Medium-sized Family Businesses Research Articles

Risk management during the COVID-19 crisis: insights from an exploratory case study of medium-sized family businesses

AbstractCurrent crises pose uncertainties and threats to family businesses (FBs), demonstrating the importance of risk management (RM). Based on an explorative case study of nine Austrian medium-sized FBs, we examine the design of RM in FBs and how the COVID-19 crisis impacts their RM practices. The findings highlight that the medium-sized FBs analyzed generally rely on both formal and informal RM, and that these structures are strongly connected to their unique stewardship culture. In the wake of the COVID-19 crisis, formal RM gained increased relevance, prompting FBs to allocate additional resources for its professional upgrading. Likewise, when confronted with heightened risks during the COVID-19 crisis, informal practices such as family bonds and close ties to employees and customers are not only reinforced but also proven highly effective, resulting in increased loyalty. The COVID-19 crisis serves as a compelling illustration of how both informal and formal RM methods have grown in strength. The synergy between these RM methods enhances risk awareness within FBs, ultimately fostering resilience during unpredictable and uncertain times.

Were Relationships in the Workplace Changed? An Exploration of the Impacts of the Mandatory Work from Home Policy on Small and Medium-Sized Family Businesses in Switzerland

Small- and medium-sized family business competitiveness is built largely upon trusted relationships between owners, management, and employees. This paper questions whether the quality of such relationships were changed by the work from home policy (WFH) utilized during the COVID-19 pandemic.
 This research analyses how mandatory WFH impacted interpersonal relationships between employees and supervisors in small and medium-sized family businesses (SMFB) by applying leader-member exchange theory (LMX). Thirteen in-depth interviews were conducted with owners or the executive management of Swiss SMFB. The study concludes that WFH affects the quality of the relationship between leaders and their employees. WFH is beneficial for the family business and its special relationships as long as all parties can count on well-established, trusted relationships and motivated and open-minded leaders who are capable of keeping the level of interpersonal communication with their employees well balanced. Where employees are struggling with WFH tasks while perceiving a denaturation of the leader-employee relationship a “call back to office” should be considered and indicates that effort is needed to improve the interpersonal relationship. A decent level of mutual trust between the parties helps firms to go through or overcome the down sides and turbulences under WFH and supports maintaining and enhancing leader-follower relationships during challenging times.

Familiness in Building the Brand Image of Family Businesses through Social Media

Abstract Objective The subject of this article is the marketing aspect of familiness related to building the image of a family business brand. The aim of the article is to analyze the impact of familiness in the activities connected with building the brand image of small and medium-sized family businesses. Methodology Qualitative and quantitative methods have been included in the conducted research. Findings The research has shown that Facebook is used by the vast majority of companies. This research has also demonstrated that a large percentage of companies do not emphasize the familiness of their company in their activities on social media. This is surprising because the analysis of the literature shows that emphasizing the family character brings definitely more benefits than risks. Value Added This article presents a research of how family-owned companies use familiness in the brand image. The results of the research can be used to guide companies on how to use familiness in their social media marketing campaigns. Recommendations It is recommended that family businesses make greater use of the potential of their family strengths. It would be advisable to conduct research explaining why the family nature of companies is so rarely emphasized in social media activities. We also suggest conducting similar research in other countries, which would allow for more general conclusions and capture cross-cultural differences.

The relationship between the use of technologies and digitalization strategies for digital transformation in family businesses

PurposeAnalyzing the effect of digitalization strategies and barriers to digital transformation (DT) on the use of technologies, in the Brazilian context, is necessary to broaden the understanding of topics in emerging economies. Thus, empirical research to evaluate and analyze aspects related to DT in small and medium-sized family businesses in an emerging economy is necessary, as it is a necessary strategic alternative in the current context.Design/methodology/approachUsing data from a survey conducted with 210 managers of Brazilian family businesses, the authors analyzed the positive cause and effect relationship between digitalization strategy and technology use. In addition, the authors seek to explore the moderating effect of barriers to digital development on the relationship between digitalization strategy and technology use. This analysis was conducted using the structural equation modeling technique, with the help of SmartPLS 4.0 software.FindingsThe findings confirm the positive relationship between the implementation of digitalization strategies and technology usage in small family businesses, thereby contributing to the broader analysis of how small family businesses employ and define their digitalization strategies. Furthermore, the authors identified barriers that hinder the development and utilization of technology for digitalization purposes.Originality/valueThis study fills gaps in empirical research by explaining the factors that drive barriers to DT in small family businesses. It contributes to advancing the understanding of digitalization strategies used by family SMEs and identifies the real strategic value opportunities that DT represents for businesses.

