The Palgrave Handbook of Heterogeneity among Family Firms

Esra Memili, Clay Dibrell, Esra Memili, Clay Dibrell

• Publisher: Palgrave Macmillan
• Year: 2018
• Print ISBN: 9783319776750
• eBook ISBN: 9783319776767
• Topic: Business
• Subtopic: Human Resource Management
• Index: Business

This handbook is the definitive source of research on the differences among family firms. It provides a timely and thorough investigation of the variant strategies and behaviors undertaken by family firms today, taking a closer look at different configurations of family involvement and how they influence outcomes and success. While studies on differences between family and non-family firms are deeply rooted in the literature, this handbook uniquely examines the family firm heterogeneity research to date and the inner firm governance, financial and non-financial objectives, and strategies such as innovation, competitive dynamics, internationalization, and human resources management.

The handbook pulls together the work of the most prominent names in family business from around the world, separating itself from the competition both in content and geographical scope.  Future research directions provided in each chapter will spark further interdisciplinary scholarly work, and will be enlightening for researchers, educators, and practitioners who are currently limited to the narrow and exclusive literature and advance the burgeoning research on this important topic.

© The Author(s) 2019

Esra Memili and Clay Dibrell (eds.)The Palgrave Handbook of Heterogeneity among Family Firmshttps://doi.org/10.1007/978-3-319-77676-7_1

Begin Abstract

1. A Brief History and a Look to the Future of Family Business Heterogeneity: An Introduction

Clay Dibrell¹ and Esra Memili²

(1)

School of Business Administration, The University of Mississippi, University, MS, USA

(2)

Bryan School of Business and Economics, University of North Carolina-Greensboro, Greensboro, NC, USA

Clay Dibrell (Corresponding author)

Email: [email protected]

Esra Memili

Email: [email protected]

End Abstract

Introduction

In 1998, the first edition of the Family Business Review was published marking a seminal point in the development of family businesses as a legitimate field of study. A preponderance of this early research focused on indicating the importance of family businesses to the economy (Shanker and Astrachan 1996), the unique form of ownership of family businesses compared to other nonfamily forms of ownership (e.g., Daily and Dollinger, 1992, 1993), definitional issues of what is a family business (e.g., Chua et al. 1999; Litz 1995), life cycles of the family business (Gersick 1997), and the theoretical foundations of a family business (e.g., Gedajlovic et al. 2012; Sharma et al. 1997; Tagiuri and Davis 1996).

Following this pattern, family business scholarship has often been a context comparison between family versus nonfamily firms (e.g., Dibrell and Moeller 2011; Gentry et al. 2016; Kim et al. 2017). Although the definitions of what is a family firm vary (e.g., levels of ownership, family involvement, intention to pass the firm ownership to the next generation), there has been relatively limited research done on the differences within family firms. Further, a preponderance of the research which has been done has been more conceptual or anecdotal-based evidence rather than empirical based. The intent of this book is to call upon future authors, reviewers, and editors to focus more on within family firms with a greater emphasis on empirical-based evidence. Figure 1.1 illustrates an organizing framework for this book through inclusion of applicable family context references provided in the introduction preceding the chapter highlights.

Fig. 1.1

Organizing framework for family

One of the first studies to consider differences within family businesses was Moores and Mula (2000). These authors discovered evidence of management control system differences among a class of family firms based on the life-cycle stage using Ouchi’s markets, clans, and bureaucracies to provide the first empirical-based evidence of heterogeneity. Building on this research, family business heterogeneity entered the family business vernacular through García-Álvarez and López-Sintas’ (2001) empirical taxonomy of differing values among founders of family businesses. This study considered how the different founder values influenced the behavior of their respective family businesses. As such, family businesses behaved differently than other family businesses based, in part, on the values of the founding family and therefore should be treated differently than a homogenous group. Family business heterogeneity is described as each family business being uniquely different than another family business based on diverse attributes of the firm. These heterogeneous attributes can take many forms such as the associated familial values embedded in the venture or the level of business family involvement in the business (e.g., Chua et al. 2012).

