Nonfamily Managers, Family Firms, and the Winner's Curse: The Influence of Noneconomic Goals and Bounded Rationality

Chrisman, James J.; Memili, Esra; Misra, Kaustav

doi:10.1111/etap.12014

Cited by 219 publications

(200 citation statements)

References 96 publications

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“…Owing to the potential critical role of family business leaders on the development of OPC, as we suggested earlier, future research can explore this phenomenon through the lens of leader-member exchange (LMX) theory in family firms (Pearson & Marler, 2010). Additionally, family size, firm size, business life cycles, and generational differences (Chrisman et al, 2013) can play a role in shaping the OPC of family firms. All these suggest future research avenues for OPC of family firms.…”

Section: Resultsmentioning

confidence: 97%

“…This is because family firms tend to accept or avoid risk to their economic performance owing to loss aversion concerning their socioemotional wealth, which can elevate noneconomic family firm performance. Indeed, family firms tend to be risk averse in order to protect socioemotional wealth to an extent that they may be willing to accept a greater economic performance hazard in order to preserve socioemotional wealth rooted in family-centered noneconomic goals (Chrisman, Memili, & Misra, 2013;Gomez-Mejia et al).…”

Section: Ccfg and Family Firm Economic And Noneconomic Performancementioning

confidence: 99%

“…These research findings suggest that family firms experience a dilemma resulting in trade-offs between economic and noneconomic goals which can shape their strategies, behavior, and performance (Chrisman et al, 2013). Therefore, it is imperative to examine the impact of CCFG on both economic and noneconomic family firm performance.…”

Section: Ccfg and Family Firm Economic And Noneconomic Performancementioning

confidence: 99%

See 2 more Smart Citations

Going beyond Research on Goal Setting: A Proposed Role for Organizational Psychological Capital of Family Firms

Memili

Welsh

Luthans

2013

Entrepreneurship Theory and Practice

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Kotlar and De Massis found that membership assortment and the number of organizational members, as well as the imminence of succession, influence goal diversity in family firms. They also showed that goal diversity can be managed and family-centered goals can be stabilized through professional and familial social interactions, driving the formation of collective commitment to family-centered goals (CCFG). Using this research as a point of departure, we propose that CCFG may impact family firm economic and noneconomic performance. Furthermore, we introduce to the family firm literature the organizational psychological capital (OPC), consisting of hope, efficacy, resilience, and optimism. We also suggest that OPC may be more prevalent in family firms than in nonfamily firms. Moreover, OPC of family firms may play an important role in the link between CCFG and economic as well as noneconomic performance.

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Section: Resultsmentioning

confidence: 97%

Section: Ccfg and Family Firm Economic And Noneconomic Performancementioning

confidence: 99%

Section: Ccfg and Family Firm Economic And Noneconomic Performancementioning

confidence: 99%

See 1 more Smart Citation

Going beyond Research on Goal Setting: A Proposed Role for Organizational Psychological Capital of Family Firms

Memili

Welsh

Luthans

2013

Entrepreneurship Theory and Practice

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“…Whereas earlier research indicates that monitoring family employees can reduce costs and enhance family firm performance (Chrisman et al, ), our study is the first to link monitoring to a nonfinancial performance‐related consequence. As family firms have a variety of economic and noneconomic goals (Chrisman, Chua, Pearson, & Barnett, ; Chrisman, Memili, & Misra, ), family firm CEOs and human resource managers need to be very careful in implementing control processes. Whereas these processes may facilitate performance, they can have undesirable effects on the overall portfolio of organizational goals and the degree to which family employees contribute to the family firm.…”

Section: Discussionmentioning

confidence: 99%

Managing Family Members: How Monitoring and Collaboration Affect Extra‐Role Behavior in Family Firms

Eddleston

Kellermanns

Kidwell

2017

Human Resource Management

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In a study of family firms that included survey responses from both family CEOs and family member employees, we examined the roles that collaboration and CEO monitoring play regarding the prevalence of extra‐role behavior, an important human resource outcome that can impact job performance and firm performance. Results indicated that an integration of stewardship and agency theories (manifested through interactions between family harmony and adaptability with monitoring) helps explain the level of extra‐role behavior displayed by family employees. The findings lend some support for the argument that effective human resource practices in family firms should be balanced between instrumental governance mechanisms that reflect a monitoring approach and normative mechanisms that focus on collaborative efforts among family employees. When this balance is achieved, an environment of fairness and accountability rather than a tone of distrust and forced compliance may prevail in family firms, thus addressing a key human resource issue in this hybrid form of organization. © 2017 Wiley Periodicals, Inc.

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“…Uncertainty and equivocality naturally exist for nonfamily decision makers when determining the proper course of action to achieve goals that themselves may appear to be uncertain, if not idiosyncratic [70]. Clear communication is essential for removing such obstacles, but that is incumbent upon family and nonfamily members.…”

Section: Suggestions For Future Researchmentioning

confidence: 99%

The Role of Relational Familiarity When Interpreting Family Business Communication

Marett

Litchfield

2015

IEEE Trans. Profess. Commun.

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Research problem: This study investigates the difference in perceptions within the family-owned businesses of messages received from family members and outsiders to assess the role that relational familiarity (the amount of prior experience two people share communicating with each other) plays in internal business communication in these settings. Previous research has shown that this relational familiarity-along with experience with the communicative medium, the message topic, and the business context-lead to channel expansion (the ability to reduce uncertainty from a message with limited communicative cues) for business communicators. But the impact of relational familiarity on communication competence and personal biases between family members-which could impact the ability of relational familiarity to achieve its intended goals-has yet to be fully explored. Research questions: (1) Does increased relational familiarity between communicators lead to increased perceptions of message effectiveness and appropriateness in lean media settings? (2) In family business settings where familial biases may be prevalent, is increased relational familiarity linked to perceptions of increased sender likeability and lowered message negativity? Literature review: Channel Expansion Theory, which proposes that communicators can overcome the limitations of a medium by using their personal experience, guides this study. Previous research found that with personal experience with the communicator sending the message, a message receiver can enhance the limited capacity of a medium to convey cues that aid in understanding the message. Four perceptual variables-message effectiveness, message appropriateness, message negativity, sender likeability-result in benefits accrued from channel expansion and relational familiarity, such as reduced uncertainty and equivocality about the message topic. Methodology: A quasiexperimental setting was designed to elicit messages from business co-workers using email. Message senders were instructed to describe the same business problem in order for the recipient to understand the problem and decide how to proceed. Eighty-three family business owners, managers, and employees received one message from a family member belonging to the same business and one message assigned at random from a nonfamily member working elsewhere (a stranger). The 83 message receivers were asked to complete instruments measuring their perceptions of the messages. Results and conclusions: Results suggested that the relational familiarity between communicators played a significant role in improving message effectiveness and message appropriateness. Sender likeability was also enhanced when family members correctly identified the source of the message. The findings suggest that family members can benefit from channel expansion, though not as many members as expected, and that complex problem and task descriptions were communicated using lean media (communication channels that inhibit sending messages infused with communicative cues...

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Nonfamily Managers, Family Firms, and the Winner's Curse: The Influence of Noneconomic Goals and Bounded Rationality

Cited by 219 publications

References 96 publications

Going beyond Research on Goal Setting: A Proposed Role for Organizational Psychological Capital of Family Firms

Going beyond Research on Goal Setting: A Proposed Role for Organizational Psychological Capital of Family Firms

Managing Family Members: How Monitoring and Collaboration Affect Extra‐Role Behavior in Family Firms

The Role of Relational Familiarity When Interpreting Family Business Communication

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