151 research outputs found
The internationalization of family SME
No full textPurpose – Owing to its specificities, the family small and medium enterprise (SME) shows a particular behavior as for the creation, development, sharing, protection and transmission of knowledge. The purpose of this paper is to study the specificities of the processes of knowledge creation and development in family firms. Design/methodology/approach – Through a questionnaire, hypotheses of the model were tested. The study is based on 118 firms belonging to various industries. After evaluating the reliability and validity of the items through exploratory and confirmatory factor analysis, the model was tested through structural equation modeling (LISREL). Findings – The model retained induces the following conclusions. Internationalization knowledge positively influences internationalization degree of the firm. The conservatism of family SME does not directly influence the level of internationalization knowledge. The influence of conservatism on internationalization knowledge is exerted only through the decisional dimension of independence orientation. The independence orientation of family SME, then with its two dimensions simultaneously (decisional and resource independence), does not significantly influence internationalization knowledge. Contrary to decisional independence which influences indirectly the degree of internationalization (through the intermediation of internationalization knowledge), resource independence influences directly the dependant variable. The mediation of internationalization knowledge is thus not totally proven. Social networking positively influences the amount of internationalization knowledge. Research limitations/implications – A major weakness is the absence of a synchronic approach as the dependent and independent variables are measured at the same moment. A more longitudinal approach would be valuable to analyze the causal relationships between the independent variables and internationalization knowledge and internationalization degree. A second limitation is that the characteristics of the sample may limit the generalizability of the results.Family firms, Small to medium-sized enterprises, Globalization, Learning organizations, Knowledge management
Organizational Learning and Knowledge DevelopmentPeculiarities in Small and Medium Family Enterprises
No full textThe aim of this theoretical contribution is to analyze the processes of organizational learning and knowledge development within the small and medium sized family firm. Due to its founding characteristics, family SME seems to be a closed, hermetic and rigid organization. Besides, the specificity of mechanisms of learning and knowledge management, in general, within this entity are justified by:- First, the overlapping of "family" and "company" spheres: the family sphere realizes a unique contribution because it constitutes a supplementary source of knowledge inbound to the company compared to a firm without family involvement, - Then, the frequency of the exchanges within the organization: the processes of exchange of piece of information and knowledge take place not only in the organizational context but also and especially in the family context. The family meetings constitute, for example, supplementary occasions for exchange and sharing of knowledge.Schematically, two major characters inherent to this entity constitute obstacles to organizational learning. Indeed, conservatism and independence orientation strongly influence the processes of learning and knowledge development.The literature suggests that the family system attempts to create and maintain a cohesiveness that supports the family "paradigm" which is described as the core assumptions, beliefs, and convictions that the family holds in relation to its environment. Information that is not consistent with this paradigm is resisted or ignored (Davis, 1983). The search for security, conformism and tradition are characteristic of conservative organizations. Particularly to the family firm, the conservative posture could be studied through three dimensions (Miller and ali., 2003). First, on the governance level, the conservatism is exhibited by the plateauing and the growing rigidity of the owner-manager and by the inefficacy of the board of directors. Second, on the strategy level, conservative family SME favorites its actual markets, customers and products and globally is unwilling to change and adopt new paradigms. Then, on the organizational and cultural levels, this entity tends to be closed and introvert. These three components have an impact on knowledge development as the conservatism tends to limit the variation and the exposition to new environments. In short, within this entity the level of organizational knowledge would be weak.The second variable influencing the processes of development of knowledge within family SME is the independence orientation. This orientation is a consequence of the family long-term commitment to the business. Paradoxically, this commitment has two contradictory effects on growth. First, it implies the pursuit of future development and continuity of the firm to make sure that the family heritage is passed on to the following generations. On the other hand, commitment implies a strategy of conservation of the heritage which passes by a strong seek for the independence. Aiming to guarantee its continuity, the (small and medium-sized) family firm establishes an independence orientation of three different types. First, from the financial point of view, it avoids as much as possible turning to outside partners (Hirigoyen, 1985). Then, on the human plan, it would be favorable to the appointment of family members or individuals belonging to the close relational circle to the posts of direction and would be reluctant to the recruitment of professional directors. Finally, to maintain the decision-making in hands of the family, the family firm tends to avoid