scholarly journals Strategic management in family business. The missing concept of the familiness learning mechanism

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Ismael Barros-Contreras ◽  
Rodrigo Basco ◽  
Natalia Martín-Cruz ◽  
Juan Hernangómez
Keyword(s):  
Value Creation ◽  
Firm Value ◽  
Family Firms ◽  
Family Members ◽  
Family Firm ◽  
Capabilities Approach ◽  
Equation Modeling ◽  
Learning Mechanisms ◽  
Content Type ◽  
Learning Mechanism

PurposeThe purpose of this article is to provide a comprehensive understanding of the roots of family firms' competitive advantages by defining and testing the familiness learning mechanisms that emerge from the interaction between family and firm. Because family members are economically, emotionally and socially attached to the firm, family firms are expected to be able to develop unique and difficult to imitate learning mechanisms related to family firm value creation.Design/methodology/approachThis study operationalizes and tests the concept of the familiness learning mechanism using a sample of nonlisted Spanish family firms. The sample is analyzed using the structural equation modeling method.FindingsResults show that family firms' ability to accumulate internal and external knowledge, integrate social knowledge, as well as create and retain socioemotional knowledge forms the concept of the familiness learning mechanism, and the authors show what implications it might have for family firm value creation.Originality/valueBy using the dynamic capabilities approach, this article highlights the importance of the knowledge and learning derived from family involvement in the firm. The creation of learning mechanisms occurs because of the close relationships between family members and their simultaneous participation in the family and in the company systems, which creates a unique context wherein knowledge and learning emerge in an idiosyncratic manner.

Leader behaviours of family and non-family executives in family firms

2020 ◽  
Vol 43 (7) ◽  
pp. 885-907
Author(s):  
Carolin Neffe ◽  
Celeste P.M. Wilderom ◽  
Frank Lattuch
Keyword(s):  
Family Firms ◽  
Longitudinal Research ◽  
Family Members ◽  
Family Firm ◽  
Self Awareness ◽  
Content Type ◽  
Leadership Frame ◽  
Family Based ◽  
Research Propositions ◽  
New Research

Purpose Several studies of family firm failures have pointed to non-family members in leading positions as a reason. However, non-family members have often played a key role in family-firm longevity, while non-family executives’ involvement in family firms is increasing. These non-family executives who (co-)run family firms are thought to require an almost impossible set of behavioural qualities. The aim of this exploratory study is to find out how specific leader behaviours of effective family executives and non-family executives may differ. Design/methodology/approach Based on Dulewicz and Higgs’ (2005) broad leadership frame, the authors draw attention to a large range of behaviours of family-firm executives. In-depth interviews were conducted with successful German executives, both family and non-family ones. Their answers had to contain specific behavioural examples. Findings More behavioural similarities than differences are shown between family- and non-family-based executives. Yet, the self-reflective communicative behavioural qualities of the non-family executives could balance a lack of such qualities among the family-based executives. Based on the three major differences – decision-making style, communication versatility and self-awareness – specific new research propositions are distilled about effective family firm leadership. Originality/value Practical suggestions for recruiting non-family executives are offered. Future quantitative longitudinal research on how to pair specific behavioural qualities of family and non-family based executives that optimise family-firm longevity is urgently needed.

When family firm corporate governance fails: the case of El Corte Inglés

2019 ◽  
Vol 10 (2) ◽  
pp. 97-115
Author(s):  
María Sacristán-Navarro ◽  
Laura Cabeza-García
Keyword(s):  
Corporate Governance ◽  
Family Firms ◽  
Family Members ◽  
Family Firm ◽  
Governance Mechanisms ◽  
Content Type ◽  
Theoretical Concepts ◽  
Corporate Governance Mechanisms ◽  
The Right ◽  
Practical Implications

Purpose The purpose of this paper is to describe internal corporate governance mechanisms in family firms as well as conflicts that may arise among shareholders and family members in the absence of specific corporate governance mechanisms. Design/methodology/approach After presenting theoretical concepts, the authors study the case of Spanish family firm El Corte Inglés to understand some of the corporate governance difficulties the company has experienced over the past few years. Findings This case illustrates how corporate governance problems can arise because the right mechanisms have not been used, leading to conflicts among family members, valuation problems and power struggles. Practical implications There is a need for family firms to employ suitable corporate governance mechanisms as governance complexity increases. Originality/value This study aims to contribute to the understanding of corporate governance problems among family members and their possible solutions.

