Competitiveness of Family Businesses

The purpose of this study is to systematically examine the advantages and disadvantages of different types of family businesses. We distinguish four different types of family businesses based on their family and business orientation: (1) House of Business, (2) Family Money Machine, (3) Family Life Tradition, and (4) Hobby Salon. In our empirical research among family businesses (n=220), we find that all four different types co-exist. In addition, we find that differences in family and business orientation result in different advantages and disadvantages with respect to performance indicators such as motivation, conflict resolution and continuity. Finally, our results indicate that, if a family firm would move along the dimensions of the orientation landscape, due to internal motivations or external circumstances, it will experience improvements on one or several criteria, but it may also encounter new concerns. These changing profiles in strengths and weaknesses can be viewed as mobility barriers or mobility opportunities when moving from one group to another.