The Palgrave Handbook of Family Firm Internationalization

Family Firms (FFs) form the majority of all firms around the world and they account for an enormous percentage of the employment, the revenue, and the GDP of most capitalist countries. While MNCs have long been thought of as the main contributors to international business, it is now recognised that a substantial number of family firms are active in the international arena. This handbook focuses on the features which make family firm internationalization unique. Chapters provide FF specific theories and cover the process of FF internationalization. It examines the role of network ties and provides an insight into the development of family firms that have grown into big multinationals. Importantly this Handbook equips you with a better understanding of specific features of family firms as they internationalize from or to Asian or emerging markets. Family firms offer a fruitful context to study internationalization through a process perspective, therefore this Handbook is an invaluable source of knowledge for students, scholars and policy makers in the areas of family business, entrepreneurship and internationalization. The Palgrave Handbook of Family Firm Internationalization Foreword 1: Breaking New Ground Ownership and Governance Goals: Economic and Non-economic Goals, and Socioemotional Wealth Family Social Capital Relationships and Network Ties Institutions Concluding Remarks References Foreword 2: Reflections on the Family Firm Internationalization Literature Introduction What Features of Family firm Governance Are Likely to Impact Its Internationalization? How to Measure Internationalization Traditional Theories of Family Firm Internationalization Niche Business Models and Family Firm Internationalization Implications for the Study of Family Firm Internationalization References Foreword 3 References Foreword 4 Preface References Acknowledgements Contents List of Figures List of Tables Notes on Contributors Part I: Family Firm-Specific Views and Internationalization 1: Internationalization Decisions in Family Firms: The Impact of Bifurcation Bias Introduction Internalization Theory and the Family Firm Bifurcation Bias: An Overview Bifurcation Bias and International Governance Decisions Bifurcation Bias and Host Country Location Selection Bifurcation Bias and Operating Mode Selection The Magnitude and Impact of Bifurcation Bias: Cultural Factors Personal Values and Bifurcation Bias Societal Values and Bifurcation Bias SEW Pursuit and Family Firm Internationalization SEW Versus Bifurcation Bias Facilitative Role of SEW in Unbiased Firms: The Imperative of Recombination Economizing on Bifurcation Bias General Economizing Strategies Timing and Scale of Bifurcation Bias Economizing Conclusion References 2: Internationalisation and Family Involvement: A Stewardship Approach in the Hotel Industry Introduction Literature Review Definition and Heterogeneity of FFs Agency Theory, Socioemotional Wealth Theory and Stewardship Theory FF Internationalisation Foreign Entry Modes of FFs Methodology Dependent Variables Independent Variables Control Variables Results Discussion Limitations and Future Research Conclusions References 3: Socioemotional Wealth and Networking in the Internationalisation of Family SMEs Introduction Socioemotional Wealth and Networking in Family Firm Internationalisation Data and Methods Data Collection and Sample Selection Dependent Variables Independent Variables Control Variables Correlations Common Method Bias Results Discussion Conclusions References 4: An Integrative Framework of Family Firms and Foreign Entry Strategies Introduction Theoretical Framework Family Firms Entry Modes: An Overview Entry Mode and Family Firms: The Theoretical Approaches Future Research and Conclusions References Part II: Internationalization Process of Family Firms 5: Internationalization of Family Firms as a Discontinuous Process: The Role of Behavioral Theory Introduction Theoretical Background Family Firms and Internationalization Internationalization as a Discontinuous Process Internationalization of Family Firms and the Behavioral Theory of the Firm Theories Used in Research on Family Firms’ Internationalization The Behavioral Theory of the Firm and Family Firms’ Internationalization Future Research Directions on Family Firms’ De-internationalization and Re-internationalization Goals and Quasi Resolution of Goal Conflict Uncertainty Avoidance Problemistic Search Learning Conclusions References 6: One Family Firm, Four Families: Developing Management Models of a Family Values-Based MNC Introduction Values-Based Management of a Family MNC Family MNCs as Internationally Operating Network Organisations Values-Based Management Model of a Family MNC: A Practice Approach Research Methodology Research Strategy Data Collection and Analysis Management Models in a Family MNC in the Forest Machine Industry Historically Developing Values-Base of the Family Firm’s Operations Localised Management Models from the Values of Headquarters to the Subsidiaries Discussion References 7: The “Unwritten Will” in Interpersonal Network Ties: Founder Legacy and International Networking of Family Firms in History Introduction Theoretical Framework Interpersonal Networks in Family Firm Internationalization Founders and Their Interpersonal Ties in Identity-Based and Calculative Networks Legacy: From Founders to Family Firms Research Design Findings Emergence of the Interpersonal Identity-Based and Calculative Ties in the Founder and Successor Generations Case Ahlström Case Serlachius Manifestation of the Founders’ “International Networking Legacy” in the Successors’ Approach Concluding Discussion References Part III: Networks in Family Firm Internationalization 8: Entry Nodes in Foreign Market Entry and Post-Entry Operations of Family-Managed Firms Introduction Theoretical Background FF Internationalisation Through a Network Lens Entry Nodes Versus Entry Modes The SEW Perspective Methodology The Qualitative Case Study Approach Case Study Selection Data Collection