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International Family Enterprise

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"Enabling Internationalization Excellence for Family Enterprises"

IFE, 2017

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CALL FOR BOOK CHAPTERS ON FAMILY FIRM (FF) INTERNATIONALIZATION

This is a call for chapters on family firm (FF) internationalization for Scholarly Handbook published by Palgrave Macmillan. The book is focused on the role of FF-specific views and networks in their internationalization, the actual internationalization process and FFs internationalizing from or to Emerging Markets in special. Both empirical and conceptual work is welcome.

Title of the Book: Scholarly Handbook of Family Firm Internationalization

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Editors: Tanja Leppäaho (LUT University) and Sarah Jack (Lancaster University School of Management)

Publisher: Palgrave Macmillan

Expected publication time: Spring 2021

Family Firms (FFs) form the majority (about 80%) of all firms around the world and they account for an enormous percentage of the employment, the revenues, and the GDP of most capitalist countries (EFB, 2012). As of now, their value as a an engine of stability and long-term growth and prosperity, simultaneously acting as natural incubators of an entrepreneurial culture, fostering the next generation of European entrepreneurs, has been finally recognized and tools to help them have been hoped for (European Commission, 2015).

Although it was long thought that large multinational corporations had an overwhelming position in international business (Oviatt & McDougall, 1994), it has recently been recognised that substantial numbers of entrepreneurial and family firms are active in the international arena (Casillas & Acedo, 2005). FF internationalization has become an important research area both practically and politically, and now also theoretically (see e.g. Arregle et al., 2017). The unification of ownership and management enables the CEO e.g. to make opportunistic investments and/or rely on intuition (Gedajlovic et al., 2004). Hence, FFs have the potential to adapt to changing environments, launch products, and enter markets that investor-controlled or managerially led firms are unable to address (Dyer & Whetten, 2006). In adverse economic conditions, family firms have been found to sustain more profitable businesses than firms with other ownership structures (Sirmon & Hitt, 2003).

It has been recognized that FF internationalization differs from those by firms owned via other types of ownership structures, but we are still missing nuanced, in-depth understanding of the FF-specific features related to their long-term existence, family-intertwinement in ownership and management, especially high level of trust inside the firm, etc. (Arregle et al., 2017; Kontinen & Ojala, 2010; Pukall & Calabro, 2014; Reuber, 2016). The number of studies on FF internationalization is, fortunately, constantly growing: the review by Kontinen and Ojala in 2010 was based on 25 articles, whereas the most recent one (Leppäaho et al., 2016) was based on 158 articles. However, very recently Arregle et al. (2017, p. 1) summarized that the need for in-depth nuances still exists: ”the extant conceptual and empirical research on internationalization indicates that family involvement matters for internationalization, yet the precise consequences of this involvement remain unclear”. In the current scholarly handbook, the focus will be on the features making FF internationalization different: their long-term existence; their special type of network ties; the theoretical views explaining the specific features of FFs combined with internationalization views.

The distinctive features of Family Firms (FFs) are related to their human, family-oriented and longitudinal nature. FFs are typically passed from generation to generation, with constant triggers for change. The triggers can involve changes in the family (births, deaths, illnesses, conflicts), in the business (changes in markets, technology, competitive situation, institutions), and in ownership (involving e.g. changes of ownership from founders to siblings or to cousins, disengagements, the selling of shares outside the family, the sale of business lines, etc.) (Gersick et al.,, 1997). The theoretical perspectives explaining distinctiveness of FFs  include agency theory (Karra et al., 2006), the concept of stewardship (Le Breton-Miller & Miller, 2009), a resource-based view (Chrisman et al., 2005), and the socioemotional wealth (SEW) perspective (Gomez-Mejia et al., 2011), among others.

SEW has indeed been recognized as a central reflection point and driver for the strategic decision-making and behavior of FBs (e.g., Berrone et al.,, 2012), serving as the “defining feature of a family business […] central, enduring, and unique to the dominant family owner, influencing everything the firm does” (Gomez-Mejia et al., 2011, p. 692). However, we know very little of the role of these conceptual and theoretical perspectives in their internationalization process (Leppäaho et al., 2016).

The most applied definitions regard internationalization as “the process of increasing involvement in international operations” (Welch & Luostarinen, 1988, p. 36) or “the process by which firms both increase their awareness of the direct and indirect influence of international transactions on their future, and establish and conduct transactions with other countries” (Beamish, 1990, p. 77). However, within the discipline of FF internationalization, there has been a tendency to produce static findings by studying internationalization through one-shot, cross-sectional studies, using correlational analytical methodologies (McAuley, 2010; Welch & Paavilainen-Mäntymäki, 2014) with minimal context-embeddedness (Leppäaho, et al., 2016) – despite the fact that internationalization is a process, and that approaches incorporating time, dynamism, and longitudinal observations are needed if a solid process theory is to be built.

