Environmental Jolts

Introduction

At 12.49 BST (British Summer Time) on July 6, 2005, after a tense and nerve-wracking wait, the winner of the bid to stage the 2012 Olympic Games was finally announced at a press conference in Singapore. The news was greeted with euphoria in the United Kingdom with headlines such as “We Won!” dominating the national news coverage. But in a small corner of East London where the games were due to be staged, the news was greeted with dismay. For many firms located on the proposed Olympic park and stadium site, the announcement was perceived as a threat to their business. Survival would depend on their response. Building new sporting facilities on the site entailed relocating the firms elsewhere even when they owned their land. For some, this represented an opportunity to renew their business in other locations, but for others it represented a rupture in economic and social links with the area. The relocations were as a result of land being compulsory acquired by a regional development agency to make way for the Games.

Referred to as a “sudden and unprecedented event,” environmental jolts have long been of interest to management scholars because of their dramatic, disruptive, and potentially threatening character (e.g., Meyer, 1982). Research reveals that how firms frame environmental jolts can influence their response. For example, they may perceive them as threatening (Meyer, 1982) or as changing available opportunities (Wan & Yiu, 2009) due to shifts in the environment (Meyer, Brooks, & Goes, 1990). Consequently, a firm’s response can influence its performance.

However, there has been little research to date on family firms in particular, so the impact of family dynamics on behavioral response remains largely unknown. Yet the engagement of the family in the ownership, management, and governance of their business can give rise to “particularistic” behaviors that are less likely to occur in nonfamily firms (Chrisman, Chua, Pearson, & Barnett, 2012, p. 270; see also Dyer, 2006). This is possible because family firms place a heightened emphasis on noneconomic goals that stem from family involvement; such behaviors may thus lead them to “deviate from rational, profit maximizing behavior” (Chrisman et al., 2012, p. 270).

Appreciating how family firms respond to an environmental jolt is an important issue due to unpredictable internal family dynamics that can add complexity to behavioral processes. For example, they are susceptible to emotional drama and conflicts between family members that can cloud judgment, spill over into the business, and threaten survival (Kets de Vries, 1993); and the demands of succession can place strains on behavior (Miller, Steier, & Le Breton-Miller, 2003). Given that a jolt disrupts the status quo, this likely heightens the effects of a jolt for them, but it remains unclear how they may respond to a jolt.

A growing body of research nevertheless provides some clues about family firm behavior in the face of external threats. This work indicates that the reference point influencing family firms’ strategic decisions is gains or losses to their socioemotional wealth (SEW; Gómez-Mejía, Haynes, Nuñez-Nickel, Jacobson, & Moyano-Fuentes, 2007). According to this perspective, SEW is so important that family firms would prefer to risk negative performance outcomes than to risk a reduction in these endowments. Recent work casts this “paradox” as a “gamble” that family firms are willing to assume in order to preserve their SEW (Berrone, Cruz, & Gómez-Mejía, 2012). Against a backdrop of growing concern that SEW has too often been treated as homogeneous among family firms (Zellweger & Dehlen, 2012), researchers have identified five dimensions of the construct together known as FIBER (family’s control and influence, identification with the firm, binding social ties, emotional attachment, and renewal of bonds; Berrone et al., 2012). This work indicates that family firms may vary in the FIBER dimensions that they prioritize (Cennamo, Berrone, Cruz, & Gómez-Mejía, 2012). However, questions about its robustness or effectiveness remain given this stream’s embryonic stage of development (Miller & Le Breton-Miller, 2014).