Leadership transition and survival strategies for family-owned SMEs in an emerging economy

PurposeThis study explores the different survival strategies employed by family-owned small and medium-sized businesses in Nigeria. The study delves into the dynamics of ensuring business continuity from founders to successors and identifies the success factors that can facilitate seamless leadership transition outcomes.Design/methodology/approachThis study utilised a qualitative multiple-case study approach, with the population consisting of founders from three medium-sized family businesses in Nigeria. Semi-structured interviews were the primary data collection tool used in the study. Furthermore, company documents were analysed to gain further insights into the leadership transition strategies employed in the selected businesses.FindingsSuccessful transition and survival of family businesses are dependent on the founder's desire and support for transition, successor preparation, building trust and credibility in successors, and instilling a clear vision for the business.Research limitations/implicationsThe study's findings will provide valuable insights to leaders of family-owned SMEs, specifically in the development of effective leadership transition action plans. It should be noted that the study is limited to three family-owned businesses in two locations in Nigeria, which may restrict the generalisability of the findings. Despite this, the study offers novel contributions to the current literature by presenting practical strategies for achieving the survival of family businesses in an emerging economy.Originality/valueThis study proposed strategies for business survival, continuity, sustainability and seamless leadership transition for small and medium-sized family-owned businesses. Importantly, the study recommends action plans for present and prospective family business leaders to deepen succession pathways.

Responsible leadership practices in the hospitality sector family businesses: evidence from an emerging market

PurposeThe study aims to find out the extent to which hospitality sector family-owned businesses in Egypt feel committed to responsible leadership practices and subsequently meet their stakeholders' expectations.Design/methodology/approachThe authors conducted semi-structured interviews with 24 owners of family restaurants in Egypt. Thematic analysis was undertaken on the collected data resulting in four major themes.FindingsThe authors find that the four dimensions (aggregation of virtuousness, stakeholder involvement, individual competencies and ethical contributions) are not fully exercised by the owners despite their readiness to behave correctly according to social norms. Furthermore, the respondents elaborated that they do not fully understand how to commence playing a role in contributing to the common good in their societies.Originality/valueTo the best of the authors’ knowledge, the present study is the first to empirically investigate responsible leadership practices in the context of small and medium-sized family businesses (restaurants in this case), particularly in the emerging market and non-Western contexts.

“With our feet on the ground and our minds free to fly”: multiple embeddedness and entrepreneurial orientation in small and medium-sized family businesses

“With our feet on the ground and our minds free to fly”: multiple embeddedness and entrepreneurial orientation in small and medium-sized family businesses

Does the form of the enterprise matter? Preferences of EU and African customers when choosing the company type for a purchase

Customer loyalty and satisfaction are crucial for the success, prosperity and survival of a business. However, customers' preferences differ according to their attitudes towards products and services, as well as the culture and conditions in which they live, which can influence their preferences when choosing a business. More than 90% of all businesses are small and medium-sized enterprises, and about 50% of private businesses in Europe and 80% in Africa are family businesses. These businesses are considered the engine of economic development and growth and are instrumental in job creation. However, if these businesses were not favoured by their customers, they would have no chance to survive and fight poverty, which is typical of African countries. Our study, therefore, identifies and compares what type of company customers from developing countries (represented by the Mbulu region, Tanzania) prefer and whether their preferences are similar compared to respondents from more developed countries (represented by Liberec, Czech Republic). By testing several hypotheses, a dependency was found between customers' attitudes when choosing a company and their place of origin. African respondents prefer large non-family businesses to small or medium-sized family businesses, while European respondents prefer small or medium-sized family businesses.

The Impact of Intergenerational Succession Intention on Family Firm’s Innovation Strategy: Evidence from China

In the development and growth of family businesses, succession is an unsolvable problem, which is also a popular focus of academic research. For a family firm, succession may be a strategic decision but also a long-term and intricate “footrace.” It will have a significant impact on the long-term viability of a family firm if it is not handled appropriately. This study mainly explores the influences of family business owners’ intergenerational succession intention on their family firms’ innovation strategy in China. In addition, this study further examines the moderating role of the institutional environment in the above relationship. Therefore, the data in this article comes from a survey of 271 family businesses in eight different regions of China. Also, this paper can aid the smooth transition of intergenerational transmission of small and medium-sized family businesses in addition to the untroubled development of technological innovation activities. Specifically, the institutional environment plays a negative moderating role in the relationship between family succession, radical succession, technological innovation, and a positive regulating role in the relationship between single equity succession and technological innovation.

