scholarly journals Unsustainable Family Business in Saudi Arabia - The Roadmap Ahead

2021 ◽  
Vol 9 (2) ◽  
pp. 233-243
Author(s):  
Anas AlRebdi ◽  
Khaliq Ahmad Mohamad
Keyword(s):  
Saudi Arabia ◽  
Family Business ◽  
Global Economy ◽  
Success Factors ◽  
Family Businesses ◽  
Next Of Kin ◽  
Future Success ◽  
The Government ◽  
Sound Management ◽  
New Generation

Family businesses play a crucial role in the global economy. The GCC especially the Kingdom of Saudi Arabia occupies a significant place in the global economic pie. It offers many employment opportunities to the Saudi and non-Saudi nationals and contributes a significantly to the GDP. According to the government sources there are an estimated 538,000 family businesses in the Kingdom and together this family business cluster contributes approximately 216 billion dollars to the national GDP and provides employments to approximately 7.2 million workers that constitute about 52 percent of the total workforce. Beside such a great potential there are only a few of them can thrive and survive in the present circumstances in the market. Just a third of family businesses are successful thanks to a new generation of entrepreneurs in command. Future success depends to a large extent on the successive achievements of these newly minted entrepreneurs and sustainability of family businesses of such companies in the past affects the success of future generations of these family businesses. There are many challenges these family businesses are facing once left them unattended may cause them to fail is the focus of this study. Hence there is a need to focus on several attributes of sound management in order to be able to continue and grow to remain sustainable would be contribution of this study. The purpose of this study therefore is to identify the various success factors associated to the question of unsustainability of these family businesses (FB) in Saudi Arabia (KSA). Our understanding indicated that Family Businesses (FB) is short-term oriented. For sustainability these FBs need to create and give more importance to factors such as strategic thinking, to train next of kin to ensure succession planning and sound corporate governance for business longevity. As recommendation the immediate family members and potential business leaders emerging from the younger generations need to be trained for their business continuity and survival.

Entrepreneurial Orientation of Family Business

2019 ◽  
pp. 133-156
Author(s):  
Emel Faiz ◽  
Gamze Uludag
Keyword(s):  
Family Business ◽  
Entrepreneurial Orientation ◽  
Global Economy ◽  
Family Businesses ◽  
Rate Of Change ◽  
Point Of View ◽  
Added Value ◽  
Third Generation ◽  
Economic Development And Growth ◽  
New Generation

Family businesses are considered as an important source of economic development and growth in that they create added value by providing new products, processes and technologies. Family businesses, where family values and perspectives dominate, have begun to experience problems in adapting to such a structure in the global economy, where the rate of change has increased, and the competition is intense. In the process of restructuring, entrepreneurial orientation is vital for these businesses. From this point of view, the aim of this chapter is to define family business, to explain their characteristics and to show the two perspectives on the entrepreneurial orientation of family businesses. The concept of “family entrepreneurship” and “transgenerational entrepreneurship” is also mentioned in the chapter. In relation to what is told in the chapter, how a conservative structure has been opened to the market by its third generation, a family business in Turkey that is going through its third generation and the innovations brought about by the new generation compose the case study.

scholarly journals Analysis of the success factors for MSME succession in Surabaya: A principal component analysis

2018 ◽  
Vol 21 (2) ◽  
Author(s):  
Candraningrat . ◽  
Oktaviani . ◽  
Sri - Suhandiah
Keyword(s):  
Principal Component Analysis ◽  
Factor Analysis ◽  
Family Business ◽  
Success Factors ◽  
Principal Component ◽  
Component Analysis ◽  
Family Businesses ◽  
Next Generation ◽  
Analysis Technique ◽  
The City

This study aims to find success factors for succession in family-based MSMEs in MSMEs in Surabaya, Indonesia, where Surabaya is a metropolitan city that allows entrepreneurs to develop and be sustainable for the next generation of family businesses. The research method used is factor analysis which is an analysis technique that forms the latent variables that have not been determined before the analysis, the results of anilisation will find any factors that influence the success of succession in MSMEs. Sample in this study amounted to 100 MSMEs of family businesses that could be met in Surabaya or incidental sampling, while respondents in this study were second generation family business owners. The method of data collection is a survey with a questionnaire instrument that has been tested for validity and reliability. The data analysis technique used is the Principal Component Analysis Factor Analysis with SPSS software. The results of this study found that six factors that determine the success of succession in MSMEs in the city of Surabaya are succession preparation procedures, successor characteristics, readiness of previous generations, communication in the succession process, relationships between family members, and introduction to the business environment. This research is expected to provide references on the sustainability of family business to the next generation in the city of Surabaya, East Java, Indonesia.

