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Journal of Family Business Strategy
journal homepage: www.elsevier.com/locate/jfbs
An exploratory study of firm goals in the context of family firms: An institutional logics perspective
Gloria Aparicioa, Rodrigo Bascob,⁎, Txomin Iturraldea, Amaia Masedaa
a Faculty of Economics and Business, University of the Basque Country, E48015, Bilbao, Spain b Sheikh Saoud bin Khalid bin Khalid Al-Qassimi Chair in Family Business, American University of Sharjah, PO Box 26666, Sharjah, United Arab Emirates
A R T I C L E I N F O
Keywords: Family business Family business goals Institutional logics Behavioral theory of the firm Delphi method
A B S T R A C T
It is assumed that cross-firm behavioral differences are caused by the different goals owners and managers leave imprinted on their organizations. However, researchers have failed to come to agreement regarding what firm goals are, what types of firm goals exist, and to what extent one type of goal is superior to others. Therefore, the aim of this study is to address these gaps using the Hybrid Delphi methodology in the particular context of family firms. Our results provide a list of family business goals, an aggregation of family business goals based on institutional logics, and evidence of the coexistence of multiple goals.
1. Introduction
Our goals can only be reached through a vehicle of a plan, in which we must fervently believe, and upon which we must vigorously act. There is no other route to success.
Pablo Picasso (1881–1973)
Modern organizations are confronted with many unprecedented changes and increasing global complexity. In order to be effective, business leaders have to understand their firm’s principal actors’ goals (Hillman & Keim, 2001) and their expectations (Pieper, 2010). In most cases, firms have multiple organizational goals because of the existence of several stakeholders with specific goals that must be satisfied (Cyert & March 1963), including both economic and non-economic goals (Raymond, Marchand, St-Pierre, Cadieux, & Labelle, 2013; Richard, Devinney, Yip, & Johnson, 2009). However, in the context of family businesses, the family as the dominant coalition (Astrachan, Klein, & Smyrnios, 2002) is likely to impose its own aspirational in- tentions to pursue family-related goals in addition to business-related goals (Basco, 2017; Chrisman, Chua, Pearson, & Barnett, 2012; Kotlar & De Massis, 2013). For instance, a family’s concerns over its organizational reputation (Zellweger, Nason, Nordqvist, & Brush, 2013), its intention to preserve its socioemotional endowment (Gómez- Mejia, Haynes, Nunez-Nickel, Jacobson, & Moyano-Fuentes, 2007), and its purpose to build its own family legacy (Englisch, Hall, & Astrachan, 2015) may lead the firm to pursue family-oriented goals.
Even though it is widely recognized that family firms pursue more than economic goals (Binz Astrachan, Ferguson, Pieper, & Astrachan,
2017; Brundin, Samuelsson, & Melin, 2014), there are still two main limitations in family business studies related to the issue of goals. First, most existing studies have not measured actual goals but have assumed that different types of ownership and management regimes (e.g., family and non-family) differ in their goals (e.g., Thomsen & Pedersen, 2000). Second, even though there have been several attempts to measure goals, there is no accepted conceptualization of family business goals, and different dimensions have been used so far (e.g., see the different interpretations made by Kim & Gao, 2013 and Zellweger et al., 2013). To close the aforementioned gaps, using the institutional logics per- spective (Thornton, Ocasio, & Lounsbury, 2012), this study explores goals as micro-foundations, considering that in “various institutional logics—state, market, community, professional, family, religion- social actors have multiple goals. The content of the goals does differ between the goals embedded in alternative institutional logics” (Thornton et al., 2012, p. 87). In the particular case of family firms, where a dominant coalition is formed by family members, a unique institutional logic emerges dubbed the family logic, which coexists with the market logic and the community logic (Reay, Jaskiewicz, & Hinings, 2015), all of which likely determine the content of the goals. Consequently, we in- vestigate two main research questions: What goals do family firms pursue? Is there any aggregation of family business goals reflecting institutional logics?
To address these research questions, we apply the Hybrid Delphi methodology (Landeta, Barrutia, & Lertxundi, 2011), which combines three well-known qualitative techniques: the focus group technique (FGT), the nominal group technique (NGT), and the Delphi technique. We believe the Hybrid Delphi methodology is most appropriate for the
http://dx.doi.org/10.1016/j.jfbs.2017.08.002
⁎ Corresponding author. E-mail addresses: gloria.aparicio@ehu.eus (G. Aparicio), bascorodrigo@gmail.com (R. Basco), txomin.iturralde@ehu.eus (T. Iturralde), amaia.maseda@ehu.eus (A. Maseda).
Journal of Family Business Strategy 8 (2017) 157–169
Available online 24 September 2017 1877-8585/ © 2017 Elsevier Ltd. All rights reserved.
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explorative purpose of our research and will enable us to uncover fa- mily business goals in family firms. Three main outputs were obtained from the Hybrid Delphi methodology: a list of family business goals, an aggregation of family business goals based on institutional logics, and evidence of multiple goals’ coexistence.
This research makes several contributions to theory and practice. First, our research provides new evidence about the goals that are im- portant within the family business context. Even though several studies have highlighted that family firms pursue different goals (e.g., see Tagiuri & Davis, 1992), our article sheds new light by identifying, in- terpreting, and classifying family business goals. By using the institu- tional logics perspective, this research also extends current knowledge about institutional logics in the context of the family firm (e.g., Reay et al., 2015) by revealing the goals that seem to be a manifestation of institutional logics. Second, this research represents a step forward in understanding organizations where multiple institutional logics coexist (Greenwood, Raynard, Kodeih, Micelotta, & Lounsbury, 2011), specifi- cally focusing on goals as a micro-foundation of institutional logics. Third, this work is the first attempt in the field of family business to apply the Delphi technique as the explorative research methodology to approach complex realities. Finally, this research has practical im- plications for those working in or with family firms, such as owners, managers, and business consultants, because it opens the black box of family business goals, recognizing the complexity of family firms as they make decisions.
This article is structured as follows. First, we theoretically present the main arguments, describing how the complexity of family firms starts with the multiple institutional logics that coexist within them. Second, we discuss the methodology used to address our research questions. In the following section, we interpret our results by pre- senting the chain of methodological steps used in the research process. In the last section, we present conclusions, limitations, and a future line of research.
2. Goals as micro-foundations of institutional logics
The institutional logics perspective is a framework to study the in- terrelationships among institutions, individuals, and organizations in a societal context (Thornton et al., 2012). The concept of institutional logics is defined as “the socially constructed, historical patterns of material practices, assumptions, values, beliefs, and rules by which individuals produce and reproduce their material subsistence, organise time and space, and provide meaning to their social reality” (Thornton & Ocasio, 1999). Following Friedland and Alford’s (1991) ideas, we can posit that market, family, and community institutions provide a distinct set of logics, often contradictory, that are basically formed by material and symbolic elements. For instance, while the fa- mily logic attempts to convert social relationships into reciprocal and unconditional obligations, the market logic is about the accumulation and commodification of human relationships and activities (Friedland & Alford, 1991), and the community logic centers on mutual co-operation among actors (Greenwood, Díaz, Li, & Lorente, 2009). A key assumption of the institutional logics perspective is that these logics provide a link between individuals and cognition and between socially constructed institutional practices and rule structures (Thornton & Ocasio, 2008, p. 101). In other words, the interests, iden- tities, values, and assumptions of individuals and organizations are encapsulated in a set of institutional logics, which in turn are likely to constrain and/or stimulate actions.
