Skip to main content

How does family capital influence the resilience of family firms?

Abstract

How does being a family business contribute to resilience in a turbulent business environment? We draw on the Sustainable Family Business Theory (SFBT) to highlight the role of family capital (human, social, and financial capital) in the resilience of a sample of family firms. We collected data through semi-structured interviews with managers of four Tunisian family firms after the political revolution between 2011 and 2014, which triggered economic instability and business discontinuities. Organizational agility and resilience consequently became vital. We find that social capital of family firms, which may be composed of local and/or international contacts, contributes the most to firms’ ability to absorb shocks, reallocate existing resources, and internalize practices that allow firms to cope with future disturbances. We also find that financial capital is largely determined by social capital and human capital of family firms. Our research contributes to the family business resilience literature by showing how developing resilience at an individual level (social capital) fosters organizational level (family business) resilience. The interactions between the three dimensions of social capital are particularly interesting for sustainable family business theorists. We show that financial capital mediates the impact of human and social capital in order to strengthen firms’ resilience. Our research also has implications for the international entrepreneurship literature: we found that international contacts provide family businesses in crisis with strong social support together with access to strategic opportunities at the local level. Future research could focus on the direct and indirect impacts of several dimensions of family capital in order to test which configuration of family capital leads to the greatest resilience. Studies could also further explore the impact of the network of international contacts in the strategic renewal of resilient family firms by identifying international opportunities.

Résumé

Comment l’entreprise familiale peut-elle se montrer résiliente dans un environnement d’affaires turbulent? Nous puisons nos arguments de la théorie de l’entreprise familiale durable pour mettre en évidence le rôle du capital familial (capital humain, social et financier) dans la résilience d’un échantillon d’entreprises familiales. Nous avons collecté des données à travers des entretiens semi-directifs avec les managers de quatre entreprises familiales tunisiennes après la révolution politique entre 2011 et 2014. Cette révolution a déclenché une instabilité économique sévère mettant à l’épreuve la capacité des entreprises à être résiliente. Nos résultats montrent que le capital social des entreprises familiales (composé aussi bien par des contacts locaux que des contacts internationaux) contribue fortement à la capacité des entreprises à absorber les chocs (capacité d’adaptation), réallouer les ressources existantes (capacité de renouvellement) et internaliser certaines pratiques permettant aux entreprises de faire face aux perturbations futures (capacité d’appropriation). Nous constatons également que le capital financier est. en grande partie déterminé par le capital social et le capital humain des entreprises familiales. Notre recherche contribue à la littérature sur la résilience de l’entreprise familiale en montrant comment le développement de la résilience au niveau individuel (capital social des membres de la famille) contribue au développement de la résilience à un niveau organisationnel. De même, les interactions entre les trois dimensions du capital social sont particulièrement intéressantes pour les théoriciens de l’entreprise familiale durable. Nous montrons, en effet, que le capital financier médiatise les effets du capital humain et social afin de renforcer la résilience des entreprises. Notre recherche présente également des implications pour la littérature sur l’entreprenariat international en montrant que les contacts internationaux des entreprises familiales apportent un soutien social considérable à l’entreprise en situation de crise mais aussi offrent la possibilité d’accès à des opportunités stratégiques à l’échelle locale. Les recherches futures pourraient se concentrer sur les impacts directs et indirects des différentes dimensions du capital familial afin de tester la meilleure configuration du capital familial conduisant à une plus grande résilience. Les recherches futures pourraient également explorer l’impact des contacts internationaux sur le renouvellement stratégique des entreprises familiales résilientes et ce, à travers l’identification d’opportunités à l’échelle internationale.

This is a preview of subscription content, access via your institution.

Fig. 1:
Fig. 2

References

  • Akgün AE, Keskin H (2014) Organizational resilience capacity and firm product innovativeness and performance. Int J Prod Res 52(23):6918–6937

    Article  Google Scholar 

  • Altintas G, Royer I (2009) Renforcement de la résilience par un apprentissage post crise : une étude longitudinale sur deux périodes de turbulence. M@n@gement 12:266–293

    Article  Google Scholar 

  • Arregle J-L, Hitt MA, Sirmon DG, Very P (2007) The development of organizational social capital: attributes of family firms. J Manag Stud 44(1):73–95

    Article  Google Scholar 

  • Barton MA, Sutcliffe KM, Vogus TJ, DeWitt T (2015) Performing under uncertainty: contextualized engagement in wildland firefighting. J Conting Cris Manag 23(2):74–83

    Article  Google Scholar 

  • Begin L, Chabaud D (2010) La résilience des organisations: le cas d’une entreprise familiale. Rev Fr Gest 36(200):127–142

    Article  Google Scholar 

  • Bohatá M, Mládek J (1999) The development of the Czech SME sector. J Bus Ventur Bus Ventur 14(5–6):461–473

