35771 - 2 PGS

Effects of Non-Family Workers on Family Business

Students’ name

Tutor

Course

Date

Family businesses are owned by two or more members of the same family (Reed, 2017). The family business can be owned and managed by members of the family and is intended to realize different types of returns including returns on the relationship, return on finances, and emotional return (Aguinis, 2014). This type of business is fully owned and managed by members of the family who assume different positions in the organization. Some instances, however, need where the family business is forced to hire non-family members (Grzywacz & Handlowa, 2016). When a non-family member is hired in a family owned and managed business the action leads to significant effects on the business performance (Glas, Mirtič, & Pšeničny, 2016). Several factors affect family business which include the need to maintain family relation, social factors, management of family and business. This research therefore seeks to distinguish the difference brought about when the non-family member is introduced in the executive position of a family business.

The study seeks to test the hypothesis that when a non-family member is included in a family owned and managed business at the executive level the business performance is improved . The study will attract several dependent and independent variables. The independent variable will include attitude, level of social interaction, personal interests, and family conflicts. The dependent variable on the other hand includes the business profitability level. There are intervening variables which include the impact of non-family member, the business interest and legal requirements .

Literature review

According to Hisrich, Peters, & Shepherd (2017) Family members are closely related to each other, and this makes management of the business mostly personal. When the members of the family tend to argue the work done, they take things to a personal and family level that could result in severe conflict and poor management of the firm (Wolff & Resnick, 2012). Organizations run by the family members strive to create a distinction between the family and business issues making it difficult for them to operate (Searing, 2016). Other members also embezzle funds for the business with the idea that it’s a family issue and rarely will legal action be taken against them (Ritonija, et al., 2015). According to the principles of economics the business and the owner should be treated as two different entities, however creating the distinction becomes difficult in the family business (Johnson, 2015). The inclusion of purely family members in the business could, therefore, be fatal at some point.

According to Lussier & Hendon (2016) introduction of non-family members in family business creates a sense of increased respect for the organization. The non-family member takes the job with more seriousness than the family people which can be translated in their performance (Parkin, 2018). In most cases failure to deliver on the desired services could lead to adverse action than in the case of a family member (McLean & Yang, 2014). The decisions made by the non-family member will also be sound in fear of being victimized for poor performance. People who are related tend to have similarity in their strengths and weaknesses. Therefore, the inclusion of new member creates a diversity of knowledge in the organization (Martin, Heron, Moreno-Walton, & Jones, 2016). The diversity of knowledge in an organization helps in maintaining high-performance standards since the employees complement each other (Kushell, Spinelli, Nadaff, DeLuca, & Bolt, 2011). Most successful family-owned businesses have the family members mixed with the other members in different positions in the organization to maintain the diversity and cover the weaknesses portrayed in the family (Karlan, Morduch, & Startz, 2017). Determination of the best strategy to use therefore becomes a challenge for many people.

Method

The study will take the form of a survey intended to collect quantitative data. The variables to be included in the study include the number of family members employed in the family business relative to the number of non-family members. The performance of the organization will be measured through the amount of profit generated. The survey will be conducted in different organizations and results subjected to analysis and test of the hypothesis.

References

Aguinis, H. (2014). Test-score banding in human resource selection: technical, legal, and societal issues. Westport, Conn: Praeger.

Glas, M., Mirtič, D., & Pšeničny, V. (2016). Family business. Transitional impacts and the EU enlargement complexity, str, 300-327.

Grzywacz, J., & Handlowa, S. G. (2016). Sources of financing: the development activities of enterprises in Poland. Warsaw: SGH Publishing House. SGH Warsaw School of Economics.

Hisrich, R. D., Peters, M. P., & Shepherd, D. A. (2017). Entrepreneurship. New York, NY: McGraw-Hill Education.

Johnson, J. (2015). Diversity policy. Kingfisher garden centre, 1-16.

Karlan, D. S., Morduch, J., & Startz, M. L. (2017). Economics. Dubuque: McGraw-Hill Education.

Kushell, J., Spinelli, S., Nadaff, G., DeLuca, F., & Bolt, D. D. (2011). Introduction to the franchising case study: Subway Restaurants. Marina Del Rey, CA: Young Entrepreneurs Network.

Lussier, R. N., & Hendon, J. R. (2016). Human resource management: Functions, applications, & skill development. Thousand Oaks: SAGE Publications, Inc.

Martin, M. L., Heron, S. L., Moreno-Walton, L., & Jones, A. W. (2016). Diversity and Inclusion in Quality Patient Care. Cham: Springer International Publishing.

McLean, G. N., & Yang, B. (2014). Creativity and Human Resource Development: An Integrative Literature Review and a Conceptual Framework for Future Research. Human Resource development review, 1-32.

Parkin, M. (2018). Microeconomics. New York, NY: Pearson.

Reed, S. M. (2017). A guide to the human resource body of knowledge. Hoboken, New Jersey: John Wiley & Sons, Inc.

Ritonija, N., Lazar, N., Gole, P. A., Maček, A., Vukasovič, T., & al, e. (2015). Professional skills in management and leadership, entrepreneurship and communication - The e-PROFMAN project. Re-imagining learning scenarios, 2(12), 97.

Searing, E. (2016). Practising Professional Ethics in Economics and Public Policy. Netherlands: Springer.

Wolff, R. D., & Resnick, S. A. (2012). Contending economic theories: neoclassical, Keynesian, and Marxian. Law and economics, 55-78. Retrieved from http://ouleft.org/wp-content/uploads/Contending-Economic-Theories-Wolff.pdf

�There are independent, dependent and intervening variables but there is no relation between them. In literature review please prove the relation between. In other words. There are independent variables which are related with non-family employee effects,but how did we find those variables.

�Also, there is a dependent variable, but what you want to say in here how business profitability level is affected? Please prove it with literature review

And lastly please explain the relation between intervening variables and dependent variables and also independent variables.

You can draw a sheme for it

�Could you please send me the references as you use in my paper as a document?because I couldn’t find them