Adaptation,Survival,and Growth of the Family Business: An Integrated Systems Perspective

Abstract

Family ownership and control are still significant in the majority of business enterprises in the United States. A high percentage of these companies face special problems particularly related to corporate development and transition from an enterpreneurial to a professional management structure. The dual criteria for corporate membership (family and professional competence) require special management efforts. Without these efforts, organizational rigidities develop which undermine the corporation's ability to function effectively. While the relevance of the interaction between family relationships and the working environment of organizational effectiveness has been recognized, family systems and organization approaches have never been simultaneously applied in the study of family-dominated businesses. In this paper we develop a scheme that is derived from principles of organizational and family-systems theory. We describe a set of processes and mechanisms that define and regulate the interaction between the business and family system. We show the applicability of these concepts to the study of adaptation and maladaptation in the family-dominated corporation.

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