Longevity Of Family Businesses Research Articles

Succession planning and family business longevity: a study on currency exchange companies

Succession planning and family business longevity: a study on currency exchange companies

Transgenerational value transmission in business-owning families: an indigenous African perspective

PurposeThis study aims to investigate the favourable conditions that influence transgenerational value transmission (TVT), value acceptance and value similarity between generations in indigenous African business-owning families.Design/methodology/approachThis study adopts a multiple case study design and draws on semi-structured face-to-face interviews to collect data from participants in seven indigenous Black business-owning families located in South Africa. The software ATLAS.ti was utilised to manage the data and reflexive thematic analysis was undertaken.FindingsThe analysis reveal four themes describing how transmission factors facilitate favourable conditions for successful TVT in IBSA business-owning families, namely, authoritarian parenting, a loving and connected family relational climate, the continuous reinforcement of autonomy during childhood development and family authenticity in the face of societies dominant values climate. Furthermore, value similarity is perceived to exist among the different family generations in the business-owning families.Originality/value This study is among the first to adopt the value acquisition model to empirically examine successful TVT and examine the extent of value similarity or dissimilarity, using the business-owning family as the unit of analysis. Novel contributions to family business literature and practices are proposing a model for TVT in an African context and studying relationships from a business-owning family perspective. The model for TVT could be used to socialise the NextGen members into value sets and behaviours that help business-owning families preserve their entrepreneurial legacy and family business longevity.

The longevity of family businesses in the transport industry. Lessons from Zimbabwe

The longevity of family businesses in the transport industry. Lessons from Zimbabwe

Engaging With the Category: Exploring Family Business Longevity From a Historical Perspective

Longevity is at the core of what makes family businesses special. Unlike most attempts to explain longevity that have focused primarily on the factors within a family business that lead to longevity or the factors outside of an organization’s environment, we adopt a business-history perspective that enables us to show how the interplay between the organization and its environment can help to explain family business longevity. Building on the category literature, we trace the interaction of a small Swedish fourth-generation high-quality furniture manufacturer with its category over a period of more than 120 years. We identify the internal mechanisms driving family business longevity, the external mechanisms driving category development as well as the mechanisms underlying their interaction. Specifically, we provide new insights into how agency exercised by the family business contributes to the shaping of the category they are a member of, thereby nurturing their business longevity.

Unveiling the determining factors of family business longevity: Evidence from Kosovo

This paper explores the determining factors that affect family business longevity in Kosovo. The study is based on a sample of 356 family businesses, from different sizes and sectors. Correlations, linear regression, and path analysis were used for empirical analyses. The study highlighted that of all the determining factors considered, three of them influence the family business longevity, such as quality of family members’ relationships, knowledge transfer from the founder to the successor, and family culture, while founders’ education/professional training, succession planning, and successors’ adequate preparation, have no impact on the family businesses longevity. Implications, limitations, and future research directions are discussed as well.

Preserving the longevity of long-lasting family businesses: a multilevel model

Prior research lacks an understanding of how decision makers preserve longevity within family businesses. This study examines longevity under a microfoundational lens, through an interpretive qualitative research design. The selected cases are nine long-established Australian family wineries. The outcome is a multilevel grounded model of the preservation of family firm longevity that integrates the dual firm-family relationship with the individual level of decision makers. The model shows the role played by interactions among multiple levels of analysis — namely, the individual, the family and the firm — in preserving the longevity of the family business.

The role of values in enhancing longevity among indigenous black South African family businesses

Background: Values play a fundamental role in the longevity of family businesses. However, not fully understanding these roles threatens their long-term survival. Given their potentially large numbers and subsequent ability to reduce unemployment and poverty, it is critical that black-owned South African businesses achieve entrepreneurial success. While much research exists on family business values in a Western and European context, research on family business values in an indigenous black South African (IBSA) context is nonexistent.Aim: The aim of this research is to determine the role that family business values play in enhancing the longevity of IBSA family businesses.Setting: The study focused on IBSA family businesses that are independently owned and managed by one or more IBSAs and which are located in various major cities of South Africa.Methods: A qualitative methodological approach following a multiple–case study design was adopted. Semistructured interviews were conducted with several key participants using a combination of face-to-face, telephone and online interviews. The six steps of reflexive thematic analysis were used to analyse the data.Results: Four themes describe the role of family business values in enhancing longevity among the IBSA family businesses. Family business values were found to guide the behaviour of family business members, build the identity of the business-owning families and their businesses and build a sense of community in both the family and the family business. The continuity and success of their family businesses were also attributed to these underlying family business values.Conclusion: Family business founders and/or current leaders should articulate the value set they uphold and use it as a resource to build the identity of both their families and family businesses while moderating the behaviours of family business members.Contribution: The study responds to several research calls to investigate family businesses in African cultural settings and provides practical guidance to scholars, entrepreneurs and practitioners on how family businesses can use values as strategic resources to enhance business longevity and success.

