AI Adoption in Family Firms: A Mixed-Methods Study on the Paradoxical Roles of Passive and Active Family Involvement
Jonas Soluk, Ivan Miroshnychenko, Satish Nambisan
kHUB post date: January 2026
Originally published: June 14, 2025 (PDMA JPIM • Vol. 43, Issue 1 • January 2026)
Read time: 75 minutes
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Artificial intelligence (AI) technologies have gained significance for all types of firms, including family firms. However, unlike other business contexts, family firms face unique challenges in adopting complex and generative technologies, such as AI. This is particularly evident when examining the heterogeneous nature of family firms distinguished by passive (i.e., family ownership) and active (i.e., family management) family involvement. Specifically, we adopt a social capital perspective and combine inductive qualitative and deductive quantitative research into a mixed-methods design. In the first step, we conduct a multiple case study of eight firms using rich data from 125 interviews and archival documents. While the case evidence shows that strong external network ties with suppliers, customers, and competitors help overcome the challenges related to AI technologies, we reveal opposing impacts of passive and active family involvement. Interestingly, our qualitative insights emphasize a negative moderation effect for passive family ownership exacerbating the challenges of AI and a positive moderation effect for active family management facilitating AI adoption. In the second step, we conduct a quantitative test of this conceptual model. On the basis of large-scale data from 1444 firms, we find empirical support that increasing strengths of external network ties with suppliers, customers, and competitors drive AI adoption. Moreover, we find support for the opposing roles of passive family ownership as a negative moderator and active family management as a positive moderator in the relationship between supplier ties on the one hand and AI adoption on the other. Our study contributes toward a nuanced understanding of the idiosyncratic challenges of AI adoption faced by different types of family firms and the role of social capital in this regard and, more broadly, to research on innovation and technology adoption in family firms.
Practitioner Points
- Firms should strengthen external network ties with suppliers, customers, and competitors to access complementary knowledge and accelerate AI adoption, particularly in the face of internal resource and expertise constraints.
- AI strategies in family firms should explicitly account for the distinct effects of ownership and management involvement, recognizing that passive family ownership may impede, while active family management may facilitate AI-driven transformation.
- Passive family owners are advised to professionalize governance structures and delegate operational authority to enable more agile, evidence-based decision making in AI-related initiatives.
- Actively involved family managers should institutionalize long-term stakeholder collaboration and learning mechanisms to align AI adoption with the firm's strategic continuity and legacy-oriented objectives.