Some concerns center on the extent to which FIBER dimensions are sufficiently distinctive. For example, scholars query whether the dimensions may overlap, are distinctive, or may work in concert (Chua, Chrisman, & De Massis, 2015). Founding scholars here suggest that there may exist a broader range of SEW sources (Gómez-Mejía, Cruz, Berrone, & De Castro, 2011); however, these have not been exhaustively investigated and open the door to the possibility that key determinants may have been missed. Such factors as location, for example, receives no attention in this literature, yet early work has shown that family firms, in contrast with nonfamily firms, place more emphasis on the location of their business facilities (Kahn & Henderson, 1992). Noneconomic motives dominate in SEW research (Gómez-Mejía et al., 2014), but how these might intertwine with rational economic and wealth maximization motives has received less attention (Miller & Le Breton-Miller, 2014). As Miller and Le Breton-Miller (2014) note, their motives may be mixed, and the importance that they place on different SEW priorities may thus differ. By knowing more about their behaviors and influences when facing a jolt, an opportunity exists to advance the literature by unraveling links between family dynamics and family firms’ response. This study aims to address this gap by examining how family firms respond to an environmental jolt, and why.

To explore these issues, the forced relocation of firms located on land earmarked for the London 2012 Olympic Games was selected as the empirical setting. This was an environmental jolt that affected all companies on the site, a substantial number of which were family firms. A multiple-case study approach incorporating three family firms and two nonfamily firms was adopted to explore their behavioral response. Findings suggest that family firms engaged in a behavioral response, labeled as engagement intensification, which engendered increasing risk for their business. This entailed involvement in one or more of three behavioral responses: contesting, proselytizing, and brinkmanship. These responses were influenced by three factors: family business place attachment, family business heritage longevity, and ownership dispersion. This study aims to contribute to the literature by extending notions of SEW to capture the importance of place and heritage, thus enabling a more nuanced appreciation of family firm behavior when a threat to SEW is perceived.

Literature Review

Interest in organizational response to environmental jolts has grown since Meyer’s formative study of a doctor’s strike that affected hospitals in San Francisco in 1982. He believed that “jolts,” distinguishable from other external events such as crises, catastrophes, or threats (Billings, Milburn, & Schaalman, 1980), could trigger responses that reveal how organizations adapt to their environment. He defined environmental jolts as “transient perturbations whose occurrences are difficult to foresee and whose impacts on organizations are disruptive and potentially inimical” (Meyer, 1982, p. 515). Unlike abrupt events thought to jeopardize organizations, he suggested that environmental jolts are “ambiguous” events that can prove threatening or lead to new opportunities. Later work by other scholars has sought to explore this potential dichotomy, showing how such events can act as a catalyst to opportunity-seeking actions (Sine & David, 2003) and thus lead to value creation (Liu, Hung, & Chu, 2007) or, conversely, render existing firm strategies ineffective due to their sudden and discontinuous character (Meyer et al., 1990).

Research on environmental jolts more broadly underlines the ambiguous nature of these events, demonstrating that they can lead to such diverse responses as maladaptive or pathological cycles of behavior that reduce flexibility or increase rigidity (Staw, Sandelands, & Dutton, 1981); categorization tactics that create favorable perceptions of organizational identity (Elsbach & Kramer, 1996); or the interpreting of external disruption as an opportunity, dependent on spatial proximity to the locus of disruption (Pérez-Nordtvedt, Khavul, Harrison, & McGee, 2014). Furthermore, as jolts are enigmatic and paradoxical, they often force action before decision makers understand the consequences (Meyer et al., 1990).

Research has considered many elements of jolts—for example, different levels of analysis: organizational (Meyer, 1982), industry (Goll & Rasheed, 2011), or field (Sine & David, 2003); different types of jolts (Goll & Rasheed, 2011); different variables such as strategy, structure ideology, and slack resources (Meyer, 1982); venture stage development (Venkataraman & Van de Ven, 1998); and the timing of response (Goll & Rasheed, 2011). However, the influence of the family on organizational behavior has not been explored, even though we know that it is a “critical variable” (Astrachan, 2003; Chrisman, Chua, & Sharma, 2003) and that its confluence with business creates inimitable capabilities or “familiness” (Habbershon & Williams, 1999) that can affect firm behavior. Family business is defined in this article as a

business governed and/or managed with the intention to shape and/or pursue the vision of the business held by a dominant coalition controlled by members of the same family or a small number of families in a manner that is potentially sustainable across generations of the family or families. (Chua, Chrisman, & Sharma, 1999, p. 25)

