Micro-Foundations of Corporate Entrepreneurship in Family Firms: An Institution-Based Perspective

2018 ◽  
Vol 43 (2) ◽  
pp. 274-281 ◽  
Author(s):  
Sohrab Soleimanof ◽  
Kulraj Singh ◽  
Daniel T. Holt
Keyword(s):  
Family Firms ◽  
Family Members ◽  
Institutional Context ◽  
Corporate Entrepreneurship ◽  
Family Firm ◽  
Institutional Perspective ◽  
The Family ◽  
Impact On Family ◽  
Micro Foundations

Family firm institutional context is composed of institutions that originate from the family and the business. Hence, a confluence of family and business institutions, with varying degrees of salience, interact and influence entrepreneurial behaviors within family firms. We suggest an institution-based perspective for examining entrepreneurial behaviors and explain why an institutional perspective can deepen our understanding of the micro-foundations of corporate entrepreneurship within family firms. Furthermore, we elaborate on family institutions’ influence on entrepreneurial behaviors by highlighting these institutions’ impact on family members’ cognitions and abilities, as well as, family and nonfamily members’ interactions and relationships.

scholarly journals Company manager altruism and behavioural biases in family firms

2017 ◽  
Vol 1 (1) ◽  
pp. 55-62
Author(s):  
Gérard HIRIGOYEN
Keyword(s):  
Firm Performance ◽  
Family Business ◽  
Agency Costs ◽  
Family Firms ◽  
Family Members ◽  
Theoretical Work ◽  
Family Firm ◽  
Behavioral Bias ◽  
The Family ◽  
Impact On Family

Family actors behaviors have not been much studied over the last 20 years, while at the same time, literature about family firms produced increasingly many valuable papers. That is why a relevant Framework for knowing and understanding the behavioral biases of family members is still missing, and this lack concerns also the causes, outcomes and mechanisms of such biases. Particularly and contrary to the prominent literature, the altruism of the manager will be construed as behavioral bias leading to agency costs with an impact on family firm performance. Based on theoretical work, a modeling of these different problems of agency and altruism in the family business will be proposed.(paper in French)

scholarly journals Coexistence, Unity, Professionalism and Prudence

2021 ◽  
Vol 11 (1) ◽  
Author(s):  
Miguel-Angel Gallo
Keyword(s):  
Family Business ◽  
Family Firms ◽  
Family Members ◽  
Family Firm ◽  
Family Businesses ◽  
The Family ◽  
Over Time

Family firms are complex and dynamic entities that are rich with peculiar, idiosyncratic features. The objective of this paper is to provide guidance to help those involved in family businesses, businesspersons, and family members to pursue the continuity of the family firm over time. Based on the author’s experience with entrepreneurs who built successful businesses, this paper identifies four elements that are critical to achieve transgenerational continuity in family firms, namely: coexistence, unity, professionalism, and prudence. The analysis of each element provides suggestions and key considerations for both scholars and practitioners in the family business field.

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.

Does a second-generation returnee make the family firm more entrepreneurial?

2018 ◽  
Vol 12 (2) ◽  
pp. 287-304 ◽  
Author(s):  
Ying Fu ◽  
Steven Si
Keyword(s):  
Family Firms ◽  
Second Generation ◽  
Corporate Entrepreneurship ◽  
Family Ownership ◽  
Content Type ◽  
The Family ◽  
Impact On Family ◽  
Industry And Commerce ◽  
Short Time ◽  
The Relationship

Purpose This paper aims to focus on a special group of people in family firms in China, the second generation who are returnees, and to study their impact on family ownership and corporate entrepreneurship. Design/methodology/approach Survey data from China’s private enterprises in 2015 were used to test the hypotheses. Data were collected through a joint effort by the China Federation of Industry and Commerce and the School of Management of Zhejiang University. The authors used a stratified sampling method, and questionnaires were distributed to 12 provinces in East, Central and West China. Two sets of questionnaires were distributed and answered. Findings Compared with those family firms without second-generation returnees, the relationship between family ownership and corporate entrepreneurship is significantly enhanced in family firms that have second-generation returnees. Furthermore, compared with the second-generation returnees who stay overseas for a short time, returnees who stay overseas longer are more likely to promote corporate entrepreneurship. Originality/value This study explores the unique characteristics of second-generation returnees and explores these returnees’ impact on family ownership and corporate entrepreneurship in the Chinese context. This could generate a new value to the family entrepreneurship literature.

Family Firm(s) Outcomes Model: Structuring Financial and Nonfinancial Outcomes Across the Family and Firm

2016 ◽  
Vol 30 (2) ◽  
pp. 182-202 ◽  
Author(s):  
Daniel T. Holt ◽  
Allison W. Pearson ◽  
Jon C. Carr ◽  
Tim Barnett
Keyword(s):  
Financial Performance ◽  
Family Firms ◽  
Family Members ◽  
Family Firm ◽  
Research And Practice ◽  
Family Unit ◽  
Firm Outcomes ◽  
The Family

Family firms are distinguished theoretically from nonfamily firms due to their pursuit of unique, family-related aspirations and goals. The pursuit of these aspirations and goals leads many family firms to define success or failure in terms of a broader set of outcomes than nonfamily firms. Despite this, family firm research has generally taken a constricted view of family firm outcomes by concentrating on narrowly defined financial performance as measured by accounting and/or market-based indicators. We contend that this somewhat myopic focus has slowed the field’s development to some degree, by constraining our ability to test its fundamental tenets. To address this, we draw on several disciplines to systematically order family firm outcomes within a family firm(s) outcomes model that encompasses both financial and nonfinancial dimensions. While financial performance is important in research and practice, herein we refer to both financial and nonfinancial outcomes and explain how these outcomes map on the family unit and the family firm. Furthermore, we suggest measures that can be used and explain how the model can be applied when researchers select financial and nonfinancial outcomes important to family members as the family firm’s success or failure is gauged.

