An Investigation of Family Culture in Family Firms’ Performance in Retailer-Vendor Strategic Partnerships

Leonardo Amado Godoy

doi:10.32920/14648466

Abstract

This research proposes a model to measure the effect of family culture on firm performance in family business retailer-vendor strategic partnerships. Prior research that has contributed to the development of the discourse on family culture, organizational culture, family and relationship value, commitment, and trust will be analyzed. Eight hypotheses are presented, four of which are an extension of prior research. The model ratifies a positive relationship between family culture and performance, especially when considering the successor generation. Since the founders of the firm are the personification of the family culture itself, for this group, family culture does not positively influence performance. The outcome of this research will illustrate not only the effects of family culture in family firms’ performance, but also the impact of relationship and behavioral factors in business.

Highlights

Firms are the most common type of businesses, considering small and medium-sized organizations (e.g., Chirico & Nordqvist, 2010; Gersick, Davis, McCollom, & Lansberg, 1997; Westhead & Howorth, 2007), but are some of the most resilient organizational structures in the world (Carr & Bateman, 2010)
Two thirds of all companies around the world are family enterprises (Englisch, Hall, & Astrachan, 2015), and 50%-80% of global employment is generated by family firms (FFI, 2012)
This paper focuses on retailer-vendor strategic partnerships, which is suggested by Smith et al (2014, p. 257) to include “the most important vendor or supplier with respect to achieving a higher level of competitiveness over the 3-5 years.”

Summary

Introduction

Firms are the most common type of businesses, considering small and medium-sized organizations (e.g., Chirico & Nordqvist, 2010; Gersick, Davis, McCollom, & Lansberg, 1997; Westhead & Howorth, 2007), but are some of the most resilient organizational structures in the world (Carr & Bateman, 2010). Firms simultaneously create economic and social wealth, while facing substantial challenges to endure from one generation to the (Chirico & Nordqvist, 2010). The growth of interest and research in family businesses among scholars (Debicki, Matherne III, Kellermanns, & Chrisman, 2009) is a consequence of the relevance of family business in the global economy. Two thirds of all companies around the world are family enterprises (Englisch, Hall, & Astrachan, 2015), and 50%-80% of global employment is generated by family firms (FFI, 2012). In East Asian countries family firms account for over two-thirds of the economy, and in Western Europe, family firms account for 44% of the economy (Claessens, Djankov, Fan, & Lang, 2002)

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Results

Conclusion