Ekonomika a management
SURVIVAL AND LONGEVITY OF FAMILY BUSINESSES: A CASE OF EASTERN BUSINESS CULTURE
Family businesses all over the world are suffering from long-term survival problems (Miller et al., 2004; Salvato & Leif, 2008) despite financially outperforming in the short run (Dyer, 2006; Villalonga & Amit, 2006). Meanwhile, general business literature agrees that if a business outperforms in accumulating more resources in the short run, it has a greater propensity to sustain in the long run (Efrat & Shoham, 2012). In this case, despite the diverse ideologies, the short term in this paper is termed to be less than three years. The simple question arising from these two research findings is why family businesses are not as sustainable in the long run if they can outperform in the short run?
Jméno a příjmení autora:
Ravindra Hewa Kuruppuge, Ales Gregar
Family business, family involvement, business survival, business success, eastern business culture, western business culture, Sri Lanka
DOI (& full text):
The main objective of this study is to understand how Sri Lankan family businesses’ survive over the long term, across generations. Even though previous studies on Western business culture have…více
The main objective of this study is to understand how Sri Lankan family businesses’ survive over the long term, across generations. Even though previous studies on Western business culture have adequately conceptualized operations family businesses, a huge knowledge vacuum and/or several inconsistencies are shown in Eastern business culture in case of survival and longevity of family businesses. Studies from both cultures commonly affirm that family businesses outperform over non-family firms in the short run. Similarly, most studies from Western business culture assure that family businesses are suffering from business survival problem in the long run. Contradicting to this research finding emerged in Western business culture, most Sri Lankan family businesses are reported surviving over generation from the inception. As a result, a requirement of an academic analysis of Sri Lanka family businesses has emerged. Twenty two interviews from twelve family businesses (cases) facilitated an understanding of how family members become dedicated partners of the business and contribute to its survival. Respondents were either managers or owners. Purposive sampling techniques facilitated to select respondents from respective cases. Interviews indicated that education and business challenges motivate family members to remain strongly engaged in the business, as do familial bonds and the subsequent tacit knowledge. Further, respondents revealed the interdependence of business success and the personal success of family members. Therefore, family businesses in the context of Sri Lankan business culture have experienced above-average durations of business survival in comparison to Western business culture.
Ekonomika a management