The institutional logics perspective provides arguments to extend current knowledge to explain that formal and informal institutions af- fect organizational behavior and strategies, which results in organiza- tional homogeneity (DiMaggio & Powell, 1983) and/or heterogeneity (Friedland & Alford, 1991). Specifically, the micro-foundation of in- stitutional logics, which links macro-logics with micro-behaviors and −decisions, highlights that social actors both influence and are
influenced by institutions in a loop-like relationship (for a complete explanation of the model, see Thornton et al., 2012). According to the authors, “Institutional logics focus the attention of individual actors through cultural embeddedness, activating a social actor’s situated identities, goals and schemas” (Thornton et al., 2012, p. 84), thereby affecting social interactions nested in organizations. That is, decisions made in an organization are consequences of its institutional logic, which then activates specific individual goals.
Goals—defined as the “value premises that can serve as inputs to decisions” (Simon, 1964, p. 3)—guide, encourage, and constrain par- ticular strategic choices (Basco & Calabrò, 2017; Basco, 2014) and ethical behaviors (Vazquez, 2016). The behavioral theory of the firm posits that organizational goals result from the interaction of coalitions within firms (Cyert & March 1963). That is, firms are viewed as a nexus of coalitions of stakeholders (e.g., managers, shareholders, customers, and owner families) with different interests and expectations, and the process of bargaining among stakeholders determines firm goals. Within different institutional logics, such as the market, community, and family, social actors have multiple goals (Thornton et al., 2012). Therefore, firm goals are engendered by the institutional logics of embedded stakeholders and focus the firm’s attention in specific ways (Thornton et al., 2012).
2.1. Goals in the context of family firms
In the specific context of family firms, the family represents an important coalition that is able to exert control over the firm through the ownership, governance, and management arenas (Klein, Astrachan, & Smyrnios, 2005). The family, as the principal agent within the firm, is authorized to interpret and reinterpret its goals (Thornton & Ocasio, 1999). The family’s involvement in and influence on the firm offers a unique laboratory (as a phenomenon of study) to analyze firm goals because family firms have not only economic en- dowments derived from business activities related to market needs but also social and emotional endowments derived from family relation- ships (Basco & Pérez Rodríguez, 2011) to fulfil the family’s affective, emotional, and social needs (Gómez-Mejia et al., 2007). In this sense, we expect to find coexisting institutional logics related to the firm’s economic-oriented goals (driving it to pursue maximized economic returns—“like a business”), non-economic-oriented goals (driving it to emphasize traditions, symbols, values, and altruism at the micro-le- vel—“like a family”) (Foreman & Whetten, 2002), and social goals (driving it to look after the business family and family business as a close community).
Family influence provides the foundation for a particular business culture. Therefore, it is an important endowment that defines how fa- mily and business systems share assumptions and values (Craig, Dibrell, & Garrett, 2014). Consequently, family- and business-oriented goals in family firms, which represent the firms’ intentions or aspira- tions (McKenny, Short, Zachary, & Payne, 2011), are determined by market, community, and family logics. That is, the aggregate effect of the micro-process of bargaining determines family business goals (Kotlar & De Massis, 2013), which are not only shaped by a specific market logic (i.e., a firm is organized to maximize economic returns) and a specific community logic (i.e., a firm is organized to serve com- munity needs) but also by a family logic (i.e., a firm is organized to benefit family members or achieve financial security for family owners in the future). The constellation of goals that emerges at the firm level is produced by the fuzzy boundaries among the family, the firm, and the external environment. Therefore, in the context of family firms, not only do goals combine the traditional tension between economic and non-economic points of view (responding to different stakeholder lo- gics), but the nature of this tension is also demarcated by the underlying firm orientation based on market, community, and family logics.
Even though family business goals have been studied since the nascent stage of the family business field (e.g., Basco, 2010; Dunn,
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1995; Lee & Rogoff, 1996; Tagiuri & Davis, 1992; Westhead & Howorth, 2007), there are two main limitations of existing research. First, al- though most of the existing research has assumed that different types of ownership and management regimes have specific goals, such goals have barely been measured (e.g., Thomsen & Pedersen, 2000). This assumption leads to the second limitation: even though it has been recognized that family firms pursue both economic goals and non- economic goals (Brundin et al., 2014), there is no clear con- ceptualization of family business goals—namely, the dimensions that form the concept.
2.2. Research questions
A first step toward closing these gaps was made by Kotlar and De Massis (2013), who explored the formulation of goals within the family business context. However, they did not identify the plethora of family business goals or their links with institutional logics. A second move- ment in the same direction was made by Reay et al. (2015), who ex- plored the institutional logics that operate in family firms, but they assumed that different logics may manifest in specific family business goals. Consequently, the aim of this research is to fill the gap among the aforementioned studies by trying to answer the following research questions: What goals do family firms pursue? Is there any aggregation of family business goals reflecting institutional logics?
3. Methodology
Considering that our research aim is to deal with the complex and sometimes non-explicit reality of family business goals, we used a qualitative research approach to address our research questions. This type of research approach and its particularities make it appropriate to identify, clarify, and classify family firm goals by capturing information about beliefs, values, feelings, and motivations underlying behaviors that are not conveyed in quantitative data. By using a qualitative re- search approach, we “construct” rather than “discover” knowledge, but this construction is by nature our own interpretation of the reality we investigate (Creswell, 2003). Therefore, we decided to use the Hybrid Delphi methodology (Landeta et al., 2011). In this context, the Delphi technique is part of a broader process along with the focus group technique (FGT) and the nominal group technique (NGT). Combining these three different techniques into one structured procedure to extract and process information on a particular research problem helps en- hance the advantages of each technique and simultaneously reduces their limitations.
The Delphi technique uses experts’ judgements to deal with complex problems. A series of questions and controlled feedback are used as valid vehicles to obtain and process information from participants (Rowe, Wright, & Bolger, 1991). Specifically, this technique follows an iterative process by stimulating participants’ interactions based on anonymity in order to get expert opinions through successive con- sultation rounds (Goluchowicz & Blind, 2011). Since its introduction in the 1950s (see Dalkey & Helmer, 1963), the Delphi technique has been used in a variety of application areas and disciplines1 (Landeta, 2006; Rowe & Wright, 2011).
The Delphi technique, along with the iterative rounds of expert panels, enables data collection and controlled feedback, thus providing valuable solutions for the problems at hand. Feedback is an important part of the method because the Delphi technique seeks to obtain a re- liable group opinion from a set of experts. The main characteristics of this methodology, as Landeta et al. (2011) pointed out, are as follows: 1) it is an iterative process with at least two consultation rounds using the same questions; 2) it maintains the anonymity of among partici- pants; 3) there is controlled feedback such that information exchange among experts is handled by the group coordinating the study; and 4) opinions undergo statistical treatment. With this in mind, the purpose of this study was to selected group of experts to consult about family business goals. Next, we explain the methodological process.
3.1. Research design
The Hybrid Delphi method used to address our research questions has two main phases (see Fig. 1). The first phase is labeled “face-to- face” because it is the phase in which a group of experts—in our case, family business owner-managers—meets together physically. In this phase, two techniques—the FGT and NGT2—are applied to develop a reference framework to broadly clarify family business goals. The
Fig. 1. The hybrid Delphi research procedure.
