When and how high family involvement helps a family business: The role of long-term orientation and innovativeness

Author(s):  
Dina L. Taylor ◽  
Soroush Aslani ◽  
Dexi Zheng
2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Erny Rachmawati ◽  
Suliyanto ◽  
Agus Suroso

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.


2021 ◽  
Vol 4 (2) ◽  
Author(s):  
Tung-Shan Liao ◽  
Thi Thuy Dung Pham ◽  
Juin-Cherng Lu

The paper's purpose is to examine the role of knowledge and learning as a dynamic capability that leads to competitive advantage in family firms. It further conceptually develops a model showing the relationship between intellectual capital, firm performance, and dynamic capabilities in family firms. Using past case studies related to the subject, this study highlights the importance of knowledge accumulation, integration, codification, and the preservation of socioemotional wealth as dynamic capabilities that allow a family firm to sense and seize business opportunities that transform the business to a competitive advantage. Findings from the case applications reveal that family businesses benefit from the accumulation of knowledge through expertise, skills, and employment of non-family members and having family involvement as strategic important assets that lead to increased value in family firms’ performance.


2021 ◽  
Vol 11 (2) ◽  
Author(s):  
Ana M. Moreno Menéndez ◽  
Marco Castiglioni ◽  
María del Mar Cobeña Ruiz-Lopez

This paper proposes that family firms do not necessarily internationalize less than non-family businesses, but rather, they do it more slowly. Lower speed of internationalization process of family business (measured by the speed of the export development process) is a consequence of the role of the socio-emotional wealth (SEW) in these firms. SEW operates through three different mechanisms: (1) long-term orientation, (2) risk avoidance, and (3) lack of resources to be independent. The empirical research, based on a panel of more than a thousand Spanish manufacturing firms along nine years (2006-2014), supports the hypothesis proposed, independently of firm’s previous size, age, and export commitment level.


2020 ◽  
Vol 33 (3) ◽  
pp. 284-309 ◽  
Author(s):  
Giovanna Campopiano ◽  
Andrea Calabrò ◽  
Rodrigo Basco

Stemming from familiness and the notion of nonimitable strategic resources, we investigate, in the presuccession phase, the role of acquisition and accumulation of family strategic resources, along with the way family involvement in the top management team affects resource mobilization and deployment, in determining the intention to choose either a family or a nonfamily member as the next CEO. Data from a cross-country double-respondent family business data set (Successful Transgenerational Entrepreneurship Practices project) reveal that human capital is a significant family strategic resource reducing the intention to select a family CEO, although leveraging this resource by a top management team dominated by family members enhances this intention.


2018 ◽  
Vol 40 (4) ◽  
pp. 141-160
Author(s):  
Christopher Ocker

Historians are only beginning to appreciate fully the political and social impact of the aftermath of the German Peasants’ War. The case of Barbara (Schweikart) von Fuchstein, widow of Sebastian von Fuchstein, a Kaufbeuren lawyer suspected of Anabaptism and exiled at the end of the war, sheds light on the role of middle-rank nobility in the process of post-war reordering. Her eventual success in a conflict with her violent cousin, Ulrich Schweikert, a knight in the service of the Abbot of Kempten, draws attention to middle-rank competition in the Upper Allgäu, where historians have emphasized the tenacity of peasants and the long-term winnings of princes. Her case also illustrates the flux of religious identities at ground level in the early Reformation, among lay people whose interest in the religious controversy was secondary to, perhaps inseparable from, family business. Les historiens commencent à peine à mieux comprendre l’impact politique et social des suites de la Guerre des Paysans en Allemagne. Le cas de Barbara (Schweikart) von Fuchstein, veuve de Sebastian von Fuchstein, un avocat de Kaufbeuren suspecté d’être anabaptiste et exilé à la fin de la guerre, met en lumière le rôle de la petite noblesse dans la réorganisation d’après-guerre. En effet, le succès remporté par Barbara (Schweikart) von Fuchstein contre son agressif cousin, Ulrich Schweikart, chevalier au service de l’abbé de Kempten, attire notre attention sur la compétition se déroulant au sein de cette noblesse dans la région de l’Oberallgaü, tandis que les historiens ont par ailleurs souligné la ténacité des paysans et les gains à long terme des princes. Ce cas illustre également le caractère changeant des identités religieuses dans les populations des débuts de la Réforme, tels les laïcs ayant moins d’intérêt pour les controverses religieuses que pour leurs affaires familiales, voire subordonnant les premières aux secondes.


2016 ◽  
Vol 29 (4) ◽  
pp. 365-379 ◽  
Author(s):  
Antonio J. Revilla ◽  
Ana Pérez-Luño ◽  
María Jesús Nieto

This study explores the question of whether—and under which circumstances—family involvement helps avoid business failure. We hypothesize that it is family involvement in management, rather than ownership, which reduces the risk of failure during economic downturns; however, this effect is negatively affected by the firm’s entrepreneurial orientation (EO). We argue that EO hinders reaching consensuses on and commitment to family-centered goals, which are focused on long-term survival. We analyze 369 manufacturing firms in Spain from 2007 to 2013, and find that family involvement in management reduces the risk of business failure, but this effect decreases as EO increases.


2017 ◽  
Vol 27 (2) ◽  
pp. 199-216 ◽  
Author(s):  
Silke Tegtmeier ◽  
Christina Classen

Purpose Opportunity recognition (OR) is a key factor in the entrepreneurial process. The purpose of the paper is to elaborate on whether OR, such as related to internationalization strategies, by/in family businesses differs from OR by other companies or individuals, and if yes, to what extent. Design/methodology/approach Taking a conceptual perspective, the authors combine OR and family business knowledge to develop propositions on how family entrepreneurs recognize opportunities. Findings The authors develop three propositions about OR in entrepreneurial families. Specifically, they suggest that storytelling strengthens OR in family businesses and helps to hold on to tacit opportunities. They also address their special human capital resources. These advantages together with their long-term orientation lead to the proposition that family businesses are more likely to recognize opportunities than non-family businesses. Research limitations/implications These findings contribute to an increased understanding of the role of OR in family business research and offer an operational base for future quantitative and qualitative studies. Practical implications The insights in this paper are valuable for practitioners and policymakers as well. Practitioners will get feedback on their own family business management by reflecting on the findings reported and will be able to put the theses into a wider context. Politicians wishing to support family businesses need to understand the specifics of this entrepreneurial process to create good conditions for their development and sustainability. Originality/value This conceptual paper marries the two parallel “streams” of theory and practice of entrepreneurship and family business.


1997 ◽  
Vol 21 (3) ◽  
pp. 55-71 ◽  
Author(s):  
Reginald A. Litz

Why does the vast majority of business school research either ignore, or at best, gloss over the role of family in owning or managing business enterprises? This paper addresses this question and contemplates how the gap might be remedied. It begins by reviewing recent definitional work on the family firm in order to chart the parameters of the family business construct. It then proceeds to describe the nature of, and interaction patterns that have evolved between family firms, privately held corporations, faculties of business, and business school researchers seeking job security offered by tenure. The paper concludes by offering recommendations for addressing the family business research lacuna. The first recommendation focuses on rethinking the grounding assumptions that have undergirded much traditional organizational research. The second suggestion deals with methodological issues and recommends the patient nurture of long-term, mutually beneficial linkages with family firms that might facilitate in-depth longitudinal inquiry.


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