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Article
Publication date: 29 April 2021

Mohammad Rezaur Razzak, Suaad Jassem, Alima Akter and Syed Abdulla Al Mamun

The purpose of this research is to examine the interplay between family commitment as a family-centric resource and professionalization of the organization as a firm-centric…

Abstract

Purpose

The purpose of this research is to examine the interplay between family commitment as a family-centric resource and professionalization of the organization as a firm-centric resource to determine how the two phenomenon come together to enhance business performance in the context of privately held family firms.

Design/methodology/approach

Deploying the theoretical lens offered by the resource-based view, a conceptual link is developed between family commitment to the firm and firm performance with the potential moderating influence of firm professionalization. The hypotheses are tested using data collected from 357 privately held medium-to-large family-owned manufacturing companies in Bangladesh. The data are analyzed through structural equation modeling using SmartPLS (v.3.2).

Findings

The data analysis suggests that in absence of the moderator; professionalization, family commitment has a positive and significant association with firm performance. While in the presence of the moderator the above relationship is substantially stronger. The findings indicate that when family-specific resources and firm-specific resources are synchronized, it enhances performance of the family firm and puts it on a strong economic footing toward a more sustainable future.

Research limitations/implications

Cross-sectional nature of the study exposes it to the specter of common method bias despite the fact that procedural remedies were initiated to minimize the impact of such occurrence. Furthermore, data were collected from a single individual in each organization. Therefore, a longitudinal study with data obtained from multiple individuals at different levels of the organization would possibly yield more robust findings.

Practical implications

Leaders of family firms may find pertinent clues from the outcome of this study. Particularly, the confluence of family commitment to the firm as a family-specific resource and professionalization as a firm-specific resource can be valuable, rare, difficult to imitate and substitute source of competitive advantage for the family business organization.

Social implications

Survival of family businesses is vital to the global economy as one of the primary drivers of global gross domestic product growth and source of new employment. Policymakers can benefit from the findings of this study to customize policies to nurture growth of family enterprises and incentivize family firms to adopt professionalization through better governance and transparent managerial procedures.

Originality/value

A nuanced understanding of how family commitment and firm professionalization combine to significantly improve performance of family firms has not been dominant in the literature. Therefore, findings of this study carry special theoretical implications, because it suggests that both family-specific features and firm-specific features are necessary for enhanced levels of firm-centric business outcomes such as economic performance.

Details

Journal of Small Business and Enterprise Development, vol. 28 no. 5
Type: Research Article
ISSN: 1462-6004

Keywords

Open Access
Book part
Publication date: 14 December 2023

Abstract

Details

Family Firms and Family Constitution
Type: Book
ISBN: 978-1-83797-200-5

Article
Publication date: 11 May 2022

Mohammad Rezaur Razzak

Drawing on the stakeholder theory, the purpose of this study is to examine relationships between family identity, emotional attachment and binding social ties, and commitment of…

Abstract

Purpose

Drawing on the stakeholder theory, the purpose of this study is to examine relationships between family identity, emotional attachment and binding social ties, and commitment of family firm owners to the family enterprise in the context of an emerging economy. Furthermore, this study examines whether the strength of the above relationships significantly vary between the founder generation and the subsequent generation of owners.

Design/methodology/approach

A set of hypotheses is tested by applying partial least squares structural equation modeling on a sample of 357 family-owned manufacturing companies in Bangladesh. Deploying SmartPLS (v. 3.2), the path model is analyzed through bootstrapping procedure. The moderating effect is tested through multigroup analysis.

Findings

The findings suggest that the relationships between emotional attachment and family identity and commitment are positive and significant, whereas the association between binding social ties and commitment was not significant. Furthermore, a multigroup analysis revealed that there is a significant difference between the founder generation and their next generation in terms of influence of binding social ties and family identity on commitment, whereas there appears to be no difference in terms of emotional attachment and commitment between the two generations.

Practical implications

This study shows that compared to the founder generation, the next generation prioritizes family identity and social bonds, which leads to greater levels of collective commitment to the organization. Such knowledge may provide clues to incumbent family-firm leaders by identifying the areas where they need to emphasize in generating greater levels of commitment among their successors.

Originality/value

To the best of the author’s knowledge, this appears to be the first such study that provides a nuanced understanding of how family generation in control of the family firm influences the relationships between psychosocial components of socioemotional wealth and collective commitment of the owners of family firms in the context of an emerging economy.

Details

Journal of Entrepreneurship in Emerging Economies, vol. 15 no. 6
Type: Research Article
ISSN: 2053-4604

Keywords

Article
Publication date: 8 September 2022

Nuno Fernandes Crespo, Cátia Fernandes Crespo and Maria Calado

The purpose of this study is threefold: 1) to examine the relevance of specific strategic orientations for family businesses in the context of an intense crisis such as the…

Abstract

Purpose

The purpose of this study is threefold: 1) to examine the relevance of specific strategic orientations for family businesses in the context of an intense crisis such as the COVID-19 pandemic; 2) to investigate the role of a family adaptability in surviving the crisis; and 3) to assess how proactive strategic responses connected with marketing or retrenchment responses connected with reducing costs relate to the expected survival of the crisis.

