Now showing 1 - 10 of 72
  • Publication
    Listening to the heart or the head? Exploring the “willingness vs. ability” succession dilemma
    Incumbents typically seek a highly committed and at the same time highly competent child as a successor, yet such a candidate is often not available. Extant literature is unable to predict which desired attribute—commitment (i.e., willingness) or competence (i.e., ability)—is most important in this dilemma. Drawing from institutional logics literature, we suggest that the incumbent’s personal experiences, education, and cultural embeddedness, as much as firm-level situational stimuli, direct incumbent attention to either corporate logic, favoring competence, or family logic, favoring commitment, to guide decision-making about which family member to choose as a successor. We test our hypotheses using policy capturing with responses of 1,060 family firm owner-managers, and contribute to research on succession, family firms, and institutional logics.
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  • Publication
    The impact of family management on employee well-being: A multilevel study
    Non-family employees are an important resource in family firms; therefore, understanding their well-being is of utmost relevance for management theory. Integrating leadership theory into family business research, we draw from the emotional contagion and person-organization fit theories and argue that employee well-being in terms of organizational-level affective climate and individual-level job satisfaction is higher in firms managed by a family CEO. Moreover, we hypothesize that this relationship becomes stronger with higher levels of CEO transformational leadership and weaker with increasing CEO tenure. We test our hypotheses using a large-scale, multilevel dataset comprising 2,246 direct reports of the respective CEO and 41,531 employees from 497 family- and non-family-managed firms. By applying multilevel modeling, we found support for our proposed hypotheses. Post-hoc tests reveal that the positive effect of family management is particularly strong in first generation family firms. This article contributes to research on leadership and on family firms and advances the evidence-based debate about employees in those firms.
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    Scopus© Citations 4
  • Publication
    Doing more with less: Innovation input and output in family firms
    (Academy of Management, 2016-08)
    Duran, Patricio
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    Family firms are often portrayed as an important yet conservative form of organization that is reluctant to invest in innovation; however, at the same time, evidence shows that family firms are still flourishing and that many of the world's most innovative firms are indeed family firms. Our study contributes to disentangling this puzzling effect. We argue that family firms-owing to the family's high level of control over the firm, wealth concentration, and importance of non-financial goals-invest less in innovation but have an increased conversion rate of innovation input into output and, ultimately, a higher innovation output than non-family firms. Empirical evidence from a meta-analysis based on 108 primary studies from 42 countries supports our hypotheses. We further argue and empirically show that the observed effects are even stronger when the CEO of the family firm is a later-generation family member. However, when the CEO of the family firm is the firm's founder, innovation input is higher and, contrary to our initial expectations, innovation output is lower than that in other firms. We further show that the family firm-innovation input/output relationships depend on country-level factors, namely, the level of minority shareholder protection and the education level of the workforce in the country.
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    Scopus© Citations 559
  • Publication
    Exploration and Exploitation in Established Small and Medium-sized Enterprises: The Effect of CEOs' Regulatory Focus
    Based on theory of regulatory focus and organizational ambidexterity, we hypothesize that the level of engagement in exploration and exploitation in a small or medium-sized enterprise (SME) is affected by the respective CEO's chronic regulatory focus. In our analysis of survey responses from CEOs in Switzerland, we find that the CEO's level of promotion focus positively affects the firm's engagement in both, exploration and exploitation, while the CEO's prevention focus is negatively associated with the firm's exploration but not significantly related to its exploitation. The positive associations between a CEO's promotion focus and the firm's exploration/exploitation activities are enhanced under conditions of intense competition.
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    Scopus© Citations 135
  • Publication
    The Impact of Storytelling on Innovation: a Multi Case Study
    (Academy of Management, 2015-01) ;
    Dessi, Cinzia
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    Floris, Michela
    The founder’s values and beliefs are often determinant for family business’ later organizational path and as such affect the organization’s level of innovation. Building on recent research that has identified storytelling as an important means to imprint the founder’s values and beliefs, we apply a multi-case research design to investigate how different foci of those stories affect a family firm’s level of innovation. We suggest that founder-centered stories entail a focus on decisions that match with the founder’s values, hierarchical decision-making, and destructive conflicts, which ultimately lead to low levels of innovation. To the contrary, family-centered stories free family members in their decision-making and entail a collaborative decision-making characterized by low levels of conflicts. As a result, those firms have higher levels of innovation as compared to firms with founder-centered stories. We summarize our findings in a model of path creation in family firms.
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    Scopus© Citations 1
  • Publication
    The Impact of Shared Stories on Family Firm Innovation : a Multi-Case Study
    (Sage, 2015-09-18) ;
    Dessi, Cinzia
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    Floris, Michela
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    Murru, Alessandra
    Innovation is a key determinant of long-term success for family firms. We apply a multiple case study research design to investigate the relationship between stories that are shared among family members across generations and the family firms' innovations. We derive a set of eight propositions suggesting that founder focus is negatively, and family focus is positively associated with innovation. We further propose that these relationships are mediated by the scope of decision-making options, the distribution of decision-making power between generations, and the role of conflict in the families.
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    Scopus© Citations 159
  • Publication
    Value Creation in Family Firms: A Model of Fit
    (Elsevier, 2015-06) ; ;
    Voordeckers, Wim
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    We propose a framework describing how family ownership can create or destroy value depending on the goals, resources, and governance of the family firm, which are each influenced by the family owners. Taking a contingency perspective, we suggest that a fit is required for all three elements - family-influenced goals, resources, and governance - for the family firm to flourish over generations. We conclude with a suggested research agenda indicating research opportunities at the nexus of these identified elements. Further we provide some guiding questions for practitioners that might stimulate fruitful discussions among family firm owners and managers about how to realize "fit."
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    Scopus© Citations 47
  • Publication
    Family, Wealth, and Governance: An Agency Account
    (Wiley-Blackwell, 2015-11) ;
    Family firms often evolve into ownership constellations with multiple family owners. Building on agency theory, we argue that the growing complexity within a group of family blockholders gives rise to what we label family blockholder conflicts, defined as conflicts within a group of family owners. To curb family blockholder conflicts, families often separate the family from its assets and install intermediary governance structures. We explore four frequently applied structures (uncoordinated family, embedded family office, single family office, and family trust), which vary in their degree of separation between family owners and assets and consequently the extent to which the firm might incur family blockholder costs and the double-agency costs associated with appointing agents to oversee agents. We conclude with a discussion of the distributive effects of the four family governance constellations for family wealth over time.
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    Scopus© Citations 96