Abstract
It is important to consider this lack of impact on management research. Dyer confronts the issue through the example of the Mintzberg and Waters (1982) study of Steinberg, Inc. In retrospect, family dynamics were instrumental not only in the demise of the firm, but also in earlier stages of the firm's life cycle, including its growth. Despite this, the researchers chose to ignore family influences in favor of observable and documented professional business practices. Dyer contends that the “field of management apparently sees the theoretical and practical problems associated with families that work together as unimportant” (p. 402).
Dyer makes additional explicit and implicit points regarding the omission of family business in mainstream organizational research. Many academicians hold opinions such as the following:
family firms are the antithesis of “professionally” managed firms
nepotism should be avoided
family relationships fall outside rational models of organization
there is a lack of readily accessible information on family businesses that can be empirically analyzed
institutional and professional rewards accrue to the study of large, publicly traded firms
families exert no significant influence on businesses
A factor compounding the organizational research dilemma is the lack of attention to family business in management education. There is a certain circular reinforcement of the omission of family business in research and teaching. Dyer reports that minimal attention is given to family business in both journals and texts. As a result, those being prepared for careers in management education are not exposed to family–related topics as either a subject of scholarly investigation or as a subject for instruction.
One source of guidance for increasing the visibility of family business and infusing it into research and teaching may be the widely read Porter–McKibbin report (1988), a document that proved influential in revising accreditation standards for schools of business in American universities. Applying the conclusions from Porter–McKibbin, we begin with the premise articulated by Dyer that family–owned businesses represent a major portion of the United States economy and perhaps an even larger portion of other economies. Implementation of a research agenda, such as the one proposed by Dyer, must be framed by the perspective of the relationship of colleges and universities to the family businesses and other constituents in their environments. This requires grappling with issues internal to academic institutions and to the interactions of those institutions with the larger business community.
In 1988, Porter and McKibbin published the results of surveys of various groups that are stakeholders in the graduates of business administration education programs. They collected data from professors, administrators, students, alumni, and corporate employers. They found both support for and complaints against the process and product of business education. The following points are extracted and paraphrased from the Porter–McKibbin report, with commentary added on the implications for family business education and research.
• The corporate community wants realistic, practical, hands–on approaches from universities (p. 303).
Might family business owners want the same? Porter and McKibbin contended, however, that what executives report in a survey that they want is not necessarily what the business community needs.
Dyer recounts the Steinberg story, showing how ignoring family issues can lead academics to an erroneous conclusion. Imagine how differently Mintzberg and Waters (1982) would have interpreted their observations if they had been trained to assess the influence of family dynamics. It is very likely that any feedback they provided to Sam Steinberg was probably what he wanted, i.e. a confirmation that his business was healthy. In retrospect, what he needed was to hear that his family relationships were leading the company to disaster. This realistic, hands–on advice was not available from researchers who were focusing only on the business side of the equation.
• The comparative advantages of universities in offering courses to the business community include credibility, access to the latest research–based knowledge, the opportunity for companies to come together to exchange ideas, well–designed and integrated programs, and quality instruction.
As with any fledgling discipline, credibility in family business research and education comes with a research foundation that demonstrates intellectual rigor and meaningful results. There is encouragement through the completion of an increasing number of theory–based dissertations that have examined variables and relationships to determine if there are models or applications unique to family firms (see, for example, Hoelscher, 2002; Kenyon–Rouvinez, 2000; King, 1997; LaChapelle, 1997; Raskas, 1998; Sharma, 1997; Thomas, 1999). Contrasts can be made with nonfamily enterprises, enabling management scholars to prepare students better for the types of businesses in which they are likely to be employed. Extending this argument, academics have information of value to convey to practitioners in family enterprises, through consulting, continuing education, or practitioner–oriented publications. There are implications for nonfamily managers and employees of the firms, as well as the family stakeholders of the companies.
In 1989 Aronoff was able to verify 25 active, university–based family business programs in the United States, an increase of only five since a Nation's Business magazine survey a decade earlier (Aronoff & Cawley, 1990). The Family Firm Institute, a multidisciplinary organization of family businesses, consultants, educators, and researchers reports over 100 universities with active family business programs in 2002. From Dyer's observations, it is evident that this growth has not materially added to the research–based knowledge of the field. These outreach programs can potentially, however, provide researchers access to rich sources of data.
• There is a general perception that more effective methods should be used to communicate the results of faculty research to practitioners (p. 167).
Some inroads have been made. Family business forums and similar outreach/continuing education type programs have spread to dozens of universities internationally. Authors of small business and entrepreneurship textbooks are including chapters on family firms. One journal (Family Business Review) is dedicated to family business research, and others are accepting articles describing investigations of family business topics, even dedicating special issues to the subject (e.g., Dyer & Handler, 1994).
