Academic journal article Entrepreneurship: Theory and Practice

Toward a Theory of Familiness: A Social Capital Perspective

Academic journal article Entrepreneurship: Theory and Practice

Toward a Theory of Familiness: A Social Capital Perspective

Article excerpt

In the search for ways in which the family firm context is unique to organizational science, the construct of "familiness" has been identified and defined as resources and capabilities that are unique to the family's involvement and interactions in the business. While identification and isolation of a construct unique to family firms is both groundbreaking and important for family firm research, it is also important that the development of the construct continues to be examined from complementing theoretical viewpoints. As such, we set out to review the development of the familiness construct and identify its dimensions. We also explore the nomological relationships of the construct based on a social capital theory perspective and offer a theory of familiness.


Family business researchers continue to seek ways to describe how family firms are differentiated from other organizational forms. Chrisman, Chua, and Sharma (2005, p. 559) urge researchers to identify "... the nature of family firms' distinctions," examining if these distinctions are truly the result of the family's involvement. Researchers suggest this is the case, since "... the family component shapes the business in a way that family members of executives in nonfamily firms do not and cannot" (Chua, Chrisman, & Sharma, 1999, p. 22).

In this search to discover how family firms uniquely differ from nonfamily firms, researchers have applied broad theoretical perspectives, such as agency theory, to better understand the family firm context. Although these approaches have increased our understanding of family business, they have yet to lead to constructs and theories that describe why certain causal relationships comprise the "family" aspects that exist in these firms. One notable exception is the construct known as "familiness," which has emerged as a concept uniquely related to family business research.

Habbershon and Williams (1999) first introduced the term "familiness," describing it as "... the idiosyncratic firm level bundle of resources and capabilities resulting from the systems interactions" (Habbershon, Williams, & MacMillan, 2003, p. 451). Chrisman, Chua, and Litz (2003) later described the concept as "... resources and capabilities related to family involvement and interactions" (p. 468). Familiness is proposed as a source of competitive advantage, generating firm wealth and value creation. For our purposes, distinctive familiness describes the positive influence of family involvement in the firm.

Due to the broad nature of the construct, it is necessary to identify the unique family resources and capabilities that constitute familiness before substantive relationships are explored. Additionally, the familiness definition should be reviewed, identifying the relationships that relate to its application. While the familiness concept is in its infancy, construct clarity is required before future research can unfold (Chrisman, Chua, & Steier, 2005).

We adopt a social capital perspective to provide definitional clarity for identifying the behavioral and social resources that constitute familiness. Relationships in the family firm result from enduring interaction and involvement of the family (Chrisman, Chua, & Steier, 2005), and we use social capital theory to explain how familiness is created. Social capital theory provides a framework to identify the unique behavioral resources and capabilities of family firms, as well as the antecedents of social capital unique to family firms.

Therefore, the purpose of this article is to: (1) examine the definition and dimensions of familiness for adequate content validity; (2) identify the theoretical antecedents and outcomes of the familiness construct based upon previous theoretical perspectives (Habbershon & Williams, 1999); and (3) extend our knowledge of familiness by using social capital theory to create a theory of familiness, identifying the behavioral and social resources and capabilities unique to family firms. …

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