Evaluation of Family Effects in the Context of Power, Experience and Culture on Business and Management in the Family Firms (original) (raw)
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Purpose-The purpose of this study is to analyze the relationship between family influence, measured through power, experience and culture (F-PEC) and family business (FB) performance. Performance is measured from a financial and non-financial perspective. Design/methodology/approach-Empirical study using the quantitative method and data collected through a questionnaire, answered by 169 Portuguese family firms. The survey design was based on prior research of FB performance and the F-PEC questionnaire. The exploratory factor analysis and multiple linear regression models are used. Findings-The results indicate a negative relationship between experience and financial performance, a positive association between a culture of family commitment and performance (financial and noneconomic goals), and a positive relationship between a culture of family values and non-economic goals. The results show the importance of agreement between the firm and the family goals. Family influence on FB performance cannot be seen only from a positive (stewardship theory) or a negative (agency theory) perspective. Originality/value-Commitment increases financial performance and the achievement of non-economic goals (perpetuity and family assets). It is important to study how a culture of commitment leads to superior performance.
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The key factor distinguishing family firms from others is the family’s involvement in the governance of their firm through participation in ownership, management, and board (if any) along with their intentions for maintaining family control over the firm across generations. Firma Roleski in the profile of this chapter is an example. The level of family involvement in governance depends on a firm’s being private or publicly traded, firm age, firm size, industry in which it operates, and family size as well as other family dynamics. In the profile firm Firma Roleski, aside from 100% family ownership and involvement in management, a family constitution is in place not only to ensure the continuity of the family business success but also to facilitate the succession to future generations.
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Purpose: This paper assesses how management and succession is handled in family businesses. In addition, the research seeks to find out how to manage the business succession in the family business during the transitional period of the case company. Furthermore, the objective of my research is to provide guidelines for implementing family business succession strategy. Approach: Study was a meta-analytical literature review based on the analytical and descriptive research designs used. Findings: This paper found that rewards of a family-owned business are many as are the challenges. The findings of this research indicate that family businesses are unique and they have several common characteristics that differentiate them from other businesses. This uniqueness also causes the special challenges and opportunities, which family businesses face in their operations. The most significant characteristic that separates family businesses from non-family businesses is the family's impact on the business and ownership. The unique family business characteristics, challenges and opportunities stated in the theoretical framework can be applied to the family businesses used in this research. It can be stated that both of the case companies fit the concept of a typical family business, which is unique compared to other businesses. Limitations: the design and process of sieving articles for critical review is time consuming and involves voluminous data analysis. Conclusion: Family businesses try to intersect the distinctions between family issues and business matters. This needs to be handled with utmost care as it spells the difference between success and failure. The outcomes of this research pointed out that there are mainly two obstacles concerning the family business i.e. The company does not have a proper successor, the family governance issues have an impact on the family business succession. In other words, the family governance issues which are aspects of the poor management mode and feudal family culture. Originality: There is a paucity of recent research in this area and this paper makes a contribution towards filling this gap.
Journal of Family Business Strategy, 2011
Despite considerable progress made using systems and configurative approaches in family business research, current knowledge remains limited on how different combinations of organizational attributes determine relevant outcomes and, therefore, how family affects businesses. To address this question, we focus on the overlap between family and business at management and governance levels. We posit that family- and business-oriented decisions emerge in four areas: board of directors, succession, human resources, and strategic process. This argument allows us to conceive three ideal types of family firms that yield maximum family firm performance, by considering the way that family firms adjust their orientations in their decisions. Building on a sample of 732 privately owned Spanish family firms, we propose the following main hypothesis: the greater the similarity of a family firm to an ideal profile, the better its performance. Our main results show that family firms can achieve successful business results by using a combination of family and business orientations in their decision making.► Research questions: How are family businesses managed and governed from the standpoint of the family-business relationship? And, how do different combinations of management and governance affect family firm performance? ► Our typological model of family business is inspired by essence perspective which asserts that the family's influence on the firm creates certain specific ways of acting. ► We used an empirical method to analyze the proposed typological model. ► We found that business performance can be achieved by different ways, i.e. different horizontal fits.
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The research tested the hypothesized relationships among family influence, behavioral integration, professionalization and succession planning of the top management team, market dynamism and firm performance. Thus, this study also examines variation in family and non-family executives’ perception of research variables. The automotive parts manufacturing industry (i.e., automotive supplier industry) in Turkey is the target research field in this study since the majority of the firms are family-owned and -operated. The results of the study indicated a positive relationship among culture (values & loyalty, involvement & commitment) based family influence, top management team behavioral integration and firm performance. A positive impact of collaborative behavior based top management team behavioral integration on top management team succession planning by means of strategic goals and core competencies were found. Another finding was the positive impact of corporate values – based top m...
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