Organizational Learning as an Antecedent of Family Business Longevity: A Conceptual Consideration

Organizational Learning as an Antecedent of Family Business Longevity: A Conceptual Consideration

Beyond Charity: Family Foundations Perpetuating Longevity of Family Businesses

Family foundations are prevalent, but seldom have researchers examined its function and influence as an ownership vehicle for family businesses. This paper advances an institutionalized reference-point theory to explain family foundation’s role on perpetuating family business. The theory posits that these foundations cultivate family members long-term commitment to corporate responsibility which enhances the identification and socio-economic wealth creation of business families. In a longitundinal study of public-listed family businesses (1996-2016) in Taiwan using survival analysis, the presence of family foundation not only itself promotes, but also, as a moderator, heightens the positive effect of family ownership on longevity of family firms. Qualitative evidence from interviewing professional accountants affirmed that family foundations strengthened the identification of members to the family businesses. Further, while their purpose was for charity and not control of the business, establishing the foundation shifted family members’ orientation for the long-term, which resulted in longer survival.

Centenarian family and non-family companies. An exploratory analysis

Few companies are able to reach 100 years of existence, and even fewer do so without losing ownership control to the founders' families. Perhaps due to its scarcity, few quantitative data are available on this type of company. This paper analyzes, based on a sample of 120 Spanish centenary companies, the differences between family and non-family centenary companies, from a quantitative and exploratory perspective. Likewise, a comparison is made with a control sample of another 120 non-centenarian companies in order to draw conclusions. The analysis shows that there are more non-family centenary companies than family companies, although the latter obtain higher returns and have a more robust financial structure (less indebtedness and more liquidity) than the rest of the companies. Despite the limitations derived from the data used, the work contributes to the literature on business demography and on the longevity of family businesses.

Conflict management strategies in family business

Purpose: The aim of this paper is to determine, theoretically and empirically, which strategies are most commonly used to manage conflict situations and to what extent conflict management strategies have an effect on knowledge transfer between owners and successors in family businesses in Bosnia and Herzegovina. This research empirically establishes a link between conflict management strategies and knowledge transfer. Methodology: In addition to theoretical conceptualization, the paper presents quantitative empirical research confirming the validity of the proposed hypothesis. Results: The results of the research show that owners who tend to use the integrating, obliging and compromising conflict management strategies, attach more importance to succession planning and transfer of knowledge and experience to successors. In contrast, dominant leaders are less willing to plan for succession, as they would prefer to retain all the crucial information and decision-making authority and are therefore reluctant to share their knowledge and power. Conclusion: Relevant conflict management strategies can be implemented to help maintain family relationships and ensure business continuity. Learning effective conflict management techniques is important for anyone involved in a family business. Thus, managing conflict is important for the success and longevity of family businesses.

ПРЕЕМСТВЕННОСТЬ КАК ЭКОНОМИЧЕСКОЕ И МОРАЛЬНОЕ ОСНОВАНИЕ ДЕЯТЕЛЬНОСТИ МОСКОВСКИХ КУПЕЧЕСКИХ СЕМЕЙНЫХ ФИРМ (XIX — НАЧАЛО ХХ В.)

