Next-generation Family Members Research Articles

The apple doesn't fall far from the tree: Parenting styles and its effects on family business succession intentions

This research integrates the parenting style literature and the Theory of Planned Behaviour to investigate the influence of authoritarian and authoritative parenting styles on the succession intentions of next-generation family members. Through a survey of 179 next-generation family members in Chinese family businesses, our research shows that authoritative parenting positively influences succession intentions sequentially through subjective norms of family business succession and perceived behavioural control or attitude toward family business succession. In contrast, sequential mediation relationships are not supported for authoritarian parenting. Follow-up twenty-one interviews not only confirm our survey results but also provide further explanations for the unsupported relationships between authoritarian parenting and succession intentions.

Parental influence on next-generation family members in South African Black-owned family businesses

PurposeThere are many factors that contribute to a person's career choice. The decision of whether or not to join the family business is certainly most influenced by parents. The aim of this research is to determine how much of an impact parents have on their next-generation family members' (NGFMs) decision to join the family business.Design/methodology/approachFollowing a positivistic paradigm, a cross-sectional design was followed using a quantitative, self-administered questionnaire through a judgemental sampling technique. A structured questionnaire was distributed to South African respondents who have parents who own a family business. The data were analysed using Statistica.FindingsThe results indicate that parental style, culture, self-efficacy and parental identification were found to influence the NGFMs' intention to join the family business significantly. Their decisions can be influenced by several factors, and parents can better manage these aspects by being aware of these influencing factors.Practical implicationsGiven the imminent ageing of a large cohort of senior leaders, this research adds to the body of knowledge by highlighting the necessity for committed, willing and ready next-generation family members (NGFMs) to ensure efficient succession in family businesses. Therefore, effective management is required for succession-planning, particularly from the perspective of the successor.Originality/valueThis study, therefore, responds to calls for more in-depth quantitative studies on family businesses in general and on Black-owned family businesses in South Africa in particular. This study will evaluate the significance of parent influence on NGFMs to join Black family-owned businesses in South Africa. This research will assist family business owners and their families in understanding their children's intentions, designing and evolving an appropriate system to instill necessary traits, skills and attitudes in the children, preparing them for upcoming challenges, adding new perspectives to the family business and ensuring its profitability and long-term growth.

A Study on the Effects of Fit and Gender on Next-Generation Family Members’ Succession Intentions

A Study on the Effects of Fit and Gender on Next-Generation Family Members’ Succession Intentions

Intergenerational transmission of entrepreneurship: An East African perspective of SME owner’s choice of joining the family business or independent own founding

Drawing from the lens of entrepreneurship as a contextually driven phenomenon, this study examined the effects of parental business exposure (PBE) on the entrepreneurial mode of entry (EME) of the next-generation family members and the role of exposure to self-employed grandparents and motivation to venture on the relationship between PBE and EME. A survey administered to a sample of 440 SME owners in Kenya who had one or both entrepreneurial parents indicated that PBE significantly and positively influences joining the family business and significantly and negatively impacts the independent own founding EME. Both exposures to self-employed grandparents and necessity entrepreneurship motivation improve the positive relationship between PBE and joining the family business EME. By investigating the role of these two factors in the intergenerational transmission of entrepreneurial behaviour that are of keen interest in a developing country context like Kenya, this study provides practical guidance to family businesses in these contexts on the importance of extended households and a post-entry phase training of the next-generation family business entrepreneurs in shaping the next-generation leaders of family businesses.