    Article  Google Scholar 

  • Boin A, Hart P, Stern E, Sundelius B (2005) The politics of crisis management: public leadership under pressure. Cambridge University Press, Cambridge

    Book  Google Scholar 

  • Brewton KE, Danes SM, Stafford K, Haynes GW (2010) Determinants of rural and urban family firm resilience. J Fam Bus Strateg 1(3):155–166

    Article  Google Scholar 

  • Brinkerink J and Bammens Y (2017) Family influence and R&D spending in Dutch manufacturing SMEs: the role of identity and socioemotional decision considerations. J Prod Innov Manag. https://doi.org/10.1111/jpim.12428

  • Brown F (1998) The “softer side” of consulting to business-owning families: understanding our clients and ourselves. Fam Bus Rev 11(3):193–205

    Article  Google Scholar 

  • Burt RS (1992) Structural holes. Cambridge University Press, Cambridge

    Google Scholar 

  • Cameron KS, Bright D, Caza A (2004) Exploring the relationships between organizational virtuousness and performance. Am. Behavioral Scientist 4:766–790

    Article  Google Scholar 

  • Carver CS, Scheier MF, Weintraub JK (1989) Assessing coping strategies: a theoretically based approach. J Pers Soc Psychol 56(2):267–283

    Article  Google Scholar 

  • Chetty S, Campbell-Hunt CA (2004) Strategic approach to internationalization: a traditional versus a “born-global” approach. J Int Mark 12(1):57–81

    Article  Google Scholar 

  • Chirico F, Salvato C (2016) Knowledge internalization and product development in family firms: when relational and affective factors matter. Entrep Theory Pract 40(1):201–229

    Article  Google Scholar 

  • Christianson MK, Farkas MT, Sutcliffe KM, Weick KE (2009) Learning through rare events: significant interruptions at the Baltimore & Ohio Railroad Museum. Organ Sci 20(5):846–860

    Article  Google Scholar 

  • Danes SM (2006) Tensions within family business-owning couples over time. Stress Trauma Cris 9(3–4):227–246

    Article  Google Scholar 

  • Danes SM (2014) The future of family business research through the family scientist’s lens. In: Melin L, Nordqvist M, Sharma P (eds) The sage handbook of family business. Sage, Thousand Oaks, pp 611–619

    Chapter  Google Scholar 

  • Danes SM, Brewton KE (2012) Follow the capital: benefits of tracking family capital across family and business systems. Int Stud Entrep 15:227–250

    Google Scholar 

  • Danes SM, Lee J, Stafford K, Heck RKZ (2008a) The effects of ethnicity, families and culture on entrepreneurial experience: an extension of sustainable family business theory. J Dev Entrep 13(3):229–268

    Google Scholar 

  • Danes SM, Loy JTC, Stafford K (2008b) Business planning practices of family-owned firms within a quality framework. J Small Bus Manag 46(3):395–421

    Article  Google Scholar 

  • Danes SM, Stafford K, Haynes G, Amarapurkar SS (2009) Family capital of family firms: bridging human, social, and financial capital. Fam Bus Rev 22(3):199–215

    Article  Google Scholar 

  • De Massis A, Frattini F, Kotlar J, Petruzelli A, Wright M (2016) Innovation through tradition: lessons from innovative family businesses and directions for future research. Acad Manag Perspect 30(1):93–116

    Article  Google Scholar 

  • Dreux DR (1990) Financing family business: alternatives to selling out or going public. Fam Bus Rev 3(3):225–243

    Article  Google Scholar 

  • Duran P, Kammerlander N, Van Essen M, Zellweger T (2016) Doing more with less: innovation inputs and outputs in family firms. Acad Manag J 59:1224–1264

    Article  Google Scholar 

  • Dyer WG, Nenque E, Hill EJ (2014) Toward a theory of family capital and entrepreneurship: antecedents and outcomes. J Small Bus Manag 52(2):266–285

    Article  Google Scholar 

  • Ellis PD (2011) Social ties and international entrepreneurship: opportunities and constraints affecting firm internationalization. J Int Bus Stud 42(1):99–127

    Article  Google Scholar 

  • Evrard Y, Pras B, Roux R (1997) Market, studies and research in marketing. Nathan, Paris

    Google Scholar 

  • Feranita F, Kotlar J, De Massis A (2017) Collaborative innovation in family firms: past research, current debates and agenda for future research. J Fam Bus Strateg 8(3):137–156

    Article  Google Scholar 

  • Fredrickson BL (2001) The role of positive emotions in positive psychology. The broaden-and-build theory of positive emotions. Am Psychol 56(3):218–226

    Article  Google Scholar 

  • Gallo MA, Vilaseca A (1996) Finance in family business. Fam Bus Rev 9(4):387–401