This research was further extended through the works of Miller, Breton-Miller, and their co-authors (e.g., Breton-Miller and Miller 2006; Miller and Breton-Miller 2006; Hoopes and Miller 2006; Miller et al. 2013). These authors articulated how family firms can differ in a variety of ways including in their forms of corporate governance, ownership concentrations, founder versus multiple generational involvement, and resource configurations. Nordqvist et al. (2014) further advanced the field by identifying nine different configurations of family involvement in ownership from controlling owner to cousin consortium. This work is of interest as it considers family beyond the immediate family (e.g., father succeeded by the daughter) to include different configurations of the family (e.g., cousins with family investors) with an emphasis on the family dynamics.

In their seminal article on sustainable family businesses (e.g., Danes et al. 2009; Olson et al. 2003; Stafford et al. 1999), a group of scholars with a background in family social sciences considered how the family impacts the family business. Drawing from sociology and family sciences, these authors considered family dynamics (e.g., family conflict) and how these relationship dynamics influence the decision-making behaviors of the family business.

Moreover, we see heterogeneity of family businesses from finance and accounting disciplines. From a corporate finance perspective, Anderson and Reeb (2004) considered the heterogeneity of boards through the inclusion of family into this conversation. Villalonga and Amit (2006) extended this conversation further by including family ownership, control, and management influencing the value of the firm in publicly traded firms. These conversations have now been more thoroughly integrated in the family business heterogeneity language (e.g., Cannella et al. 2015). From an accounting perspective, the seminal work by Moores (2009) and follow-up special issues in the Family Business Review (Salvato and Moores 2010) and Journal of Family Business Strategy (Songini et al. 2013) were instrumental in providing an accounting perspective of family for both the accounting field (e.g., Hiebl et al. 2013) and the family business domain (e.g., Stockmans et al. 2013).

The applications of these different traditions and disciplines add to the ability to delineate and to track how the family business domain has grown (e.g., Stewart’s (2003) application of an anthropological perspective to family business) and the trajectory of the discipline. Through these myriad of lenses, the confluence of differing perspectives enriches our research questions and broadens our audience. Family business/enterprise research has grown into a meta-discipline.

Antithetically, the study of family business heterogeneity mirrors other concepts from other disciplines, such as dynamic capabilities from the strategic management field. If dynamic capabilities are truly dynamic and ever changing, then how does a scholar define or capture a dynamic capability (Arend and Bromiley 2009)? The same can be said of family business heterogeneity. Chandler posits “families consist of heterogeneous individuals. The number of family members involved, the potential for role and affective conflict, generational effects, and the power exercised by family members could all influence the choice of control structures and subsequent outcomes” (2015: 1307–1308). Further, the context, organizational culture, and the temporal pace of decision-making and activities within the firm influence the extent of heterogeneity in a family business (Howorth et al. 2010), as well as the varying utility of ownership among the different family members and the life-cycle stage of the family enterprise. Given the potential for variance among family businesses, the idiosyncratic, complex nature of family business heterogeneity raises concerns about the reliability of generalizing findings outside of the immediate sample of studied firms. These criticisms are warranted and should be considered. Likewise, these same apprehensions point to the necessity for scholars to delve deeper among the gradations of how the business family, the family enterprise, and the family business are similar and dissimilar.

The purpose of this book is to build upon the framework in Fig. 1.1 by further fleshing out the heterogeneity nuances of family businesses and to extend the reach of the family business domain through the editorially reviewed chapters of family business scholars from diverse backgrounds with many originating outside of the management discipl...

Table of contents

• Cover
• Front Matter
• 1. A Brief History and a Look to the Future of Family Business Heterogeneity: An Introduction
• Part I. Family Business Research to Date
• Part II. Family Governance
• Part III. Non-financial and Financial Dynamics
• Part IV. Organizational Behavior and Human Resources Management
• Part V. Strategies
• Back Matter