Transgenerational Entrepreneurship: Exploring Growth and Performance in Family Firms Across Generations

237 Pages·2010·1.1 MB·English

by  Mattias Nordqvist

Transgenerational Entrepreneurship
IN ASSOCIATION WITH THE GLOBAL STEP PROJECT
The success of passing a family business from one generation to another depends
not only on instilling business ideas and leadership in future generations, but, and
perhaps more importantly, it depends on engendering the entrepreneurial spirit in
those business leaders to come; this is the practice of transgenerational leadership.
Successful Transgenerational Entrepreneurship Practices, more commonly know
as the STEP Project, was put in place to help facilitate family enterprising. An
innovative research initiative that spans the globe, it off ers insight, partnership and
solutions for current and future family leaders. In the STEP Project, academics of
entrepreneurship and business collaborate with prosperous multigenerational family
businesses to explore and identify those practices that will help family business grow
and prosper through three key tenets: venturing – launching new businesses; renewal
– revitalizing existing businesses; and innovation – introducing new products and
processes. By creating a stream of powerful practices and cases that empower families
to build their entrepreneurial legacies, the members of the STEP Project are rapidly
moving their discoveries from research into practice.
Current STEP Partners
Europe ● PUCMM, Dominican Republic
● Alba Graduate School of ● Universidad San Francisco de
Business, Greece Quito, Ecuador
● ESADE, Barcelona, Spain ● Tecnológico de Monterrey,
● HEC, Paris, France Mexico
● Jönköping International Business ● INCAE Business School, Costa
School, Sweden Rica/Nicaragua
● Lancaster University, Lancaster, ● IESA, Venezuela
England ● Inter American University of
● UCD, Dublin, Ireland Puerto Rico
● Universita Bocconi, Milan, ● CENTRUM, Pontifi cia
Italy Universidad Católica del Perú
● University of Edinburgh,
Edinburgh, Scotland Asia Pacifi c
● University of Jyväskylä, ● Chinese University of Hong
Jyväskylä, Finland Kong, Hong Kong
● Universitaet St. Gallen, St. Gallen, ● Nankai University, Tianjin, P.R.
Switzerland China
● Universitaet Witten/Herdecke, ● Sun Yat-Sen University, Taiwan
Germany ● Sun Yat-Sen University,
● Universiteit Antwerpen, Antwerp, Guangzhou, P.R. China
Belgium ● Kyungpook, National University,
● University of the Western Cape, Korea
South Africa (Joint Venture with ● Waseda University, Japan
Jönköping) ● Queensland University of
Technology, Australia
Latin America ● Bond University, Australia
● Fundação Dom Cabral, Brazil ● Indian School of Business,
● Universidad Adolfo Ibáñez, Chile Hyderabad, India
● Universidad de Los Andes, ● UNIRAZAK, Malaysia
Colombia ● Bangkok University, Thailand
Transgenerational
Entrepreneurship
Exploring Growth and Performance in
Family Firms Across Generations
Edited by
Mattias Nordqvist
Associate Professor of Business Administration, Jönköping
International Business School, Sweden and Co-Director, Center
for Family Enterprise and Ownership (CeFEO), Sweden
and
Thomas M. Zellweger
Assistant Professor of Entrepreneurship and Family Business,
University of St Gallen, Switzerland and Managing Director,
Center for Family Business, University of St Gallen, Switzerland
IN ASSOCIATION WITH THE GLOBAL STEP PROJECT
Edward Elgar
Cheltenham, UK • Northampton, MA, USA
© Mattias Nordqvist and Thomas M. Zellweger 2010
All rights reserved. No part of this publication may be reproduced, stored
in a retrieval system or transmitted in any form or by any means, electronic,
mechanical or photocopying, recording or otherwise without the prior
permission of the publisher.
Published by
Edward Elgar Publishing Limited
The Lypiatts
15 Lansdown Road
Cheltenham
Glos GL50 2JA
UK
Edward Elgar Publishing, Inc.
William Pratt House
9 Dewey Court
Northampton
Massachusetts 01060
USA
A catalogue record for this book
is available from the British Library
Library of Congress Control Number: 2009940735
ISBN 978 1 84720 797 5
Printed and bound by MPG Books Group, UK
2
0
Contents
List of fi gures vi
List of tables vii
List of contributors viii
Acknowledgements xiii
Foreword xiv
1 Transgenerational entrepreneurship 1
Timothy G. Habbershon, Mattias Nordqvist and
Thomas M. Zellweger
2 A qualitative research approach to the study of
transgenerational entrepreneurship 39
Mattias Nordqvist and Thomas M. Zellweger
3 Balancing familiness resource pools for entrepreneurial
performance 58
Ugo Lassini and Carlo Salvato
4 Portfolio entrepreneurship in the context of family owned
businesses 96
Markus Plate, Christian Schiede and Arist von Schlippe
5 Entrepreneurial orientation across generations in family fi rms:
the role of owner- centric culture for proactiveness and
autonomy 123
Ethel Brundin, Mattias Nordqvist and Leif Melin
6 Propelled into the future: managing family fi rm
entrepreneurial growth despite generational breakthroughs
within family life stage 142
Alain Bloch, Alexandra Joseph and Michel Santi
7 Dealing with increasing family complexity to achieve
transgenerational potential in family fi rms 167
Eugenia Bieto, Alberto Gimeno and María José Parada
8 How much and what kind of entrepreneurial orientation is
needed for family business continuity? 195
Thomas M. Zellweger, Philipp Sieger and Corinne Muehlebach
Index 215
v
Figures
1.1 Research framework for transgenerational entrepreneurship 9
3.1 The relationship between fi rm age and fi rm vitality according
to resource- based theory 62
3.2 The relationship between fi rm age and fi rm vitality under the
three population ecology hypotheses 63
3.3 The relationship between fi rm age and fi rm vitality according
to both population ecology and resource- based theory 64
3.4 The link between familiness and the Veronesi Group’s
performance 67
4.1 Development of the turnover of the ALT AG from 1959 to
2007 104
6.1 Typology of family structures 155
8.1 Entrepreneurial orientation continua 210
vi