Entrepreneurial Forms: a Continuum for NGFM

Purpose - The purpose of this research is to study the entrepreneurial trajectory of next generation family members (NGFM) as a basis for differentiating the contexts that drive the emergence of various entrepreneurial forms in family firms.The research question is: how the FF context influences the emergence of different entrepreneurial forms. Design/method/approach - To answer the research question, we conducted qualitative research focused on the Grounded Theory method that aims to build a theory upon empirical evidence. We collected data from 22 semi-structured interviews that asked NGFM about the history of their FF and their role within it. Findings - We propose a model that is a continuum of entrepreneurial forms and consists of internal new venture, family entrepreneurial portfolio, and independent new venture. The NGFM were classified under those 3 categories depending on their entrepreneurial activity and the organizational arrangement that the entrepreneurship took place in the economy. Also, there is a fourth form called the follower role which correspond to the reference point form non-entrepreneurship, it dictates the dynamics that FF have to overcome so that it can be entrepreneurial. Each FF and NGFM is able to engage in more than one entrepreneurial form simultaneously or consecutively, the background that influence the development of one or another entrepreneurial form is determined by the FF and the family dynamics. The proposed model is a continuum since the trajectory of NGFM is also an entrepreneurial learning path that have an adaptative character over time. The variables used for the analysis were: family unit, impact intention scope, creation of need, inclusiveness of decisions, paternalistic culture and informal team building. The most relevant insight about these variables is that the uniqueness of entrepreneurial forms is given by the combination of them in different levels of intensity among cases, this allowed us to address the complexity of the cases and a broader comprehension of each entrepreneurial form. Research implications – While it has a limited number of entrepreneurial forms included in the model it invites to analyse the dynamics that precede entrepreneurship in FF, especially in an individual manner addressing the complexity of the family and firm interactions. Practical implications – Insights from this research are useful for family firms to shape their dynamics in order to enable the formation of determined entrepreneurial forms. Also, it is important for education in entrepreneurship and family firms since it transcends the classic view of family as the only background of family firms and offer a more comprehensive view of FF backgrounds and entrepreneurial forms emergence. Originality and value – this paper highlights the importance of analysing the dynamics that precede entrepreneurial forms, and mainly to do it in a detailed way, avoiding generalizations about family firms and providing a continuum model with the whole overview. Keywords – Entrepreneurship, Family Business, Entrepreneurial forms

Selling Brownies or Formal Education: A Breakpoint for Entrepreneurial Learning in Family Firms

Purpose- The purpose of this study is understanding the entrepreneurial learning in family firms, from a process perspective and focused on next generation family members (NGFM), who were exposed to entrepreneurial learning processes in their family firms. While the relationship between family firms and entrepreneurship has captured a lot of research interest, the processes that entail the transfer of entrepreneurial knowledge and skills between family members have received less attention. This paper contributes to fill this gap by analyzing the learning experiences and relationship with previous generations that originated entrepreneurial learning in next generations. Design/methodology/approach – This study is based on 24 Colombian cases of NGFM, who were diverse in terms of ages, entrepreneurial achievements, and connections to the family firms. Findings – Entrepreneurial learning is a continuous and incremental process with multiple mechanisms to learn, which are defined by the previous generation. There is a temporal dimension associated with life stages, which defines the type of mechanisms more useful to learn about entrepreneurship. Early involvement is a key factor for entrepreneurial learning, but it requires further comprehension than what current literature has reached. Originality/Value – By applying the process perspective of entrepreneurial learning to the context of family firms, the study identifies unique dynamics to transfer entrepreneurial knowledge and skills among generations, which help understanding the diversity of entrepreneurial performance of these firms.

Effects of parental entrepreneurial performance on the mode of entrepreneurial entry by the next-generation family members: evidence from an emerging economy

PurposeThe purpose of the paper is to examine the effects of perceived parental entrepreneurial rewards, or PPERs (i.e. the offspring's perception of the degree of parental success in entrepreneurship), on the corporate venturing (CV) mode of entrepreneurial entry and the interaction effects of family business involvement (FBI) and formal employment on the association between PPER and CV by the next-generation family members.Design/methodology/approachA survey was administered to a sample of 738 small business owners in Kenya; of which, 440 small business owners were selected because they grew up in a family business context. A probit model was used to examine the main and interaction effects.FindingsPPERs significantly influenced CV. FBI improves the positive relationship whereas formal employment reduces the effects of PPER on CV.Practical implicationsFamilies in business need to improve conversations with their children to include discussions concerning the intrinsic and extrinsic rewards of running a family business, which may shape not only the entrepreneurial entry path of their offspring but also the willingness to establish businesses that may grow and lead to continuity of the family business of origin.Originality/valueThe study investigates the effect of being embedded in a business family in shaping the CV mode of entrepreneurial entry by the next-generation family members who may not, on the one hand, find independent own founding an attractive option and for whom, on the other hand, the succession mode of entry may not be an option.

