Negative reflections of nepotism on employees and obstacles in the process of institutionalization of family businesses

Abstract

One of the most prominent problems faced by family businesses is the presence of nepotism. This study was conducted to find out if nepotism is present in local family businesses operating in Kosovo. It also aims to identify the negative reflections of nepotism on employees and the effects of nepotism on obstructing the institutionalization of family businesses. In this study, direct interviews were conducted with the managers of 10 family businesses who have no family ties with the founders of the business. The study was conducted with qualitative methods with the model of the case study, where the program MAXQDA 2020 was used for data analysis, which created codes and categories from the results of interviews. From the results of this study, it is understood that nepotism as a phenomenon is widespread in these enterprises. On the other hand, some of the negative reflections of nepotism on the managers and other employees of these family businesses have been identified as a result of the existence of nepotism. It is also understood that the existence of nepotism is an obstacle to the institutionalization of family businesses

An Examination of Nepotism Perceptions within Ugandan Family-Owned Enterprises

“…Supporting this notion, Spahi (Spahi et al, 2022) identified the negative consequences of nepotism on managers and employees in Kosovo. Similarly, (Sugundan et al, 2018) emphasized the detrimental nature of nepotism, describing it as a "very unhealthy practice" that disrupts human resource recruitment and demotivates non-family employees.…”

“…This pervasive nature of nepotism presents a significant challenge for Ugandan family businesses, as widely discussed in various publications. Notably, research by Spahi (Spahi et al, 2022) identifies nepotism as a leading cause of decreased employee motivation. While only 35.8% of respondents denied the existence of nepotism altogether, a substantial portion (64.3%) acknowledged its presence, highlighting its potential impact on Ugandan family businesses.…”