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Calibrating management control technologies and the dual identity of family firms

Tarek El Masri (Department of Accountancy, Concordia University, Montreal, Canada)
Matthäus Tekathen (Department of Accountancy, Concordia University, Montreal, Canada)
Michel Magnan (Department of Accountancy, Concordia University, Montreal, Canada)
Emilio Boulianne (Department of Accountancy, Concordia University, Montreal, Canada)

Qualitative Research in Accounting & Management

ISSN: 1176-6093

Article publication date: 19 June 2017

Abstract

Purpose

Family firms possess dual identities, being the family and the business, which can be segmented and integrated to various degrees. This study examines whether and how management control technologies are calibrated to fit into the dual identities of family firms.

Design/methodology/approach

A qualitative study of 20 family firms was conducted using semi-structured, in-depth interviews with owner-managers, drawings of mental maps and publicly available information. The notion of calibration was developed and used, with its three components of graduation, purpose and reference, as an organizing device for the interpretive understanding of the management control usage and its relation to family firms’ dual identities.

Findings

The study finds that the use of calculative, family-centric and procedural management controls – in sum the pervasive use of management control technologies – are associated with a professionalization of the family firm, a foregrounding of the business identity and a reduction of the disadvantageous side of familiness. In comparison, the pragmatic and minimal use of management control technologies are found to be associated with an emphasis on family identity. It transpires as liberating, engendering trust and unfolding a familial environment.

Research limitations/implications

Because results are derived from a qualitative approach, they are not generalizable at an empirical level. By showing how the use of management control technologies is calibrated with reference to family firms’ dual identities, the paper reveals the perceived potency of control technologies to affect the identity of firms.

Practical implications

The study reveals how family firms perceive management control technologies as strengthening their business identity while weakening their family identity. Thereby, this study provides an account of how management control technologies are expected to change the identity of firms.

Originality/value

This paper contributes to the management control and family business literatures because it uncovers how management control technologies are calibrated in reference to family firms’ dual identities. It shows that calculative, family-centric and procedural management controls are used to professionalize the firm and strengthen its business identity as well as to reduce the negative effects of the family identity. The paper also illustrates how the liberating force of using pragmatic and minimal control technologies can serve to give prominence to the family identity.

Keywords

Acknowledgements

The authors would like to especially thank the guest editors Hanno Roberts and Luca Gnan as well as the two anonymous reviewers who greatly helped in developing the paper. The authors further appreciate the comments received from Claude Laurin and research workshop participants at Concordia University on earlier versions of this paper. Tarek El Masri and Michel Magnan acknowledge financial support from the Stephen A. Jarislowsky Chair in Corporate Governance (Concordia University) and the Institute for the Governance of Private and Public Organizations as well as from the CPA Research Center in Accountability at the John Molson School of Business (Concordia University).

Citation

El Masri, T., Tekathen, M., Magnan, M. and Boulianne, E. (2017), "Calibrating management control technologies and the dual identity of family firms", Qualitative Research in Accounting & Management, Vol. 14 No. 2, pp. 157-188. https://doi.org/10.1108/QRAM-05-2016-0038

Publisher

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Emerald Publishing Limited

Copyright © 2017, Emerald Publishing Limited