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1 – 10 of 86Olof Brunninge and Anders Melander
In this chapter, we explore the impact of socioemotional and financial wealth on the resource management of family firms. We use MoDo, a Swedish pulp and paper firm, covering…
Abstract
In this chapter, we explore the impact of socioemotional and financial wealth on the resource management of family firms. We use MoDo, a Swedish pulp and paper firm, covering three generations of owner-managers from 1873 to 1991, to grasp the shifting emphases on socioemotional and financial wealth in the management of the company. Identifying four strategic issues of decisive importance for the development of MoDo, we analyze the organizational values that guided the management of these issues. We propose that financial and socioemotional wealth stand for two different rationalities that infuse organizational values. The MoDo case illustrates how these rationalities go hand in hand for extended periods of time, safeguarding both financial success and socioemotional endowments. However, in a situation where the rationalities are no longer in line with the development of the industry context, the conflict arising between the two rationalities may have fatal consequences for the firm in question.
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Xi Zhong, Liuyang Ren and Ge Ren
The phenomenon of defamilization of family firms is gradually increasing for the growth of family firms, that is, nonfamily executives are increasingly present in the executive…
Abstract
Purpose
The phenomenon of defamilization of family firms is gradually increasing for the growth of family firms, that is, nonfamily executives are increasingly present in the executive teams of family firms. Although previous scholars have identified various determinants of family firms' defamilization, whether and when innovation underperformance affects the decision to defamilize family firms has not been explore. This study aims to fill the aforementioned research gaps.
Design/methodology/approach
This study empirically tests the theoretical view based on the data of Chinese A-share family listed companies from 2009 to 2017.
Findings
The authors found that innovation underperformance drives family companies to increase the percentage of nonfamily executives in their executive teams. Further, the authors found that family firms are less willing to hire nonfamily executives with an increase in socioemotional wealth, particularly when founders of such businesses serve as directors or are major shareholders, even when they are not directors.
Originality/value
This study shows that innovation underperformance and socioemotional wealth are important predictors of family firms’ defamilization decisions.
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Tarek El Masri, Matthäus Tekathen, Michel Magnan and Emilio Boulianne
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…
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.
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Lucrezia Songini, Chiara Morelli and Paola Vola
Notwithstanding the relevance of managerial control systems (MCS) in any organization, as well the distinctive role they can play in family business, due to its specific features…
Abstract
Notwithstanding the relevance of managerial control systems (MCS) in any organization, as well the distinctive role they can play in family business, due to its specific features, the literature rarely dealt with the role and characteristics of MCS in family business. Taking into account previous contributions from different disciplines (organization, management accounting, and family business), the current work aims to better understand the state of the art about research in the field of MCS in family business in order to identify main research gaps and propose future research directions.
Forty-five articles have been analyzed, which were issued in 29 sources. Research findings show that the literature on MCS in family business is limited and not very conclusive. Some authors focused on the type of controls, other authors outlined the role of MCS in managerialization and the relation with professionalization. A few studies focused on some specific mechanisms, especially strategic planning and compensation. Some contributes dealt with MCS’ determinants and impacts. Differences between family and non-family firms were proposed. However, a clear and organized picture of the features of MCS in family firms, their determinants, and impacts has not yet been developed. Particularly, the impact of the distinctive features of family business on MCS represents an underdeveloped research field along with how MCS can be differently developed and used in different kinds of family firms. In the light of findings of the literature review, we propose a reference research framework on MCS in family business.
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Esra Memili, Kaustav Misra, Erick P.C. Chang and James J. Chrisman
The purpose of this paper is to use the socio‐emotional wealth perspective to examine how the level of family involvement reduces the propensity to use incentives to non‐family…
Abstract
Purpose
The purpose of this paper is to use the socio‐emotional wealth perspective to examine how the level of family involvement reduces the propensity to use incentives to non‐family managers in small to medium‐sized enterprises (SME) family firms.Design/methodology/approach – Primary data were collected from US firms. To evaluate the hypotheses, a logit model was employed on a final sample of 2,019 small family firms.
Findings
Results suggest that family influence and control and intra‐family transgenerational succession intentions are negatively related to the propensity to use incentives. Also, the interaction effects of family management and ownership reduce the propensity to use incentives.
Originality/value
The paper’s empirical findings imply that despite their potential economic benefits, family involvement reduces the probability that incentives will be offered to non‐family managers because such incentives are perceived to be inconsistent with the preservation of the family’s socioemotional wealth. Also, choices that reflect a preference for socioemotional wealth may not only be a function of decision framing and loss aversion but also by the size of the economic pay‐offs that might be available. The findings suggest that non‐family managers in SME family firms may be affected by a family’s preoccupation with its socioemotional endowments. Thus, the authors expect that this paper provides further avenues to explore the decisions about attaining non‐economic and economic goals and other strategic issues in family firms.
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Extant literature is ambiguous on the corporate social performance (CSP) of family firm. This paper aims to synthesize existing evidence of the relationship between family firm…
Abstract
Purpose
Extant literature is ambiguous on the corporate social performance (CSP) of family firm. This paper aims to synthesize existing evidence of the relationship between family firm and corporate responsibility performance, and to examine the moderating effects of national culture.