Stewardship theory of corporate governance and succession planning in family businesses of UAE: views of the owners

PurposeThis paper aims to explore corporate governance (CG) and succession planning in family-owned businesses in the United Arab Emirates (UAE).Design/methodology/approachSemi-structured interviews are conducted with 16 owners and heirs of UAE family businesses. The interviews – face-to-face and asynchronous electronic – are conducted instead of a questionnaire to get an in-depth analysis of the topic in the context of both medium- and large-sized family businesses.FindingsThe responses are mixed with regard to governance challenges (duality, gender, internal control, transparency, etc.). The majority of the interviewees indicate that succession planning remains one of the biggest challenges for family businesses in the UAE. Fifteen of the sixteen interviewees document that a sound succession strategy must be in place to ensure the continuity of the business and prevent future disputes among potential successors. Similarly, the respondents also emphasise the importance of transparency and accountability for the sustainability of family businesses. The sustainability of family businesses relies on many aspects, such as national regulations, corporate systems and the succession process. Finally, most of the respondents from medium-sized companies opined that incorporating CG is a time-consuming and expensive process.Practical implicationsThe interviewees supported stewardship theory in case family members are occupying positions on the board as they have more long-term commitment and a greater sense of belonging to the business (socio-emotional wealth) compared to non-family members. The interviewees acknowledge that the lack of professionalism and conflicts of interest among family members can be offset by recruiting non-family members.Originality/valueFamily businesses are particularly significant in the Arab world as they account for over 60% of gross domestic product (GDP) and use above 80% of the workforce which make them interesting research subject. In addition, this paper explores the CG challenges faced by both large- and medium-sized family businesses in the UAE within the theoretical framework of stewardship theory.

Women in Latin American family businesses: an institutional logics perspective

PurposeThe authors conceptually theorize the obstacles and opportunities that women encounter in family businesses embedded in Latin America, by differentiating between two clusters of countries embedded in this continent.Design/methodology/approachUsing secondary data obtained from various sources, the authors adopted a flexible pattern matching methodology, which involves linking theoretical propositions with actual observed patterns. For each proposition, the authors categorize the comparison with the observed data as either confirming or rivaling the expected patterns in the clusters.FindingsThis study’s findings reveal that women have more leadership and employment opportunities in the first cluster (Brazil, Chile, and Mexico) than in the second (Argentina, Colombia, and Peru). The authors propose that these differences are the result of higher tolerance for women in political leadership positions and of the presence of larger and more internationally expanding corporations in the first cluster. We also find differences between two groups of women: female family members and female nonfamily members, with the former being granted much more opportunities than the latter.Practical implicationsThis research increases the understanding of potential avenues for managers and policymakers in Latin America to foster gender diversity as a means to remain competitive in a global market. While actions at the state level may be more long-term oriented, others, such as those taken by small and medium-sized family businesses may have more immediate effects in minimizing gender biases and encouraging a greater participation of females in business.Originality/valueBy differentiating between two clusters of countries in Latin America, and by making careful consideration of whether females have family ties, the authors provide a more realistic and contextualized theoretical map that depicts the situation of women in Latin American family businesses. This contextualization is one of the first that attempts to examine how multiple institutional logics impact women in family businesses in an underexplored region of the world while differentiating between female family members and female nonfamily members. These findings inform policymakers and family business owners in Latin America on the peculiar challenges that women encounter in their context, while calling for more measures promote the active presence of females in Latin American family businesses.