Design/methodology/approach

The method adopted is a quantitative research approach. The theoretical framework uses a partial least squares structural equation modeling (PLS-SEM) for the data collected from an online survey of a sample of 544 family businesses in the accommodation industry.

Findings

This paper makes three main findings. First, family businesses that invest in operational marketing actions as a strategic response to the crisis have a high expectation of surviving the crisis. Second, family businesses that reduce their operational and labor costs as a strategic response have a low expectation of surviving the crisis. Third, the family business’s adaptability is also fundamental to their expectation of survival.

Originality/value

This is the first paper to identify the possible reactions of family businesses to the COVID-19 crisis. the authors show that there are proactive or retrenchment strategic responses, and the authors relate those responses to the expectancy of surviving the crisis. This is also the first study to examine the relevance of family adaptability as a measure of the resilience of family businesses and, therefore, as a determinant of the expectation of surviving the crisis.

Details

Journal of Family Business Management, vol. 13 no. 1
Type: Research Article
ISSN: 2043-6238

Keywords

Article
Publication date: 22 April 2011

Ramona K. Zachary

Most researchers overlook the family system in the pursuit of family business studies and research. They mistakenly have assumed that the study of only the family business is…

10130

Abstract

Purpose

Most researchers overlook the family system in the pursuit of family business studies and research. They mistakenly have assumed that the study of only the family business is sufficient to understand the influence and effect of the family itself. The importance the family system is documented as well as the evolution of family business as a field of study and various family business definitions. Conceptualizations of the family business are critiqued and the Sustainable Family Business Theory (SFBT) is presented relative to its board and detailed emphasis on the family system. This paper aims to address these issues.

Design/methodology/approach

This article is a review of previous family business research including specific conceptual models developed in the literature, particularly relevant to the inclusion of the family system.

Findings

Few researchers examine the family system in detail but those that do are reviewed and discussed.

Research limitations/implications

Research, teaching and practice must be conducted with the recognition of the family system relative to the family business.

Social implications

Recognizing the family system for its unique social contributions will have impact on future research, teaching, and practice.

Originality/value

This review of previous research offers researchers a broader and comprehensive view of the family business, which is inclusive of the family system, as well as the business system and their respective interactions. Researchers, educators, and practitioners will benefit from this paper.

Details

Journal of Family Business Management, vol. 1 no. 1
Type: Research Article
ISSN: 2043-6238

Keywords

Article
Publication date: 14 December 2015

Susanne Beck and Peter Kenning

The long-term survival of companies depends strongly on successful new product introductions. However, insufficient customer new product acceptance (NPA) often leads to high…

1778

Abstract

Purpose

The long-term survival of companies depends strongly on successful new product introductions. However, insufficient customer new product acceptance (NPA) often leads to high failure rates for manufacturers. Retailers, as intermediaries between the company and the customer, often obtain a crucial role as primary touchpoint. Previous research shows that customers’ perception of a company is transferable to its products and thus influences NPA. Family firms, as successful company type, are supposed to positively influence NPA. The purpose of this paper is to analyse whether manufacturers achieve a strategic advantage regarding NPA when choosing retailer that are perceived as family firms.

Design/methodology/approach

Conducting an online survey, the authors tested whether the family firm image (FFI) of a retailer’s brand influences customers’ belief in the trustworthiness of a new product brand and their purchase intention, which reflect two components of NPA.

Findings

The results indicate that a strongly perceived FFI has a direct positive effect and, through perceived trustworthiness, an indirect effect on NPA. Those effects are moderated by the customers’ perceived uncertainty about the product. The authors show that aside from increasing trustworthiness, a retailer’s FFI creates a substantial strategic advantage that increases NPA and hence decreases manufacturers’ failure rates.

Originality/value

This paper is the first to investigate retailer brand influence on NPA. By providing a new definition and measurement of customers’ family firm perception, this study represents the first quantitative intent to assess the consequences of such perception.

