This document summarizes research on family business management and the influence of family on firm performance and strategy. It discusses how family involvement can be measured and how this affects decision-making. Research shows that family firms are heterogeneous and can achieve success through different combinations of family-oriented and business-oriented decisions. The document outlines future research areas, including integrating these findings into theories of strategic management and exploring the relationship between individual, family, and firm levels of analysis.

1. Family-Enterprise Management
Is family influence an asset or a
liability?
Basco Rodrigo PhD
Witten/Herdecke University
Witten Institute for Family Business
1

2. Family-Enterprise Management
Is family influence an asset or a liability?

3. Family business field
M. C. Escher
Relativity, 1953
3

4. Family business field
4

5. Family business field
Research Centers
Family Business Institutes
Family Business Chairs
Conferences
Academic Journals
How has family business knowledge been created?
How has family business knowledge evolved ?
Researchers
Family Owners
Practitioners
Family Managers
5

6. Family business field
 Procedure – Literature review
» Journals: ETP, JBV, and FBR
» 2000-2009
» 235 articles
» Organization of papers:
- Descriptive characteristics: topic, theory, future research, academic limitations, recommendations
and general conclusions.
- Internal and external elements/knowledge
» Classification:
- Borrowing and replicating
- Borrowing and extending
- Inverse contribution
6

7. Family business field
 Future research lines – theoretical/methodological
» Literature review for topics such as governance, management, firm performance. To
analyze to what extent these three steps (bringing knowledge from the main stream,
adding and developing new knowledge, and bringing back knowledge) can be
recognized in different topics.
» Trap on the ontological view of Family Business Field. This is a limitation for developing
a real theory of family firm which incorporates the family as well as the firm
perspective.
» Methods: general statistical methods and specific methods to incorporate the family
dimensions into the general research.
7

8. Family-Enterprise Management.
Is family influence an asset or a liability?

9. Family-Business Relationship

10. Family-Business Relationship
•
CEO Alfred Ritter of Ritter Sport: ‘We do not think in years, but rather
generations’
•
CEO Dr Karsten Ottenberg of Gieseck & Devrient: ‘We do not think in producing
good figures in the next quarter. We are more concerned with sustainability over
generations’
•
CEO Angel Añaños of AJEGORUP: ‘Family participates actively in relevant business
decisions and if there isn’t unanimity within the family there are two
alternatives: either to convince those who don’t agree or let themselves be
convinced by those of a different opinion’.

11. Family-Business Relationship
• How to measure the family influence on firm behavior?
• Does family influence on firm affect firm performance?
• Does the fit between family-business interaction and strategic position
Family
Firm
economically matter?

12. Family-Enterprise Management.
Is family influence an asset or a liability?

13. Family-Business Relationship

14. Family-Business Relationship
It is known that: family business behave differently
king
ecision-ma
D
How to measure the family-business relationship?
Where can family-business relationship be captured?

15. Family-Business Relationship

16. Family-Business Relationship
 Methodology
» Scale development (questionnaire)
» Sample design and data collection (representative sample)
- Spain
- +700 small and medium family firms
- Firm size: 50 to 500 employees
- Family business definition: 50% capital in family members / at least 2 family members TMT.
» Data analysis
- Descriptive analysis
- Factorial analysis (underline structure of the data)
- Discriminant analysis
- Confirmatory factorial analysis (construct validity: reliability, convergent validity, discriminant
validity, nomological validity)

17. Business
orientation
Family
orientation

18. Family-Business Relationship
Family involvement
STRATEGIC PROCESS
SUCCESSION
HUMAN RESOURCES
BOARD OF
DIRECTORS
How is an organization governed and managed?
Family-oriented decisions
Business-oriented decisions

19. Family-Business Relationship
• Family participation is a necessary condition …… but not sufficient
to understand how family firms work.
• It is not the family participation itself what makes family firm
different, but the way the family affects decision-making.

20. Family-Business Relationship
 Future research lines – theoretical/methodological
» How to integrate this result into the system theory?
» Heterogeneity of family firms: how do family firms combine family-oriented and
business-oriented positions? What is the effect on firm performance?