Tensões dinâmicas no sistema orçamentário de empresa familiar e a dualidade da estrutura

ABSTRACT This article aimed to understand the dynamic tensions in the budgetary system of a family business based on the duality of structure perspective. The research on dynamic tensions in the budgetary system of family businesses is inconclusive. Dynamic tensions are explored in light of traditional theories, and few studies use Simons’ (1995) four levers of control. Moreover, the management control systems (MCSs) of family businesses have particularities that need to be explored. These particularities of family businesses provide different explanations for the dynamic tensions in the budgetary system. Duality of structure enables an understanding of the interaction between the structure and agents’ actions in the production and reproduction of the social order of a family business, within a context of dynamic tensions in the budgetary system. The research revealed the dynamic tensions in the budgetary system of a family business in one budgetary cycle. The findings are relevant since, based on a duality of structure perspective, they present indications that these dynamic tensions are associated with positive forces (belief and interactive control systems) in interaction with negative forces (boundary and diagnostic control systems). This is a single case study in a medium-sized family business engaged in the production and sale of foods. The data were collected through semi-structured interviews, observations, and documents, and analyzed based on discursive textual analysis. The evidence suggests that the social order of the family business is produced and reproduced with the dynamic tensions that occur in the planning and control stages of the budgetary system. The study contributes to the literature on dynamic tensions in the budgetary system of a family business by addressing what they are and how these tensions occur based on the duality of structure perspective. It contributes to practice, as it enables an understanding and better management of these tensions and the achievement of budgetary goals and objectives.

Managing Knowledge Resources in Family Firms: Opportunity or Challenge?

The purpose of this study was to explore the specificities of the relationship between knowledge management (KM) processes and the potential and realized absorptive capacities in the context of a knowledge-based view. The paper advances our understanding of the contributions of knowledge management processes and the potential and realized absorptive capacities in small- and medium-sized family firms. We draw on case studies of two small- and medium-sized family businesses operating in different industries. Our results show that the choice of the KM approach and the family business characteristics determine the extent to which a family firm is successful in managing its knowledge processes and absorptive capacity. Moreover, the results indicate that family businesses are impacted by their own characteristics, such as the fact that they do not dissociate between the personalities of the owners and the business, and are context-specific. Since the focus of this research was limited to KM processes and absorptive capacity, it would be beneficial for future research to investigate the mechanisms that enable firms to manage their potential and realized absorptive capacities and the extent to which they generate dynamic capabilities through KM processes. Further studies of the impacts of family business characteristics on the firm’s success in managing knowledge resources are also recommended.

What are the fundamental knowledge-sharing drivers of small family businesses in the restaurant and fast-food industry?

PurposeDespite the undoubted role of knowledge in the small family business (FB) in the restaurant and fast-food industry, there are some main challenges in the knowledge-sharing (KS) orientation for promoting their business. This study tries to recognise and explore the drivers influencing these enterprises' KS processes.Design/methodology/approachThe authors applied combined exploratory and confirmatory analysis in two studies. In the first study, by the Delphi method, the 22 experts consisting of managers, FB owners and academic professors explore and forecast significant items and drivers. The second study is a confirmatory factor analysis (CFA) for validating the first study's indicators using the survey collected amongst 218 restaurants and fast foods employees.FindingsThe findings indicate 23 indicators in three main drivers of individual, organisational and technological, are critical for KS in small FBs in the investigated industry.Originality/valueThis research supports the understanding of knowledge management and the FB and contributes to recognising the influential factors for KS amongst small and medium-sized family businesses in the food-related industry. Also, by identifying and ranking the most significant factors, this research will help entrepreneurs facilitate FB entrepreneurship. Finally, the results provide practical implications for current and future KM and FB decision-makers.

Preserving Socioemotional Wealth of Small and Medium-Sized Family Businesses: A Propose Framework

Family businesses are found to acquired non-economic goals as compared to their business counterparts. Nevertheless, small and medium-sized family businesses are found to be facing challenges such as limited inter-knowledge sharing, lack of strategic succession planning and technology adoption that might hinder their goals achievement and sustainability. Thus, this research aims to propose a framework as to preserve the socioemotional wealth of small and medium-sized family businesses through family resources and capability such as knowledge sharing, succession planning and technology readiness. This study also proposes to test the moderating role of technology readiness in the relationship of knowledge sharing and succession planning toward socioemotional wealth of small and medium-sized family business.

Invloed van bedrijfsstrategieën op de prestaties van kleine, familiale ondernemingen

The impact of compagny stragegies on the performance of small family compagnies. Dumoulin brick and pipe factory in Langemark and Wijtschate (Belgium), c. 1922-1981. The case of the Dumoulin brick and pipe factory (c. 1922-1981) in Langemark and Wijtschate in the southern Westhoek (Belgium) can be regarded as a typical example of a small, family-owned, West Flemish company that tried to survive in a turbulent business environment. In the twentieth century, the ceramic sector was characterized by large-scale technological changes and a rearrangement of the industrial landscape. This article reconstructs and analyzes the life cycle of the Dumoulin brick and pipe factory. The use of an explicit theoretical framework and the regional focus contribute to the international historiography of small and medium-sized enterprises and family businesses, as well as to the socio-economic history of West Flanders.