Details

International Journal of Retail & Distribution Management, vol. 43 no. 12
Type: Research Article
ISSN: 0959-0552

Keywords

Book part
Publication date: 8 July 2010

Vipin Gupta and Nancy Levenburg

Family businesses must be examined within the cultural contexts in which they are bred, nourished, and grown. According to Chrisman, Chua, and Steier (2003), family businesses are…

Abstract

Family businesses must be examined within the cultural contexts in which they are bred, nourished, and grown. According to Chrisman, Chua, and Steier (2003), family businesses are launched for reasons other than the desire for dollars and cents (or rupees and yen). In fact, the authors note, “Family businesses… bring together so starkly the economic and non-economic realities of organizational life…” (2003, p. 442). Calls for family business research that extend beyond traditional geographical boundaries to include global comparisons have been issued by Hoy (2003) and others. Fortunately, recent developments in cultural assessment and measurement methodology have provided tools to enable a better understanding of families and family businesses vis-à-vis the use of regional clusters and comparative lenses (Gupta & Hanges, 2004). Gupta and Hanges (2004) note three clusters of the Catholic ethic: Southern (or Latin) Europe, Latin America, and Eastern Europe. As shown in Table 1, more than three-fourths of the population in these clusters follows the Catholic faith. In this study, we examine the spirit of family business in these three clusters.

Details

Entrepreneurship and Family Business
Type: Book
ISBN: 978-0-85724-097-2

Article
Publication date: 14 August 2018

Alexander Chepurenko

The purpose of this paper is to deal with informal entrepreneurial activity of micro and small family businesses in the specific transitional environment.

Abstract

Purpose

The purpose of this paper is to deal with informal entrepreneurial activity of micro and small family businesses in the specific transitional environment.

Design/methodology/approach

The paper uses two cases – an informal micro business (“marginal” family business), and a formal retail small firm (“simpleton” family firm), respectively, of a panel conducted in 2013–2015 in Moscow.

Findings

First, the real distribution of responsibilities between family members is informal; it relies more on interpersonal trust and “common law.” Second, exactly the ease of governing such trust-based businesses for the founders’ generation sets limits of succession of small-scale family businesses. Third, as trust in the state is very low, the policy of Russian authorities to quickly force informal entrepreneurs to become legalized is substantially wrong; the results would be either a transformation of “simpleton” into “marginal” businesses or quitting business.

Research limitations/implications

Research limitations of the study are the number of observations and the localization of the panel only in the capital of Russia.

Practical implications

The fundamental failure of Russian State policy toward small-scale family businesses is its attempt to convince “marginal” to formalize and to oppress “simpleton” family businesses pushing them into informality. In fact, it should be designed vice versa: tolerate “marginal” businesses and let them to “live and die” while shaping a friendly environment for “simpleton” family firms.

Originality/value

The paper argues that the most important facet of informality in small family entrepreneurship is the informal property rights and governance duties’ distribution among the family members.

Details

International Journal of Sociology and Social Policy, vol. 38 no. 9/10
Type: Research Article
ISSN: 0144-333X

Keywords

Article
Publication date: 16 August 2013

Carmen Gallucci and Antonio D'Amato

This work seeks to investigate the performance of wine businesses operating in the Campania region in the South of Italy and aims to verify the family power effect on company…

Abstract

Purpose

This work seeks to investigate the performance of wine businesses operating in the Campania region in the South of Italy and aims to verify the family power effect on company performance.

Design/methodology/approach

The study was conducted on a sample of 114 firms that operate in the quality wines industry. Using a panel data regression model with time fixed effects, the authors analyzed the firm performance during the interval 2007‐2010 to detect the effect of family power on the firm performance. Family power was measured through the degree of family involvement in ownership and on the board. Performance was measured in terms of revenue and profitability.

Findings

The research highlights a U‐shaped relationship between family power and revenue and an inverted U‐shaped relationship between family power and profitability.

Originality/value

The findings show an empirical framework which could stimulate the academic debate on family effect in order to draw implications for marketing management and policy makers in the wine business and to provide suggestions for further research.

Details

International Journal of Wine Business Research, vol. 25 no. 3
Type: Research Article
ISSN: 1751-1062

Keywords

Article
Publication date: 28 September 2012

Josep Tàpies and María Fernández Moya

The purpose of this article is to offer an empirical study on the particular topic of the role of values on longevity of family firms in order to open the future research agenda.

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Abstract

Purpose

The purpose of this article is to offer an empirical study on the particular topic of the role of values on longevity of family firms in order to open the future research agenda.

Design/methodology/approach

To analyse the first issue, the article contrasts samples from Spain, Italy, France and Finland. The second and third issues are focused on the Spanish sample, but, to enrich the debate, Italian and French samples have also been included.

Findings

The present paper seeks to shed light on this stream of research by developing an analysis that focuses on three key elements: the ranking of values that have the most influence on family business longevity, the process of value transmission, and the condition of longevity as an asset.

Originality/value

The link between longevity and values has been pointed out by several authors, who underlined values as an important factor to support a long‐term vision, as well as a source of competitive advantage based on using values as specific company resources. Nevertheless, not many empirical works have dealt with this topic.

Details

Journal of Family Business Management, vol. 2 no. 2
Type: Research Article
ISSN: 2043-6238

Keywords

21 – 30 of 154