Existing work has shown that when the preservation of SEW is threatened family firms may be prepared to respond in ways that may be suboptimal for their business (Gómez-Mejía et al., 2007). For instance, in an early study focused on olive oil producers in Spain, Gómez-Mejía et al. (2007) explained how family firms facing an external threat rejected the option of joining a cooperative to mitigate its effects. Doing so implied a loss of control, which the firms perceived as a threat to their SEW endowment. They therefore opted to go it alone, resulting in negative performance outcomes. However, this work did not focus on differences among family firms in terms of their SEW for those either inside or outside of the cooperative; the extent of SEW invested in their business was also unclear. Nevertheless, subsequent studies have also shown that family firms will be prepared to jeopardize outcomes to protect their SEW. For example, to preserve their SEW family firms will diversify less even when it could reduce concentration risks (Berrone, Cruz, Gómez-Mejía, & Larraza-Kintana, 2010), pollute less even when it increases costs (Berrone et al., 2010), and appoint board-affiliated directors previously linked to the family firm even if this means receiving less independent advice (Jones & Lichtenstein, 2008). In short, they can “gamble” or make a decision that “places the organization at peril of total ruin through its failure to survive” (Gómez-Mejía et al., 2007, p. 111; see also Gómez-Mejía et al., 2014). This operates at a deep psychological level, linking the identity of family firm members with that of the firm (Berrone et al., 2010). Control and its retention emerges as a constituent element of SEW that could give rise to such behavior (Berrone et al., 2010; Gómez-Mejía et al., 2007; Zellweger & Dehlen, 2012). Other noneconomic aspects of family firms’ that engender SEW are affect, including expression of identity, exertion of family influence, ability to hire trusted clan members, and dynastic continuation (Naldi, Cennamo, Corbetta, & Gómez-Mejía, 2013).

Responding to concerns that SEW has frequently been treated as a latent explanatory construct, scholars have replied by specifying its key dimensions (Berrone et al., 2012). This work suggests that heterogeneous firm responses can be explained by difference in the salience of each dimension depending on family preferences (Cennamo et al., 2012). However, despite these insights we do not yet fully understand how differences in SEW priorities can affect behavior. Furthermore, scholars are increasingly calling for more robustness in the specification of the construct (Schulze & Kellermanns, 2015) and research to explore ways to capture its dimensions or it effects (Berrone et al., 2012; Miller & Le Breton-Miller, 2014). For example, they suggest that it may vary among firms, across family members, or across life-cycles (Schulze & Kellermanns, 2015), and thus affect behavior. Furthermore, while recent work acknowledges that there may be additional sources of SEW, these remain largely unexplored (Gómez-Mejía et al., 2011; Schulze & Kellermanns, 2015). This is important because while firms facing an environmental jolt may have both socioemotional and financial-economic objectives, their relative importance or even how they may intertwine to affect behavior is unclear (Zellweger & Nason, 2008). Sources such as location or heritage have received little empirical attention in the literature on family business, even though research has indicated that deciding on family firm location is among the most important strategic decisions that they will take, similar to the selection of a home (Kahn & Henderson, 1992).

Research Method

Case Selection

Cases were selected based on theoretical sampling principles, an approach recommended for analytical induction (Bansal & Roth, 2000). To provide a basis on which cases could be compared those that were homogenous were identified (Ambos & Birkinshaw, 2010; Salvato & Corbetta, 2013). The emphasis was placed on identifying, first, family firms—those that were consistent with the definition adopted by Chua et al. (1999). All firms chosen for the study were located on the site of the proposed Olympic park and stadium at the time that the winning bid was announced and were subject to the same environmental jolt. Particular emphasis was placed on firms that owned their own land, as they had an additional financial commitment to the area and faced not only disruption to their business but loss of land as well. They would also be entitled to compensation based on disruption to their business and their loss of land. The focus was further narrowed to small and medium enterprises (SMEs) employing just under 50 workers or more, as the jolt could have heightened salience since they had more to lose than the majority of one-person operations affected by the Games. In addition to these similarities there were differences in key firm characteristics: firms’ age and number of generations involved in the business, the length of time they had been located in the area, and industry. Finally, three family firms were selected that were willing to provide a high level of research access to their businesses.