1 Rowe and Wright (2011) presented an overview of the origin and applications of the Delphi technique. Furthermore, this method has been applied in several areas and dis- ciplines, such as medical, nursing, and health services research (Gibson, 1998; Kirk, Carlisle, & Luker, 1996; Sumsion, 1998); university community research (Landeta et al., 2011); support for government decisions (Landeta et al., 2008); information systems re- search (Hadaya, Cassivi, & Chalabi, 2012; Schmidt et al., 2001); business and industrial research (Linstone & Turoff, 2002); finance research (Kozan & Iefremova, 2014), and strategic management (Julian, Ofori-Dankwa, & Justis, 2008), among others.
2 The NGT used in this research is a modified NGT (Landeta et al., 2011). Instead of making a list of goals in the face-to-face session (as for traditional NGT), the research coordinating group used all the information appearing in the session to make a refined list.
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outcome of this phase is a refined list of family business goals, which serves as a starting point for the Delphi interaction rounds—the second phase. The aim of this second phase, labeled “non-face-to-face,” is to facilitate participation from and interaction among a group of selected experts (composed of owner-managers, business consultants, and aca- demic researchers exploring the topic of family firms) in the exchange of opinions without the influence of the rest of participants. This pro- cess is likely to lead to superior results (than if each expert was con- sidered separately) in terms of identifying, interpreting, integrating, and classifying family business goals.
3.1.1. Face-to-face phase The process started with a meeting (15 April 2015) among a group
of eight family business owner-managers selected from a list of poten- tial candidates built from the personal contacts of the current study’s authors. We followed the involvement approach to define family firm by considering the criteria ‘family involvement in business’ (ownership, governance, and/or management) (e.g., Basco & Voordeckers, 2015; Basco, 2013). The selected group of participants possessed explicit fa- mily business knowledge and experience with family businesses, both features needed for the purpose of our study. Furthermore, many of them were part of family business associations. Specifically, six parti- cipants were presidents of Spanish family firm associations, so they had a broad view of this kind of firm. The details of this group of experts are presented in Table 1.
At the beginning of the face-to-face phase applying the FGT, parti- cipants were guided in the general discussion by a moderator and two observers (the moderator and observers were the co-authors of this article). The FGT followed a traditional procedure where the moderator was responsible for presenting the problem and organizing a round of open discussion about family business goals among the participants. The time assigned for this technique was 45 min, which was used ef- fectively. The session was recorded with the agreement of each parti- cipant.
In the second part of the face-to-face phase, the NGT was applied. This part lasted one hour and 30 min and was divided into different activities. First, the moderator asked the participants to reflect on and write down on paper (later collected by the moderator) what they be- lieve the main goals in family businesses are (this task was assigned 15 min). Second, the moderator invited each expert to present his or her ideas about family business goals to the rest of the participants without receiving comments or criticism from the other participants. This part of the NGT is closely related to brainstorming, but it “follows a highly structured agenda for building the base of knowledge through the use of formal means to involve all participants” (see Day & Bobeva, 2005, p. 104). This task lasted one hour and 15 min. Third, the moderator in- tegrated all the family business goals mentioned by the participants in a list on a whiteboard. Fourth, the moderator invited the experts to in- dividually reflect on the list of goals on the whiteboard in order to add, remove, or modify any of the compiled family business goals. With this task, the face-to-face activities ended.
The raw data (records and documents written by the participants with their comments) obtained from the sessions during the face-to-face phase were analyzed by two members of the research team (one of the members was a passive observer during the meeting, whereas the second had not participated in this phase). Using content analysis and working independently, each of the researchers created a list of family business goals. Once both lists were ready, all members of the research group participated in a constructive debate to define the final list (in the results section, we provide more details about the final list of family business goals). There was a huge overlap between both lists. However, the wording of the goals differed. Therefore, in both cases, the group came to agreement on what goals include and how to define the written expression of goals. The output of this phase concluded with a refined list of family business goals. The same procedure was used to aggregate the list of goals and to reach consensus. In the results section, we analyze the outputs of this phase.
3.1.2. Non-face-to-face phase The iterative rounds of the Delphi process were conducted using
questionnaires sent via email through the Encuesta Facil platform.3 The process took place in June and July of 2015. To avoid dispersion re- flections within the group of experts and following recommendations made by Delbecq, Van de Ven, and Gustafson (1975) to focus the process on the aim of the study (i.e., in our study, obtain a list of family business goals and then classify and prioritize them), the first round of iteration started with the list of family business goals obtained in the face-to-face phase. The number of iterations was defined by the re- searchers involved in the process (all authors of this article) based on the stability of the experts’ answers (Landeta et al., 2011), the marginal information added in a new round, and the absence of extreme posi- tions (Linstone & Turoff, 1975).
3.1.3. Selection of experts A critical issue when applying the Delphi technique is selecting the
group of experts because the quality of the participants could determine the richness of the information gathered to explore the particular pro- blem and could therefore affect the reliability of the results. Thus, fol- lowing recommendations made by Day and Bobeva (2005), we selected participants based on their specific knowledge of family business. We considered that knowledge of a family business could come from three different yet complementary perspectives: 1) owner-managers directly involved in the firm, 2) business consultants actively involved in ad- vising family firms, and 3) academics with a well-recognized research in the family firm field. Thus, the final considerations for our selection of experts was based on the need to have a heterogeneous group of individuals (Bolger & Wright, 2011) reflecting a broad diversity of in- ternal and external points of view on family firms and the need to have broad regional dispersion in Spain to capture cultural diversity within
Table 1 Participant information—Face-to-face phase.
Participant Current position Sector Size Generation N of family members working of the firm Family ownership
P 1 CEO Food distribution − Food industry 400 2 3 100% P 2 CEO Graphic arts 25 2 5 100% P 3 Chairman of Family Council Electric sector 2000 3 4 100% P 4 Chairman of the Board Automotive industry 92 1 4 90% P 5 CEO Metal industry 300 3 12 87% P 6a CEO Services 17 1 1 100% P 7 CEO Electric industry 2800 2 2 100% P 8 CEO Electric industry 67 3 2 100%
a P6 is a special family firm case. There are two owners who are brothers, but only one of them is actively involved in the firm at the moment. Following the definition of family firm for this study, we considered that participant P6 has a family firm because of the kinship relationship among the ownership.
3 Encuesta Facil is an internet-based firm that provides a solution for conducting sur- veys (http://www.encuestafacil.com/).
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the country. While there is no specific rule outlining the final number of experts needed, we followed the general recommendation to have at least 10 to 18 experts in each category (Okoli & Pawlowski, 2004). Thus, the group of experts in our research was composed of 30 parti- cipants: 10 family business owner-managers, 10 business consultants, and 10 academic researchers in the family business field (see Table 2a–2c). Two of the family business owner-managers who parti- cipated in the first phase were also part of the expert panel in the Delphi process, which is standard process in the Hybrid Delphi methodology (Landeta et al., 2011). Experts were invited to participate through a personalized letter in which the dynamics and main objective of the research were explained.
3.1.4. The delphi process For our study, the Delphi process had three iterative rounds with
experts via email. We used a combination of closed and open questions to explore the topics of interest.
3.1.4.1. First round. The purpose of the first round was to validate and receive constructive feedback on the refined list of goals obtained in the face-to-face phase. The questionnaire in this round had three main questions: 1) to rate the importance of each family business goal (using a Likert scale from 1 = less important to 5 = most important), 2) to add new goals if they believed some goals had been missed or to adjust the nuance of the listed goals if necessary, and 3) to select the three most important goals and explain the reasons for their selection.