Perceived Parental Care and Next-Generation Family Members’ Succession Intentions: The Sequential-Mediating Role of General Self-Efficacy and Perceived Person-Job Fit

ABSTRACTWhereas the existing literature on the relationship between parental behavior and family business succession mainly focuses on parental behavior in the business domain, we highlight the importance of parental behavior in the family domain. Integrating attachment theory, the family business succession literature, and person-job fit literature, our study proposes a theoretical framework hypothesizing that general self-efficacy and perceived person-job fit mediate the association between perceived parental care (an underrepresented family-domain-specific parental behavior) and next-generation family members’ succession intentions. This framework is tested by data from two surveys and further verified by qualitative interviews of next-generation family members. Multivariate analysis results suggest that next-generation family members’ general self-efficacy and perceived person-job fit played a sequential-mediating role in the relationship between perceived parental care and next-generation family members’ succession intentions. Our interviews not only confirm these results but also reveal new insights, particularly into the specific Chinese context in the study of family business succession.

Aditya Gandhi and Gandhi jewels: earning a place in the family business (Part A and B)

Learning outcomes Part A – to identify the challenges of inducting and nurturing next-gen leaders, to outline the building blocks for the successful induction of the next generation into the family business and to spell the importance of mentoring conversations as a tool for successful induction in the family business. Part B – to define the basic tenets of effective communication-goal setting, planning and action using the goals, plans and action framework, to build a “listening” environment through understanding the hearing, understanding, remembering, interpreting, evaluating, and responding mode and to relate the importance of “questioning” in diagnosing a problem and reading both verbal and non-verbal cues in communication. Case overview/synopsis The two-part case describes the role of communication amongst young family business scions and a mentor’s role in shaping such communication. Part A traces the induction of Aditya Gandhi, a fourth-generation scion of Gandhi Gems and Jewels, a 110-year old Indian family business dealing in precious gems and jewels. It deals with the challenges of mentoring and successful induction of the next-generation into family business Part B of the case describes the communication between Aditya Gandhi and the proprietor of Gandhi Gems and Jewels’ key client, Ghanshyam Das. It deals with the tenets of effective communication as should be understood by young next-generation family members. Complexity academic level The case can be used in an executive programme for owners of family businesses or in an undergraduate or post-graduate programme in general business administration or family business management. Supplementary materials Teaching Notes are available for educators only. Subject code CSS 11: Strategy.

Next-generation leadership development: a management succession perspective

Purpose This research study focusses on the succession challenges in small-medium outboard marine businesses of Malaysian Chinese family ownership. The founder-owners face challenges in convincing the next-generation members to establish their careers within the family business and to ensure successions are in place to safeguard the family's wealth. A gap exists in the research literatures concerning such family business owners; and their experiences would provide valuable information to other Malaysian Chinese family businesses planning to start the succession journey. Design/methodology/approach An exploratory case study methodology to research five Malaysian Chinese family businesses cases in Klang Valley, Selangor, Malaysia, is used in this study. The primary qualitative data were obtained through in-depth, semi-structured interviews and observations. The research data lead to the identification of the following themes: generational change affects the survival of small-medium Malaysian Chinese family-owned businesses; the founder-owners' intention and desire for business to pass to the next generation give rise to the imperative of succession; the founder-owners' motive and goals, family context and the business nature would determine a large part to how the succession plans are carried out and the upbringing, expectation and obligations would determine how the next generations of children would view the prospect of taking over the family business. From this, a succession model that detailed an inclusive approach to succession planning process between the two generations is established. Research limitations/implications A small purposive sample is included, and it is recommended that a larger and more diverse sample be collected in future studies. This study follows a nuclear family structure of parents and children. If more Chinese family businesses are selected based on a wider set of family members such as uncles and cousins, the findings may differ. Social implications This research study could also facilitate other Malaysian family businesses to rethink and refocus on the importance of undertaking an inclusive approach to succession planning and also help potential next-generation successors in understanding and working towards attaining the qualities that family firms look for in future leaders. Originality/value The researcher summarizes the study findings into a management succession model. An inclusive succession approach is needed to overcome these challenges and would enable sustainability, continuity and longevity of the family business. This would help the family business to understand that succession is not a single event but a process that needs to be planned together with the next-generation family members over a certain period of time.

