Family Business Survival Research Articles

Harmony, Justice, Confusion, and Conflict in Family Firms: Implications for Ethical Climate and the “Fredo Effect”

Family firm leaders acting as stewards of a close-knit enterprise may attempt to build a positive atmosphere of trust, clarity, and cohesiveness in the firm’s operation. Yet, conditions unique to family firms may lead some family members to develop a heightened sense of entitlement and weaker bonds to the organization. This creates conditions for a Fredo effect, where a family member’s incompetence, opportunistic behaviors, and/or ethically dubious actions can impede the firm’s success, potentially resulting in a scandal that could lead to the firm’s demise and negative economic impact on employees, customers, and other stakeholders. Surveying 147 family-firm members, we examine the role that linkages among perceptions of family harmony norms, distributive fairness, role ambiguity, and relationship conflict play in the emergence of a family member who acts as an impediment to the firm, which can be manifested in damaging unethical behaviors. As hypothesized, family harmony norms and fairness perceptions are negatively related to family impediment, while role ambiguity is positively related to family impediment. However, relationship conflict mediates these connections, underscoring the potential damage this type of conflict can create in a family firm, even if leaders of the firm attempt to establish conditions that reflect a stewardship approach to firm governance. We discuss how these findings impact the development of an ethical climate in the family firm and the implications for family business survival or scandal.

Crossroads of family business research and firm demography—A critical assessment of family business survival rates

Do family firms rise and decline in three generations? Not only since Thomas Mann's “The Buddenbrooks” has the survival rate of family firms intrigued family business scholars, practitioners and consultants. In this article, we trace the family firm survival rate to its roots and discuss its empirical basis and univocal reading. We then ask how the mortality of family businesses could be measured, and which contextual factors need to be taken into account. To this end we explore the literature on firm demography, a field which is particularly concerned with age and mortality, and identify crossroads with family business studies. We conclude by suggesting a re-conceptualization of survival rates within a larger firm demographic research framework.

Influence of Federal Disaster Assistance on Family Business Survival and Success

This study examines the impact of federal disaster assistance on the survival and success of small family‐owned businesses with fewer than 500 employees from 1996 to 1999. Small family‐owned business owners were defined as those who had been in business at least a year, had spent a least 6 hours a week or a minimum of 312 hours annually working in the business, had lived with at least one family member and had fewer than 500 employees. This study suggests firms located in counties receiving more disaster assistance are not more likely to survive, however these firms are more likely to realize positive changes in revenue than firms located in counties receiving less disaster assistance. Businesses located in an economically vulnerable rural county, those engaged in family to business resource intermingling and those transferring more business income to the household were more likely to survive. Larger businesses, those headed by women and those transferring more income from the business to the family were most likely to succeed.

Factors Associated with Long-Term Survival of Family Businesses: Duration Analysis

This study identified factors influencing family business survival using National Family Business Panel and Spatial Hazard Events and Losses data. Sustainable Family Business Theory guided the use of a parametric duration model of long-term survival. Community characteristics, family achievements, family processes during change, business and owner characteristics, and business processes during stability affected long-term survival. Economic vulnerability of rural counties, family income from business, hiring temporary help, business size, viewing business as a way of life, and owner experience were associated with increased duration of business survival. Being home-based, a female owner, and customer-focused were associated with decreased duration of survival. Some family processes and achievements increased the duration of business survival; none decreased it.

BUILDING THE PROFESSION: OUR ROLES AND RESPONSIBILITIES

In the January 2008 edition of The Academy of Management Review, Linda Trevino expressed her disappointment in realizing that some colleagues had declined editors’ requests to review (Trevino, 2008). She continued by stating that reviewing is both a professional and ethical responsibility for all of us. I could not agree more with Professor Trevino. Her critical assessment of the state of reviewing in our profession is a wake-up call. If we want our profession to continue growing in quality and be members in good standing in our chosen career path, then we should all act professionally and ethically in our treatment of each other’s work. After all, as Professor Trevino states, the Golden Rule works in all possible directions. So, please, next time you receive a request to review, do not discard it. If you have a valid reason for declining, please let the editorial team know as soon as possible. You may even help identify able and willing reviewers. Similar professional and ethical attitudes are expected of all involved in the submissionpeer evaluation-publication process: authors, editors, associate editors and others. Furthermore, sponsoring institutions must recognize the value of all aspects of faculty participation in this endeavor. We are privileged to be engaged in something we love to do. To paraphrase one of the original SNLs: Academia has been very good to us! The rise of management fields to today’s professional status has especially been good to us! Let’s make it even better by helping each other! This issue would not have been possible without the contributions of the many professionally and ethically acting manuscript reviewers. I want to thank them on behalf of the authors, the editorial team and the profession. The first article is contributed by Linda Niehm, Nancy Miller, Mack Shelley and Margaret Fitzgerald. Their study, Small Family Business Survival Strategies for Coping with Overlapping Family and Business Demands, deals with a critical topic in the success of a family venture. What is the right balance between home and work? The authors analyze the homework place balance achieved by surviving and non-surviving firms. The implications of their work are both interesting and of great importance not only for family businesses, but also for an economic system that depends so heavily on them.

Self-Perpetuation Family Organization Built on Values: Necessary Condition for Long-Term Family Business Survival

Family businesses have long been conceptualized in terms of overlapping and interacting management, ownership, governance, and family systems. As family businesses evolve and develop across generations, observing progress in each of the requisite systems presents a variety of challenges. This article demonstrates the importance of family organization to the systems of management, ownership, governance, and family as a family business evolves over time.

Christian Family Businesses: Opportunities for Future Research

Family businesses dominate the business landscape around the world. Traditionally, research has concentrated on understanding the complex processes that underpin the creation, development, and survival of family businesses. To date, however, a Christian perspective on family business research has been largely overlooked. The aim of this paper is to explore the connections between a Christian perspective and the most prevalent business form worldwide. This paper contributes by reviewing relevant literature in the family business field and by suggesting future research paths.