Table 2a Main information about the owner-manager experts—Non-face-to-face phase.
Expert Type of expert
Current position Sector Size (Number of employees)
Generation N of family members working at the firm
% of family ownership
B 1 FMO CEO Food distribution 400 2 3 100% B 2 FMO CEO Graphic arts 25 2 5 100% B 3 FMO CEO Agriculture and livestock 50 2 1 100% B 4 FMO CEO Graphic arts 100 3 3 90% B 5 FMO Human resources
manager Metal industry 230 2 7 80%
B 6 FMO CEO Electrical equipment distribution
50 2 2 100%
B 7 FMO CEO Food distribution 29 3 4 100% B 8 FMO CEO Electric industry 67 3 2 100% B 9 FMO CEO Agro-food industry and food
distribution 540 3 4 100%
B 10 FMO CEO Pyrotechnic 12 4 1 100%
Table 2b Main information about the business consultant experts—Non-face-to-face phase.
Expert Owner or employee
Number of employees
Years as consultant
% of work consulting family firms
Specialty
C 1 Employee 15 10 80% Succession process C 2 Owner 4 28 70% Communications and governance C 3 Owner 12 25 50% Strategy C 4 Owner 16 25 70% Strategic planning in family businesses, including family protocol C 5 Employee 10 15 80% Communications and governance C 6 Owner 300 20 40% Family protocol C 7 Owner 200 18 50% Succession process C 8 Employee 42 25 100% Succession process, family protocol, family conflicts, firms with siblings and
cousins, professionalization of the family firm C 9 Owner 15 4 60% Leadership C 10 Owner 14 12 80% Succession process
Table 2c Main information about the academic scholar experts—Non-face-to-face phase.
Expert Time as director of a family business center/chair
Time researching family firms
No. of published articles on Family Firms
Research themes in family firms
AR 1 12 years 13 years 12 Financial structure, mergers and acquisitions, family protocols, corporate governance
AR 2 15 years 15 years 22 Succession, factors of success, conflicts, internationalization AR 3 13 years 13 years More than 10 Internationalization and entrepreneurial orientation AR 4 4 years 8 years 16 Innovation, performance, gender AR 5 11 years 9 years 5 Innovation AR 6 15 years 10 years 10 Gender AR 7 15 years 20 years 35 Succession, governance, familiness AR 8 10 years 10 years 10 Knowledge management and intellectual capital, entrepreneurship,
continuity and succession AR 9 7 years 5 years 7 Firm valuation and analysis, cost of equity capital, socioemotional
wealth, technological innovation AR 10 8 years 8 years 2 Knowledge management and organizational learning,
entrepreneurship
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3.1.4.2. Second round. The second round used the information generated in the first round to initiate the controlled feedback process. The structure of the questionnaire in the second round was similar to that of the first-round survey and contained three questions. First, the experts were asked to again rate the importance of the family business goals (using a Likert scale ranging from 1 = less important to 5 = most important). The experts’ assessments in this second round were made through controlled feedback. That is, in order to rate the list of goals, each expert received via personalized email additional information about his or her answers in Round 1 (because it would have been impossible for them to remember their assessments for 43 goals in Round 1) and a report with aggregate results for all participants. The report contained two sections: 1) the mean and mode values for each goal for the whole sample of participants and 2) an illustrative report sent via email with their assessments, the aggregate scores of all experts, and the main comments given by the experts. The report served as a basis for consensus by helping experts locate their individual views within the aggregate consensus in a better manner. The aim of this procedure was to let the experts either validate the ratings they gave for each goal in the first round or change their assessments based on additional information about the aggregate results for the entire group. Second, as in the previous round, the experts were asked to select the three most important goals and to explain their reasons for their selection. Finally, the third question asked the experts to rate (using a Likert scale from 1 = less important to 5 = most important) an aggregate classification of the family business goals, which integrated four categories combining business- and family-oriented goals and economic and non-economic goals.
3.1.4.3. Third round. We reached enough stability regarding the list of family business goals in the second round. To ensure stability, we used three measures following Landeta, Matey, Ruíz, and Galter (2008) and Schmidt, Lyytinen, and Cule (2001). First, we analyzed consensus/ convergence of opinion by considering the standard error for each goal between the first and second rounds.4 Second, we analyzed the stability of replies, which considers individual and group changes from the first round to the second round.5 Finally, we analyzed the stability of the ranking.6 The aim of the third round was to achieve a better descriptive picture of the family business goals and to use this information as a control benchmark to corroborate the consistency of the previous rounds and the whole process. In this round, the questionnaire included the same third question that was in the second round, asking experts to rate an aggregate classification of the family business goals. As in the previous round, the experts received feedback from the coordination group to analyze the stability and consensus of their answers. Additionally, as a robustness check to test the consistency of participant answers, the questionnaire incorporated three open-ended questions about the relationship between business-
oriented and family-oriented goals. In the following section, we discuss and interpret the main results
from the process.
4. Results
We obtained three main outputs from the aforementioned process: 1) a list of family business goals, 2) an aggregation of family business goals based on institutional logics, and 3) evidence of multiple coex- isting goals. Next, we interpret the meaning of all these outputs in the context of our theoretical framework.
4.1. List of family business goals
The face-to-face phase provided us with an initial list of family business goals, which were contrasted and corroborated in the Delphi process (non-face-to-face phase). Additionally, the non-face-to-face phase provided valuable feedback to improve the wording of the family business goals. Table 3 shows the final wording of the goals (column labeled: Level 1—disaggregated items). The final list draws a global picture of the plethora of family business goals (43 family business goals) and, in this sense, extends the previous study of family business goals in different ways.
First, our research extends the previous study of Tagiuri and Davis (1992). Despite the similarity that both studies develop lists of family business goals (which represents a first step in reaching consensus on family business goals), different techniques were used in both studies (while our study used a mix of qualitative techniques, Tagiuri and Davis combined qualitative and qualitative methods), which represents an important step forward from a methodology point of view in the field of family business. Second, another key difference between both studies is the level of analysis used to capture family business goals. While Tagiuri and Davis’ (1992) study focused on personal owner-manager goals, our research focuses on the organizational level, exploring family business goals in general as a concept for different stakeholders. In this sense, we broaden Kotlar and De Massis’ (2013) research, which fo- cused on the process of bargaining among stakeholders, by moving from an individual perspective to a more abstract perspective—namely, the organizational perspective. Finally, we extend the study of family business goals beyond the US environment by contextualizing our re- search in Spain, a country with a long tradition of family firms.
4.2. Family business goals as a mirror of institutional logics
Even though the list of family business goals itself is an important outcome, we noticed—in line with current family business research knowledge—that there are potential goals with similar characteristics. Table 3 shows the levels of aggregation of the family business goals we collected. The third level represents a general dimension—create sus- tained wealth over time—which defines the ultimate family business goal embracing the meaning of being a family firm. This general statement is composed of 17 dimensions, which together show that family firms are susceptible to business, community, and family logics. For instance, the dimension business growth (e.g., capture new markets, develop business portfolio, and increase market share) represents the business logic, which entails maintaining firm competitiveness within the market. The dimension economic, social, and environmental conditions (e.g., create ties with the local community, incorporate ethics and honesty in business, assume commitment to society, and promote business with local pro- viders) represents the community logic because of the physical and psychological embeddedness of the firm in the formal and informal institutional context. Finally, the dimension concern for the family unit (e.g., promote communication to maintain family harmony, promote the firm as a place to meet, support family employment while ensuring the most capable family members are promoted) represents the family logic because of the family embeddedness in the firm. Our results
4 The value of the standard deviation is lower in the second round than in the first. This reduction is an indication of the collective learning process produced due to the feedback provided in the second round. Variation in consensus is calculated as the average stan- dard error of the second round minus the first round. The average standard error in the first round was 1.02, whereas it was 0.88 in the second round. The average coefficient of variation in the first round was 0.27, and there was a 0.03 decrease in the second round. The coefficient of variation is calculated as the ratio average of standard error and mean. These results show that in the second round, there was higher consensus.