In economic history, succession is considered as one of the factors of a long-term commercial activity. In the 19th century, first of all, this is succession in the work of the family firm. Exploring the history of entrepreneurship in this sense would mean studying, first, the succession of economic activity (including intergenerational transfers of assets), and, second, the institutional succession, including the rules and regulations procedures in management of industrial and commercial enterprises, based on moral principles. The intergenerational transition of the family business was not only based on the legislation requirements and depended on the composition of the family, it also took into account ethical norms aimed at stabilizing the merchant family’s entrepreneurial activity. The article focuses on different aspects of succession in the merchant family’s activity, including the influence of the factor of the family business longevity on formation of entrepreneurs’ self-identity, an understanding the importance of the topographic factor in business relations with constant customers. It also analyzes intra-family agreements, which were created to ensure the stability of the family business, the reflection of ideas about the continuity of business in the texts of wills is also considered. Great importance was attached to the institutional consolidation and strengthening of the family firms’ property assets. Drawing upon materials from archival sources, the article examines the histories of large Moscow firms of the Bakhrushins, Khludovs, Tretyakovs, Nosovs, Naydenovs, Samgins, Zimins, which activities in industry and trade numbered from four to six generations over a century.

Standing the test of time: External factors influencing family firm longevity in Germany and Spain during the twentieth century

While most research on family business longevity focuses on how internal corporate governance issue impact resilience, the aim of this article is to foreground the relevance of external environmental factors, and to do so in an internationally comparative perspective. By historically comparing the largest family businesses in Germany and Spain in the twentieth century, we find that they differ significantly in age and ask how external factors help us better understand these variances. After analysing the institutional framework of the two countries during the second part of the 20th century, we explore the strategic responses developed in reaction to that framework by four of the largest family businesses in the two countries. With this, we strive to capture the interdependent nature of internal decision-making processes and external environmental changes, ultimately arguing for a more holistic understanding of family business resilience over time.

Almajid Limited: the tumultuous journey of a multigenerational enterprise in Saudi Arabia. Case study: Parts A, B, C and D

Learning outcomes Reflect on the influence of different lifecycle stages on the strategy of a family business; evaluate the impact of family, industry and company dynamics on the evolution of a family firm; assess the impact of ownership, governance and succession considerations on the sustainability of a family firm; and develop decision-making skills to overcome specific dilemmas and secure the family business longevity. Case overview/synopsis Five industries, three generations and one family business. What started off as an entrepreneur’s ambition, Almajid Limited has proven itself to a sustainable source of revenue and a diverse portfolio of businesses for multiple generations of a Saudi Arabian family. This case study offers an exclusive opportunity to follow the tumultuous journey of a Saudi family business and analyze the different phases of its evolution over seven decades and three generations. In particular, the case aims to highlight the complexities surrounding the management of a family firm and illustrate how various lifecycle stages stemming from a number of areas (e.g. family, company, industry, ownership and governance) simultaneously influence the family business strategy. Being deeply embedded in the context of Saudi Arabia, the case unveils the unique challenges of managing a family business in a conservative cultural setting. The case study is divided into four parts, with each of them putting the emphasis on a different lifecycle area of significance for the evolution of the family business. Each part culminates with the identification of an area-relevant dilemma that needs to be addressed for the family firm to be able to move into the next stage of its development. Part A focuses on the family area or axis, the Part B on the industry axis, Part C on the company axis, while Part D is based on the sustainability axis, which embraces as many as three dilemmas in relation to the ownership, governance and succession in the family firm. Moreover, each part incorporates a timeline of critical events that contributed to the emergence of a specific dilemma and a culturally-rooted anime that helps the readers visualize the story, picture somebody else’s reality, and empathize with the key protagonists of the case to achieve optimal decision-making. Complexity academic level Graduate audience: Master of Business Administration or Master of Global Entrepreneurial Management. Supplementary materials Teaching Notes are available for educators only. Subject code CSS 11: Strategy.

Human Capital: The Key to the Longevity of a Family Business

Globally, family-owned businesses are the oldest and most predominant form of an enterprise, forming an integral part of the organised and unorganised sectors of free economies. Over the years, with the greater longevity of family businesses in India, there has been a dynamic and strategic shift in Indian families from being ‘family businesses’ to ‘business families’. This shift has come with its own set of challenges, most critical among them being the challenges related to ‘human capital’ for these businesses. The need to balance familial relationships with the pragmatism of business is a unique interplay which creates multiple complexities and inter-related issues for all family members alike. With close to 75 per cent of the Indian workforce employed by family-owned businesses, it is important to dive deeper into the human resources (HRs) function in Indian Family businesses. Our endeavour is to understand the challenges of HRs in a family business and how this differs from larger corporations or non-family businesses.

