slack results in fewer strategic changes rather than more.