Are non-blood related “family” members treated differently? Determinants of bifurcation bias among family members in the family firm

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Taewoo Kim ◽  
Laura Marler
Keyword(s):  
Social Identity Theory ◽  
Family Firms ◽  
Family Members ◽  
Family Firm ◽  
Individual Factors ◽  
Content Type ◽  
Societal Factors ◽  
Related Family ◽  
The Family ◽  
The Impact

PurposePossible asymmetric treatment among family members has long been neglected in the field of family firm research. To fill this gap, the purpose of this study is to shed light on the heterogeneity of treatment of family members in family firms by proposing factors that influence the likelihood of bifurcation bias among “family” members.Design/methodology/approachDrawing upon social identity theory and the concept of bifurcation bias, the authors theorize that family members working in family firms are not a homogenous entity, but rather a heterogeneous entity contingent on their status and/or position in the family. To provide a comprehensive understanding of heterogeneous treatment among family members, both individual factors and societal factors should be considered.FindingsBlood relatedness of family members is suggested as an important determinant of the likelihood of bifurcation bias among family members. It is also proposed that the impact of blood relatedness is likely influenced by both individual factors (familial proximity and familial tenure) and a societal factor (collectivism).Originality/valueTheorizing takes a step forward to advance the understanding of interpersonal dynamics in family firms. In particular, this article expands the research boundaries of family business research by taking into account that not all “family” members are treated preferentially. Moreover, this article deepens our understanding of the nature and status of non-blood related family members by unveiling the influence of both individual and societal factors. This article also provides a theoretical foundation for human resource management (HRM) research in family businesses by addressing bifurcation bias among family members.

Emotional intelligence in family firms

2014 ◽  
Vol 4 (1) ◽  
pp. 4-23 ◽  
Author(s):  
Gonzalo Gómez Betancourt ◽  
Isabel C. Botero ◽  
Jose Bernardo Betancourt Ramirez ◽  
Maria Piedad López Vergara
Keyword(s):  
Family Business ◽  
Family Firms ◽  
Family Members ◽  
Family Firm ◽  
Business Owners ◽  
Interpersonal Dynamics ◽  
Content Type ◽  
The Family

Purpose – Although researchers have highlighted the importance of relational and family factors for the sustainability of a family firm, there is not much empirical research exploring how emotions and the management of emotions play a role in the interpersonal dynamics of family business owners. The purpose of this paper is to explore how the way family members manage their emotions affects the interpersonal dynamics in the family, business, and ownership subsystems of a family firm. Design/methodology/approach – The paper presents an in-depth case study from a family firm in Colombia-South America. Findings – The results indicate that the capability that family members have to manage their emotions influences the interpersonal dynamics that take place in the family firm at the individual and group level. In this case, the paper found that although emotional intelligence (EI) affected interpersonal relationships in a firm, this effect was based on the individual's willingness to use their EI capabilities, previous history between people, and the goals individuals have within each subsystem in a family firm. The paper also found that interpersonal dynamics, in turn, influence how family members work together. Research limitations/implications – Because this study uses an in-depth case study, the intention of the paper is to provide an initial picture of how EI can play a role in the interpersonal interactions between family business owners. The authors hope that this study can be used as a building block to enhance the understanding of the role of EI in family firms. Practical implications – EI represents an individual's capability to perceive, understand, manage, and regulate self and other's emotions. For family firms, this means that family business owners can use this capability to determine how to enact their roles in the family firm and how to interact with other to ensure harmony in their relationships. Originality/value – This paper builds on previous work on emotions in family firms to explore the role of EI in family firms, and provides an empirical exploration of the role of management of emotions in family firms.

scholarly journals Parents’ Learning Mechanisms for Family Firm Succession: An Empirical Analysis in Spain through the Lens of the Dynamic Capabilities Approach

2020 ◽  
Vol 12 (19) ◽  
pp. 8220
Author(s):  
Natalia Martin-Cruz ◽  
Ismael Barros Contreras ◽  
Juan Hernangómez Barahona ◽  
Héctor Pérez Fernández
Keyword(s):  
Dynamic Capabilities ◽  
Family Firms ◽  
Positive Impact ◽  
Family Firm ◽  
Capabilities Approach ◽  
Dynamic Capability ◽  
Learning Mechanisms ◽  
The Family ◽  
Intention To Continue ◽  
The Impact