5 The qualitative group stability measure, which calculates the percentage of items for which each expert maintains his or her valuation from the first round to the second round, was 78% (percentage of experts who maintained their answers). We also calculated this measure for each group of experts: 84% for owner-managers, 76% for family business consultants, and 69% for academics. Additionally, the percentage of individual stability, which accounts for the percentage of experts who did not modify any of their estimations in the second round, was 23.33%. Because the percentage of change is relatively high, this offers evidence that the feedback provided in the second round resulted from a learning process.
6 The Kendall’s rank-order correlation coefficient (T), which makes pairwise compar- isons between both rankings, was not significant (p < .000).
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Table 3 Levels of aggregation in the family business goal list.
Level 3—General dimension
Level 2—Aggregated dimensions Level 1—Disaggregated items Theoretical Classification
Create sustained wealth over time
Economic and financial performance 1. Meet Economic and financial ratios, such as profit/sales, return on investment, return on assets, and cash flow ratios
Business-oriented economic goal (BEG)
Business growth 2. Capture new markets 3. Develop business portfolio (new activities, new products, etc.) 4. Increase market share
Cash payment to partners or shareholders
5. Maintain and ensure a stable distribution of dividends across time Family-oriented economic goal (FEG)
Firm as the family's means of economic support
6. Maintain/increase the family’s standard of living (economic security) 7. Cover the family’s cash requirements
Protection of the family nature of the firm
8. Retain firm ownership in family hands
9. Retain family control over board 10. Retain firm management in family hands
Preservation of family equity 11. Maintain/increase the inter-generational value of the company 12. Pass on a healthy firm to future generations 13. Ensure the firm’s growth is in balance with the family’s growth
Emotional motivation 14. Maintain the founder’s entrepreneurial spirit Family-oriented non-economic goal (FNEG)15. Sustain the pride of having developed an innovative firm
16. Preserve the family’s interest in the business to ensure its continuity
Transgenerational family business 17. Maintain the family's business leadership and entrepreneurial vision 18. Maintain and increase the family's involvement in the business 19. Maintain and reinforce the family's commitment to the business
Firm's commitment to the firm's project 20. Preserve commitment of non-family employees to the business 21. Transmit family values to the entire firm
Concern for the family unit 22. Promote communication/information to maintain family harmony 23. Promote the firm as a place to meet and share time among family members 24. Support family employment while ensuring the most capable family members are promoted
Preparation for future generations 25. Train and increase the skills of future generations 26. Ensure the current generation sets an example for future generations 27. Prepare the transition of the firm to the next generation 28. Professionalize the firm’s structures by integrating future generations
Protection of the family name 29. Maintain the reputation of the family name in society 30. Take care of the business image, which is linked to the family image 31. Preserve the family's reputation in the business community
Concern for employment and employees 32. Maintain and, if possible, create jobs Business-oriented non-economic goal (BNEG)33. Achieve a high-quality working climate
Customer focus 34. Meet customer needs 35. Make the customer the focus of the business
Economic, social, and environmental contributions
36. Create and maintain ties with the local community
37. Incorporate ethics and honesty in business dealings 38. Assume commitments to society and the local network 39. Promote business with local providers wherever the firm has business
Local roots 40. Maintain the firm’s original locations 41. Preserve the original location as the decision-making center
Conservation of firm traditions 42. Maintain the core economic activities that formed the basis of the firm's origins 43. Maintain the original essence of the firm—firm’s roots
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provide evidence supporting a prior assumption that there are at least three main institutional logics embedded in family firms (Reay et al., 2015).
When we asked experts to rate four aggregate groupings of goals that the family business literature already considers valid (business- oriented economic goals, family-oriented economic goals, family-or- iented non-economic goals, and business-oriented non-economic goals), we observed less dispersion among responses for each group of ques- tions in the third round of the Delphi method. The experts’ answers converged and showed equal importance for different goals. This con- firms the assumption that the family firm is a particularly well-suited context to observe the coexistence of multiple logics.
Finally, as we explained in the method section, to further explore the meaning of family-oriented and business-oriented goals, we asked partici- pants to comment on the following three statements representing the tra- ditional dilemma of how family firms manage multiple goals: 1) “Family firms pursue a balanced combination of business goals and family goals,” 2) “Business goals prevail over family goals,” and 3) “Family goals prevail over business goals.” In Table 4, we present a combination of the answers we received with verbatim comments from the experts. All these results are additional confirmation of the importance of family-oriented goals in family firms. Family and business demands are intrinsically linked and clearly manifest in the plethora of family business goals that family firms pursue or at least consider in their decision making. Based on this discussion, we propose the following:
Proposition 1. Firm goals reflect the institutional logics in which family firms are embedded.
4.3. Co-existence of family business goals
An additional outcome of the non-face-to-face phase was the goal ranking. The Delphi technique allowed us to analyze stability and convergence in the respondents’ answers. Consequently, with the goal assessment, we were in a position not only to present a list of potential family business goals but also a ranking of their importance (see Table 5). This ranked list corroborates what family business scholars have been considering since the birth of the field—namely, that family firms are able to combine different types of goals. Further, within the 10 most important goals, there are goals representing market, community, and family forces. For instance, the market logic is represented by goals like “meet economic and financial ratios, such as profit/sales, return on investment, return on assets, and cash flow ratios”, “meet customer needs”, “make the customer the focus of the business”. The family logic is represented by goals like “retain firm ownership in family hands”, “retain family control over board”, “pass on a healthy firm to future generations”, “maintain/increase the family’s standard of living (eco- nomic security)”, “maintain/increase the inter-generational value of the company”, “sustain the pride of having developed an innovative firm”. Finally, the community logic is represented by goals like “Incorporate ethics and honesty in business dealings.”
Additionally, with the intention of amplifying the richness of the qualitative information reported and to corroborate and control the results coming from the ranking, the experts were asked to explain their selection of the most important goals. Table 6 summarizes the main results considering the seven most important goals based on the number of times they appeared in the list of the three most important goals identified by each expert. The results reflect an overlap between market and family goals. The analysis reveals that each goal displays an im- plicit time frame. Firm performance (Goal 1) and family ownership (Goal 8) may represent short-term goals necessary to ensure business and family survivability. Communication (Goal 22) is a goal that links interactions in both systems—the business and the family—and is a necessary practice for medium-term survivability. Finally, succession preparation and successor training represent a longer-term perspective necessary to consolidate business and family survivability. Based on
this discussion, we propose the following:
Proposition 2. Goals that reflect market, community, and family institutional logics coexist in family businesses.
5. Conclusion
The importance of studying firm goals lies in the fact that firms goals guide, encourage, and constrain particular strategic choices (Basco, 2014) and ethical behaviors (Vazquez, 2016), and they play a specific role in the transformation of organizations and institutions (Thornton et al., 2012). The aim of this study was to interpret and better understand firm goals in the context of family firms by following an explorative approach and using the Hybrid Delphi methodology, which combines three techniques: the focus group technique (FGT), the nominal group technique (NGT), and the Delphi technique.