FFs as firms offer a fruitful context to study internationalization through a process perspective: FFs possess certain processual features that are typical of them (though not necessarily unique to them). Thus, they may be passed on from generation to generation and even over centuries, with numerous processes between the business, family members, and ownership constantly taking place and influencing each other (Gersick et al., 1997). The strategy management process of FBs differs from that of non-FBs, shaped as it is by family goals, interests and culture, the involvement of both family and nonfamily members in management and governance, sibling relationships, and succession (Sharma et al., 1997).  Succession processes are critical for knowledge and skill transfer between different generations (Davis & Harveston 1998), and new generations may possess higher propensities and capabilities to promote internationalization (e.g. Calabro et al., 2016). The different generations and family members involved in the FB may also attach differing importance to SEW and its different dimensions, which include family continuity, family prominence, and family enrichment (Debicki et al., 2016). Thus, founding family owners may be more inclined to preserve SEW and hence resist internationalization than later generations (Fang et al., 2018).

Family ownership influences both inside-the-firm and outside-the firm network ties (Arregle et al., 2007; Salvato & Melin, 2008). FFs typically possess network ties with a high level of trust, closeness and long-term commitment (Arregle et al., 2007; Roessl, 2005; Zellweger et al., 2018), but how this influences on their international network ties has been very little touched upon (Kampouri et al., 2017; Kontinen & Ojala, 2010; Kontinen & Ojala, 2012; Pukall & Calabro, 2014). Like stated above, this scholarly handbook tackles important viewpoints of FF internationalization process, as per suggestion of e.g. Kontinen and Ojala (2010), Pukall and Calabro (2014), Reuber (2016) Arregle at al. (2017), Kampouri et al. (2017) and Leppäaho et al. (2016).

The scholarly handbook will have four specific core areas, with 5-6 chapters each:

       i.          FF-specific views and internationalization

      ii.          Internationalization process

    iii.          Networks in FF internationalization

    iv.          FF internationalization in and from Asia and Emerging Markets

The preliminary timetable (subject to changes) is as follows:

  1. August 15, 2019: Submission of a 1-2-page proposal of the book chapter
  2. September 15: Decision on accepted chapters (informed directly to authors)
  3. November 30, 2019: Submission of the first draft of the book chapter
  4. February 2020: Letter on the needed revisions (to the authors)

3.     May 2020: Submission of a revised version of the book chapter

4.     January 2021: Planned publication of the handbook

Both empirical and conceptual work is welcome. Please address your questions and send your chapter proposal, with an indication under which sub-theme of the book it is written for, in a PDF form to tanja.leppaaho@lut.fi by August 15, 2019. See also http://ife.fi

References

Arregle, J. L., Duran, P., Hitt, M. A., & Van Essen, M. (2017). Why is family firms’ internationalization unique? A meta‐analysis. Entrepreneurship Theory and Practice, 41(5), 801-831.

Arregle, J. L., Hitt, M. A., Sirmon, D. G., & Very, P. (2007). The development of organizational social capital: Attributes of family firms. Journal of management studies44(1), 73-95

Beamish, P. W. (1990). The internationalisation process for smaller Ontario firms: a research agenda. Research in global business management, 1, 77-92

Berrone, P., Cruz, C., & Gomez-Mejia, L. R. (2012). Socioemotional wealth in family firms: Theoretical dimensions, assessment approaches, and agenda for future research. Family Business Review, 25(3), 258-279.

Cabrera‐Suárez, K., De Saá‐Pérez, P., & García‐Almeida, D. (2001). The succession process from a resource‐and knowledge‐based view of the family firm. Family Business Review, 14(1), 37-48.

Calabrò, A., Brogi, M., & Torchia, M. (2016). What Does Really Matter in the Internationalization of Small and Medium‐Sized Family Businesses?. Journal of Small Business Management, 54(2), 679-696.

Casillas, J. C., & Acedo, F. J. (2005). Internationalisation of Spanish family SMEs: An analysis of family involvement. International Journal of Globalisation and Small Business, 1(2), 134–151.

Chrisman, J. J., Chua, J. H., & Sharma, P. (2005). Trends and directions in the development of a strategic management theory of the family firm. Entrepreneurship Theory and Practice, 29(5), 555-576.