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.

Does the Family Business Interaction Factor Represent a Resource or a Cost?

2004 ◽  
Vol 17 (2) ◽  
pp. 99-118 ◽  
Author(s):  
Ernesto J. Poza ◽  
Susan Hanlon ◽  
Reiko Kishida
Keyword(s):  
Family Business ◽  
Family Firms ◽  
Management Practices ◽  
Family Members ◽  
Agency Cost ◽  
Family Firm ◽  
Interaction Factor ◽  
The Family ◽  
Governance Practices ◽  
The Impact

The authors investigate the interaction between families and their businesses and the impact of this interaction on management and governance practices used. Family businesses participating in the family business programs at three U.S. universities completed questionnaires pertaining to family and business culture and practices. The research draws on the agency cost theory, governance, systems theory, and the resource-based view of organizations literature in the consideration of family firm attributes and the relationship between family members, nonfamily managers, and the firm. Chief executive officers generally perceive management practices, succession processes, and family environment more favorably than do either other family members or nonfamily managers. There are no significant differences in perceptions between active and inactive family members on the family scales. The difference in perceptions of the family firm between nonfamily managers and family managers is discussed as a challenge to the full utilization of professional management capabilities by family firms. Finally, owning family unity, the perception of business opportunity, and how positive the relation between firm and family is influences managerial and governance practices and therefore represents a resource for competitive advantage and sustained business performance.

scholarly journals UNDERSTANDING ORGANIZATIONAL CULTURE IN A SMALL FAMILY FIRM

2015 ◽  
Vol 4 (2) ◽  
pp. 153
Author(s):  
Gustavo José Da Nóbrega Danda ◽  
Denize Grzybovski
Keyword(s):  
Organizational Culture ◽  
Family Firms ◽  
Single Case ◽  
Family Members ◽  
Radical Change ◽  
Family Firm ◽  
Business Culture ◽  
Structured Interviews ◽  
Entrepreneurial Process ◽  
The Family

The purpose of this study is to investigate the characteristics of organizational culture that fosters entrepreneurship in family firms. The entrepreneurial process is viewed as radical change in family firms due to emotions related to change in this kind of organization, which are more intense than nonfamily firms and makes the organization behaves the same way of previous generation. The culture of family firm Alfa is analyzed through the model of Hall, Melin and Nordqvist (2001) which classifies family business culture according to the fact that it is dominated by one or several family members, the degree of culture explicitness and cultural openness. A single case study was conducted and semi-structured interviews were made with family and non-family members of the family firm Alfa. It was concluded that, despite the fact the employees feel comfortable to express their ideas and critics, the values and norms are not clearly stated and the culture is dominated by the influence of the founder. These last two characteristics damage the entrepreneurial process in the family firm analyzed. 

“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.

Does family involvement matter post IPO? Adding value through advertising in family firms

2018 ◽  
Vol 8 (3) ◽  
pp. 218-234 ◽  
Author(s):  
Atanas Nik Nikolov ◽  
Yuan Wen
Keyword(s):  
Firm Performance ◽  
Family Involvement ◽  
Family Business ◽  
Family Firms ◽  
Family Firm ◽  
Family Businesses ◽  
Publicly Traded ◽  
Content Type ◽  
The Public ◽  
The Family

PurposeThis paper brings together research on advertising, family business, and the resource-based view (RBV) of the firm to examine performance differences between publicly traded US family vs non-family firms. The purpose of this paper is to understand the heterogeneity of family vs non-family firm advertising after such firms become publicly traded.Design/methodology/approachThe authors draw on the RBV of the firm, as well as on extensive empirical literature in family business and advertising research to empirically examine the differences between family and non-family firms in terms of performance.FindingsUsing panel data from over 2,000 companies across ten years, this research demonstrates that family businesses have higher advertising intensity than competitors, and achieve higher performance returns on their advertising investments, relative to non-family competitors. The results suggest that the “familiness” of public family firms is an intangible resource that, when combined with their advertising investments, affords family businesses a relative advantage compared to non-family businesses.Research limitations/implicationsFamily involvement in publicly traded firms may contribute toward a richer resource endowment and result in creating synergistic effects between firm “familiness” and the public status of the firm. The paper contributes toward the RBV of the firm and the advertising literature. Limitations include the lack of qualitative data to ground the findings and potential moderating effects.Practical implicationsUnderstanding how family firms’ advertising spending influences their consequent performance provides new information to family firms’ owners and management, as well as investors. The authors suggest that the “familiness” of public family firms may provide a significant advantage over their non-family-owned competitors.Social implicationsThe implications for society include that the family firm as an organizational form does not need to be relegated to a second-class citizen status in the business world: indeed, combining family firms’ characteristics within a publicly traded platform may provide firm performance benefits which benefit the founding family and other stakeholders.Originality/valueThis study contributes by highlighting the important influence of family involvement on advertising investment in the public family firm, a topic which has received limited attention. Second, it also integrates public ownership in family firms with the family involvement–advertising–firm performance relationship. As such, it uncovers a new pathway through which the family effect is leveraged to increase firm performance. Third, this study also contributes to the advertising and resource building literatures by identifying advertising as an additional resource which magnifies the impact of the bundle of resources available to the public family firm. Fourth, the use of an extensive panel data set allows for a more complex empirical investigation of the inherently dynamic relationships in the data and thus provides a contribution to the empirical stream of research in family business.

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