Family business identity as source of performance, efficiency and competitive advantage

• Author: Horia Moasa
• Position: Transilvania University of Brasov
• Pages: 79-84

Bulletin of the Transilvania University of Braşo v

Series VII: Social Sciences • Law • Vol. 12(61) No. 1 – 2019

https://doi.org/10.31926/but.ssl.2019.12.61.1.8

FAMILY BUSINESS IDENTITY AS SOURCE OF

PERFORMANCE, EFFICIENCY AND

COMPETITIVE ADVANTAGE

Horia MOAȘA1

Abstract: This paper addresses the importance of understanding the

creation and continuous development of organizational identity as a source

of performance, efficiency and competitive advantage of family businesses in

relation to non-family businesses. I present three stages of family business

identity creation and development and their unique characteristics that drive

performance and efficiency: founder or founding family controlled stage,

extended family stage and non-family members and management stage.

Keywords: organizational identity, family business, founders, non-family

members.

1. Introduction

Family-owned organizations are central in the global economy since they represent

80% of businesses across the globe and more than a t hird of Fortune 500 companies,

with 60% of total employment and 78% of all new jobs in the US alone (Groysberg &

Bell, 2014). But what has allowed today’s family businesses to manage the transition

through ever-changing and turbulent environments and pros per?

This paper addresses the importance of understanding the cr eation and continuous

development of organizational identity as a source of performance, efficiency and

competitive advantage of family businesses in relation to non-family businesses.

Based on in-depth interviews with 37 family members from several small-size family

businesses (up to 100 employees), I present three stages of family business identity

creation and development and their unique characteristics that drive performance and

efficiency: founder or founding family-controlled stage, extended family stage and non-

family members and management stage.

In the founder or founding family controlled stage the founder’s freedom to imprint

the individual identity onto the new business, the decision to put his/her name to the

company and the commitment of the spouse/immediate family to the new venture,

thus generating a “copreneurial identity” represent family business’ unique identity

building characteristics that drive performance and competitive advantage.

1 Transilvania University of Braşov, horia.moasa@unitbv.ro