Survival and longevity of family businesses: a case of Eastern business culture

The main objective of this study is to understand how Sri Lankan family businesses’ survive over the long term, across generations. Even though previous studies on Western business culture have adequately conceptualized operations family businesses, a huge knowledge vacuum and/or several inconsistencies are shown in Eastern business culture in case of survival and longevity of family businesses. Studies from both cultures commonly affirm that family businesses outperform over non-family firms in the short run. Similarly, most studies from Western business culture assure that family businesses are suffering from business survival problem in the long run. Contradicting to this research finding emerged in Western business culture, most Sri Lankan family businesses are reported surviving over generation from the inception. As a result, a requirement of an academic analysis of Sri Lanka family businesses has emerged. Twenty two interviews from twelve family businesses (cases) facilitated an understanding of how family members become dedicated partners of the business and contribute to its survival. Respondents were either managers or owners. Purposive sampling techniques facilitated to select respondents from respective cases. Interviews indicated that education and business challenges motivate family members to remain strongly engaged in the business, as do familial bonds and the subsequent tacit knowledge. Further, respondents revealed the interdependence of business success and the personal success of family members. Therefore, family businesses in the context of Sri Lankan business culture have experienced above-average durations of business survival in comparison to Western business culture.

Non-family chair and corporate performance

Using a sample of Chinese family firms listed from 1999 to 2014, we investigate the relationship between non-family leadership and firm performance. We find that firms with a non-family member as board chair perform significantly worse than firms whose chair belongs to the family. Moreover, we show that the underperformance of non-family-chair firms is more pronounced when firms are under weaker outside monitoring and when the controlling families care less about family business longevity. The negative effect of a non-family chair is robust to a variety of endogeneity tests. We also dismiss alternative explanations other than concern for reputation. Overall, our empirical results suggest that the social norms regarding family reputation are important in shaping the controlling shareholders’ expropriation incentives and firm performance.

Inside an African family business estate: the founder’s legacy and the successor’s dilemma

Subject area Family business. Study level/applicability Specialized undergraduate courses, Elective MBA courses. Case overview This case study uncovers the remarkable story of the relentless growth and sporadic weakening of Nurul Ain (NA) Limited, a family business conglomerate with major operations in the Eastern region of Africa. The case provides an opportunity to follow the different stages of development of this family-owned organization through a sequence of strategic events and family dynamics that led to its recurrent success, decline and rejuvenation. Despite the numerous successes of NA Limited since its establishment in the early 1990s, the ambiguous relationship between family, ownership and management systems has caused a ripple effect of strategic, structural and governance challenges that threaten the sustainability of the family business. Nowadays, the founder faces the pressing challenge of ensuring his legacy remains intact and is passed over to his chosen successor, who, in turn, is confronted with the dilemma of joining the family business or pursing an independent career outside NA Limited. Shedding light on the complexity of today’s family-run organizations, the case allows examining the effectiveness of strategic decision-making in an emerging market context by applying a variety of family business principles, theories and frameworks. Expected learning outcomes Discuss the sources of competitive advantage and the typical challenges that family firms face in the context of emerging markets. Perform a comprehensive corporate diagnosis and examine the specificities of strategic management process in family businesses. Assess the succession management practices in family-run organizations and design a profile of successful successor. Discuss the effectiveness of various corporate governance mechanisms in the context of family-owned enterprises. Evaluate the strategic choices of the top management team and offer recommendations for securing the family business longevity. Supplementary materials Teaching Notes are available for educators only. Please contact your library to gain login details or email support@emeraldinsight.com to request teaching notes. Subject code CSS 11: Strategy.

The Power of Psychological Ownership in the Longevity of Family Businesses

The Power of Psychological Ownership in the Longevity of Family Businesses

Family Cohesion as a Longevity Factor of Business with Intergenerational Transmission

This article contributes to a line of research in Business History that aims to determine the factors of family business longevity in the long term with the study of individual cases. The literature has identified family cohesion as one of the essential factors for survival. Cohesion may be reinforced or broken at the time of the intergenerational transfer. This study finds that a critical response on the part of the business family to the difficulties associated with intergenerational transfer of control, including modifications to the original plan, is usually based on trust between generations. Within the business family cohesion facilitates intergenerational transfers and, consequently, allows the family to evolve and transform itself into a business dynasty.