the inter-organizational relations, cooperative investments, and tries to limit the sharing of the control of its investments. The contribution of outsiders (financiers, directors or partner organizations) can, however, be precious to the company. And the introversion would be a major obstacle to the perpetuity of the firm because it inhibits growth. As a consequence, independence orientation limits the accumulation of knowledge because, on one hand, the horizons of the company will be limited and little varied, and on the other hand, the potential valuable knowledge contribution of outsiders is excluded.The study of these variables raises questions about the efficacy of the organizational memory within the family firm. This organization runs particular risks because of the peculiarity of its knowledge management mechanisms. Because of its founding natural characteristics, the family firm nurtures mechanisms which reinforce the causal ambiguity (Nelson and Winter, 1982) by strengthening the voluntary effort to avoid either a too fast imitation or the loss of knowledge-based resources if the individual or the group holding it leaves the organization (Arrégle, 1995). In short, family firms show an inclination to concentrate the processes of knowledge management around its tacit dimension by encouraging its formation contrarily to the explicit component. However the weak externalization of knowledge coupled with the avoidance of sharing outside the family causes serious risks. First, an obvious risk of deterioration is present because of the weak importance of the organizational protection mechanisms and the strong reliance on individual memory. Moreover, we suggest a risk of erosion of knowledge due to the fragmentation caused by successions that do not preserve the unity of the firm. There is risk of "fragmentation" of the strategic knowledge if the company is shared between the potential successors. This risk would be less pronounced if a prior sharing of knowledge with outside directors had been engaged.Another particularity of family firms is about the intergenerational transmission and transfer of knowledge (Cabrera-Suarez and ali., 2001). Mechanisms inciting to intergenerational transfer of knowledge must be set up because of the negative impact of conservatism and independence on organizational knowledge and due to the fragility of family firm organizational memory.Organizational knowledge, family business, conservatism, independence orientation
Family Businesses in the Arab Economic Context
No full textInternational audienceThis chapter offers a review of key economic factors and challenges shaping the economic context in which Arab family businesses operate. Growth, exports, foreign direct investment (FDI), unemployment and countries’ governance are the main aspects analysed in this chapter. In a second step, the major economic opportunities and threats that Arab family business faces will be exposed
Governance, Strategy, and Financing
No full text256 pages : illustrationsIncludes bibliographical reference
Socioemotional approach: Exploring women’s guilt in an all-female Egyptian family business
No full textThe role of women in family businesses is still an under-researched area, with existing research focusing on issues such as women’s roles, work-life balance and equality in terms of pay or careers. This paper seeks to understand the close interpersonal relationships of a small family business. It uses a case study approach to examine the dynamics and emotions at play within the firm and then develops a thought-provoking model of guilt to explain these dynamics. The case study examines an all-female family business in Egypt (Sharm-el-Sheikh). It is a small women’s wear business started and managed by the mother with both daughters employed. Using narrative inquiry, the research explores this family at a crucial turning point, following the business through near bankruptcy to ‘seeing light at the end of the tunnel’ before finally closing. The business achieved its recovery by professionalizing and changing ownership structures, aided by open communication and the recognition of roles and responsibilities. The research, conducted over a 2-year period starting in 2010 and ending in 2012, provides initial insights into the process through which family businesses are bound by guilt and love—emotions which exist simultaneously and which are reflected in the indviduals, the businesses and the family members’ lives. Suggestions for future research are also given. These include replication of the study in developed countries and other cultural contexts as well as development of a deeper understanding of the emotions of love and guilt in the context of working within and entering into family firms
The Influence of Family Members’ Identification With the Firm on Family SME’s International Diversification: The Moderating Role of Exploration and Exploitation
No full textThis research investigates the effect of the key socio-emotional goal of family members’ identification with the firm on international diversification. Furthermore, it examines the moderating effect of a family firm’s learning orientation – expressed in terms of a firm’s exploratory and reproductive orientations – on the relationship between this goal and a firm’s degree of international diversification. Our findings do not validate the thesis according to which a reproductive orientation would reinforce the negative relationship between family members’ identification and international diversification. However, it shows that exploratory orientation negatively moderates the relationship between family members’ identification with the firm and international diversification.Cette recherche analyse l’effet de l’identification des membres de la famille à l’entreprise – objectif socio-émotionnel clé au sein des entreprises familiales – sur la diversification internationale de l’entreprise. L’effet modérateur de l’orientation apprentissage – exprimée en