Family Business Review recent issues

Editors' Note: The Craft of Reviewing

Sharma, P., Kellermanns, F. W. — Fri, 20 Nov 2009 12:51:10 PST

The Role of the Secondary Market for Life Insurance in Preserving a Family Business

Adams, E. S., Sabes, J. R. — Fri, 20 Nov 2009 12:51:11 PST

A family business may have a hidden asset that can be tapped and sued to its advantage to fight off competitive threats, access capital in difficult times, act upon growth opportunities, or diversity assets. This untapped asset is a life insurance policy. Many family businesses own life insurance to protect their owners and are ideal candidates for life settlement if they do not own a qualifying policy. This article argues that the secondary market of life insurance provides viable estate planning strategies for family businesses and should be safeguarded and preserved from the efforts of the insurance industry and other organizations to limit their use.

Founding-Family Ownership and Firm Performance: The Role of High-Performance Work Systems

Tsao, C.-W., Chen, S.-J., Lin, C.-S., Hyde, W. — Fri, 20 Nov 2009 12:51:11 PST

The controversial findings of both high and low performance for family-controlled public firms offer a unique context in which to study the moderating role of high-performance work systems (HPWS) on founding-family ownership effects. In a sample of Taiwan-based public firms, founding-family ownership was found not to be associated with firm performance. However, when the level of HPWS facing family ownership was accounted for, the results showed that the relationship between founding-family ownership and firm performance is significantly negative for companies with lower levels of HPWS but is significantly positive for companies with higher levels of HPWS.

Private Family Ownership and the Agency Costs of Debt

Steijvers, T., Voordeckers, W. — Fri, 20 Nov 2009 12:51:11 PST

This article presents empirical evidence on the agency costs of debt in private family firms by examining the explicit (interest rate) as well as implicit (business and personal collateral) bank loan price simultaneously. Using a cross sectional sample of lines-of-credit of the NSSBF database, family firms appear to be more likely to pledge personal collateral which suggests that agency costs of debt are higher in family firms. Hence, personal collateral seems to be a better instrument than interest rates or business collateral for financial institutions to cope with the specific agency problems (e.g. self-control problems and negative effects of parental altruism) in family firms.

Family Ownership, Board Independence, and R&D Investment

Chen, H.-L., Hsu, W.-T. — Fri, 20 Nov 2009 12:51:11 PST

Family influence is central in Asian countries; however, little research exists regarding the effects of family ownership and corporate governance on corporate investment decisions. This article examines the relationships among family ownership, board independence, and R&D investment using a sampling of Taiwanese firms. The finding of the negative family ownership—R&D investment relationship suggests that family ownership may discourage risky long-term R&D investment. Such a finding may also suggest that firms with high family ownership may use R&D investment more efficiently and thus need less R&D in relation to firms with low family ownership. In addition, the interaction of family ownership and CEO duality/independent director ratio is negatively/positively related to R&D investment, suggesting that firms with high family ownership may increase R&D investment when the CEO—chair roles are separated or when more independent outsiders are included in the board.

A Conversation With Sara Miller McCune, Founder of the SAGE Publishing Group

Bianchi, C. — Fri, 20 Nov 2009 12:51:11 PST

Book Review: Annino, P., Davidow, T., Harrison, C. A., & Davidow, L. (2009). Women in Family Business: What Keeps You Up at Night? Charleston, SC: BookSurge. Barrett, M., & Moores, K. (2009). Women in Family Business Leadership Roles: Daughters on the Edge. Cheltenham, UK: Edward Elgar. Gupta, V., Levenburg, N., Moore, L. L., Motwani, J., & Schwarz, T. V. (2008). Culturally Sensitive Models of Gender in Family Business: A Compendium Using the GLOBE Paradigm. Hyderabad, India: ICFAI University Press

