The Effect of Family Influence on an Organization’s Intention to Hire Management Consultants

For centuries trusted advisors have helped leaders address knowledge gaps and provided an opportunity to evaluate logic processes and ideas before executing them. In industry, management consultants have turned the trusted advisor role into a profession that has increasingly garnered academic focus over time. While the benefits of management consulting may be difficult to quantify, the study of those benefits has been primarily case based and focused on publicly traded companies. Family businesses constitute 59% of the private sector workforce and 54% of private sector GDP in the US, representing a significant impact on the economy. But we know little about what influences a family business to seek external help or when a family business hires management consultants. The present study extended bounded systems theory to explore how family influence and succession intentions affect the intention to hire management consultants, and how performance aspirations moderate this relationship. The research identified a positive relationship between succession intentions and the intention to hire management consultants. It also demonstrated that family influence is not a statistically significant determinant of intention to seek external help. The results from this study help advance academic knowledge and provide useful insights to practitioners.