termes d’orientation exploratoire et reproductive – sur la relation entre l’identification et le degré de diversification internationale est évalué. Les résultats ne valident pas la thèse selon laquelle l’orientation reproductive renforcerait la relation négative entre l’identification et la diversification internationale. Cependant, l’étude montre que l’orientation exploratoire modère négativement la relation entre l’identification des membres de la famille à l’entreprise et la diversification internationale.Esta investigación analiza el efecto de la identificación de los miembros de la familia con la empresa – un objetivo socioemocional clave en las empresas familiares – sobre la diversificación internacional de la empresa. Se evalúa el efecto moderador de la orientación al aprendizaje – expresada en términos de orientación exploratoria y reproductiva – sobre la relación entre la identificación y el grado de diversificación internacional. Los resultados no apoyan la tesis de que la orientación reproductiva refuerza la relación negativa entre la identificación y la diversificación internacional. Sin embargo, el estudio muestra que la orientación exploratoria modera negativamente la relación entre la identificación de los miembros de la familia con la empresa y la diversificación internacional
Conservatism: An Explanation of the Financial Choices of the Small and Medium Family Enterprise
No full textInternational audienceThe financial behavior of the family firm is a recurring topic in the literature. Hirigoyen's pioneer research (1984) reveals the specificity of the financial behaviors of industrial family medium-sized companies compared to those of the other categories of firms. This type of firms set out effective structures enabling them a better financial management because, on the one hand, they have a long term vision and, on the other hand, are not accountable for short-term results (Dreux, 1990), especially for unquoted firms. In addition, the desire to transmit the firm to the next generations would more encourage the effective management of capital (Gallo and Vilaseca, 1996). Precisely, the long-term horizons of the family firm make it possible to qualify its capital as “patient financial capital” (Reynolds, 1992). Indeed, this capital is invested for long periods without threat of liquidation contrary to “ordinary” financial capital which generally have a due limit corresponding to the end of investment (Dobrzynski, 1993). The firms having this type of capital would be able to pursue more creative and innovating strategies. Besides, family firms, of small and medium size especially, are characterized by the lack of financial resources. Ward (1987) observes that poverty in capital which is necessary to finance the needs of the family and the business is a factor which inhibits growth. Two explanations justify the lack of financial resources in SME. The first makes responsible the financial markets. Indeed, investors would be very hesitant as for investing in these firms (Mahérault and Lyagoubi, 2002). Many family firms SME are not able to meet the necessary conditions, or sometimes unwilling to set up the adequate organizational answers, to facilitate their access to the external capital (Davis and ali., 2000). The second explanation is about internal obstacles. To achieve its goal of durability, the family firm tries to evolve in a more or less hermetic universe. Accordingly, external financial intervention is avoided because it can deteriorate the independence of the firm. The small and medium family enterprise is characterized by a strong conservative attitude. How does conservative orientation influence the financial choices of the small and medium family enterprise? This theoretical contribution tries to answer this question. For Kreiser and ali. (2002), the family firm in general adopts a strategy of a conservative growth dedicating the “living company” model. Such a company consecrates long-term survival instead of financial performance as the main objective to be pursued. Accordingly, highly aware of its identity, it privileges financial conservatism and maintains a narrow control on strategic decisions in family hands. The analyzes of Hirigoyen (1985) join this idea since the author emphasizes that the industrial family SME does not furnish a true effort to increase its market share because it is mainly preoccupied by controlled growth. The analysis will be done in two steps. After pointing out the main dimensions of the financial conservatism of family SME: internal financing and avoidance of the external financial involvement, the analysis will explain the manifestations of conservatism and its sources. The paper will be concluded by reflections as for the strategies enabling to avoid, limit or even eliminate the impacts of conservatism
Conservatism: An Explanation of the Financial Choices of the Small and Medium Family Enterprise
No full textInternational audienceThe financial behavior of the family firm is a recurring topic in the literature. Hirigoyen's pioneer research (1984) reveals the specificity of the financial behaviors of industrial family medium-sized companies compared to those of the other categories of firms. This type of firms set out effective structures enabling them a better financial management because, on the one hand, they have a long term vision and, on the other hand, are not accountable for short-term results (Dreux, 1990), especially for unquoted firms. In addition, the desire to transmit the firm to the next generations would more encourage the effective management of capital (Gallo and Vilaseca, 1996). Precisely, the long-term horizons of the family firm make it possible to qualify its capital as “patient financial capital” (Reynolds, 1992). Indeed, this capital is invested for long periods without threat of liquidation contrary to “ordinary” financial capital which generally have a due limit corresponding to the end of investment (Dobrzynski, 1993). The