Succession is a concern for most family firms. The literature has addressed succession in family firms from different perspectives. However, there are still unaddressed questions concerning the microfoundations of succession, and there is a need to secure a better understanding of the succession process and what role parents play therein. Using the dynamic capabilities approach, we shed light on the influence of parents’ behaviors on successors’ intentions. In particular, the paper pursues a twofold aim; first, to analyze the effect of learning mechanisms that parents deliberately use with their children in the family firm on the succession dynamic capability; and second, to explore the impact of this dynamic capability of successor intention to continue in the family firm. We test the model on a sample of potential successors of family firms in Spain. Using partial least squares (PLS) for a sample of 9146 individuals, we confirm the positive impact of the use of parents’ deliberate learning mechanisms on succession dynamic capability and, in turn, the positive effect of the created succession dynamic capability on the successor’s intention to continue the family firm. Furthermore, we find that perceived self-efficacy fails to have any effect on successor intention.

The effects of goals attainment on CEO-owner satisfaction and the role of family involvement

2019 ◽  
Vol 10 (2) ◽  
pp. 116-127
Author(s):  
Ondřej Machek ◽  
Jiří Hnilica
Keyword(s):  
Family Involvement ◽  
Family Business ◽  
Firm Value ◽  
Family Firms ◽  
Hierarchical Regression ◽  
Content Type ◽  
Business Goals ◽  
Growth Increase ◽  
The Family ◽  
Owner Satisfaction

Purpose The purpose of this paper is to examine how the satisfaction with economic and non-economic goals achievement is related to the overall satisfaction with the business of the CEO-owner, and whether family involvement moderates this relationship. Design/methodology/approach Based on a survey among 323 CEO-owners of family and non-family businesses operating in the Czech Republic, the authors employ the OLS hierarchical regression analysis and test the moderating effects of family involvement on the relationship between the satisfaction with different goals attainment and the overall satisfaction with the business. Findings The main finding is that family and non-family CEO-owner’s satisfaction does not differ significantly when economic goals (profit maximisation, sales growth, increase in market share or firm value) and firm-oriented non-economic goals (satisfaction of employees, corporate reputation) are being achieved; both classes of goals increase the overall satisfaction with the firm and the family involvement does not strengthen this relationship. However, when it comes to external non-economic goals related to the society or environment, there is a significant and positive moderating effect of family involvement. Originality/value The study contributes to the family business literature. First, to date, most of the studies focused on family business goals have been qualitative, thus not allowing for generalisation of findings. Second, there is a lack of evidence on the ways in which family firms integrate their financial and non-financial goals. Third, the authors contribute to the literature on the determinants of personal satisfaction with the business for CEOs, which has been the focus on a relatively scarce number of studies.

“We are a family firm”

2018 ◽  
Vol 8 (1) ◽  
pp. 2-21 ◽  
Author(s):  
Claudia Binz Astrachan ◽  
Isabel C. Botero
Keyword(s):  
Family Business ◽  
Family Firms ◽  
Family Firm ◽  
Business Owners ◽  
Public Companies ◽  
Content Type ◽  
Brand Building ◽  
Depth Interview ◽  
The Family ◽  
Family Associations

Purpose Evidence suggests that some stakeholders perceive family firms as more trustworthy, responsible, and customer-oriented than public companies. To capitalize on these positive perceptions, owning families can use references about their family nature in their organizational branding and marketing efforts. However, not all family firms actively communicate their family business brand. With this in mind, the purpose of this paper is to investigate why family firms decide to promote their “family business brand” in their communication efforts toward different stakeholders. Design/methodology/approach Data for this study were collected using an in-depth interview approach from 11 Swiss and German family business owners. Interviews were transcribed and coded to identify different themes that help explain the different motives and constraints that drive their decisions to promote the “family business brand.” Findings The analyses indicate that promoting family associations in branding efforts is driven by both identity-related (i.e. pride, identification) and outcome-related (e.g. reputational advantages) motives. However, there are several constraints that may negatively affect the promotion of the family business brand in corporate communication efforts. Originality/value This paper is one of the first to explore why family businesses decide to communicate their “family business brand.” Building on the findings, the authors present a conceptual framework identifying the antecedents and possible consequences of promoting a family firm brand. This framework can help researchers and practitioners better understand how the family business nature of the brand can influence decisions about the company’s branding and marketing practices.