Tables
3.1 Financial, entrepreneurial and social performance of the
Veronesi Group (1952–2007) 68
3.2 The role of leadership in driving the growth of the Veronesi
Group: crucial historical events 73
3.3 The impact on EO of maintaining activities in the original
business 76
3.4 The role of symbols and rituals in sharing entrepreneurial
values outside the organization and among family members
across generations: selected evidence 85
4.1 Overview of ALT interviewees 102
4.2 Possible sources of competitive advantage and examples 103
4.3 Overview of crucial resources and capabilities in the portfolio
entrepreneurship process of ALT 118
5.1 Interviewees at Novo Footwear and Chem Tech 128
6.1 Findings: a 3- stage process 162
7.1 Interviewee profi le 176
7.2 Company profi le 177
7.3 Propositions 185
7.4 Main conclusions about the models 188
8.1 The diff erent views of traditional entrepreneurship and family
business literature 197
8.2 Overview of selected cases 198
vii
Contributors
Eugenia Bieto is Associate Professor of the Business Policy Department at
ESADE, Spain. She is the corporate deputy director general. She obtained
a PhD in management sciences from ESADE- Universitat Ramon Llull.
She founded the ESADE Entrepreneurship Institute. Her research is
focused on corporate entrepreneurship.
Alain Bloch is Adjunct Professor of Entrepreneurship and Family Business
at HEC Paris, France. He is co-f ounder of HEC Paris Family Business
Centre and Director of the HEC Entrepreneur graduate program. He has
a PhD in information systems and management from the University Paris-
D auphine. A Fellow of Price-B abson College Fellows Program (SEE 15),
Alain Bloch is also Professor at the French Conservatoire National des
Arts et Metiers, where he is head of marketing, retailing and negotiation.
His own experience as an entrepreneur and a family business manager
has led him to focus his research on innovation, entrepreneurship, family
business and leadership.
Ethel Brundin, PhD, is Associate Professor at the Jönköping International
Business School in entrepreneurship, marketing and management (EMM)
and the Center for Family Enterprise and Ownership (CeFEO). Her
research projects focus on entrepreneurship and family fi rms, the family
ownership logic and projects with a focus on emotional ownership in
family businesses. She has published articles on how to study micro proc-
esses, is a member of three editorial boards, publishes regularly in interna-
tional journals and serves as a committee member of the world conference
on emotions in organizations. She is a visiting professor at the University
of the Western Cape, Cape Town, South Africa.
Alberto Gimeno is Associate Professor at the Business Policy Department
at ESADE, Spain and co-d irector of the Advanced Management Program
(AM) at ESADE Executive Education. Dr Gimeno is Visiting Professor at
Witten-H erdecke Universität, Germany. He holds a PhD in management
sciences from ESADE- Universitat Ramon Llull. He is a member of the
Expert Group on Family Business that advises the European Commission
and a member of the Body of Knowledge Committee of the Family Firm
Institute (FFI). He is one of the founding partners of Family Business
viii
Contributors ix
Knowledge (FBK), an applied research company in the fi eld of the family
business. He acts as a consultant to family business. His research is
focused on the application of the theory of complexity to family business
management, with the aim of creating useful analytical models. He is the
co- author of a theoretical model (the Structural Risk Model).
Timothy G. Habbershon is a Managing Director at Fidelity Investments,
the largest mutual fund company in the USA and a private family control-
led company. Within this company Dr Habbershon is involved in matters
of organizational design and development, and succession planning for
the company. He is also a coach to senior executives and teams. Prior
to joining Fidelity in 2006 Dr Habbershon was the founding director
of the Institute for Family Enterprising at Babson College in Wellesley,
Massachusetts, and Assistant Professor of Entrepreneurship, holding
the President’s Term Chair in Family Enterprising. While at Babson he
developed an emphasis on family based entrepreneurship called transgen-
erational entrepreneurship. Additionally, Dr Habbershon was a found-
ing partner in the TELOS Group, a consulting fi rm that specializes in
transition and strategy consultations to large family fi rms worldwide.
Alexandra Joseph is a PhD candidate and researcher at HEC, Paris,
France. After graduating from EM Lyon she started her career in a con-
sulting fi rm and joined her family business. After obtaining her DEA in
industrial strategy (Sorbonne), she focused her research on strategy and
entrepreneurship in the fi eld of family business.
Ugo Lassini is Assistant Professor of General Management at Università
degli Studi di Verona, Italy. He is a Member of the Centre for Research
on Entrepreneurship and Entrepreneurs at Bocconi University and of the
Strategic and Entrepreneurial Management Department at Sda Bocconi
in Milan, Italy. He obtained a PhD in business administration and man-
agement from Bocconi University. His current research focus is on the
growth patterns of small and medium enterprises (SMEs) and the evolu-
tion of entrepreneurial capabilities in closely held fi rms. He has published
research on the dynamics of internal and external growth in SMEs and
determinants of entrepreneurial behavior in family fi rms.
Leif Melin is Professor of Strategy and Organization and the Hamrin
Professor in Family Business Strategy at Jönköping International Business
School (JIBS), where he is the founding director of the Center for Family
Enterprise and Ownership (CeFEO). Before joining JIBS in 1994 he was
Professor of Strategic Management at Linköping University. His research
interests include several topics related to strategizing and strategic change
in the context of family business, applying the strategy as practice