firms having this type of capital would be able to pursue more creative and innovating strategies. Besides, family firms, of small and medium size especially, are characterized by the lack of financial resources. Ward (1987) observes that poverty in capital which is necessary to finance the needs of the family and the business is a factor which inhibits growth. Two explanations justify the lack of financial resources in SME. The first makes responsible the financial markets. Indeed, investors would be very hesitant as for investing in these firms (Mahérault and Lyagoubi, 2002). Many family firms SME are not able to meet the necessary conditions, or sometimes unwilling to set up the adequate organizational answers, to facilitate their access to the external capital (Davis and ali., 2000). The second explanation is about internal obstacles. To achieve its goal of durability, the family firm tries to evolve in a more or less hermetic universe. Accordingly, external financial intervention is avoided because it can deteriorate the independence of the firm. The small and medium family enterprise is characterized by a strong conservative attitude. How does conservative orientation influence the financial choices of the small and medium family enterprise? This theoretical contribution tries to answer this question. For Kreiser and ali. (2002), the family firm in general adopts a strategy of a conservative growth dedicating the “living company” model. Such a company consecrates long-term survival instead of financial performance as the main objective to be pursued. Accordingly, highly aware of its identity, it privileges financial conservatism and maintains a narrow control on strategic decisions in family hands. The analyzes of Hirigoyen (1985) join this idea since the author emphasizes that the industrial family SME does not furnish a true effort to increase its market share because it is mainly preoccupied by controlled growth. The analysis will be done in two steps. After pointing out the main dimensions of the financial conservatism of family SME: internal financing and avoidance of the external financial involvement, the analysis will explain the manifestations of conservatism and its sources. The paper will be concluded by reflections as for the strategies enabling to avoid, limit or even eliminate the impacts of conservatism
CONSERVATISM: AN EXPLANATION OF THE FINANCIAL CHOICES OF THE SMALL AND MEDIUM FAMILY ENTERPRISE
No full textThe financial behavior of the family firm is a recurring topic in the literature. Hirigoyen's pioneer research (1984) reveals the specificity of the financial behaviors of industrial family medium-sized companies compared to those of the other categories of firms. This type of firms set out effective structures enabling them a better financial management because, on the one hand, they have a long term vision and, on the other hand, are not accountable for short-term results (Dreux, 1990), especially for unquoted firms. In addition, the desire to transmit the firm to the next generations would more encourage the effective management of capital (Gallo and Vilaseca, 1996). Precisely, the long-term horizons of the family firm make it possible to qualify its capital as “patient financial capital” (Reynolds, 1992). Indeed, this capital is invested for long periods without threat of liquidation contrary to “ordinary” financial capital which generally have a due limit corresponding to the end of investment (Dobrzynski, 1993). The firms having this type of capital would be able to pursue more creative and innovating strategies. Besides, family firms, of small and medium size especially, are characterized by the lack of financial resources. Ward (1987) observes that poverty in capital which is necessary to finance the needs of the family and the business is a factor which inhibits growth. Two explanations justify the lack of financial resources in SME. The first makes responsible the financial markets. Indeed, investors would be very hesitant as for investing in these firms (Mahérault and Lyagoubi, 2002). Many family firms SME are not able to meet the necessary conditions, or sometimes unwilling to set up the adequate organizational answers, to facilitate their access to the external capital (Davis and ali., 2000). The second explanation is about internal obstacles. To achieve its goal of durability, the family firm tries to evolve in a more or less hermetic universe. Accordingly, external financial intervention is avoided because it can deteriorate the independence of the firm. The small and medium family enterprise is characterized by a strong conservative attitude. How does conservative orientation influence the financial choices of the small and medium family enterprise? This theoretical contribution tries to answer this question. For Kreiser and ali. (2002), the family firm in general adopts a strategy of a conservative growth dedicating the “living company” model. Such a company consecrates long-term survival instead of financial performance as the main objective to be pursued. Accordingly, highly aware of its identity, it privileges financial conservatism and maintains a narrow control on strategic decisions in family hands. The analyzes of Hirigoyen (1985) join this idea since the author emphasizes that the industrial family SME does not furnish a true effort to increase its market share because it is mainly preoccupied by controlled growth. The analysis will be done in two steps. After pointing out the main dimensions of the financial conservatism of family SME: internal financing and avoidance of the external financial involvement, the analysis will explain the manifestations of conservatism and its sources. The paper will be concluded by reflections as for the strategies enabling to avoid, limit or even eliminate the impacts of conservatism.
L’internationalisation de la firme : les théories de l’apprentissage organisationnel sont-elles caduques ?
No full textInternational audienc
- …