Birth mode of family firms, family entering time and R&D investment: evidence from China

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Muhammad Zulfiqar ◽  
Shihua Chen ◽  
Muhammad Usman Yousaf
Keyword(s):  
Agency Theory ◽  
Family Firms ◽  
Family Firm ◽  
Research Database ◽  
Content Type ◽  
Firm Birth ◽  
The Relationship ◽  
D Investment ◽  
Moderating Role

PurposeOn the basis of behavioural agency theory and resource-based view, this study investigates the influence of family firm birth mode (i.e. indirect-established or direct-established), family entering time on R&D investment and the moderating role of the family entering time on the relationship between birth mode and R&D investment.Design/methodology/approachThe authors collected 2,990 firm-year observations from family firms listed on A-share in China from 2008 to 2016 in the China Stock Market and Accounting Research database. They used pooled regression for data analysis and Tobit regression for robustness checks.FindingsIndirect-established family firms show more inclined behaviour towards R&D investment than direct-established counterparts. Family entering time positively affects the R&D investment of family firms. Moreover, family entering time plays a significant moderating role in the relationship between family firm birth mode (i.e. indirect-established or direct-established) and R&D investment.Originality/valueTo the best of the authors’ knowledge, this work is a pioneering study that introduced the concept of family firm birth mode (i.e. indirect-established or direct-established) and family entering time. This work is novel because it differentiated family firms according to their birth modes, an approach which is a contribution to the existing literature of family firms. Moreover, the investigation of the moderating role of family entering time has also produced notable results that help understand the impact of family entering time on different types of family firms. The interpretation of outcomes according to behavioural agency theory also produced useful insights for future researchers as well as for policymakers.

Exploring organizational problem-solving modes: a dynamic capabilities approach

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Matin Mohaghegh ◽  
Andreas Größler
Keyword(s):  
Problem Solving ◽  
Dynamic Capabilities ◽  
Fundamental Solutions ◽  
Capabilities Approach ◽  
Dynamic Capability ◽  
Learning Mechanisms ◽  
Content Type ◽  
Improvement Programs ◽  
Micro Foundations

PurposeAdopting the dynamic capability perspective, this study aims at exploring which problem-solving capabilities result in fundamental solutions with a potentially low likelihood for problems to recur. This can also shed light on why, despite many attempts, process improvement programs often fail to produce such long-term solutions.Design/methodology/approachA case study is carried out to inductively describe and classify problem-solving in companies and to indicate why problem-solving efforts are typically bounded to short-term solutions. The empirical findings are triangulated with findings from the extant literature.FindingsFirst, the authors propose three problem-solving modes with different characteristics and potential impacts on operational performance: intuitive problem-solving, semi-structured problem-solving and systematic problem-solving. Second, by emphasizing dynamic capabilities' micro-foundations and with the focus on learning mechanisms, the authors show that, among these modes, only systematic problem-solving can serve as a dynamic capability with fundamental solutions. Third, based on insights from the case study, the authors address behavioral and organizational impediments that curb dynamic capabilities and limit systematic problem-solving adoption.Originality/valueThis study is an empirically informed attempt to understand systematic problem-solving as a dynamic capability. The authors uncover the micro-foundations and the learning mechanisms through which systematic problem-solving becomes a dynamic capability. By highlighting problem-solving orientation as a hardly investigated dimension of improvement programs, the authors show that a mixture of a static problem-solving approach and a set of impediments at both individual and organizational levels is the major reason of failures of improvement programs over time.

Family firm CEOs: human capital and career success

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Maria Rita Blanco ◽  
Miguel Angel Sastre-Castillo ◽  
Maria Angeles Montoro-Sanchez
Keyword(s):  
Human Capital ◽  
Latin American ◽  
Quantitative Methods ◽  
Family Firms ◽  
Family Firm ◽  
American Family ◽  
Graduate Degree ◽  
Capital Theory ◽  
Content Type ◽  
The Way

PurposeThis article explores the influence of education and experience on the time to the top in family and non-family CEOs who work for Latin American family firms.Design/methodology/approachIn order to achieve these objectives, this study draws upon human capital theory as well as career and family firm literature. The careers of 129 CEOs of family firms who form part of the América Economía ranking were analyzed and quantitative methods were used.FindingsIn Latin American family firms, family CEOs reach the top faster than their non-family counterparts. In addition, the influence of human capital variables on the way to the top differs between the two groups. For family CEOs, obtaining a graduate degree delays the way to the top, while for non-family ones, it reduces the time to the top. As regards experience, for promoted family CEOs, the greater the percentage of the career spent in the organization they lead, the shorter the time to the top. No support was found for either the influence of having worked for just one firm or having had elite graduate education abroad, in multilatina CEOs.Practical implicationsIndividual career management suggestions for future CEOs as well as specific guidelines for talent managers are proposedOriginality/valueThis is the first study to explore the influence of human capital indicators on the time to the top in Latin American family firm CEOs.

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