McCollom Hampton, M. — Fri, 20 Nov 2009 12:51:11 PST

Ad Hoc Reviewers for 2009

Fri, 20 Nov 2009 12:51:11 PST

Family Business Review--Special Issue September 2011: Marketing and Family Businesses

Fischer, E., Reuber, A. R. — Fri, 20 Nov 2009 12:51:11 PST

Family Capital, Family Business, and Free Enterprise

Sorenson, R. L., Bierman, L. — Thu, 27 Aug 2009 14:19:16 PDT

Developing Public Policy About Family Enterprise

Durenberger, D. — Thu, 27 Aug 2009 14:19:16 PDT

Family Capital of Family Firms: Bridging Human, Social, and Financial Capital

Danes, S. M., Stafford, K., Haynes, G., Amarapurkar, S. S. — Thu, 27 Aug 2009 14:19:16 PDT

The purpose was to present a family capital typology based on Sustainable Family Business Theory II and to document its relative contribution to short-term firm achievements and long-term sustainability using National Family Business Survey panel data. Family capital was defined as total owning-family resources composed of human, social, and financial capital. Family capital significantly contributed to firm achievements and sustainability. In the short term, all family capital types explained 13.5% of gross revenue variance and 4% of owner’s success perception variance. In the long term, all family capital types explained 26.7% of gross revenue variance and 11.6% of owner’s success perception variance.

Putting the Family Into Family Business Research

Dyer, W. G., Dyer, W. J. — Thu, 27 Aug 2009 14:19:16 PDT

Much of the recent research on family businesses has focused on how the family affects business performance. This commentary suggests that researchers should also consider how certain variables affect both the business and the family. Suggestions for how to do such research are presented.

Management Work--Family Research and Work--Family Fit: Implications for Building Family Capital in Family Business

Rothausen, T. J. — Thu, 27 Aug 2009 14:19:16 PDT

In this article, 25 years of organization science research on work—family is summarized, and its implications for building the human, social, and economic elements of family capital in family business are developed. The impact of work—family conflict; sex and gender roles; role enrichment; work—family benefits, programs, and policies; and work, job, and organization redesign are emphasized. A social systems model of environment—environment fit—work—family fit—is developed. Implications for future research and for investing in family capital are discussed.

Enhancing Work--Family Balance Research in Family Businesses

Stafford, K., Tews, M. J. — Thu, 27 Aug 2009 14:19:16 PDT

Rothausen thoroughly reviews the literature on work—family balance in traditional workplaces and provides a useful framework for determining a healthy balance between work and family in a family business context. This article addresses Rothausen’s contributions to enhancing work—family research in family businesses, and it specifies areas for further research using a fit model. Work family scholars have the potential to integrate research in economics, sociology, and psychology and so help form interdisciplinary teams to conduct research on family businesses.

The Family Point of View, Family Social Capital, and Firm Performance: An Exploratory Test

Sorenson, R. L., Goodpaster, K. E., Hedberg, P. R., Yu, A. — Thu, 27 Aug 2009 14:19:16 PDT

Based on the social capital, conflict, and ethics literatures, this study introduces a new concept, the family point of view, and provides theoretical arguments resulting in the following hypotheses: (a) The family point of view emerges from collaborative dialogue, which helps develop agreement to ethical norms; (b) the presence of ethical norms further helps cultivate family social capital; and (c) as a resource in a family business, family social capital is positively related to family firm performance. Using structural equation modeling, an exploratory test of 405 small family firms found support for all three hypotheses. The findings indicate a fully mediated relationship among collaborative dialogue, ethical norms, family social capital, and firm performance. The study not only highlights the importance of moral infrastructure in family firms but also helps clarify components of family social capital.

The Soul of Family Business

Hubler, T. M. — Thu, 27 Aug 2009 14:19:16 PDT

This is a supplement to the paper "The Family Point of View, Family Social Capital, and Firm Performance: An Exploratory Test." The paper explores, from a practitioner’s perspective the emergence of the family point of view and defines the soul of family business. The paper also explores how a family can nurture dialog so as to create the expression of family values which may be achieved through creation of a Common Family Vision, commitment to building the emotional equity of the family, and a common communication framework that supports the discussion necessary for emergence of the family point of view.

