scholarly journals Governance in Hungarian family businesses

2019 ◽  
Vol 3 (1) ◽  
pp. 7
Author(s):  
Attila Wieszt
Keyword(s):  
Family Involvement ◽  
Family Business ◽  
Business Performance ◽  
Large Scale ◽  
Geographical Location ◽  
Family Businesses ◽  
Computer Assisted ◽  
Governance System ◽  
The Family ◽  
Governance Practices

Aim: A large-scale, exploratory survey had been conducted on the whole population of family businesses in Hungary in 2017/18 concentrating on the heterogeneity of the family business population. This paper presents the findings of this survey focusing only on the governance practices of the Hungarian family businesses.Design / Research methods: Two questionnaires were asked from a sample of Hungarian family businesses in the form of a computer-assisted phone interview. This sample is based on probability sampling of a larger database representative to the Hungarian population of business organization in terms of annual revenue, geographical location and industry. Questions were formulated considering models of family involvement, socio-emotional wealth, succession, governance, and professionalization.Conclusions/findings: Hungarian family businesses succeed in involving a growing number of family members into the company which also positively relates to the business performance of the firms. The developmental patterns of their governance practices reflect their increasing level of professionalization.However, they can hardly involve external, non-family professionals into the Top Management Team, which may be crucial especially for the further growth of medium-sized firms. Their family governance concentrates rather on operatively bridging family and company, and not on planning the maintenance of long-term family control.Originality/value of the article: The paper delivers both informations on the heterogeneity of the Hungarian family businesses from a governance-related point of view, and show direct, practical implications regarding the family business governance system. Its results can be of interest both for family business owners, researchers, and consultants.

Direct and indirect effect of entrepreneurial orientation, family involvement and gender on family business performance

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Erny Rachmawati ◽  
Suliyanto ◽  
Agus Suroso
Keyword(s):  
Family Involvement ◽  
Family Business ◽  
Entrepreneurial Orientation ◽  
Business Performance ◽  
Family Businesses ◽  
Future Research ◽  
Content Type ◽  
The Family ◽  
The Relationship

PurposeThis study aims to determine the direct effect of entrepreneurial orientation on family business performance. This study also discusses the role of family involvement as a mediating variable and the role of gender as a moderating variable in the relationship between entrepreneurial orientation and family business performance.Design/methodology/approachA total of 328 hotels in Yogyakarta, Indonesia, were selected as samples by the convenience sampling method. Primary data is collected through structured questionnaires that are delivered by themselves to key people in the hotel such as owners, directors and key staff (HRD, financial, relationship). Hypotheses are tested by structural equation modeling procedures using AMOS 22.0. Sobel test is used to determine the indirect effect of the mediation variable.FindingsThe results showed that entrepreneurial orientation had no significant effect on family business performance. Family involvement acts as a full mediation in the relationship between entrepreneurial orientation and family business performance. Gender acts as a moderating variable that can strengthen the relationship between entrepreneurial orientation and family business performance. The results showed support for previous research.Research limitations/implicationsThe results of the study cannot conclude the national family business because it adopts convenience sampling and the sampling area is limited in Yogyakarta. Future research can use a larger sample. This study only researches hotels managed by family businesses, so it is not feasible to conclude for family businesses in general. Future research may choose to use several types of family businesses so that more varied results can be obtained. Future research could also compare hotels managed by family businesses with non-family businesses. The results also found that in addition to gender roles, respondent heterogeneity was an important component in the study of social identity. Therefore, research examining the influence of different cultures on the relationship between entrepreneurial orientation and family business performance should be an extraordinary topic for future study. Other results from this study also indicate that there is a role for religion in improving hotel performance. Future research is needed to further explore Islamic business modeling for family businesses.Practical implicationsThis finding has significant implications that can help family businesses in developing strategies that are suitable for business management. Entrepreneurial orientation occupies a strategic position in developing sustainable competitive advantage in the family business of the tourism sector especially the hotel business in Yogyakarta for the better. Besides, the results of the study also showed that entrepreneurial orientation had no significant effect on performance. This relationship becomes significant when combined with active family involvement. This finding also shows that entrepreneurial orientation has the potential to have a more beneficial effect because of the active involvement of the family in helping with business management, alleviating business-related problems, and having a significant influence when the family also acts as management.Social implicationsResearch findings indicate the role of gender in strengthening the relationship between entrepreneurial orientation and family business performance. This provides a good position for women in the social environment to show achievement. To place women on the side of gender equality and justice in the family business in Indonesia. By opening wider access for Indonesian women in the realm of business management, expanding women's participation in a family business, increasing the role of control for women, and increasing women's knowledge and skills to increase the benefits in managing family businesses so that they have sustainable resilience in the face of global competition.Originality/valueThe results of this study provide a new model in providing an overview of the direct and indirect roles (mediating and moderating) in the assessment of family business performance. This study uses three variables which are important in performance appraisal, namely entrepreneurial orientation (independent variable), family involvement (mediating variable) and gender (moderating variable). Where research that combines these four variables, directly and indirectly, has never been done before.

