Introduction: Strategies for Longevity in Family Firms

Abstract

What is unique about strategy in family firms, and in European family firms in particular? If it is true that between 60% and 90% of all firms are family-controlled, as statistics in many countries suggest, the question should actually be reversed. We should be asking what is unique about strategy in non-family firms. Yet it is a well-known fact that strategic management developed both as a theory and as a management practice to address the specific needs of large publicly owned corporations, for two main reasons. First, these institutions are owned by a vast number of shareholders who are not directly involved in management. This means that sophisticated strategic theories and tools are needed to delegate and to control decision-making power. Second, these companies are managed by a category of professional executives who require sophisticated management practices to guide and to justify their behaviors to their more-or-less dispersed shareholders. In light of this, it is not surprising that strategy scholars and consultants have, over the years, devoted most of their attention to studying and advising large public companies and guiding their strategic behaviors.