An Exploratory Study of How Potential "Family and Household Capital" Impacts New Venture Start-Up Rates

Rodriguez, P., Tuggle, C. S., Hackett, S. M. — Thu, 27 Aug 2009 14:19:16 PDT

Drawing from social capital theory, the authors examine the relationship between family capital characteristics and new venture start-up rates in the United States. The results of this study improve the understanding of (a) how families matter in an entrepreneur’s decision to start a business, (b) how wealth and health care considerations affect the start-up decision, and (c) whether and how these effects differ among the largest ethnic groups in the United States.

Where Do New Firms Come From?: Households, Family Capital, Ethnicity, and the Welfare Mix

Steier, L. — Thu, 27 Aug 2009 14:19:16 PDT

The creation of new firms is an important economic activity; however, understanding of the actual venture-creation process remains limited. P. Rodriguez, C. S. Tuggle, and S. M. Hackett (2009) address this deficiency by adopting an internal social capital perspective and examining the effects of family financial, social, health, and ethnic contexts on firm creation. This commentary extends their work by reinforcing that households are important units of analysis and are usefully viewed as incubators and opportunity platforms for venture creation. It further suggests that social capital has a nested nature and that households should be viewed as part of the overall welfare mix.

Family Social Capital, Venture Preparedness, and Start-Up Decisions: A Study of Hispanic Entrepreneurs in New England

Chang, E. P. C., Memili, E., Chrisman, J. J., Kellermanns, F. W., Chua, J. H. — Thu, 27 Aug 2009 14:19:16 PDT

Using insights from the resource-based view, social capital, and network theories, the authors develop a model of how family social capital, as well as an entrepreneur’s knowledge capital and external social capital, influences the venture creation process. The model is tested on a sample of 85 nascent Hispanic entrepreneurs. Results indicate that family social capital, measured as family support, contributes to venture preparedness and the start-up decision, suggesting that it has both a direct and an indirect influence on venture creation.

Ethnicity Effects on the Family Business Entrepreneurial Process: Commentary and Extension

Harris, I. C. — Thu, 27 Aug 2009 14:19:16 PDT

This commentary adopts a cross-disciplinary framework to discuss possible influences of both family and ethnicity on business performance in the marketplace. Both family and ethnicity are viewed as "upstream factors" that may help a business gain a favorable identity with potential stakeholders. Family businesses that have an ethnic background in common with customers, employees, and suppliers may receive preferential treatment. Communities may patronize a business simply because of an associated group identity. Thus, ethnic collectivism may alter some assumptions about family businesses and how they compete.

Book Review: Clark, G. (2007). A Farewell to Alms: A Brief Economic History of the World. Princeton, NJ: Princeton University Press

Salley, S. — Thu, 27 Aug 2009 14:19:16 PDT

Call for Papers: Family Business Review--Special Issue

Fischer, E., Rebecca Reuber, A. — Thu, 27 Aug 2009 14:19:16 PDT

Communicating Your Qualitative Research Better

Chenail, R. J. — Tue, 28 Apr 2009 13:37:46 PDT

The Development of Successors From Followers to Leaders in Small Family Firms: An Exploratory Study

Cater, J. J., Justis, R. T. — Tue, 28 Apr 2009 13:37:46 PDT

The purpose of this exploratory study was to better understand the development of successors in the small family business, including their approach to the leadership of the firm. It examined variables (and their relationships) that help to explain family business successor leadership. A case study approach was followed, using grounded theory analysis of qualitative interviews of the top managers of six family businesses. It provided six propositions for future research—namely, concerning positive parent—child relationships, acquiring knowledge, long-term orientation, cooperation, successor roles, and risk orientation.

