A typology of next generation employment preferences in family businesses

Abstract

Within the family business literature, research unequivocally focuses on the impact of the family entity on the business entity (e.g. Bennedsen, 2015). This thesis is aligned with several earlier studies (e.g. Ram, 2001) which place the family unit at the heart of the analysis. Such approaches have been successful in demonstrating that family relationships can have an impact on work relations (e.g. Fletcher, 1997), though the influence of family relationships in the context of next generation employment preferences has yet to be explored. Whilst the succession literature accounts for offspring who assume a role within the family business, those who seek opportunities beyond its remit have been ignored. Where the next generation have been the subject of empirical work in related fields of study (e.g. ethnic entrepreneurship, see Kourtit and Nijkamp, 2012), it is frequently assumed that their motivations are rational economic ones i.e. better employment prospects than the previous generation. Furthermore, it is also assumed that these can only be found beyond the remit of the family business. This thesis answers a call from Masurel and Nijkamp (2004), who highlight that previous attempts to understand the differences between first and second generation employment preferences have yet to pay specific attention to family relationships and whether these encourage the next generation towards the family business, or deter them from it. The research framework was explored among five Italian families, each of which were involved in the catering sector. Multiple family members from each family were interviewed and combined to produce a narrative of each family. In some cases, the next generation were now responsible for the family catering business, leading it to new heights. In other cases, the next generation had forged successful careers beyond the remit of the family business. Not all of the stories, however, were happy ones. In one family, next generation family members were forced to work at the family business from as young as eight years old and, in doing so, considered themselves to have been robbed of their childhoods. Whilst some of the siblings fled the UK at the earliest opportunity, others were less fortunate and their father dictated their entire lives, including who his daughters married. The strongest theme to emerge was that of family obligations to supply labour. It is owing to these family obligations that the next generation often considered themselves 'already in' the family business. Rather than a decision to become involved in the family business, the next generation are instead confronted with the reality of exiting the family business, which some offspring find challenging. The thesis demonstrates that family relationships are no less important that other (often rational economic) influences. As such, when family relationships breakdown they can provide the key driver for the next generation to seek opportunities beyond the family business. However, the drivers behind next generation decision making are numerous and the thesis provides a typology of next generation employment preferences to complement the typology of retirement styles developed by Sonnenfeld (1998).