Research Note: Comparison of Small Businesses with Family Participation versus Small Businesses Without Family Participation: An Investigation of Differences in Goals, Attitudes, and Family/Business Conflict

Abstract

This study investigates three important issues in a family business: (1) Whether there is a significant difference, relative to their goals and attitudes, between owners of businesses with family participation and owners of businesses without family participation; (2) whether owners of businesses with family participation perceive higher levels of business‐family conflict than owners of businesses without family participation; and (3) whether owners of businesses with family participation view business‐family conflict as a significant impediment to their business performance. We conducted a survey of 231 small business owners in midsize cities in the northeastern and midwestern United States. Of the total sample, 118 are businesses in which two or more family members are employed. This study examines both the reported conflict and the positives of family‐member involvement. The findings indicate that there is no overall difference in business‐related goals between the two groups, but that owners of businesses with family participation do experience significantly more business‐family conflict. The study also concludes that this conflict is generally well managed and does not interfere with business objectives. In fact, the authors conclude that owners of businesses with family participation see the involvement of family members as a positive. Managerial implications and research suggestions are also discussed.

Trends and Directions in the Development of a Strategic Management Theory of the Family Firm

“…. Thus, although noneconomic goals are often important to family firms (Chrisman, Chua, & Zahra, 2003;Lee & Rogoff, 1996;Steier, 2003), empirical research on family business performance has primarily dealt with economic performance and we limit our discussion in this section accordingly (Chrisman, Chua, & Sharma, 2003).…”

“…While there have been studies about the goals of family firms (e.g., Lee & Rogoff, 1996, Tagiuri & Davis, 1992, they did not identify the driving forces behind those goals. If we do not understand the fundamental driving forces, we may confuse symptoms with causes.…”

Agency theory and the family business

“…This finding supports the finding that agency threats are generally lower in family firms. The authors also emphasise the need to consider non-economic goals for family firms when determining agency costs as these might be more relevant than financial performance goals (Chrisman et al, 2004, see also Lee & Rogoff, 1996).…”

Researching at the Intersection of Family Business and Entrepreneurship

“…In many ways, this can add new insights into our understanding of mutual adjustment. It is not just conflict over business issues that influences the family (Carr & Hmieleski, 2015; or conflict within the family that influences the business (Dyer, 1994;Kellermanns & Eddleston, 2004;Lee & Rogoff, 1996;Schulze et al, 2003;Sorenson, 1999), but interactions with a community of inquiry over a potential opportunity have the potential to transform the family. Moreover, the transformed family refines the potential opportunity, which in turn influences the community.…”