    Article  Google Scholar 

  • Gedajlovic E, Carney M (2010) Markets, hierarchies, and families: toward a transaction cost theory of the family firm. Entrep Theory Pract 34(6):1145–1172

    Article  Google Scholar 

  • Gittell JH, Cameron K, Lim S, Rivas V (2006) Relationships, layoffs, and organizational resilience: airline industry responses to september 11. J Appl Behav Sci 42(3):300–329

    Article  Google Scholar 

  • Harris S, Wheeler C (2005) Entrepreneurs’ relationships for internationalization: functions, origins and strategies. Int Bus Rev 14(2):187–207

    Article  Google Scholar 

  • Haynes GW, Danes SM, Stafford K (2011) Influence of federal disaster assistance on family business survival and success. J Contingencies Cris Manag 19(2):86–98

    Article  Google Scholar 

  • He X (2009) The development of entrepreneurship and private enterprise in the People’s Republic of China and its relevance to transitional economies. J Dev Entrep 14(1):39–58

    Google Scholar 

  • Hollnagel E (2006) Resilience: the challenge of the unstable. In: Hollnagel E, Woods DD, Leveson NC (eds) Resilience engineering: concepts and precepts. Ashgate, Aldershot, pp 9–18

    Google Scholar 

  • Hollnagel E, Journe B, Laroche H (2009) Reliability and resilience as dimensions of organizational performance. M@n@gement 12(4):307–339

    Article  Google Scholar 

  • Horton TP (1986) Managing in a family way. Manag Rev 75(2):3

    Google Scholar 

  • Kiss AN, Danis WM (2008) Country institutional context, social networks, and new venture internationalization speed. Eur Manag J 26(6):388–399

    Article  Google Scholar 

  • Landau J (2007) Enhancing resilience: families and communities as agents for change. Fam Process 46(3):351–365

    Article  Google Scholar 

  • Lane PJ, Lubatkin M (1998) Relative absorptive capacity and interorganizational learning. Strateg Manag J 19(5):461–477

    Article  Google Scholar 

  • Lengnick-Hall CA, Beck TE (2009) Resilience capacity and strategic agility: prerequisites for thriving in a dynamic environment. In: Nemeth C, Hollnagel E, Dekker S (eds) Preparation and restoration. Ashgate Publishing, Aldershot

    Google Scholar 

  • Lengnick-Hall CA, Beck TE, Lengnick-Hall ML (2011) Developing a capacity for organizational resilience through strategic human resource management. Hum Resour Manag Rev 21(3):243–255

    Article  Google Scholar 

  • Lindstrand A, Melén S, Nordman ER (2011) Turning social capital into business: a study of the internationalization of biotech SMEs. Int Bus Rev 20(2):194–212

    Article  Google Scholar 

  • Linnenluecke MK (2017) Resilience in business and management research: a review of influential publications and a research agenda. Int J Manag Rev 19(1):4–30

    Article  Google Scholar 

  • Luthans F (2002) Positive organizational behavior: developing and managing psychological strengths. Acad Manag Exec 16(1):57–72

    Google Scholar 

  • Lwango ABR, Coeurderoy R (2011) Le capital social de l’entreprise familiale: une approche empirique de son efficience organisationnelle. Rev Fr Gest 37:109–123

    Article  Google Scholar 

  • Manev IM, Manolova TS (2010) Entrepreneurship in transitional economies: review and integration of two decades of research. J Dev Entrep 15(1):69–99

    Google Scholar 

  • Miles MB, Huberman AM (2003) Qualitative data analysis: a methods sourcebook. De Boeck, Bruxelles

    Google Scholar 

  • Miller D, Wright M, Le Breton-Miller I, Scholes L (2015) Resources and innovation in family businesses. Calif Manag Rev 58(1):20–41

    Article  Google Scholar 

  • Musteen M, Datta DK, Butts MM (2014) Do International networks and foreign market knowledge facilitate SME internationalization? Evidence from the Czech Republic. Entrep Theory Pract 38(4):749–774

    Article  Google Scholar 

  • Nahapiet J, Ghoshal S (1998) Social capital, intellectual capital, and the organizational advantage. Acad Manag Rev 23(2):242–266

    Article  Google Scholar 

  • Oviatt BM, McDougall PP (1994) Toward a theory of international new ventures. J Int Bus Stud 25(1):45–64

    Article  Google Scholar 

  • Patel PC, Fiet JO (2011) Knowledge combination and the potential advantages of family firms in searching for opportunities. Entrep Theory Pract 35(6):1179–1197

    Article  Google Scholar 

  • Patterson JM (2002) Understanding family resilience. J Clin Psychol 58(3):233–246. https://doi.org/10.1002/jclp.10026

    Article  Google Scholar 

  • Pearson AW, Carr JC, Shaw JC (2008) Toward a theory of familiness: a social capital perspective. Entrep Theory Pract 32(6 SPEC ISS):949–969