Design/methodology/approach
The paper is based on a meta-analysis of the relationship between family firm and CSP, as well as the role of national culture on shaping this relationship.
Findings
The findings show evidence of greater CSP among family firms compared to nonfamily firms. The family firm–CSP relationship was moderated by cultural values such as ingroup collectivism, humane orientation and future orientation, and the moderating effects depended on cultural tightness.
Originality/value
The results help reconcile inconclusive prior findings, and elucidates family firms' corporate social responsibility in different cultures.
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Founders have significant influence over many domains within family businesses, and their impact on companies may be felt even after leadership succession. Founders have therefore…
Abstract
Founders have significant influence over many domains within family businesses, and their impact on companies may be felt even after leadership succession. Founders have therefore received much attention from scholars, policymakers, and entrepreneurship educators. This chapter characterizes the current literature on family business founders by identifying the topics explored and the range of methods and methodologies used in recent years to outline a research agenda for future study of founders of family businesses.
A scoping review was conducted to examine the extent and essence of contemporaneous research activity related to family business founders. Scoping reviews describe current research activity without evaluating individual studies and are effective in summarizing significant concerns and themes, identifying areas of deficiency, and establishing recommendations for future directions in research. This scoping review used elements of a rapid review due to resource restrictions and this chapter discusses efforts to mitigate the limitations introduced as a result.
After summarizing the current academic conversation about family business founders, opportunities for future research topics and methodological approaches to the study of founders of family businesses are introduced.
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Frank C. Butler and John A. Martin
This chapter explores how stress may manifest among non-family member employees, family member employees, and family firm founders in family firms during the startup phases of the…
Abstract
This chapter explores how stress may manifest among non-family member employees, family member employees, and family firm founders in family firms during the startup phases of the organization. Understanding how stress arises in family firm startups has received limited attention to date. Notably absent in the research is the understanding of how stress arises in non-family member employees, which is important to understand as non-family member employees often outnumber family member employees. As stress increases for the non-family member employee due to issues such as role ambiguity and conflict, negative outcomes resultant from this stress may increase the chances of the employee exhibiting withdrawal behaviors. It is suggested these outcomes increase the stress of the family firm entrepreneur and family members by increasing interrole and interpersonal conflicts and negatively impacting decision-making. These effects on the family members may adversely impact the family firm’s chances of performing well, thus decreasing its chances for survival. Recommendations for future research are also made.
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Izabela Szymanska, Anita Blanchard and Kaleigh Kuhns
The purpose of this paper is to focus on efforts of a large department store to increase its business advantage by boosting innovation. The first broad research question of this…
Abstract
Purpose
The purpose of this paper is to focus on efforts of a large department store to increase its business advantage by boosting innovation. The first broad research question of this study investigated how the family and non-family members influence the process of organizational change aimed at greater innovativeness in a successful retail family business. The second research question was how the family enterprise handles the tension between change stemming from innovation and progress and the need for stability continuity tradition and maintenance of family control.
Design/methodology/approach
This study is an in-depth inductive analysis (Glaser and Strauss, 1967) of an important and unique case (Yin, 1994).
Findings
The results of the study indicate that the push toward innovation was initiated by family members and that it was focused largely on creating structural support for the innovation activity keeping this activity tightly under monitoring and control by upper management. The attempts at equipping employees with innovation-relevant decision-making authority or consulting the clients in designing novel projects were absent, while the move to change the organizational culture was measured.
Originality/value
This study makes several contributions to the academic literature. It offers an empirical assessment of the effects of emotional attachment and ownership concentration on innovation management, a phenomenon postulated by Kotlar et al. (2016). These two characteristics pulled innovation-boosting initiative in opposite directions creating a unique dynamics. This research also provides an example of organizational identity that hinders the innovation process in the context of a family business that survived and developed over generations.
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Haya Al-Dajani, Nupur Pavan Bang, Rodrigo Basco, Andrea Calabrò, Jeremy Chi Yeung Cheng, Eric Clinton, Joshua J. Daspit, Alfredo De Massis, Allan Discua Cruz, Lucia Garcia-Lorenzo, William B. Gartner, Olivier Germain, Silvia Gherardi, Jenny Helin, Miguel Imas, Sarah Jack, Maura McAdam, Miruna Radu-Lefebvre, Paola Rovelli, Malin Tillmar, Mariateresa Torchia, Karen Verduijn and Friederike Welter
This conceptual, multi-voiced paper aims to collectively explore and theorize family entrepreneuring, which is a research stream dedicated to investigating the emergence and…
Abstract
Purpose
This conceptual, multi-voiced paper aims to collectively explore and theorize family entrepreneuring, which is a research stream dedicated to investigating the emergence and becoming of entrepreneurial phenomena in business families and family firms.
Design/methodology/approach
Because of the novelty of this research stream, the authors asked 20 scholars in entrepreneurship and family business to reflect on topics, methods and issues that should be addressed to move this field forward.
Findings
Authors highlight key challenges and point to new research directions for understanding family entrepreneuring in relation to issues such as agency, processualism and context.
Originality/value
This study offers a compilation of multiple perspectives and leverage recent developments in the fields of entrepreneurship and family business to advance research on family entrepreneuring.
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