21. Family-Enterprise Management
Is family influence an asset or a liability?

22. Heterogeneity of family firms

23. Heterogeneity of family firms
 System theory  Configurative approach
»
Regularity, rules and patterns
»
Holistic view
»
Goal Orientation
»
Equifinality – Multifinality
»
Circular causality
»
Homoestasis and heterostasis
 Configurative approach
» ‘Multidimensional constellation of conceptually distinct characteristics that commonly
occurs together’

24. Heterogeneity of family firms
Family-oriented decisions
Are family firms a homogeneous group?
Family-first firms
Family-enterprise first
firms
Marginal type of firms
Business-first firms
Business-oriented decisions

25. Heterogeneity of family firms
How does the family-business relationship affect family firm performance?
Family-oriented decisions
Business-oriented decisions
Family-enterprise first firms
Family-first firms
Equifinality
Family Performance
Business-first firms
Equifinality
Business performance

26. Heterogeneity of family firms
 Methodology
» Scale development (questionnaire)
- Performance (subjective measure based on degree of goal achievement)
» Sample design and data collection (representative sample)
» Data analysis
- Descriptive analysis
- Cluster analysis (underline structure of the sample – group)
- Discriminant analysis
- Ideal profile of firm – Euclidean distance
- Configurative approach procedure (heterogeneity – equifinality - performance)

27. Heterogeneity of family firms
• Heterogeneity based on behavioural elements
• Family firms can achieve successful business results by using a
combination of family and business orientations in their decisionmaking

28. Heterogeneity of family firms
 Future research lines – theoretical/methodological
» How to integrate this result into the strategic literature?
» Heterogeneity of family firms: how do family firms integrate family-orientation /
business orientation with strategic position (strategic behavior)?

29. Family-Enterprise Management
Is family influence an asset or a liability?

30. Strategic position of family firms

31. Strategic position of family firms
How do family firms fit together their family and business oriented decision-making
and strategic behaviour in order to produce superior performance?

32. Strategic position of family firms

33. Strategic position of family firms
 Methodology
» Scale development (questionnaire)
- Strategic behavior (how does the firm compete – Porter’s scale: cost-leadership and differentiation
leadership)
» Sample design and data collection (representative sample)
» Data analysis
- Descriptive analysis
- Configurative approach procedure (heterogeneity – performance)
–
–
–
–
Factorial analysis
Cluster analysis
Euclidian distance
Regression and correlation

34. Strategic position of family firms
• Decision-making and strategic behaviours are not independently
important, but they are important when they complement each
other
• Consistency in the direction of decision-making and strategic
behaviour helps firms achieve a higher level of performance

35. Family-Enterprise Management
Is family influence an asset or a liability?

36. Future steps
Family-Enterprise Management
• Practical aspects: Family-Enterprise Management
» Report - Family-Enterprise Management
(practical perspective about family-enterprise
management)
» Book – Theoretical model about Family-Enterprise Management and case studies.
» Blog to spread these ideas
» Teaching seminar/course
• Research aspects: Family-enterprise management
» Extending this research to other contexts
» Case studies:
•
•
•
Improve the scale
Introduce the connection between individual level and firm level
Context (cultural context) as relevant aspect to understand

37. Future steps
Research – Working papers
•
Special Issue: Family Business and Regional development
(Basco, R.; Block, J.; Stough, R.; Welter, F.; Wennberg, K.)
•
The role of the family firms in the regional development (Basco,
R.)
•
Search breadth and innovation in family firms: evidence
from a natural-resource based cluster in Chile (Basco, R.;
De Massis, A. Kotlar, J.)
•
Board of directors and firm performance in private
family firms: a test of the demographic versus behavioral
approach (Basco, R.; Voordeckers, W.)
•
The role of board of directors during financial crisis in
family firms (Fynn-Willem Lohe, Calabro A. & Basco, R.)
•
Board composition in family firms: Its effect on firm
performance (Vecchiarini, M: Calabro, A: & Basco, R.).
•
Who should sit here and who should sit there? Effects of
family-oriented objectives on board composition (Basco,
R. & Calabro, A.)
•
An exploratory study of family firm objectives (Basco, R.;
Pieper, T. )
•
Opportunity-oriented and family-oriented founder owner-managers.
Do they behave differently? (Basco, R.)
•
Determinants of family and non-family member nomination in the
succession of privately-owned family firm (Basco, R. & Calabró, A.)
•
Family-enterprise decision-making,
perspective (Bartolami, F. & Basco, R)
a
behavioral
economic