Balanced Scorecards to Drive the Strategic Planning of Family Firms

Abstract

The focus of this research is the measurement and management tool known as the Balanced Scorecard (BSC) and how it can be applied in the family business context. In this article we add familiness to the four BSC perspectives (financial, innovation and learning, customer, internal process) and illustrate how this can assist business development, management, and succession planning in family‐owned businesses. We use an action research project to highlight how family businesses can professionalize their management by the adoption of a BSC strategy map that includes a family business focus and links the core essence of the family business with the values and the vision of the founder to the strategic initiatives of the family business. The F‐PEC Scale constructs of power, experience, and culture are used to introduce a PEC statement that identifies and articulates the core essence of the family business. Finally, we discuss potential contributions that this project has for family businesses and those who work with and for them.

Assessing Espoused Goals in Private Family Firms Using Content Analysis

“…Taken together, the manual coding process and computer-aided content analyses can help researchers better understand the salient espoused goals of private family businesses. Similar to others advocating a balanced scorecard approach that examines financial, customer, internal business, and innovation/learning-based goals in family businesses (Craig & Moores, 2005), we argue for the importance of incorporating diverse goals into understanding the overall performance of family businesses. Following strategic reference point theory, which states that businesses use internal, external, and/or time-related referents to gauge performance (Fiegenbaum, Hart, & Schendel, 1996), we argue that such referents can be identified using content analysis of narratives and that these may be reasonable indicators of objective performance (Short & Palmer, 2003).…”

How Family, Business, and Community Logics Shape Family Firm Behavior and “Rules of the Game” in an Organizational Field

“…Similarly, Miller, Le Breton-Miller, and Lester (2011) pointed to the importance of conflicting loyalties of family firm owners -suggesting that they must make trade-offs between family and firm needs. Other studies have similarly highlighted how attention to the family logic can come at the cost of firm profitability (Craig & Moores, 2005;Rutherford, Muse, & Oswald, 2006). This stream of research shows that designing the firm's strategic approach to meet family needs reduces the firm's ability to meet financial goals Schulze, Lubatkin, & Dino, 2003).…”

Strategy for succession in family owned small businesses as a wicked problem to be tamed

“…The deliberate development of a succession plan features strongly in some of the literature and it is argued by some that firms with succession plans should achieve greater firm growth than those that lack such plans. For example, Craig and Moores (2005) suggest that without succession plans, professionalization of the family business is seriously inhibited and an opportunity to address sub-optimal performance that is the result of appointments and promotions of staff or workers that are made on the basis of birth or personal friendship rather than on the basis of ability, education and or technical qualifications are missed. There is clearly some intuitive logic associated with the extent to which those businesses that deliberately plan for growth are more likely to achieve growth and that more skilled and capable workers may be required to address sub-optimal working.…”