5.1. Discussion
By exhaustively identifying family firm goals, this study extends previous research showing that family members in family firms—based on their own objectives and positions in the family and the busi- ness—can alter business goals (Kotlar & De Massis, 2013). The proposed list reflects the market, community, and family logics that influence family firms. Therefore, our research addresses the call for new studies to explore differences in goals within certain organizations, such as those with family influence (Gavetti, Greve, Levinthal, & Ocasio, 2012). In this sense, our theoretical framework links with the behavioral theory of the firm (Cyert & March, 1963) by considering that firms pursue different objectives based on the bargaining process of key stakeholder, and it also links with the institutional logics perspective (Thornton et al., 2012) by arguing that family firms are influenced not only by the market and community logics but also by the family logic, all of which frame family business goals.
Additionally, by using the behavioral theory of the firm, we move away from conceiving the firm as a rational utility-maximizing unit and recognize its bounded rationality resulting from the cognitive limita- tions of the individuals who give life to the firm. However, individuals and firms are social actors, so when we embed them in different social groups, their intentionality is a function of goals (Thornton et al., 2012). This article represents a step forward in understanding complex institutional environments where multiple institutional logics coexist (Greenwood et al., 2011) and extends what other studies posit about institutional logics and family firm behavior (Reay et al., 2015) by considering goals a materialization of social identities—that is, the perception of oneself within social groups.
5.2. Theoretical contributions
This research has several theoretical and practical implications. First, our research offers new evidence on the plethora of goals that are important within the family business context. Specifically, with our qualitative approach, our results include an extensive list of potential family business goals, their interpretation and aggregation according to different institutional logics. While existing family business research has been built on the assumption that family firms pursue different goals than non-family businesses due to the family’s involvement links emotions and socioemotional wealth (stock of affect (Morgan & Gomez- Mejia, 2014) affecting decision making, this assumption has scarcely been tested. Despite the fact that studies have started incorporating measures of family business goals (e.g., Kim & Gao, 2013) in recent years, there is still no consensus on them.7 Consequently, our study
7 A recent empirical attempt to conceptualize family business goals was made by Basco, (2017).
G. Aparicio et al. Journal of Family Business Strategy 8 (2017) 157–169
164
T ab
le 4
St at em
en t va
lu at io n s.
B al an
ce d go
al s (B u si n es s- fa m il y go
al s)
B u si n es s go
al s p re va
il Fa
m il y go
al s p re va
il
E xp
er ts ’ co
m m en
ts E xp
er ts ’ co
m m en
ts E xp
er ts ’ co
m m en
ts
T ot al ly
ag re e
1 4
• B u si n es s ob
je ct iv es
m u st
be al ig n ed
w it h fa m il y ob
je ct iv es
as a
co n se qu
en ce
of th e co
n ti n u ou
s p ro ce ss
of p ar al le l p la n n in g
be tw
ee n fa m il y an
d fi rm
.
• T h is is on
e of
th e ke
ys to
th e fi rm
's co
n ti n u ed
ex is te n ce . B ot h se ts
of ob
je ct iv es
m u st
be cl ea rl y d efi
n ed
.
• Y ou
h av
e to
st ri ke
a ba
la n ce
be tw
ee n bu
si n es s an
d fa m il y
ob je ct iv es , bu
t it n ee d n 't n ec es sa ri ly
be 5 0 /5
0 .
• I th in k th at 's ri gh
t. If yo
u d on
't ta ke
ca re
of th at
ba la n ce
of “f or ce s, ” th er e' ll be
p ro bl em
s ei th er
in th e fa m il y or
in th e fi rm
.
1 0
• T h e fa m il y d im
en si on
ca n co
n d it io n st ra te gy
(e .g ., gr ow
th ,
br in gi n g in
n ew
sh ar eh
ol d er s an
d so
on ); h ow
ev er , th er e
al w ay
s h as
to be
a m in im
u m
bu si n es s p er fo rm
an ce .
• In
a h ig h ly
m on
et iz ed
ec on
om y,
ec on
om ic
va lu e cr ea ti on
ta ke
s p re ce d en
ce ov
er so ci al
an d em
ot io n al
as p ec ts .
• If yo
u w an
t to
en su re
co n ti n u it y in
th e fa m il y fi rm
, th e bu
si n es s
ob je ct iv es
h av
e to
ta ke
p re ce d en
ce be
ca u se
th e co
m p et it iv e
en vi ro n m en
t re qu
ir es
co m p an
ie s th at
fo cu
s on
th e bu
si n es s.
Y ou
ca n sa ti sf y th e fa m il y ob
je ct iv es
m u ch
be tt er
on ce
yo u h av
e a
su cc es sf u l fi rm
.
P ar ti al ly
ag re e
1 6
• O bv
io u sl y,
fa m il y ob
je ct iv es
fo rm
p ar t of
th e es se n ce
of an
y fa m il y
fi rm
. H ow
ev er , ev
en th ou
gh th er e h as
to be
a ba
la n ce , th e m os t
im p or ta n t ob
je ct iv es
ar e th e bu
si n es s on
es .
• I w ou
ld qu
al if y th e is su e of
ba la n ci n g.
T h e fa m il y m u st
h av
e a
su ffi ci en
t d eg
re e of
tr ai n in g to
u n d er st an
d th e n ee d to
le t
“f am
il y”
in te re st s d ef er
to bu
si n es s on
es as
th e on
ly w ay
of ke
ep in g th e co
m p an
y at
co m p et it iv e le ve
ls .
1 6
• In
th e w or ld
of fa m il y fi rm
s, it ca n 't al lb
e bl ac k or
w h it e.
Y ou
h av
e to
ta ke
ca re
of bu
si n es s ob
je ct iv es , bu
t yo
u ca n 't ig n or e th e fa m il y.
• St ri ct ly
sp ea ki n g,
th e st at em
en t is
co rr ec t, bu
t I'm
af ra id
in p ra ct ic e,
th is is n ’t th e ca se ;f am
il y ob
je ct iv es
co n d it io n bu
si n es s
ob je ct iv es
to a gr ea te r or
le ss er
in te n se
ex te n t.
• If th e co
m p an
y d oe
sn 't w or k be
ca u se
fa m il y ob
je ct iv es
ar e p u t
fi rs t, yo
u d es tr oy
th e co
m p an
y an
d yo
u d es tr oy
th e fa m il y.
1 7
• Fa
m il y ob
je ct iv es
im bu
e m an
y of
th e bu
si n es s ob
je ct iv es
w it h a
d iff er en
t n u an
ce or
vi si on
. O th er s,
in co
n tr as t, ar e in d ep
en d en
t of
th e bu
si n es s ob
je ct iv es
an d h av
e to
be ap
p li ed
in d ep
en d en
tl y of
th em
. A n d ot h er s,
as I sa id
be fo re , ar e su bo
rd in at e to
th e bu
si n es s
ob je ct iv es
(e .g ., p ro fi t fo r se cu
ri ty
in th e fa m il y) .
• I d on
't th in k yo
u ca n u n d er st an
d th is
ty p e of
co m p an
y w it h ou
t u n d er st an
d in g th e ro le
of th e fa m il y.