Family Business Tourism Risk in the Context of Coronavirus Pandemic

2021 ◽  
pp. 1-31
Author(s):  
Martina Harc ◽  
Martina Basarac Sertić
Keyword(s):  
European Union ◽  
Family Business ◽  
Global Economy ◽  
Theoretical Background ◽  
Family Businesses ◽  
Tourism Industry ◽  
Leadership Succession ◽  
The European Union ◽  
Business Resilience

The coronavirus is crippling the global economy. However, the economic impacts of the pandemic vary significantly across sectors of the economy. This outbreak and related lockdowns are putting the tourism industry under unprecedented pressure. Within months, world tourism went from over-tourism to non-tourism. Therefore, the overall objective of this chapter is to introduce the latest trends in tourism, with emphasis on family businesses. More precisely, the chapter encompasses (1) the theoretical background, which defines family business, highlights their characteristics, and summarizes the importance of leadership succession; (2) the role of family business resilience and their behaviour in times of crisis; (3) a review of relevant European Commission policy publications regarding EU tourism and statistical analyses of selected key tourism indicators; and (4) an analysis of family businesses environment in time of crisis. Hence, this chapter has documented the crucial role that family businesses tourism has within the European Union and on the front line of the current crises.

The Re-emergence of Family-Based Enterprises in East Central Europe: What Can Be Learned from Family Business Research in the Western World?

1999 ◽  
Vol 12 (2) ◽  
pp. 171-188 ◽  
Author(s):  
Rik Donckels ◽  
Johan Lambrecht
Keyword(s):  
Central Europe ◽  
Family Business ◽  
Family Businesses ◽  
Western World ◽  
The West ◽  
East Central Europe ◽  
East Central ◽  
Future Success ◽  
New Business ◽  
Family Based

We examine to what extent lessons can be drawn from the experiences of family businesses in the Western world toward the re-emerging entrepreneurship in east central Europe. We conclude that often, as it does in the West, the family forms the basis for the creation of new business initiatives in this region. It is evident that research concerning family businesses in the West can lead to particularly relevant insights. The three characteristics that almost always affect every family business constitute the cornerstone for the future success.

scholarly journals The Importance of the Governance Role in Achieving Stability and Sustainability in Family Business Companies Through Generations

2021 ◽  
Vol 7 (3) ◽  
pp. 16
Author(s):  
Samir A. Abdelaziz
Keyword(s):  
Corporate Governance ◽  
Family Business ◽  
Global Economy ◽  
Business Models ◽  
Good Governance ◽  
Business Owners ◽  
Family Businesses ◽  
Governance Risk ◽  
The Relationship

Family businesses have continued to draw researchers' attention due to their strategies while making sustainable decisions. Notably, these business models deserve more recognition in this discourse, considering that they contribute up to 70% of the global Domestic Product. This article focuses on some drivers to sustainable decisions revolving around three pillars: environmental, social, and economic. The author's aim in this context is to provide a statistical model that could be used to forecast revenue trends to establish if family businesses are poised for sustainability or not. The models essentially allow for an analysis of the relationship between family businesses' internal drivers with corresponding financial objectives.However, these business models may fail to achieve their objectives if they do not embrace good governance, allowing them to react to challenges. Corporate governance is an essential framework that companies use to reconcile individual, community, business owners, and shareholders' interests in a dynamic global economy. Companies that align with the principles of good governance are more likely to remain sustainable, stable, and profitable. In retrospect, business enterprises that ignore the provisions of corporate governance risk facing uncertainties, most notably, dissolution and bankruptcy. The second, third, and subsequent generations fail to internalize and advance the founder's long-term organizational goals.This study adds to the existing literature on economic sustainability of family businesses characterized by market value and higher revenue generation.

Family business insights: an overview of the literature

2015 ◽  
Vol 5 (1) ◽  
pp. 116-127 ◽  
Author(s):  
Paul Pounder
Keyword(s):  
Decision Making ◽  
Family Business ◽  
Success Factors ◽  
Family Businesses ◽  
Continuous Change ◽  
Business Leadership ◽  
Content Type ◽  
Key Success Factors ◽  
Quantitative Studies ◽  
The Family

Purpose – The purpose of this paper is to investigate how the family business literature has evolved, and to examine the factors influencing family-owned and managed businesses. The paper discusses important patterns in the present literature and new directions for future study. Design/methodology/approach – The research identifies key research topics and methodical approaches to understand family businesses. Insights into the reasoning behind the historic changes and the current direction and trends of the family business literature are also identified. Findings – The findings of this research argues that the main cause of the challenges in running a family business stem from the management of the interrelationship between family concerns and business concerns. Strong leadership and building a culture that accepts continuous change are key success factors. Research limitations/implications – Due to the specific nature of the family business dynamics and decision-making conflict, which can hardly be captured by quantitative studies alone, a promotion of qualitative studies is advisable. Practical implications – This study suggests that understanding the culture surrounding decision making in family business has great value. Characteristics such as aggressiveness, fearlessness and competition are key areas for investigation. Social implications – Overlooking the potential of non-family members for family business leadership can produce sub-optimal choices of successors. Further, the aspiration to change society’s and government’s view of family businesses warrants attention. Originality/value – This review of previous research offers researchers a broader and comprehensive view of the family business, which is inclusive of the challenges, decision making and solutions within the family business structure. Researchers, educators and practitioners will benefit from this paper.

scholarly journals Family Constitution and Business Performance: Moderating Factors