Davis, P. S., & Harveston, P. D. (1998). The influence of family on the family business succession process: A multi-generational perspective. Entrepreneurship Theory and Practice, 22(3), 31-53Dyer, W.G. & Whetten, D.A. (2006). Family firms and social responsibility: preliminary evidence from the S&P 500. Entrepreneurship Theory and Practice 30, 785-802.

Debicki, B. J., Kellermanns, F. W., Chrisman, J. J., Pearson, A. W., & Spencer, B. A. (2016). Development of a socioemotional wealth importance (SEWi) scale for family firm research. Journal of Family Business Strategy, 7(1), 47-57.

EFB, European Family Businesses (2012). Family Business Statistics. [online document]. Available at: http://www.europeanfamilybusinesses.eu/uploads/Modules/Publications/fa mily-business-statistics.pdf

European Commission (2015). Information on family businesses in Europe. Available at: http://ec.europa.eu/growth/smes/promoting-entrepreneurship/we-work-for/family-business/index_en.htm

Fang, H., Kotlar, J., Memili, E., Chrisman, J. J., & De Massis, A. (2018). The pursuit of international opportunities in family firms: Generational differences and the role of knowledge‐based resources. Global Strategy Journal, 8(1), 136-157.

Gedajlovic, E., Lubatkin, M.H. & Schulze, W.S. (2004). Crossing the threshold from founder management to professional management: a governance perspective. Journal of Management Studies, 41, 899-912.

Gersick, K. E., Davis, J. A., Hampton, M. M., & Lansberg, I. (1997). Generation to generation: Life cycles of the family business. Harvard Business Press.

Gomez-Mejia, L. R., Cruz, C., Berrone, P., & De Castro, J. (2011). The bind that ties: Socioemotional wealth preservation in family firms. Academy of Management Annals, 5(1), 653-707.

Kampouri, K., Plakoyiannaki, M. E., & Leppäaho, T. (2015). Family Business Internationalisation and Networks: Emerging Pathways. Journal of Business and Industrial Marketing, in press.

Karra, N., Tracey, P., & Phillips, N. (2006). Altruism and agency in the family firm: Exploring the role of family, kinship, and ethnicity. Entrepreneurship Theory and Practice, 30(6), 861-877.

Kontinen, T. & Ojala, A (2012). Social capital in the international operations of family SMEs. Journal of Small Business and Enterprise Development, 19 (1).

Kontinen, T., & Ojala, A. (2010). The internationalisation of family businesses: A review of extant research. Journal of Family Business Strategy, 1, 97-107.

Le Breton‐Miller, L. & Miller, D. (2009). Agency vs. stewardship in public family firms: A social embeddedness reconciliation. Entrepreneurship Theory and Practice, 33(6), 1169-1191.

Leppäaho, T., Metsola, J & Paavilainen-Mäntymäki, E. (2016). Process view and the internationalization of family businesses. Academy of Management conference, Anaheim, California, USA, 5.-9.8.2016.

McAuley, A. (2010). Looking back, going forward: reflecting on research into the SME internationalisation process. Journal of Research in Marketing and Entrepreneurship, 12(1), 21-41.

Oviatt, B.M. & McDougall, P.P. (1994). Toward a theory of international new ventures. Journal of International Business Studies, 25(1), 45-64.

Pukall, T. J., & Calabrò, A. (2014). The Internationalisation of Family Firms A Critical Review and Integrative Model. Family Business Review27(2), 103-125.

Reuber, A. R. (2016). An assemblage‐theoretic perspective on the internationalization processes of family firms. Entrepreneurship Theory and Practice, 40(6), 1269-1286.

Roessl, D. (2005). Family businesses and interfirm cooperation. Family Business Review18(3), 203-214.

Salvato, C. & Melin, L. (2008). Creating Value Across Generations in Family-Controlled Businesses: The Role of Family Social Capital. Family Business Review 21 (3), 259-276.

Sharma, P., Chrisman, J. J., & Chua, J. H. (1997). Strategic management of the family business: Past research and future challenges. Family business review, 10(1), 1-35.

Sirmon, D. G., & Hitt, M. A. (2003). Managing resources: Linking unique resources, management, and wealth creation in family firms. Entrepreneurship theory and practice, 27(4), 339-358.

Welch, L. S., & Luostarinen, R. (1988). Internationalization: evolution of a concept. Journal of General Management, 14, 34-55.

Welch, C., & Paavilainen‐Mäntymäki, E. (2014). Putting process (back) in: Research on the internationalization process of the firm. International Journal of Management Reviews, 16(1), 2-23.

Zellweger, T. M., Chrisman, J., Chua, J., & Steier, L. (2018). Social structures, social relationships, and family firms. Entrepreneurship theory and practice: ET&P, 33(6).