The Origins and Development of Socioemotional Wealth Within Next-Generation Family Members: An Interpretive Grounded Theory Study

Adopting an interpretive grounded theory approach, we find that key events in the early lives of next-generation family members fuel a sense of belonging and identity, which lies at the heart of their socioemotional wealth. As next-generation family members interact more with the family business, they interpret nonfinancial aspects of the firm as an answer to a larger variety of affective needs, which broadens and strengthens their interactive socioemotional wealth frame of mind. In line with our life course theory lens, we observe how key events that build up socioemotional wealth greatly influence the life paths of next-generation family members.

Career Paths in Institutional Business Elites: Finnish Family Firms from 1762–2010

This article analyzes the career paths of family business executives in institutional business elites in Finland using an empirical database based on a Bourdieusian prosopographical approach. The results indicate that career paths became more complex but shortened in length toward the beginning of the twenty-first century. The early career paths of family executives changed from positions as assistants and salesmen in the eighteenth and nineteenth centuries to governance, chief executive officer (CEO), and management positions in the twentieth and twenty-first centuries. Compared with the founder generation, next-generation family members benefited from more rapid institutional business elite career paths. The complexity of the career paths in the institutional business elite increased in subsequent generations. However, although there were few family executives with a third- or fourth-generation background in family businesses, founder-generation family executives existed in each cohort, apart from the pioneering generation.

Investigating the actual career decisions of the next generation: The impact of family business involvement

While the current family business literature has deeply informed our understanding of the career intentions of adolescents with a family background in business, a salient gap emerges regarding the ways in which family business involvement impacts the careers of the next generation. This article reports the empirical results of an interpretive qualitative study of the phenomenon of the careers of next-generation family members. The findings suggest that the family business involvement of the next generation not only influences but also alters the careers of the next generation. Helping is proposed as a key means of family business involvement for the next generation and a unique resource for family businesses. Through the activity of helping, the next generation explores the arena of the family business, which has significant consequences on career decision making.

Career Paths in Institutional Business Elites: Finnish Family Firms from 1762–2010

This article analyzes the career paths of family business executives in institutional business elites in Finland using an empirical database based on a Bourdieusian prosopographical approach. The results indicate that career paths became more complex but shortened in length toward the beginning of the twenty-first century. The early career paths of family executives changed from positions as assistants and salesmen in the eighteenth and nineteenth centuries to governance, chief executive officer (CEO), and management positions in the twentieth and twenty-first centuries. Compared with the founder generation, next-generation family members benefited from more rapid institutional business elite career paths. The complexity of the career paths in the institutional business elite increased in subsequent generations. However, although there were few family executives with a third- or fourth-generation background in family businesses, founder-generation family executives existed in each cohort, apart from the pioneering generation.

Behavioural outcomes of next-generation family members’ commitment to their firm

Are there variations in behaviours and leadership styles of next-generation family members or descendants who join their family business due to different forms of commitment? Evidence from a dual respondent study of 109 Canadian and Swiss family firms suggests that descendants with affective commitment to their family firms are more likely to engage in discretionary activities going beyond the job description, thereby contributing to organizational performance. Next-generation members with normative commitment are more likely to engage in transformational leadership behaviours. Both affectively and normatively motivated next-generation members use contingent reward forms of leadership. A surprising finding of this study is the binding force of normative commitment on positive leadership behaviours of next-generation members. This study empirically tests the generalizability of the three-component model of commitment to family businesses, a context in which different forms of commitment may play a unique role.