2017 ◽  
Vol 30 (4) ◽  
pp. 320-338 ◽  
Author(s):  
Rocio Arteaga ◽  
Susana Menéndez-Requejo
Keyword(s):  
Family Business ◽  
Business Performance ◽  
Positive Relationship ◽  
Family Businesses ◽  
Moderating Factors ◽  
Spanish Family ◽  
Improved Performance ◽  
The Government ◽  
The Relationship ◽  
Family Constitution

This study analyzes the relationship between implementing a Family Constitution (Protocol) and future family business performance. We analyze a unique sample of 530 Spanish family businesses. Half of these firms received financial aid from the government to implement a Family Protocol during 2003-2013. The analysis reveals that family businesses that implemented a Family Constitution had significantly improved performance within 2 years after the implementation. The positive relationship between the implementation of a Family Constitution and future firm performance is stronger for firms that had a nonfamily CEO, had multiple family owners, or were controlled by later generations.

scholarly journals Moderating role of gender in influencing enterprise performance in emerging economies: Evidence from Saudi Arabian SMEs sector

2021 ◽  
Vol 19 (3) ◽  
pp. 148-161
Author(s):  
Hend Hassan ◽  
Ahmed Abdelkader ◽  
Rashed Alhaimer ◽  
Marwa Abdelkader
Keyword(s):  
Saudi Arabia ◽  
Global Economy ◽  
Success Factors ◽  
Northern Region ◽  
Economic Factors ◽  
Enterprise Performance ◽  
Research Sector ◽  
Medium Enterprise ◽  
Moderating Role

The small and medium enterprise (SME) sector plays an important role in the development of the local, regional, and global economy. This study seeks to examine the relationships among several factors that are claimed to influence the performance of SMEs. Internal and external environmental factors, as well as the moderating role of gender on the research variables, are empirically examined. A survey of 142 entrepreneurs in the northern region of Tabuk, Saudi Arabia, using convenience sampling was conducted. Path analysis was used to test the research model using the Partial Least Squares (PLS) model by Warp PLS (ver. 7). Results suggest that both internal and external success factors influence enterprise performance. Based on statistically significant relationships, entrepreneurial orientation, human capital, and entrepreneur goals and motives (internal factors), as well as economic factors, socio-cultural factors, and legal and administrative factors (external factors) are influencing SME performance. Additionally, results indicate that SMEs almost perform at similar levels regardless of the gender of the SME owner. Gender is found to moderate the influence of economic factors, and legal and administrative factors on performance. There is no indication that gender moderates the influence of the rest of the factors on the performance. Such finding is surprising given the context of the study, i.e. Saudi Arabia was traditionally considered as a conservative male-dominated society. AcknowledgmentThis study was supported and funded by the research sector of Arab Open University – Kuwait Branch under decision number 21002. Authors would like to thank the National Entrepreneurship Institute “RIYADAH”, Tabuk branch, KSA for their support in data collection.

scholarly journals Family Businesses - Problems of Accounting, Financing and Survival

2017 ◽  
Vol 7 (1) ◽  
pp. 273
Author(s):  
Pawel Dec ◽  
Monika Szczerbak
Keyword(s):  
Everyday Life ◽  
Family Business ◽  
Family Businesses ◽  
Comprehensive Approach ◽  
Overwhelming Majority ◽  
Essential Aspect ◽  
The Family ◽  
Accounting Rules ◽  
The Government ◽  
Starting A Business

Paper concerns the analysis of the activities of family companies, because they represent the overwhelming majority of small and medium-sized companies in the economy. Very important, if not essential aspect of the functioning of such entities are the requirements and restrictions on their existing accounting rules. For many family businesses already just starting a business is a challenge and a breakthrough, not only in the family, but directly in everyday life. This can be compared to magnify family new baby. Hence, the authors set themselves the goal of a comprehensive approach to the issue of the functioning of family businesses and to highlight and analyze their accounting requirements in force, opportunities and sources of financing their activities, and, finally, what is equally important question of their survival. The bankruptcy of the family business is not only a loss for the economy, but it can also cause damage to individual members of the family. Thesis, which would verify the authors is that which says that these companies should be treated as partners by the government, which should not only encourage the establishment of this type of activity, but should also facilitate (or at least not hinder) doing family business.

scholarly journals Succession in the Family Business: The Great Challenge for the Family

2021 ◽  
Vol 11 (1) ◽  
Author(s):  
Juan Corona
Keyword(s):  
Family Business ◽  
Evolutionary Process ◽  
Family Businesses ◽  
The Family ◽  
Succession Process ◽  
Family Harmony ◽  
New Generation

One of the most significant challenges facing family businesses, and therefore the most studied, is how to successfully manage succession from one generation to the next. The purpose of this article is to allow the vast quantity of evidence and experience to be contextualised, and enable a better understanding of the challenges, the role the new  generation plays, the probate process, the preparation of the successor and the importance of family harmony in family business successions. The paper points to the importance to develop new generation leaders as well as the need to carefully consider when to begin with the succession process. It also highlights that preparing the successor is an evolutionary process and that family harmony is critical to succeed in the process.

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