Second, to determine how nonfamily firms might differ from family firms, two nonfamily firms with similar characteristics were selected to facilitate theoretical replication (Eisenhardt, 1989). These firms were located on the same site and subjected to the same jolt, and they were of a comparable size with the family firms. For contrast, however, one firm that was not a landowner that was included. This led to a total of five cases (see Table 1 for profiles).

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Table 1.

Case Profiles.

	ES Global	Bedrock Crushing	UK Snacks	Finlay’s	Forman’s
Nature of business	Construction and delivery of temporary architectural structures	Crushing and recycling demolition concrete	Manufacture and packaging of ethnic snacks	Refurbishment contractor	Traditional salmon smokers, fine foods, and restaurant
Date firm established	1970s	10 years (1996)	4 years (forerunner started in 1972)	42 years (1970)	107 years (1905)
Ownership	6 directors	2 cofounder directors	Father, mother, and son	Father, children, son-in-law	Sole owner
Family management	None	None	Father and son (1 nonfamily director)	Children, son-in-law	Owner (2 nonfamily directors)
Succession	N/A	N/A	First and second generation	Second and third generation	Fourth generation
Time in East London area	40+ years	10 years	7 years	42 years	107 years
Time at Olympic Park site	10+ years	10 years	3 years	40 years	2 years
Land title	Tenant	Landowner	Landowner	Landowner	Landowner
Jobs: pre (post Olympics)	25 core staff + 100 temporary	48	55 (80)	110 (65)	50
Post-Olympic performance	Growth	Sold	Growth	Stagnation	Stagnation

Data Analysis

The analysis unfolded over several key phases. As a first step, a case report was compiled for each company cataloguing various sources of information. This covered, for example, company history, the nature of its business, and also included interview transcripts, research memos, press cuttings, emails, timelines, data tables, and charts to aid data triangulation and case comparison. Next, within-case analysis was conducted by coding the data using standard coding techniques to identify firm behavioral responses and draw out key themes (Miles & Huberman, 1994) using the research question as an organizing framework. Codes were identified by breaking the data into paragraphs, sentences, or phrases; the emphasis here was placed on coding for meaning and were assigned descriptive labels.

In the next step, codes were searched for similarities and differences and then grouped based on overarching common themes in a process of axial coding (Strauss & Corbin, 1998). This was an iterative process that entailed travelling to and from the literature and led to second-order codes that were labeled to capture the key ideas found in first-order codes. A process of distilling, merging, and relabeling of codes continued during this step. Cross-case replication techniques were employed to understand the fit between each case and key emergent themes. Similarities and differences were again identified across cases, thereby enhancing validity and driving theory-building. At this point the process of abstracting up from these themes to arrive at aggregate dimensions began and led to the identification of behavior that was labeled as “engagement intensification.” This was composed of three key behavioral themes that seemed to fit the data both within and across cases: contesting, proselytizing, and brinkmanship. See Table A1 ⁵ for representative quotes. These themes were applied to nonfamily firms to assess their fit and salience against each case.

In the next step, data collected from the SEW schedule devised by Berrone et al. (2012) was analyzed to understand firms’ behavioral response. This used a 4-point scale—not applicable (n/a), weak, moderate, and strong—to describe the strength of the fit between the data and each item (see Table A2 ⁶ and Figure 1 for results). The table incorporated interview data as well as a summary of facts gained from each case. Two senior scholars familiar with family business research were invited to code the data independently to enhance validity. Where there were differences these were discussed and agreement sought on the classification of each item. These data revealed that all the family firms shared strong levels of SEW and that although there was divergence in the strength of some FIBER dimensions, these were minimal. As this did not explain the striking differences in behavioral response in the next step, the data were searched for factors that could more clearly help to explain the variances.

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Figure 1.

Family firms’ FIBER profile.

