Strategies of family businesses in a newly globalized developing economy

Abstract

PurposeThe purpose of this study is to examine the opportunities and threats faced by family businesses (FBs) from globalization in a developing country environment and how those businesses responded strategically to these factors.Design/methodology/approachThe research employs a questionnaire survey involving 108 firms listed in a database comprising 235 family businesses (FBs) obtained from the Qatar Chamber of Commerce and Industry, Doha, Qatar. The principal analytical technique employed is structural equation modeling.FindingsThe results indicate that the availability of opportunities arising from globalization seems to be more important to FBs than the threats that they may face as a result of globalization. Also, the availability of collaborative networks represents an opportunity for the FBs to expand their business overseas that in turn influence them to look for sources of funds to expand their business. Finally, the availability of the sources of funds not only influences the firms’ readiness to face the forces of globalization but it also influences them to formulate new strategies to face such forces.Research limitations/implicationsThe main limitation of this research is the rather small number of respondents. Nevertheless, the eventual sample of 108 FBs while small can still be regarded as representative. This limits the ability to make broad generalizations from the finding. However, since this is the first time the research on this subject is conducted based on the given framework, the authors believe the findings from this study are still interesting and useful.Practical implicationsThe findings suggest that Qatari FBs need to work on establishing networking with foreign partners in order for them to be ready to face globalization. Also, Qatari government needs to find ways to ensure that funding is available for FBs to expand their business either through direct loans or grants or by making sure that financial institutions set aside a portion of their funds for family business lending.Social implicationsThe results indicate that Qatari FBs were responding well to the changes resulting from globalization. Thus, this implies that FBs in Qatar are here to stay and will continue to contribute positively to the Qatari economy and society.Originality/valueSince this is the first time the research on this subject was conducted in Qatar, the authors believe the findings are interesting and useful particularly for family businesses as well as the Qatari government in their efforts to further develop FBs.