Navigating complexity: Unveiling the nonlinear relationship between family engagement and dynamic capabilities in the hotel industry

Family-owned enterprises face a growingly turbulent context, prompting them to develop adaptive capabilities and sustain their competitive advantages amidst shifting dynamics. Specifically, the tourism sector, which comprises many family businesses, has been greatly affected by the ever-changing environment. In that sense, the analysis of the idiosyncratic characteristics of family firms in dynamic capabilities development that influence the innovation of hotels is of particular relevance. This study aims to assess how family engagement affects the development of dynamic capabilities of hotels and their subsequent relationship with innovative performance within hotel chains. The results indicate that family engagement influences dynamic capabilities through a nonlinear relationship. Also, a favorable association is evidenced between these dynamic capabilities, characterized by hotels' adeptness in discerning and capitalizing on environmental opportunities through resource reconfiguration, and the resultant innovations within the hotel sector. • The consolidation of tourism family businesses has a positive influence on the deployment of dynamic capabilities. • The relationship between family management and dynamic capabilities in hotel chains is non-linear. • Dynamic capability development drives innovation in Spanish hotel chains. • Hotel chains represent a suitable sample to study the deployment of dynamic capabilities in turbulent environments. • Structural equation model allows us to test non-linear relationships in tourism family firms.