Ethnicity Effects on the Family Business Entrepreneurial Process

2009 ◽  
Vol 22 (3) ◽  
pp. 293-296 ◽  
Author(s):  
Ira C. Harris
Keyword(s):  
Family Business ◽  
Business Performance ◽  
Group Identity ◽  
Family Businesses ◽  
Ethnic Background ◽  
Preferential Treatment ◽  
Entrepreneurial Process ◽  
The Family

This commentary adopts a cross-disciplinary framework to discuss possible influences of both family and ethnicity on business performance in the marketplace. Both family and ethnicity are viewed as “upstream factors” that may help a business gain a favorable identity with potential stakeholders. Family businesses that have an ethnic background in common with customers, employees, and suppliers may receive preferential treatment. Communities may patronize a business simply because of an associated group identity. Thus, ethnic collectivism may alter some assumptions about family businesses and how they compete.

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.

scholarly journals Investigating value-laden leadership styles among family business owners

2016 ◽  
Vol 47 (4) ◽  
pp. 35-46 ◽  
Author(s):  
E. Venter ◽  
S. M. Farrington
Keyword(s):  
Leadership Styles ◽  
Leadership Style ◽  
Family Business ◽  
Business Performance ◽  
Business Owners ◽  
Primary Objective ◽  
Family Businesses ◽  
Participative Leadership ◽  
Significant Relationships ◽  
The Family

Given the need for a different approach to leadership, as well as the need for further investigation on leadership among family businesses, this study investigates several value-laden leadership styles among family businesses. More specifically the primary objective is to establish the levels of Servant, Ethical, Authentic, and Participative leadership displayed by family business owners and the influence thereof on the Perceived business performance of the family business. A survey was undertaken and 266 usable questionnaires were returned from 133 family business owners and 133 from family business employees. The data analysis involved calculating descriptive statistics and undertaking t-tests. Multiple regression analysis (MRA) was done to test the hypothesised relationships. Although the MRA analysis revealed no statistically significant relationships between the leadership styles investigated and Perceived business performance, the vast majority of respondents agreed that the styles investigated were displayed by the family business owners. For both sample groups Ethical leadership returned the highest mean score, followed by Servant and Participative leadership. The importance of these value-laden leadership styles to family businesses is thus highlighted, contradicting the literature that family businesses owners are often autocratic in their leadership style. In addition, increased clarity on the effectiveness of these value-laden leadership styles within the context of family business is provided.

scholarly journals Pushing Or Pulling Of The Business By Family Members: A Study Of Family Businesses In Sri Lanka

2015 ◽  
Vol 7 (1) ◽  
pp. 121-128 ◽  
Author(s):  
Ravindra H. Kuruppuge ◽  
Aleš Gregar
Keyword(s):  
Sri Lanka ◽  
Agency Theory ◽  
Family Involvement ◽  
Family Business ◽  
Sampling Technique ◽  
Agency Cost ◽  
Family Businesses ◽  
Research Approach ◽  
Advantages And Disadvantages ◽  
The Family