The Family Business Review adopted the editorial policy of publishing the ideas and experiences of practitioners. It is unclear how large their practitioner audience is, beyond the members of the Family Firm Institute, the journal's sponsoring organization, who are professionals, with family firms among their clientele. Other outlets, such as Family Business Magazine, contain articles that are more anecdotal and opinion–based than rigorously scholastic. Publication in such outlets is rarely credited in the academic community. The practitioner magazines have content value because the stories they print can be used as case studies for classes.
• There is also a question about how relevant research should be to target audiences (p. 177).
Family businesses lack a forum for communicating their interests and desires regarding relevant research. Paradoxically, the lack of research limits academic knowledge of the needs of this economic and societal segment. Groups such as the Family Firm Institute may be proxies for the interests of family firms and may serve as channels for communicating research results.
• The PIMS data base is cited as a rare example of the private sector willingness to supply data for academic research (p. 338).
MassMutual Life Insurance Company underwrote a major data collection effort addressing the characteristics of family businesses. The data were made available to academic investigators and results published in multiple forums. Katz (2000) compiled information on several databases applicable to entrepreneurship research, but they appear to have limited value for family business studies. Researchers need to be creative in accessing data, such as through collaborations with Family Business Magazine or other practitioner publications.
• There is concern by faculty and deans that faculty–business interactions can be carried to an extreme (p. 139).
Faculty involvement with business can be remunerative and ultimately detract from a faculty member's academic contributions. The proliferation of family business outreach programs suggests a demand for consulting services. More fundamental than the internal institutional issues are the interorganizational and interpersonal ethics of teaching, investigating, and consulting with family business owners. What are the social consequences of business faculty involvement in family business education? Are business faculty properly trained to handle and advise on emotional issues among family members? Can they assess the long–term impact of their interventions on the mental, emotional, and economic health of family members and intrafamily relationships? Do business faculty know under what conditions they should involve other, nonbusiness educators of counselors? Are there consequences beyond the classroom of what they teach students and what those students carry back to their family firms? Who is the business educator's client/student? Is it the firm or the family? There is an organizational responsibility within academia to assist in resolving these dilemmas.
• Porter and McKibbin found the major concern of deans and faculty to be funding, especially from internal sources (p. 299).
External financial support of family business programs by members and sponsors may represent a relatively untapped source of funds. Given the dearth of research reported by Dyer, the interests of the business owners may not match the research directions of the institutions. If the experience of universities receiving gifts and endowments for entrepreneurship chairs and centers is a guide, there is the potential for a redirection of faculty effort through stipulated financial support from family enterprises.
Although the Porter–McKibbin survey was conducted in the 1980s, many of the questions and concerns raised then have not fully been resolved in the intervening years. This is particularly true in the realm of family business, which, at best, was of marginal interest at the time of the study and is only beginning to be seriously investigated by management scholars.
Suppose a follow–up study were to be commissioned. What would Porter and McKibbon or their successors report today? Candidly, our first concern would be whether any questions about family business could make the cut and be included in the questionnaire. At present, we think it still unlikely. There are, however, a number of organizational research issues that could be predicted to arise that have family business implications. Although speculative, here are a few such topics:
Globalization. The interdependence among national economies is being reflected in the structure of organizations and the personnel they select. Family relationships have long been used to facilitate cross–border trade and to ensure trust in international commerce. Governance. Much attention has recently been given to abuse of authority by corporate executives and abdication of responsibility by boards of directors. Governance is one of the dominant research streams in family business. There is much to offer management scholars from studies of board selection and administration, and management and ownership succession. Work teams. The management of teams, from small work groups to strategic alliances, has become a major focus of organizational researchers. Recent surveys of employers have also shown that the ability to work in a team is one of the top factors in recruiting and selecting managers (Alsop, 2002). Because the majority of firms worldwide can be defined as family businesses, the intervening and moderating effects of family should be considered in team formation and functioning. The results of family business research demonstrate that individuals carry histories into team assignments, which ought not to be ignored..
Other subjects could be added to this brief list, e.g. ethics, environmental issues, technology, and so forth, but the examples given establish the point that business education is incomplete without addressing the family.
Dyer presents the challenge of encouraging wider spread inclusion of family issues in mainstream organizational research studies and education programs. Rigorous scholarship found in dissertations and other investigations is not yet impacting organizational research. There is a need to present family business studies in contexts to which management scholars are exposed and upon which they base the extensions of their research. When the quality and applicability of family business research outcomes becomes evident to management educators, they in turn will integrate these relevant issues into academic curricula, eventually reaching the broader audience of practitioners. Practicing managers stand to gain from understanding how family issues influence their abilities to manage organizations effectively.