Family Firms' International Commitment: The Influence of Family-Related Factors

Claver, E., Rienda, L., Quer, D. — Tue, 28 Apr 2009 13:37:46 PDT

Few studies have dealt with family businesses and internationalization theories. The aim of this article is to bridge this gap by examining the family-related factors that have an impact on the international commitment level of these companies. From a sample of Spanish family firms, findings show that long-term vision and the presence of nonfamily managers are positively related to entry modes involving stronger international commitment, although self-financing limits this commitment.

Analytical Model of Leadership in Family Firms Under Transformational Theoretical Approach: An Exploratory Study

Vallejo, M. C. — Tue, 28 Apr 2009 13:37:46 PDT

The goals of the current research were to analyze the existence of differences in leadership between family and nonfamily firms adopting a transformational leadership approach, as well as the potential positive effects of transformational leadership on family businesses. With the transformational leadership theory as theoretical background, the research reveals that leadership is more transformational in family businesses than in nonfamily businesses. Similarly, this research uses a structural equations model to explain the relations between this kind of leadership in family businesses and specific performance-related variables, such as group cohesion, longevity, and profitability.

Family Business Research in the New Millennium: An Overview of the Who, the Where, the What, and the Why

Debicki, B. J., Matherne, C. F., Kellermanns, F. W., Chrisman, J. J. — Tue, 28 Apr 2009 13:37:46 PDT

The authors' analysis of 291 family business articles published in 30 management journals between 2001 and 2007 reports the contributions of individual scholars and academic institutions to family business research. To better understand the interrelationships among scholars who have contributed to family business research, a network analysis of coauthor relationships was conducted. The authors also provide a content analysis of the articles and offer suggestions for future research. By analyzing the who, where, and what of family business research, the reasons why the developmental trends have occurred and how the field's momentum can be maintained and directed toward productive ends become clearer.

Paradigms and Theory Building in the Domain of Business Families

Moores, K. — Tue, 28 Apr 2009 13:37:46 PDT

This article argues the bona fides of the study of family business as a standalone discipline. Using a widely accepted evolutionary process for the development of scientific disciplines and an established theory-building methodology, the author introduces a theoretically robust explanation of the domain of business families. Established theories widely acknowledged as having relevance to business families are meshed with the universally accepted three-circle Venn diagram-based paradigm to illustrate both the stage of the discipline in theory building terms and an evolutionary path to further develop a theory of the business family domain.

Book Review: Bellow, A. (2003). In Praise of Nepotism: A Natural History. Garden City, NY: Doubleday

Kaye, K. — Tue, 28 Apr 2009 13:37:46 PDT

Book Review: Wyly, S. (2008). 1,000 Dollars & an Idea: Entrepreneur to Billionaire. New York: Newmarket Press

Hutcheson, J. O. — Tue, 28 Apr 2009 13:37:46 PDT

Special Issue: Accounting in Family Firms

Moores, K., Salvato, C. — Tue, 28 Apr 2009 13:37:46 PDT

Dear Reader

Bianchi, C. — Mon, 23 Feb 2009 15:38:00 PST

Embracing Change While Preserving the Core

Sharma, P. — Mon, 23 Feb 2009 15:38:00 PST

Family Firms and Entrepreneurial Orientation in Publicly Traded Firms: A Comparative Analysis of the S&P 500

Short, J. C., Payne, G. T., Brigham, K. H., Lumpkin, G.T., Broberg, J. C. — Mon, 23 Feb 2009 15:38:00 PST

There is considerable disagreement about whether family firm characteristics hinder or support entrepreneurial activities. This article highlights the existence of an entrepreneurial orientation in family firms, and it examines differences between family and nonfamily firms on the entrepreneurial orientation dimensions of autonomy, competitive aggressiveness, innovativeness, proactiveness, and risk taking, using content analysis of shareholder letters from S&P 500 firms. As such, family firms exhibit language consistent with an entrepreneurial orientation for all dimensions but use less language than that of nonfamily firms in relation to autonomy, proactiveness, and risk taking.