AbstractA number of family business researches affirm benefits of family involvement to the business while some of other studies assure only detriments of family involvement. When comparative studies of family businesses begin to surface on the family involvement in business, there is that irritating question on what effect is brought about by family involvement to the business. Therefore, the purpose of this study is to explore business advantages and disadvantages generated by family involvement in businesses in Sri Lanka. The present study attempted to address the above knowledge gap, using qualitative research approach and multiple case studies as the strategy of inquiry. Purposive sampling technique was used to select both cases and respondents. Privately held, successfully conducted four family businesses were selected as cases and, existing business owner and one family related manager from each case were taken as respondents. Data was collected mainly via semi-structured, in depth interviews, observations, and secondary documents. Data collection from interviews consisted of 15 interviews with 09 different people from four cases. Before the data analysis, coding and categorization of respondents’ views from interviews helped to identify common patterns and themes from both within the case and across cases. The analysis was carried out in the light of Agency Theory and resulted in a rich understanding of business advantages and disadvantages of family involvement in businesses in Sri Lanka. The findings of this study indicated that the agency cost is created not only on business matters but also on family matters. Further, findings revealed that agency benefit also can be obtained by family business by handling the family matters carefully in line with business matters. Findings of this study clearly indicated that an extension to Agency Theory is required to explain owner agent relationship in family businesses.

scholarly journals The role of conflict in the adoption of governance practices in family businesses

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Asael Islas-Moreno ◽  
Manrrubio Muñoz-Rodríguez ◽  
Vinicio Horacio Santoyo-Cortés ◽  
Enrique Genaro Martínez-González ◽  
Norman Aguilar-Gallegos ◽  
...  
Keyword(s):  
Family Business ◽  
Agricultural Sector ◽  
Family Businesses ◽  
Content Type ◽  
Governance Systems ◽  
The Family ◽  
Governance Practices ◽  
Multiple Case ◽  
The Relationship

PurposeLittle is known regarding triggers in the adoption of governance practices within family businesses. Enterprises can implement governance practices to avoid re-arising conflicts lived in the past. Moreover, the type of conflicts experienced can determine the order in which different types of governance practices are adopted, another issue that requires further investigation. To address these knowledge gaps, this study gathers evidence into how the adoption of governance practices is linked to the conflicts experienced in family businesses and how this adoption evolves.Design/methodology/approachA multiple case study was conducted with 15 family businesses in the agricultural sector. The conflicts experienced throughout the enterprises' trajectories and the governance practices adopted were analysed and classified according to their relationship with the family, business and ownership subsystems.FindingsThe study shows that there is no direct link between the conflicts experienced and the governance practices adopted in family businesses. The most recurrent conflicts have to do with the relationship between family and ownership; however, the adoption of governance practices is centred on the relationship between business and ownership. The practices that mediate the relationship between family and business are adopted second, and the practices that mediate the relationship between family and ownership are adopted last.Originality/valueThe study applies a classification of conflicts and governance practices that adjusts to the complexity of the family business. The research contributes to the field by providing an understanding of the integration of knowledge about the family business, governance systems and conflict.

Succession planning and family business performance in SMEs

2017 ◽  
Vol 36 (3) ◽  
pp. 330-347 ◽  
Author(s):  
Mozhdeh Mokhber ◽  
Tan Gi Gi ◽  
Siti Zaleha Abdul Rasid ◽  
Amin Vakilbashi ◽  
Noraiza Mohd Zamil ◽  
...  
Keyword(s):  
Family Business ◽  
Succession Planning ◽  
Business Performance ◽  
Positive Impact ◽  
Family Businesses ◽  
Related Factors ◽  
Content Type ◽  
The Family ◽  
The Impact ◽  
The Relationship