    Article  Google Scholar 

  • Ryff CD, Singer BH (2001) Emotion, social relationships and health. Oxford University Press, New York

    Book  Google Scholar 

  • Salvato C, Melin L (2008) Creating value across generations in family-controlled businesses: the role of family social capital. Fam Bus Rev 21:259–276

    Article  Google Scholar 

  • Seligman MEP (2002) Positive psychology, positive prevention, and positive therapy. In: Snyder C, Lopez SJ (eds) Handbook of positive psychology. Oxford University Press, New York, pp 3–9

    Google Scholar 

  • Sharma P (2008) Commentary: familiness: capital stocks and flows between family and business. Entrep Theory Pract 32:971–977

    Article  Google Scholar 

  • Sharma P, Salvato C (2011) Commentary: exploiting and exploring new opportunities over life cycle stages of family firms. Entrep Theory Pract 35:1199–1205

    Article  Google Scholar 

  • Sirmon DG, Hitt MA (2003) Managing resources: linking unique resources, management, and wealth creation in family firms. Entrep Theory Pract 27(4):339–358

    Article  Google Scholar 

  • Sorenson RL, Bierman L (2009) Family capital, family business, and free enterprise. Fam Bus Rev 22(3):193–195

    Article  Google Scholar 

  • Spreitzer G, Sutcliffe K, Dutton J, Sonenshein S, Grant AM (2005) A socially embedded model of thriving at work. Organ Sci 16(5):537–549

    Article  Google Scholar 

  • Stafford K, Duncan KA, Dane S, Winter M (1999) A research model of sustainable family businesses. Fam Bus Rev 12(3):197–208

    Article  Google Scholar 

  • Stafford K, Bhargava V, Danes SM, Haynes G, Brewton KE (2010) Factors associated with long-term survival of family businesses: duration analysis. J Fam Econ Issues 31(4):442–457

    Article  Google Scholar 

  • Stafford K, Danes SM, Haynes GW (2013) Long-term family firm survival and growth considering owning family adaptive capacity and federal disaster assistance receipt. J Fam Bus Strateg 4(3):188–200

    Article  Google Scholar 

  • Stallings RA (1998) Disaster and the theory of social order. In: Quarantelli EL (ed) What is a disaster? Perspectives on the question. Routledge, New York, pp 127–145

    Google Scholar 

  • Strike VM (2012) Advising the family firm: reviewing the past to build the future. Fam Bus Rev 25(2):156–177

    Article  Google Scholar 

  • Tengblad S (2018) A resource-based model of organizational resilience. In: Tengblad S, Oudhuis M (eds) The resilience framework: organizing for sustained viability. Springer, Singapore, pp 39–54

    Chapter  Google Scholar 

  • van der Vegt GS, Essens P, Wahlström M, George G (2015) Managing risk and resilience. Acad Manag J 58(4):971–980

    Article  Google Scholar 

  • Weick KE, Sutcliffe KM (2015) Managing the unexpected: sustained performance in a complex world. Wiley, NJ

    Book  Google Scholar 

  • Wildavsky A (1988) Searching for safety. Transaction Books, New Brunswick, NJ

    Google Scholar 

  • Williams TA, Shepherd D (2016) Building resilience or providing sustenance: different paths of emergent ventures in the aftermath of the Haiti earthquake. Acad Manag J 59(6):2069–2102

    Article  Google Scholar 

  • Williams TA, Gruber DA, Sutcliffe KM, Shepherd DA Zhao EY (2017) Organizational response to adversity: fusing crisis management and resilience research streams. Acad Manag Ann 11(2):733–769

    Article  Google Scholar 

  • Zahra SA (2005) Entrepreneurial risk taking in family firms. Fam Bus Rev 18(1):23–40

    Article  Google Scholar 

  • Zuiker VS, Katras MJ, Montalto CP, Olson PD (2003) Hispanic self-employment: does gender matter? Hisp J Behav Sci 25(1):73–94

    Article  Google Scholar 

Download references

Author information

Authors and Affiliations

Authors

Corresponding authors

Correspondence to Imen Mzid or Nada Khachlouf.

Rights and permissions

Reprints and Permissions

About this article

Verify currency and authenticity via CrossMark

Cite this article

Mzid, I., Khachlouf, N. & Soparnot, R. How does family capital influence the resilience of family firms?. J Int Entrep 17, 249–277 (2019). https://doi.org/10.1007/s10843-018-0226-7

Download citation

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s10843-018-0226-7

Keywords

  • Organizational resilience
  • Political transition
  • Family business
  • Family capital
  • Qualitative methods

Mots clés

  • Résilience organisationnelle
  • Transition politique
  • Enterprise familiale
  • Capital familial
  • Méthodes qualitatives