Here, the same coding techniques employed earlier were applied: data within and across cases were coded and broken down into units of meaning, then labeled to yield first-order codes (Miles & Huberman, 1994); a process of axial coding followed and this led to the emergence of phenomenon that had not been empirically charted in family business research hitherto: family business place attachment, family business heritage, and ownership dispersion (see Table 2). A model of firms’ response to an environmental jolt is captured in Figure 2.

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Table 2.

Data: Factors Influencing Family Firm Behavioral Response.

Themes	Family business place attachment
Family attachment to business location	● That was where they settled, that was where the boats came in to East London . . . they stayed around sort of Shoreditch, Spitalfields, Stepney, around that area and then one generation on as they started to prosper they started moving further. (CEO, Forman’s)
	● As a family we’ve always been around the area and we’ve always operated out of the area . . . (Director, Finlay’s)
Family business identification with location	● I did work for that man until he died. When I went to see him [later] he had two hundred indoor machinists and two hundred outdoor machinists, that’s how much he’d grown. But this was how it was in this area, loved it, and we would never leave. (Founder, Finlay’s)
	● It was just important to, it was just part of continuing the traditions and the tradition, our business had been in East London, succeeded in East London for a hundred years and survived in East London for a hundred years, I didn’t really want to start changing it to West London and we suddenly lose our character. (CEO, Forman’s)
Identifying product with location	● We had this fine heritage and pedigree. Now, smoked salmon, which is so much the core of what we do, was probably one of the most popular gourmet foods across the Western world. . . . It was all started here in London’s East End. (CEO, Forman’s)
	● Smoked salmon in Britain began in the East End, before the Scots also began producing it, and Forman’s was the last company left and Lance had Harry, Louis and Marcel standing behind him who had all worked their entire lives to carry the tradition forward. “You do feel the weight of history,” Lance admitted. (Article, Spitalfields Life)
	● If it was France holding the Games and they offered a champagne producer to move them to Bordeaux, this champagne producer would tell them to, you know, where to go because champagne has to be produced in Champagne and as far as I was concerned London Cure smoked salmon has to be produced in East London, otherwise it’s no longer London Cure, it’s breaking with the tradition, so the location was very important. (CEO, Forman’s)
Themes	Family business heritage longevity
Prizing family business longevity	● Just there is a longevity there and we work on the same principles. . . . We’re not here to make a quick buck, we’re not here to grow the business fantastically quickly and sell it to shareholders or anything like that. (Founder, Finlay’s)
	● There was so much to play for the continuation of the business has been within the genes of my family, obviously, but also it’s the way we approach our business activities is different, we think long term (CEO, Forman’s)
Viewing long-surviving family firms as special	● We’ve been producing fine British food here for over 100 years . . . you know we’re part of the food heritage of Great Britain and you know, I think that has value to the culture. . . . When you say to people we have a fourth-generation family business they find that very appealing. It’s unusual now . . . more people see the Haley’s comet than they do a fourth-generation family business. (CEO, Forman’s)
	● If the dozen other salmon smoke houses who were based in East London, the ones that were around at the time when we set up and were still around in the 1970s. If they were around and we went by the wayside it wouldn’t necessarily be the end of the world. But, we were the last ones. So, not only would it have been a tragedy for our family but for the industry as well. (CEO, Forman’s)

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Figure 2.

Model of family firms’ behavioral response to an environmental jolt.

Findings

The environmental jolt that occurred in this study—enforced relocation due to the staging of the London 2012 Olympic Games—provided a good opportunity to investigate family firms’ behavioral responses. From the data, several key findings emerged: first, family firms behaved in ways that engendered progressively greater risks for their business. Labeled here as “engagement intensification,” it incorporated three behaviors associated with increasing levels of risk: contesting, proselytizing, and brinkmanship. In these behaviors family firms not only differed from nonfamily firms but they also differed among themselves. Second, SEW was a strong motivating factor for all the family firms, but variances in their endowments were not sufficient to capture the degree of differences in their behavioral response. Supplementary factors, hitherto underexplored in family business research, were identified, which, added to SEW, could more effectively explain differences in their behaviors. These included family business place attachment and family business heritage longevity. As the following sections indicate, noneconomic factors were more important for family firms and this had an effect on behavior.