From Victims to Institutional Entrepreneurs? A Process Study of Middle Manager’s Reactions to Change

The rise in popularity of post-bureaucratic organizational models challenges the role and relevance of middle management. Consequently, middle managers frequently find themselves in the paradoxical situation of being responsible for implementing structures and procedures that aim to make the institution of middle management redundant. We study middle managers’ behavior in such a situation and ask why they choose particular reactions. Findings of a qualitative 32-month process study in a medium-sized family business show that middle managers react to change aiming to make them redundant with five distinct reactions. Inspired by theory on institutional entrepreneurship, we show that middle managers’ intra-organizational social position determines their reactions over time, making them either victims or institutional entrepreneurs of the change process. Our findings contribute to a better understanding how new models of organization are implemented and legitimized as well as to research on the changing role and function of middle managers.

Is small and medium-sized beautiful? The structure and evolution of family SMEs research

PurposeThe field of scientific research on small and medium-sized family businesses has been growing exponentially and the aim of this paper is to systematize the body of knowledge to develop an agenda for the future.Design/methodology/approachAdopting comparative bibliometric analyses on 155 articles (from 1989 until 2018) the authors provide a systematic assessment of the scientific research about small family firms, unveiling the structure and evolution of the field. Bibliographic coupling, co-citation analysis and co-occurrence analysis are adopted to identify the most influential studies and themes.FindingsFour clusters of research are reviewed: succession in family SMEs, performances of family SMEs, internationalization of family SMEs and organizational culture of family SMEs.Originality/valueThis paper contributes to the field of family SMEs by providing a systematic analysis of the scientific knowledge. Reviewing those clusters allows to providing avenues and reflections for future research and further practice.

Research on the Influencing Factors of Chinese Family Business's Succession from the Perspective of Re-Creation

Under the background of great changes in China's economic environment, a large number of small and medium-sized family businesses are in urgent need of transformation and upgrading that entering the channel of re-creation. For the family business, the successor signifies the future development direction and growth trend of the business. The inter-generational succession of the family business is a multistage evolution process influenced by many factors. In the specific succession practice of family businesses, the influence of the succession of family businesses is analyzed from the perspective of re-creation in combination with the actual situation. Based on the theory analysis on influencing factors of family business’s succession and the way of the questionnaire and factor analysis measure, the research had found and explained the major influencing factors of Chinese family business's succession, namely, relationship, successor, creator, re-creation, organization, environment. It provided a reference on the inter-generational succession of Chinese family businesses from the perspective of re-creation.

Innovationsmotor Medientechnik – Von der Schreibmaschine zur «Mittleren Datentechnik» bei der Siemag Feinmechanische Werke (1950 bis 1969)

Abstract The second half of the 20th century is commonly considered to be a time in which German companies lost their innovative strength, while promising new technologies presented an enormous potential for innovation in the US. The fact that German companies were quite successful in the production of medium data technology and had considerable influence on the development of electronic data processing was neglected by business and media historians alike until now. The article analyses the Siemag Feinmechanische Werke (Eiserfeld) as one of the most important producers of the predecessors to said medium data technologies in the 1950s and 1960s. Two transformation processes regarding the media – from mechanic to semiconductor and from semiconductor to all-electronic technology – are highlighted in particular. It poses the question of how and why a middling family enterprise such as Siemag was able to rise to being the leading provider for medium data processing office computers despite lacking expertise in the field of electrical engineering while also facing difficult location conditions. The article shows that Siemag successfully turned from its roots in heavy industry towards the production of innovative high technology devices. This development stems from the company’s strategic decisions. As long as their products were not mass-produced, a medium-sized family business like Siemag could hold its own on the market through clever decision-making which relied on flexible specialization, targeted license and patent cooperation as well as innovative products, even in the face of adverse conditions. Only in the second half of the 1960s, as profit margins dropped due to increasing sales figures and office machines had finally transformed into office computers, Siemag was forced to enter cooperation with Philips in order to broaden its spectrum and merge the production site in Eiserfeld into a larger business complex.