LONGEVITY OF FAMILY BUSINESSES
The term ‘transgenerational’ is used to describe research into cross-generational aspects that contribute to the longevity of family businesses. Succession processes do not just start when the next generation enters the firm; plans begin to be made within the family as soon as they are born. Therefore, the question of succession continuously occupies the business and the family, but succession is not the only aspect that contributes to longevity. There are fundamental questions about how the relationship between the family and the company can be organised permanently for the benefit of both. This entails numerous academic lines of enquiry, such as: How is the education of the next generation envisaged? How are succession arrangements negotiated and implented? In what form are shares transferred to the children? To what extent are all these family strategy decision-making processes considered and structured? This topic entails a number of cross-generational challenges that business families must address with varying degrees of professionalism.
LONGEVITY AS A CHALLENGE TO ACADEMIC RESEARCH
Ever since it was founded in 1998, the Witten Institute has been investigating the question of why businesses endure. Its first big project was about which successful templates enable family businesses to remain in family ownership over multiple generations to the benefit of the business and the family. Longevity was also the focus of a second major project that aimed to provide an overview of how Germany’s large, long-lasting companies (100 years and older) are structured from a business and a family point of view. The ‘Family Strategy Over Generations’ project was designed as a ‘journey of learning’ in which some of Germany’s largest and most important family businesses presented and discussed their family strategy regulatory systems. Completed in 2017 with the drafting of a system theory of the business family, this work sums up the findings of almost 20 years of family business research. The current ‘Large Dynastic Families’ project examines the unique issues that need to be addressed by companies with large groups of shareholders (around 80 shareholders or more, often well over 100). In addition, the WIFU collaborates closely with the ESADE Business School in Barcelona. The mental models concept developed by Prof. Dr Alberto Gimeno, who is also a visiting professor at the WIFU, helps differentiate between the varying logics of family businesses (patriarchal logic), the model of the operative family, the active proprietor family model and the investment family, and we use it in many ways as a foundational structural model.
FAMILY STRATEGY AS
A PRACTICAL APPROACH
This term collectively describes the efforts made towards shaping the relationship between family and company positively over the long term. This involves examining numerous crucial issues, since linking such disparate social systems as families and businesses demands constant diligence. While families focus on relationships between their members, their feelings and their well being, the logic of a business focuses on how the current situation of a company affects its ability to make decisions and its cash flow. These two logics clash at various points, and there is a need to formalise and organise family processes. For example, the family sets rules for itself (but what happens when they are broken?) and forms consultative bodies (raising the questions of who will be appointed to them, with which qualifications and by which selection procedures). The most serious threats to a family business are from the market and the extent to which conflicts with the family impact the business, which is why effective conflict management in business families is a priority.
LITERATURE (SELECTION)
- Kleve, H., T. Köllner, A. von Schlippe & T. Rüsen (2020): “The Business Family 3.0: Dynastic Business Families as Families, Organizations and Networks.” Systems Research and Behavioral Science special issue Organization and Membership edited by M. Grothe-Hammer & A. la Cour. DOI:10.1002/sres.2684.
- Book: Gimeno, A.; Baulenas, G. & Coma-Cros, J. (2010): Familienunternehmen führen – Komplexität managen: Neue Denkmodelle und praktische Lösungen. With a foreword by Arist von Schlippe, V&R Verlag: Göttingen.
- Article: Grossmann, S. & Schlippe, A.v. (2015): Conflict in Family Businesses – Family Businesses: Fertile Environments for Conflict. In: Journal of Family Business Management, Vol. 5, No. 2, pp. 294-314.
- Book: Rüsen, T.; Schlippe, A.v. & Gimeno, A. (2017): Strukturelles Risiko und mentale Modelle in Familienunternehmen. In: Rüsen, T. & Schlippe, A.v. (editors): Dynamiken in Familie und Unternehmen. V&R Verlag: Göttingen, pp. 45-56.
- Article: Kleve, H.; Schlippe, A.v.; Rüsen, T. (2018): Unternehmerfamilie 3.0: Große Unternehmerfamilien als Familien, Organisationen und Netzwerke. In: Zeitschrift für Organisationsentwicklung, Issue 4/2018, pp. 52-58.
- Book: Plate, M.; Groth, T.; Ackermann, V. & Schlippe, A.v. (2011): Große deutsche Familienunternehmen. V&R Verlag: Göttingen.
- Book: Schlippe, A.v. (2014): Das kommt in den besten Familien vor. Systemische Konfliktbearbeitung in Familien und Familienunternehmen. Concadora: Stuttgart.
- Book: Schlippe, A.v. (2017): Gute Governance – Für die Familie so selbstverständlich wie für das Unternehmen? Plädoyer für eine kluge Familienstrategie. In: May, P. & Bartels, P. (editors): Governance in Familienunternehmen. Bundesanzeiger Verlag: Cologne, pp. 511-524.
- Book: Schlippe, A.v.; Groth, T. & Rüsen, T. (2017): Die beiden Seiten der Unternehmerfamilie. Familienstrategie über Generationen. Auf dem Weg zu einer Theorie der Unternehmerfamilie. V&R Verlag: Göttingen.
- Book: Simon, F.B.; Wimmer, R. & Groth, T. (2005): Mehr-Generationen-Familienunternehmen. Carl Auer Systeme: Heidelberg.
RESEARCH PROJECTS
- Multi-generation family businesses (2000-2005)
- Large German family businesses (2007-2011)
- Conflicts in family businesses (2011-2013)
- Family strategy over generations (2011-2017)
- Large dynastic families (since 2017)