Discussion

This study has sought to analyze how family firms respond to an environmental jolt—viewed as a sudden, unprecedented, and dramatic external event (Meyer, 1982). The results presented here suggest that family firms vary in their behavioral response among themselves and in contrast with nonfamily firms. Noneconomic factors as well as economic factors influence the way that family firms interpret and frame an environmental jolt and thus their subsequent behavioral response. Where economic considerations were strongest, nonfamily firms offered the least resistance to the jolt, in one case embracing it as an opportunity, and where noneconomic motives were most acute a family firm interpreted the jolt as a severe threat and one to be resisted at virtually any cost. In between these two extremes, as noneconomic factors became more pronounced family firms showed more proclivity for risk-taking. An important insight here is that the behaviors in which family firms engaged were not intrinsically different to those any other type of firm could adopt but their motivations were different and this influenced the likelihood of engaging in progressively risk-taking behavioral forms.

This study highlights a behavioral response exhibited by family firms in the face of an environmental jolt that engendered increasing risk for their business. Labeled as engagement intensification, it incorporated three behaviors that occurred sequentially and cumulatively: contesting, proselytizing, and brinkmanship. Contesting refers to vocal objections and criticism of official offers, which, in this case, carried a risk of alienating authorities. This is close to ideas found in social movement research in which activists dispute the actions or claims made by target organizations (Baron & Diermeier, 2007). All firms in the study, with the exception of one nonfamily-owned firm, engaged in this behavior—it was the least risky behavior of the three but also the one providing the least defense against a jolt. Proselytizing aimed to create an unfavorable external climate for adversaries using public forums. According to social movement research, activists can seek to force concessions by using publicity-centered tactics to undermine a target organization’s reputation (Baron & Diermeier, 2007). However, results in this study show that this response risks valuable resources being diverted away from the firm and alienating authorities; only two of the family firms in the study engaged in this behavioral response. Brinkmanship, the third and most extreme behavioral response identified largely unseen in management research, raises the stakes for both actor and adversary. It is the riskiest of the three responses and the only firm that engaged in this behavior was a family business.

To date, brinkmanship has only been fully explored in game theory, economics, political science, applied to international negotiation and crisis bargaining (Nalebuff, 1986; Powell, 1988). In keeping with this broader work, findings here indicate that actors can engage in behaviors that may potentially harm not only their adversaries, but themselves as well (Schelling, 1960). This process is known as divisibility because damage may be shared among all parties to a conflict. According to brinkmanship research, threats must be credible (Dye & Sicotte, 2006). This can be achieved by embarking on a process of events or actions that escalate the threat (Dye & Sicotte, 2006). A key part of this process is demonstrating a willingness to lose control over the progress of events in what Dixit and Skeath (1999) term as controlled loss of control. Such conditions were noted when Forman’s sought to pursue costly and risky legal action in the process the firm risked losing the case or incurring spiraling legal fees. For their adversaries, the authorities, the risk also lay in losing their case or having any further activity suspended in lieu of a hearing. In taking highly expensive legal action, the firm demonstrated a willingness to take action that had the inherent possibility of slipping beyond its control.

Building on definitions of brinkmanship found in game theory and political science (Powell, 1988; Schelling, 1960), this article introduces the notion of brinkmanship into management research and offers a definition suited to this context: a behavioral tactic that demonstrates willingness to take action that risks mutually negative outcomes for a family firm and its adversaries. This indicates that family firms can deliberately act in ways designed to raise the stakes in order to force concessions.

Two key contributions flow from this study, the first indicates that family firms differed in their stock of SEW, although these difference were minimal. This is important as hitherto the bulk of prior research has treated it as a latent explanatory construct, and thus far the salience of its constituent dimensions has not been captured empirically (Berrone et al., 2012; Schulze & Kellermanns, 2015). More recently, research has considered variance in the strength of SEW but without deconstructing the role of individual dimensions. Using a qualitative and case-study approach, this study has explored each dimension of the FIBER model and finds that while SEW is strong for all the family firms, there were some albeit minimal differences between them.