Purpose The purpose of this paper is to examine the impact of preparation level of heirs and the relationship between family and business members on the performance of family business in small- and medium-sized enterprises (SMEs) in Malaysia. Design/methodology/approach A quantitative research design involving the use of a survey questionnaire was implemented to investigate the influences of succession planning factors on the performance of family business in SMEs. The survey was conducted on 50 family business successors in Malaysian SMEs. Findings The result showed that the two studied factors – preparation level of heirs and the relationship between family and business members – have a positive impact on the performance of family business. Research limitations/implications The research concentrated on the performance of family business in SMEs in Malaysia’s southern region. The generalization therefore must be made very cautiously to the overall Malaysian SMEs. Practical implications The findings help family businesses to better understand the importance of the preparation level of heirs and the relationship between family and business members on business performance. This study shows the importance of key factors influencing succession planning so that the successor to the family business can bring the family firm to the next stage of success. Originality/value This study serves as a reference or guide for the management of family businesses to better understand the important factors for effective succession planning. It considers the best possible preparation and family-related factors affecting the end results of business, particularly in Malaysian SMEs.

scholarly journals Transgenerational innovation capability in family firms

2020 ◽  
Vol 27 (1) ◽  
pp. 1-25
Author(s):  
Felipe Hernandez-Perlines ◽  
Domingo Ribeiro-Soriano ◽  
Maria Rodríguez-García
Keyword(s):  
Measurement Invariance ◽  
Family Business ◽  
Business Performance ◽  
Family Businesses ◽  
Innovation Capability ◽  
Content Type ◽  
The Family ◽  
Generation Family ◽  
Composite Models ◽  
Innovation Capacity

PurposeBased on the theory of dynamic capabilities, the purpose of this study is to examine how generation influences the effect of innovation capability on family business performance. To achieve this purpose, a moderation model is tested using the generational level as the moderating variable.Design/methodology/approachThis study used a sample of 106 family businesses CEOs who were surveyed by mail using the Limesurvey 2.5 platform. The results obtained were analyzed using the second-generation partial least squares (PLS) structural equation model. The MICOM (Measurement Invariance of Composite Models) approach was used to analyze the moderating effect.FindingsThis research sheds lights on the innovation capacity to influence the family businesses performance, and on the generational level moderating this effect. As a result, the influence of the innovation capacity in second generation family businesses performance is higher than in the first generation.Research limitations/implicationsThis study reveals the influence that the generational level has on the effect of innovation capacity on the family business performance. A greater dispersion of ownership, more participatory decision-making, and greater CEOs commitment to leadership in second- and later-generation family businesses, are the main key drivers of this result.Originality/valueIn comparison to previous studies, this research provides insights into the moderating effect of the generational level on the influence of innovation capacity on the family businesses performance through the MICOM approach (Measurement Invariance of Composite Models).

Putting the Family Into Family Business Research

2009 ◽  
Vol 22 (3) ◽  
pp. 216-219 ◽  
Author(s):  
W. Gibb Dyer ◽  
W. Justin Dyer
Keyword(s):  
Family Business ◽  
Business Performance ◽  
Family Businesses ◽  
Business Research ◽  
The Family

Much of the recent research on family businesses has focused on how the family affects business performance. This commentary suggests that researchers should also consider how certain variables affect both the business and the family. Suggestions for how to do such research are presented.

scholarly journals The contribution of familiness to the performance of family businesses

2004 ◽  
Vol 4 (1) ◽  
Author(s):  
W. P. Venter ◽  
S. Kruger
Keyword(s):  
Competitive Advantage ◽  
Conceptual Model ◽  
Family Involvement ◽  
Family Business ◽  
Business Performance ◽  
Family Businesses ◽  
Superior Performance ◽  
Unique Contribution ◽  
Family Capital ◽  
Long Run

While family businesses are known to consistently outperform non-family businesses in financial terms over the long run, family businesses have received comparatively little attention from researchers. In this article an explanation is offered for this superior performance in the form of the concept of "familiness" - the unique contribution that family involvement brings to any business (which is divided into founder capital and family capital). It is explained that family businesses possess no general competitive advantage over non-family businesses. The unique strength of successful family businesses does not lie in their espoused advantages, but in their ability to sustain and adapt, through family capital, the culture created by the founder. An evolutionary conceptual model of the creation and transmission of familiness is provided to explain how this unique strength influences family business performance over the long run.

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