Nadine Kammerlander

Given the importance of non-economic considerations throughout the entrepreneurial life cycle, I aim to investigate the drivers of owner-managers' "emotional pricing" when they wish to sell their firms to successors. Emotional pricing thereby denotes those elements of the owner-managers' price expectations that cannot be traced back to economic considerations. Building on arguments from behavioral finance, I hypothesize that "emotional pricing," which in this study reflects owner-managers' willingness to sell the firm at a discount, is driven by the reluctance to lose access to information about the firm and to lose influence on the firm, and by an aversion to putting the firm's future at risk. In particular, I argue that a long-term relationship between an owner-manager and a firm, a familiar relationship between an owner-manager and a successor, and situational contingencies-especially unsatisfactory firm performance-increase the owner-manager's emotional-pricing component. I test the hypotheses using a sample of 1,354 owner-managers of Swiss SMEs, who provided their views on their exit intentions. I subsequently compare those results to 455 actual ownership transfers involving Swiss SMEs.

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.

Family business succession is a crucial and challenging process, during which incumbents and successors increasingly build on the support of advisors. Based on qualitative data gathered from five small- and medium-sized companies, we aim to explore the different roles an advisor assumes along the four phases – trigger, preparation, selection and training – of the succession process. This study makes three contributions to the literature. First, we outline how the role of the advisor adjusts over time – from an initializer to a process planer to a task supporter to finally that of a coach – and thereby supports him or her in serving both, incumbent and successor. Second, we show how the different roles of the advisor and the corresponding activities affect the emotions of incumbent and successor in each phase of the process either positively or negatively. Finally, we suggest that full role adjustment of the advisor supports the incumbent and the successor in adjusting their own roles which ultimately has a positive effect on the outcome of the succession process.

In our quantitative study we investigate the antecedents of two distinct exit routes. Building on information asymmetry theory, we discuss that the owner's inferior knowledge about the ability of potential family external (in contrast to family internal) successors renders a family internal transition more likely. However, this information asymmetry can be mitigated by activities such as owners' screening and successors' signaling efforts to unveil the successor's ability. Our data exhibits a positive effect of signaling and an inverted u-shaped effect of screening on the probability of an external succession. Socioemotional wealth, generated by long ownership duration, moderates these effects.