This discussion looks first at the similarities between family firms to understand why all the family firms engaged in contesting behavior but diverged on other forms. The data suggest that SEW was important—family control and influence, and family identification with the firm were almost universally strong. In just one case, two items of the first dimension were either not applicable or weak due to the fact that the firm, Forman’s, was wholly owned by a single family member. This indicates that concentrated ownership may intensify the sense of ownership and control experienced by a family firm. Other scholars also point to an association between strength of SEW and percentage ownership (Schulze & Kellermanns, 2015). These results indicate that control and influence in combination with identification with the firm are key factors in the framing and initial response to a jolt. This likely explains all three family firms’ engagement in contesting behaviors as they were keen to remain in control of a business in which they strongly identified. One nonfamily firm also engaged in contesting behavior but its motives were different. They were also keen to protect their interests but their focus was primarily economic and thus they were not motivated to progress to more risk-taking behavior.

There were some differences between family firms on the remaining dimensions of the FIBER model. Where emotions or affective considerations were less pervasive firms were less inclined to engage in increasing risk-taking behavior such as UK Snacks, for example. Strategic decision making was thus less sentimental and more instrumental in keeping with more entrepreneurial orientations. Where decision making was driven by emotional considerations, behavior could progress to more risky-taking forms, as was the case for Forman’s. While Finlay’s was also subject to intense emotional influences on behavior, this also had the effect of constraining their behavioral response. During the period of the jolt the firm suffered from acute family conflicts and divisive management and this likely limited the coordination and marshaling of resources necessary to progress to more risky and costly action.

The importance of succession also differed among the family firms. It was not a uniformly key goal. For UK Snacks it was a low priority, Forman’s had adopted a wait and see approach, while Finlay’s for whom it was important faced some uncertainty about the pool of the next generation. This is a surprising result as succession is considered a cornerstone of family business. It further underlines SEW’s limited power to explain the variance in behavior of firms in the study. In line with recent calls by scholars (Schulze & Kellermanns, 2015), this work has begun the process of linking aspects of family firms’ SEW with firm outcomes, in this case their behavioral response and family priorities. Overall, however, the differences identified between family firms’ based on FIBER were minimal and could not sufficiently explain the more striking variances in their behavioral response.

This article’s second contribution is to identify the factors that influence differences in family firms’ behavioral responses and their adoption of increasingly aggressive behaviors. These factors did not feature as part of existing SEW dimensions. The study highlights how three influences incorporating two family-related key factors can affect family firms’ behavior in response to a jolt. The first factor, family business place attachment, while it remains unexplored in family business research, is an important concept because as researchers have shown in other disciplines (Low & Altman, 1992) place attachment influences the affective bond between individuals and place (Vaske & Kobrin, 2001), and at the group level where symbolic meaning can be shared (Scannell & Gifford, 2010). It can arise for different types of places including, for example, homes, neighborhoods, landscapes, or plazas, as well as at different stages of life, from childhood to adulthood (Low & Altman, 1992). Place attachment can have symbolic meaning (Greider & Garkovich, 1994) and influence organizational identity (Low & Altman, 1992). Its importance is in emphasizing the emotional and cognitive aspects of place (Vaske & Kobrin, 2001), the feelings that individuals have for these (Williams & Vaske, 2003), and the sense of meaning they can engender (Manzo & Perkins, 2006). This body of work has, however, missed the distinctive characteristics of family business in relation to place. Family business scholars have long understood the importance of business location for family firms (Kahn & Henderson, 1992) and have suggested that SEW can assume more value when firms operate in industries that are tied to particular geographic locations (Schulze & Kellermanns, 2015). The results in this study go further by indicating that location attachment is a key variable that can affect a family firm’s own sense of place and thus embody an emotional aspect not sufficiently developed in this prior work on family firms. Introducing the concept into management research, this study indicates that where there is strong intertwinement between place, family residential location, and business, family firms are likely to be more highly attached to their location and thus strive harder to protect this. Furthermore, where a family firm’s identity (family and business) is also intricately linked to products that have their own connection to a specific area, like wine or cheese, the sense of place attachment is likely to be significantly stronger than those firms without these links.