Data Analysis Findings The Entry Nodes of Family-Managed SMEs (First Entry to International Markets) The Entry Nodes of Family-Managed SMEs (Post-Entry to International Markets) Discussion and Conclusions References 9: How Do Family Firms Orchestrate Their Global Value Chain? Introduction GVC and the Global Factory Model Family Firm Distinctive Characteristics: Non-financial Goals and Family Social Capital Family Firm Orchestration of the GVC: Design and Governance Discussion Limitations and Future Research Directions References 10: Coexistence of Economic and Noneconomic Goals in Building Foreign Partner Relationships: Evidence from Small Finnish Family Firms Introduction Theoretical Background International Networking of Small FFs Socioemotional Wealth as a Liability and a Capability in Strong Network Relationships Methodology Findings SEW Profiles Foreign Partner Relationship (FPR)-Building Discussion Conclusions Appendix: Example Case Firms with High, Moderate or Low SEW Profile References 11: Networking from Home to Abroad: The Internationalization of The Iberostar Group Introduction Theoretical Framework: Networks in the Internationalization of Family Firms When Context Matters: Spain in the Second Half of the Twentieth Century Our Case Study: Iberostar Group, the History of a Long-Lasting Family Firm Research Method Qualitative Case Study Research Data Collection Data Analysis From Home to Abroad: A Longitudinal Process of Networking The Internationalization of the Inbound Business The Internationalization of the Outbound Business: From Iberojet to Sunworld The Internationalization of the Hotel Business Discussion and Conclusions References 12: Social Capital and Values in the Internationalization of Family Firms: A Multi-Country Study Introduction Theoretical Background Values and Bifurcation Bias Family Structures Methodology Data Collection and Analysis Case Profiles at the Time of the Interviews FIN FRA TAI Findings Case FIN Case FRA Case TAI Cross-Case Analysis Discussion and Conclusions References Part IV: Family Firm Internationalization from Emerging Markets 13: The Network Dynamics During Internationalization of a Family Firm: The Case of a New Venture from Colombia Introduction Family Firm Internationalization from a Network Perspective Methodology Findings: Focused Case Narrative Gaining Professional Competencies and International Work Experience Setting up the Business Gaining Experience Locally with Development Technology Becoming Part of the Local Ecosystem Becoming an Importer/Re-seller of Technology and Know-How Becoming a Video Game Producer Creating Competencies for the Development and Sales of Globally Competitive Mobile Video Games in Cooperation with Alliance Partner Building a Local Support Infrastructure Creating a Local Ecosystem for Video Game Entrepreneurship Engaging with the Global Community of Mobile Video Game Development Tying International Game Experts to Product and Business Development Experimenting with New Product and Cooperation Strategies Seeing the World Through Different Eyes Synthesis of Findings Discussion The Networking Profile of the Family Member and the Non-family Member Shaping the Evolution of the Firm’s International Network Dealing with the Mixed Gamble During Internationalization Overcoming the Locational Disadvantage Conclusions References 14: Internationalisation of a Migrant Family Firm and Contextual Uncertainty: The Role of Ethnic Social Networks Introduction Theoretical Framework Migrant Families in Businesses Networks and Social Capital Benefits and Disadvantages of Ethnic Networks Uncertain Contexts, Risk and Instability Context Nicaragua and German Families in Business The Coffee Industry Methodology The Khül Family and the Selva Negra Estate Data Analysis Findings Ethnic Identity and Networks as Starting Points Relevance of Ethnic Relational Resources for Succeeding Generations The Relevance of a Mixed Network for Future International Purposes Discussion Limitations and Further Research References 15: Internationalization of Small Indian Family-Firms: An Emergent Theory Introduction Review and Synthesis of Literature Internationalization Literature in Perspective: Three-Circle Framework Internationalization of Small Family-Firms (FFs) Emerging Economy Firms and Internationalization Internationalization of Small Indian FFs: The Paradox of Environmental Context Gap in Research Integrated Model of Emerging Economy Small Family-Firm Internationalization The Ability to Internationalize Willingness to Internationalize Research Methods Findings and Empirical Analysis Internationalization Process Decision to Internationalize and Internationalization Pathways Internationalization Strategies Sustainability of Internationalization Family-Specific Factors Affecting Internationalization Entrepreneurial Orientation of the Key Influencer Family Socio-Emotional Wealth (SEW) Bifurcation Bias Network Relations and Ties Internal Resources and Capabilities Discussion Alternative Typology for Small FF Internationalization Limitations and Opportunities for Future Research References 16: Family Firms’ Internationalization: The Importance of Home Country Institutions Introduction Institutional Theory and Internationalization of Family Businesses Institutional Isomorphism and Family Firms’ Internationalization Coercive Pressure and Family Firms Mimetic Isomorphism and Family Firms Normative Pressure and Family Firms Home Country Institutions on Family Firms’ Internationalization Laws and Regulations Facilitating Business Transfer Associations of Family Businesses Protection of Minority Shareholders Generalized Trust Toward Family Businesses Taxation of Reinvested Profits Social Networks Culture Discussion and Conclusions Future Research References 17: Internationalization Process of Developing-Country Family SMEs: The Case of Solanos Hermanos S.A. of Guatemala Introduction Theoretical Underpinning Methodological Approach Setting Firm Results Descriptive Information Structural Resources Experiential Resources Discussion and Conclusions References Index