Fo r th at
re as on
, fa m il y
ob je ct iv es
so m et im
es p re va
il bu
t by
tr an
sf er ri n g th em
or tr an
sl at in g
th em
to bu
si n es s ob
je ct iv es .
• T h is
is on
e of
th e gr ea te st
p ro bl em
s ca u si n g fa m il y fi rm
s to
fo ld .
D is ag
re e
4
• T h er e is n o ab
so lu te
tr u th
in re fu si n g to
ag re e be
ca u se
w it h ou
t th e
fi rm
,t h er e' d be
n o fa m il y,
bu t I be
li ev
e m or e in
a ba
la n ce
be tw
ee n
th e ob
je ct iv es .
• Y ou
h av
e to
m ai n ta in
th e ba
la n ce
be tw
ee n th e tw
o d iff er en
t ty p es
of ob
je ct iv es .
1 3
• In
th e ev
en t of
op p os in g in te re st s,
fa m il y in te re st s p re va
il in g ov
er bu
si n es s in te re st s le ad
s to
in effi
ci en
cy , lo ss
of co
m p et it iv en
es s,
an d
co n fl ic t.
• If th at
is th e ca se , th e co
m p an
y ca n 't la st
lo n g;
it s ve
ry su rv iv al
is p u t in
je op
ar d y.
• T h ey
sh ou
ld n 't be
be ca u se
if th er e ar e n o p ro fe ss io n al s h ea d in g th e
m an
ag em
en t of
th e co
m p an
y an
d th e fa m il y,
th e co
m p an
y is
d oo
m ed
to fa il .
• If fa m il y ob
je ct iv es
p re va
il ov
er bu
si n es s ob
je ct iv es , th e su rv iv al
of th e
co m p an
y w il l be
m or e co
m p li ca te d .
G. Aparicio et al. Journal of Family Business Strategy 8 (2017) 157–169
165
sheds some new light by identifying the implicit and explicit goals that emerge in family firms and by proposing a list of goals and different levels of aggregation.
Second, by using the institutional logics perspective, this research also extends current studies about institutional logics in the context of the family firm (e.g., Reay et al., 2015) by revealing the explicit and implicit goals that are manifestations of institutional logics. Therefore, this research represents a step forward in understanding organizations where multiple institutional logics coexist (Greenwood et al., 2011), specifically focusing on goals as a micro-foundation of institutional logics.
Finally, this research is the first study in the field of family business to apply the Delphi technique as an explorative method. This applica- tion is important because the family business field, as a new field of research (Perez Rodriguez & Basco, 2011), needs to explore new methodologies to better understand the phenomenon under study (Sharma & Carney, 2012). Specifically, we were able to interpret family business goals without using case study methodology, which is the most common qualitative methodology applied in the field. Further, by taking this approach, we were able to address the intrinsic limitation of the case study methodology. With the Hybrid Delphi methodology
combining group dynamics (FGT and NGT) with the Delphi technique, we were able to explore a complex problem like family business goals with a pluralistic vision provided by a group of experts with different perspectives on family firms. Additionally, the controlled iterative feedback of the Delphi technique provided participants’ freedom of expression by reducing the possibility that certain people (because of their personalities or position in the firm or in society) will control the progression of the discussion. Therefore, this alternative procedure led to superior results in identifying, interpreting, classifying, and de- termining the importance of family business goals among the institu- tional logics that shape the family firm’s existence.
5.3. Practical contributions
This research also has practical implications for those working in or with family firms, such as owners, managers, and business consultants, because it opens the black box of family business goals while ac- knowledging the complexity family firms face when they make deci- sions. The constellation of goals that family firms have to satisfy makes these firms extremely fragile to govern and manage because some goals may be mutually inconsistent. This in line with the conclusion from the
Table 5 Ranking of family business goals.
Rank Goals Mean 1 round
Std error Mean 2 round
Std error Variation of consensus
1 Meet Economic and financial ratios, such as profit/sales, return on investment, return on assets, and cash flow ratios
4.6 0.61 4.7 0.53 0.08
12 Pass on a healthy firm to future generations 4.5 0.78 4.5 0.68 0.10 8 Retain firm ownership in family hands 4.4 0.90 4.4 0.93 −0.03 9 Retain family control over board 4.1 1.20 4.3 0.96 0.24 37 Incorporate ethics and honesty in business dealings 4.1 0.94 4.3 0.71 0.23 34 Meet customer needs 4.2 0.82 4.3 0.74 0.08 6 Maintain/increase the family’s standard of living (economic security) 4.0 0.81 4.2 0.63 0.18 11 Maintain/increase the inter-generational value of the company 4.1 0.94 4.2 0.81 0.14 35 Make the customer the focus of the business 4.1 0.98 4.2 0.85 0.13 15 Sustain the pride of having developed an innovative firm 4.1 0.90 4.2 0.79 0.11 19 Maintain and reinforce the family's commitment to the business 4.0 1.20 4.2 0.91 0.29 16 Preserve the family’s interest in the business to ensure its continuity 4.1 0.83 4.1 0.74 0.09 25 Train and increase the skills of future generations 4.0 1.27 4.1 0.94 0.33 14 Maintain the founder’s entrepreneurial spirit 3.9 1.11 4.1 0.94 0.17 20 Preserve commitment of non-family employees to the business 4.0 0.96 4.0 0.81 0.16 27 Prepare the transition of the firm to the next generation 3.9 1.33 4.0 1.03 0.30 17 Maintain the family's business leadership and entrepreneurial vision 4.0 0.95 4.0 1.00 −0.05 28 Professionalize the firm’s structures by integrating future generations 3.9 1.20 4.0 1.07 0.14 22 Promote communication/information to maintain family harmony 3.8 1.27 4.0 1.00 0.27 21 Transmit family values to the entire firm 4.0 0.89 3.9 0.96 −0.07 26 Ensure the current generation sets an example for future generations 3.9 1.14 3.9 1.03 0.11 32 Maintain and, if possible, create jobs 3.9 0.99 3.9 0.90 0.10 4 Increase market share 3.7 0.87 3.9 0.63 0.24 36 Create and maintain ties with the local community 3.8 0.83 3.8 0.70 0.13 38 Assume commitments to society and the local network 3.7 0.84 3.8 0.68 0.17 3 Develop business portfolio (new activities, new products, etc.) 3.7 1.06 3.7 0.94 0.11 13 Ensure the firm’s growth is in balance with the family’s growth 3.6 1.50 3.7 1.28 0.21 33 Achieve a high-quality working climate 3.6 1.16 3.7 0.99 0.17 18 Maintain and increase the family's involvement in the business 3.8 1.04 3.7 0.88 0.16 40 Maintain the firm’s original locations 3.6 0.81 3.6 0.67 0.14 41 Preserve the original location as the decision-making center 3.6 1.00 3.6 0.89 0.11 29 Maintain the reputation of the family name in society 3.6 1.13 3.5 0.97 0.16 31 Preserve the family's reputation in the business community 3.6 1.22 3.5 1.07 0.14 2 Capture new markets 3.6 0.90 3.5 0.78 0.12 30 Take care of the business image, which is linked to the family image 3.5 1.17 3.5 0.97 0.19 7 Cover the family’s cash requirements 3.3 1.12 3.5 0.94 0.19 24 Support family employment while ensuring the most capable family members are
promoted 3.5 1.17 3.4 1.00 0.16
5 Maintain and ensure a stable distribution of dividends across time 3.0 1.07 3.3 1.01 0.05 39 Promote business with local providers wherever the firm has business 3.2 0.86 3.2 0.87 −0.02 10 Retain firm management in family hands 3.2 1.22 3.1 1.04 0.18 43 Maintain the original essence of the firm—firm’s roots 3.0 0.93 3.1 0.94 −0.02 42 Maintain the core economic activities that formed the basis of the firm's origins 3.0 0.85 2.8 0.73 0.12 23 Promote the firm as a place to meet and share time among family members 2.7 1.06 2.6 0.94 0.12
Note: The list has been ordered according to the importance of the goals (mean) from the second round (Delphi method).