Corporate venturing in family business: The effects on the family and its members

Previous literature on corporate entrepreneurship (CE) in family business (FB) focusses on the determinants of CE and presents conflicting results on its effects on firm-level performance. We argue that previous studies have overlooked the idea of FBs being complex social systems comprising three components, controlling families, business entities and individual family members; and any business activity in a FB should also be studied with respect to its effects on the family and individual family members, which ultimately impacts the performance. Moreover, previous FB literature addresses CE as a monolithic concept and does not separate its two primary types: corporate venturing (CV) and strategic renewal (SR). This article focusses solely on CV, investigating the impact of CV on FB. The research is based upon a set of longitudinal in-depth case studies of three FBs engaged in CV initiatives. The findings suggest that CV can have positive, negative or possibly both effects at the family and individual levels depending on four moderating factors. At the individual level, if a succession process is present, CV may increase the incumbent leader's capability to effectively direct the selection and development process of next generation family members (NGFMs) as well as the NGFMs’ human capital. However, CV could also reduce the affective commitment of NGFMs to the core business and such a risk appears to be higher when CV participation in the FB strategy is low. At the family level, development of CV initiatives may both enhance and reduce the family cohesion. The risk of its decrease grows with greater relevance of non-active family members’ ownership and the greater financial impact of the CV initiative itself.

Exploring Succession Planning within Small Family Owned Businesses

Succession planning involves the training of next-generation family members to remain as the core value in a family business. However, small family firms are facing higher risks of failure because the succession process does not receive much interest. Therefore, it is vital to find effective ways to transfer the less tangible considerations to the next generation family members. This paper will addresses several issues of family business succession planning, with the purpose of identifying the main triggers for succession, criteria of a good successor and types of education required to run the family business. This research employs a multi-method approach, where the distribution of survey questionnaires, interviews and observations were conducted over time. A total of 388 family businesses answered the questionnaires and from the findings, tacit knowledge, achieved from informal education, was the contemporary way of transferring the business, from the owner to the successor. It also explains the current trend of succession planning and the key issues associated with successfully development principle successors. Moreover, this paper provides the relationship between succession issues and the performance of Malaysian small family businesses.

Strategic Planning in Family Business: A Powerful Developmental Tool for the Next Generation

This article addresses the issue of training next-generation family members once they have joined the management team in their family firm. The qualitative analysis of strategic planning processes of 18 Italian family firms shows that involving next-generation family members in the planning process benefits their developmental process. The findings indicate that this involvement provides the next generation with crucial tacit business knowledge and skills, facilitating interpersonal work relationships between incumbents and next-generation leaders and building credibility and legitimacy for the next generation. The comparative analysis of the cases allowed us to identify the five variables that seem to combine in explaining much of the observed differences in the amount and composition of benefits experienced in the 18 firms. Our findings extend current understanding of two understudied topics in family business: the postentryphase training of the next generation and strategic management in family firms.

Strategic Planning in Family Business: A Powerful Developmental Tool for the Next Generation

This article addresses the issue of training next-generation family members once they have joined the management team in their family firm. The qualitative analysis of strategic planning processes of 18 Italian family firms shows that involving next-generation family members in the planning process benefits their developmental process. The findings indicate that this involvement provides the next generation with crucial tacit business knowledge and skills, facilitating interpersonal work relationships between incumbents and next-generation leaders and building credibility and legitimacy for the next generation. The comparative analysis of the cases allowed us to identify the five variables that seem to combine in explaining much of the observed differences in the amount and composition of benefits experienced in the 18 firms. Our findings extend current understanding of two understudied topics in family business: the postentry-phase training of the next generation and strategic management in family firms.

The Succession Experience of the Next Generation

Literature indicates that succession is critical to the future of a family firm. However, little is known about how the next generation actually experiences the process of succession. An in-depth biographical study of thirty-two next-generation family members indicates specific factors critical to succession. The findings are delineated in a framework that portrays these influences, their relationships, and the effect they have on the succession experience of next-generation family members.