Shared Vision promotes family firm performance

• Main Author: John Edward Neff
• Format: Article
• Language: English
• Published: Frontiers Media S.A. 2015-05-01
• Series: Frontiers in Psychology
• Subjects: predictive model; Family Business; Shared Vision; Family Functionality; Firm performance; Role clarity
• Online Access: http://journal.frontiersin.org/Journal/10.3389/fpsyg.2015.00646/full

A clear picture of the influential drivers of private family firm performance has proven to be an elusive target. The unique characteristics of private family owned firms necessitate a broader, non-financial approach to reveal firm performance drivers. This research study sought to specify and evaluate the themes that distinguish successful family firms from less successful family firms. In addition, this study explored the possibility that these themes collectively form an effective organizational culture that improves longer-term firm performance. At an organizational level of analysis, research findings identified four significant variables: Shared Vision (PNS), Role Clarity (RCL), Confidence in Management (CON), and Professional Networking (OLN) that positively impacted family firm financial performance. Shared Vision exhibited the strongest positive influence among the significant factors. In addition, Family Functionality (APGAR), the functional integrity of the family itself exhibited a significant supporting role. Taken together, the variables collectively represent an effective family business culture (EFBC) that positively impacted the long-term financial sustainability of family owned firms. The index of effective family business culture also exhibited potential as a predictive non-financial model of family firm performance.