This explains the strong behavioral response by Forman’ and Finlay’s, for whom the link between product, business, and family was the most intense. Finlay’s, however, while strongly attached to their location, did not have the same product connection with the area and engaged in less riskier behavioral responses compared with Forman’s. Of the two nonfamily firms one was unperturbed by relocation as it was not tied to any particular area, the other had only been in the area a comparatively short time, so had not developed a strong attachment to the area.

The second family-related factor indicates how family firms with a long-established heritage appear to place greater importance on preserving this compared to firms with a shorter history. If it could trace its ancestry back over multiple generations and over a sustained period, a family firm was most apt to view its business as a societal asset. Thus, heritage is perceived by family firm members as valuable not only for the firm itself but also for the wider community in which it is based. This suggests that heritage and its continuance can be viewed as a commodity (Ashworth, 1994) and one that can be imbued with value and meaning (Graham & Howard, 2008). Forman’s referred to this as a family “heirloom.” While family place attachment and heritage emerge as different but equally important concepts in this study, heritage, identity, and place are nevertheless viewed as interconnected (Graham & Howard, 2008). This suggests that those family firms with a strong or long heritage linked to a particular location are likely to perceive more is at stake when these are threatened. It can explain difference among family firms, for example, why Forman’s, the family firm with the longest heritage and strongest attachment to its location, engaged in the most aggressive behavioral response and why UK Snacks with little of these investments resisted the least. These factors were not important for nonfamily firms.

This research shows that locational and historical factors play an underexplored role in influencing family firm behavior in the face of an environmental jolt. The importance of location for the family, the business, its products or services, and their heritage are important insights that are missing from SEW research. These findings suggest that the FIBER model should be extended to incorporate additional dimensions of place and heritage. This insight would add richness and depth to current conceptions of SEW by allowing it to capture more nuanced difference between family firms, differences that can ultimately have a strong influence on behavior.

Ownership dispersion is the third key factor that influences family firms’ behavior (Chrisman et al., 2012; Wright, Chrisman, Chua, & Steier, 2014) by mitigating their ability to act. Decision-making power shared among several parties can serve to limit drastic actions. When it is concentrated in one pair of hands, there are no such checks on behavior. This is in line with recent work suggesting that both ability and willingness must be present to enable particularistic family business behaviors (De Massis, Kotlar, Chua, & Chrisman, 2014).

Limitations and Future Research

Several implications for future research and practice arise from this study. First, this work draws attention to the importance of the external environment and its interaction with family firms’ internal dynamics. It suggests that those dynamics will lead family firms to continually seek to adapt and to accommodate environmental events in ways that allow them to survive. They will not accept extinguishment lightly, even where acting may threaten their very survival, because to do nothing may be to face certain demise. It ultimately indicates that family firms are capable of taking seemingly irrational decisions in pursuit of rational goals. Second, this work suggests that policy makers and others should take heed of family business heritage, both historically and geographically, and recognize that this may intensify their behavior in response to an environmental jolt. As for family firms themselves, they should constantly review internal processes to evaluate extreme behavior and its benefits for their firm.

This work is not without its limitations. First, its focus on one industrial setting in one country limits its generalizability. The setting, while unique, also restricts its relevance to other areas. The data collected were retrospective, which may reduce recall and introduce bias; however, interviews with contemporaries who could recall the same events minimizes this weakness along with the use of other supplementary data sources. This study, nevertheless, raises numerous opportunities for further research. First, scholars could investigate family firms’ response to environmental jolts using a larger quantitative sample in other international settings to analyze how cultural context affects such behavior. They could also consider whether there are other responses than the three reported here. Given limited empirical work on place attachment in family business research, this would warrant further exploration of the importance of location for different family business generations, how this affects performance, and how heritage may shape current and future behavioral approaches. Brinkmanship remains largely unexplored in management and family business research; thus, there are valuable research opportunities to explore the process of engaging in brinkmanship behavior and its role in firms’ strategic development (e.g., in firm mergers and alliances).