G. Aparicio et al. Journal of Family Business Strategy 8 (2017) 157–169
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global survey of world’s largest family businesses (see the series of re- ports edited by Ernst & Young and Coles College of Business, 2014) highlighting that families that put equal emphasis on both family and business goals seem to be more successful and longer lived than those that put greater emphasis on either one or the other. Family governance and management approach is more complex and challenging (due to the need for satisficing both sub-systems at the same time) because it requires leveraging the unique advantages inherent to family business.
Goals are anchored in societal groups that likely determine firm behavior. Owners and managers have to make decisions bearing this in mind, and business consultants have to carefully understand the meaning of a firm’s goals to give beneficial advice.
The proposed list of goals that we identified in the research process can serve as a starting point for owners and managers (family and non- family members) to explicitly talk about the priority of particular goals and define what goals determine decision making. Further, determining when certain goals are more important than others could help inter- nalize individual and collective (firm) intentions, which likely precedes effective behavior. There are no family firms exempted from such so- cial, cultural, political, and familial pressures, so understanding the footprint of institutional logics could be the first step in better mana- ging complexity in family firms.
5.4. Limitations and future line of research
This study has several limitations that not only represent the boundaries of its contributions but also provide opportunities for future research. First, because we focused on key experts, such as owner- managers, business consultants, and family business academics, we gained in-depth data about family business goals in general, but we were not able to distinguish intra-family differences. Future research should address this limitation and focus on collective similarities and differences of goals among family members working at the firm and those working outside firm. Family members’ different affiliations with the firm could also alter their perceptions and interpretations of the firm shaping individual expectations. Therefore, data from several fa- mily members with different affiliations with the firm could be ana- lyzed using the principal–principal agency perspective (Calabrò, Campopiano, & Basco, 2017). There is a current debate (e.g., Gomez- Mejia, Cruz, Berrone, & De Castro, 2011; Gu, Lu, & Chung, 2016; Memili, Singal, & Barrédy, 2016; Miller & Le Breton-Miller, 2006) about the advantages (e.g., goal alignment that generates high commitment and pro-organizational behavior among owners) and disadvantages (e.g., goal discrepancy that exacerbates agency problems and
consequently agency costs) of family-owned firms. It might be possible that the existence of goal alignment or goal discrepancy is circum- stantial and depends on the context. Qualitative studies could shed new light on this the debate to interpret owner goals and contextualize them in different families and business circles in order to dismantle what triggers goal alignment and discrepancy among family members (owners and ipso facto owners).
Second, in line with the aforementioned limitation, our research focuses on family business goals in general without taking into con- sideration different moments or circumstances in the family business cycle. Our panel of experts highlighted that even though a balanced situation is required for firm survival, the importance of different family business goals is contingent on specific circumstances, such as genera- tion of owners, external economic turmoil, and external emotional fa- mily crises. Therefore, future studies should investigate how the im- portance of each goal changes over time and how those changes affect strategic decision making within the firm (Jebb & Tay, 2016; Ployhart & Vandenberg, 2009; Sonnentag, 2012). The possible theore- tical approach to better frame this problem is institutional logics. The institutional logics approach considers that actors focus attention and activate different goals based on prevailing institutional logics (Thornton et al., 2012), which may determine the actions the firm takes. In this sense, the primacy of one goal over another can be de- termined by the powerful, urgent, and important demands of stake- holders from each logic (Mitchell, Agle, & Wood, 1997). This line of research could serve to clarify why family firms act differently than non-family firms in similar circumstances.
Third, it is important to recognize that this research is not about socioemotional wealth per se; it is about family business goals more broadly. We think this debate requires attention, but it is beyond the scope of this article. Even with the overlap of both topics—socioemo- tional wealth and family business objectives—it is important to re- cognize differences and similarities. While socioemotional wealth at- tempts to capture the social, emotional, and economic endowment that the family has in the firm (Gomez-Mejia et al., 2011), family business goals are the frames that determine a particular course of action. The family business field can become more mature by developing clear concepts to explain, analyze, and predict the phenomenon of study. Even though the field of family business has gained significant external legitimacy (Chrisman, Chua, & Steier, 2003; Pérez Rodríguez & Basco, 2011) due to its mainstream researchers, an overall theory of family business is needed to “explain and predict not only the interaction between family and business systems at the individual and family firm levels but also the interaction between family firms and the
Table 6 Ranking based on the three most important goals.
Ranking Frequency First Round
Frequency Second Round
Interpretation of experts’ comments
1. Meet Economic and financial ratios, such as profit/ sales, return on investment, return on assets, and cash flow ratios
12 18 Firm economic aspects are important for both the firm and the family. If the firm is not profitable, there is no family firm. Any other goal would be
subordinate to the economic and financial health of the firm. 8. Retain firm ownership in family hands 9 14 The independence of the firm is a necessary condition to be a family firm.
Independence means the ability to make decisions, which may help integrate family, business, and community demands.
25. Train and increase the skills of future generations 5 6 This is related to the future of the family firm in family hands: family ownership and/or family management. There is a need to maintain skilled
new generations to overcome future challenges. 22. Promote communication/information to maintain
family harmony 6 5 Family members not employed in the firm have to know and understand the
dynamic of the firm, while family members employed in the firm have to understand family dynamics.
11 Maintain/increase the inter-generational value of the company
5 5 Grow intergenerational family wealth.
6. Maintain/increase the family’s standard of living (economic security)
5 5 Quality of life is an important reason for making an effort to maintain the competitiveness of the family firm: economic motivation.
27. Prepare the transition of the firm to the next generation
4 3 Be prepared for succession.
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environment at the aggregate level” (Basco, 2015, p. 260). Finally, our study is exploratory in nature in order to interpret the
complex reality of family business goals and it focuses on Spanish firms. Therefore, the presence of bias in the sample is a limitation. Future research could test the consistency of the goals across a wide range of family firms and across cultures. For instance, having a sample with a wide range of family firms could help explore potential differences among generations and better understand goals (changes) of dynastic business families. Additionally, the next step to extend this line of re- search is to attempt to generalize our results applying quantitative techniques. By using a quantitative approach as an extension of our results, it may be possible to identify the underlying structure of family firm goals, which may help conceptualize and operationalize the con- cept. This line of research might contribute to resolving one particular problem that currently exists in family business regarding what we mean when we talk about family business goals.
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- An exploratory study of firm goals in the context of family firms: An institutional logics perspective
- Introduction
- Goals as micro-foundations of institutional logics
- Goals in the context of family firms
- Research questions
- Methodology
- Research design
- Face-to-face phase
- Non-face-to-face phase
- Selection of experts
- The delphi process
- First round
- Second round
- Third round
- Results
- List of family business goals
- Family business goals as a mirror of institutional logics
- Co-existence of family business goals
- Conclusion
- Discussion
- Theoretical contributions
- Practical contributions
- Limitations and future line of research
- References