Resource Mobilization and Performance in Family and Nonfamily Businesses in the United Kingdom

Levie, J., Lerner, M. — Mon, 23 Feb 2009 15:38:00 PST

This study draws on agency theory and the resource-based view to hypothesize that family and nonfamily businesses differ in the capital that they deploy and the way that they deploy it. It, and test this hypothesis in a large U.K.-based sample of 319 family business and 258 nonfamily business owner/managers. The analysis revealed that adverse selection, opportunism, and niche marginalization are more prevalent among family business owner/managers. Yet, their businesses are similar to those of their nonfamily business peers in performance outcomes such as size and growth, which suggests that weaknesses in human and financial capital choice are offset by strengths in the social capital of family firms.

The Effects of Family Versus Career Role Salience on the Performance of Family and Nonfamily Firms

Barnett, T., Eddleston, K., Kellermanns, F. W. — Mon, 23 Feb 2009 15:38:00 PST

This study investigated how the relative salience of business owners' family and career roles might influence performance outcomes in family versus nonfamily firms. Using data from 156 family and nonfamily firms, the data show that family firm status moderates the relationships such that the career role salience of a business owner is positively and more strongly associated with performance outcomes in family firms than in nonfamily firms. Conversely, the data show that family firm status negatively moderates the relationship between the business owner's family role salience and expansion activities. Implications for theory and practice, as well as future research directions, are discussed.

Research on Women in Family Firms: Current Status and Future Directions

Martinez Jimenez, R. — Mon, 23 Feb 2009 15:38:00 PST

Based on a review of 48 articles and other research works published since 1985, the current work examines both obstacles to and positive aspects of women's involvement in family firms. The most important findings of this work concern the important role that wives play for the continuity and growth of the family firm and the factors that can help or hinder daughters to progress professionally and achieve leadership positions in this type of firm. Research questions and methods and implications for future research and practice are also presented.

Updating Systems Concepts in Family Businesses: A Focus on Values, Resource Flows, and Adaptability

Distelberg, B., Sorenson, R. L. — Mon, 23 Feb 2009 15:38:00 PST

This article extends and expands current systems views of family business and provides a framework for interpreting family business holistically. The framework extends the definition of family-first and business-first systems and adds three categories that typify the gradations of firms that represent balanced systems emphases. In addition, this article discusses the goals, resource transfers, strengths, and limitations of each type of system and describes how firm adaptability and resource flows influence and change these family business systems; it argues that to understand family business health, one must understand the values and goals that guide the family, business, and ownership systems, as well as the overall family business system; and it presents an inclusive definition of family and business based on systems membership.

Studying the Family Enterprise Holistically: Evidence for Integrated Family and Business Systems

Basco, R., Perez Rodriguez, M. J. — Mon, 23 Feb 2009 15:38:00 PST

This research contributes to the family business literature by empirically demonstrating that family enterprises that give more emphasis to family and business as a whole have better family results and similar business results when compared to those enterprises that limit governance to only the business. The article includes a review of the literature, and it identifies a set of four basic dimensions that focus on different aspects of family enterprise. The study then combines measures of these dimensions to describe both the governance and the nature of the family and the business. A representative sample of 732 Spanish family enterprises enabled the research to reveal empirical support for the theory positing that balanced attention to governing the subsystems is an effective route to family enterprise management.

Book Review: Kets de Vries, M. F. R., & Carlock, R. S., with Elizabeth Florent-Treacy. (2007). Family Business on the Couch: A Psychological Perspective. London: Wiley

Donnellan, G. J. — Mon, 23 Feb 2009 15:38:00 PST

Book Review: Gordon, G., & Nicholson, N. (2008). Family Wars: Classic Conflicts in Family Business and how to Deal with Them. London: Kogan Page

Jaffe, D. T. — Mon, 23 Feb 2009 15:38:00 PST