Family Business Corporate Entrepreneurship:Driving Mechanism And Long-term Path

Since the reform and opening up policy over the past 40 years,China’s economy has rapidly developed,in which family businesses have played a pivotal role.Some coastal provinces with a majority of family businesses,relying on the entrepreneurial spirit of business owners,have generated regional clusters and become the greatest growth forces in China.However,the growth mode of Chinese family-owned enterprises is far from being driven by innovation,which depends more on low-cost and large market capacity.The data shows that many non-public enterprises in China are on the verge of stagnation and recession.What is even more rigorous is that most first-generation entrepreneurs in China have been older and the handover class is imminent.Whether Chinese family businesses can achieve sustainable development has become an urgent research task at the moment.Coporate entrepreneurship can help companies to survive,improve profits,and grow.This is not only Peter F.Drucker’s theoretical perspective about 30 years ago,but also the practical way out for many companies at home and abroad in recent years.However,compared with non-family companies,family businesses are always criticized as representatives of "conservative businesses"and "businesses don’t move forward after being wealthy".The root of these "disorders" is the involvement of "family",an emotional attribute which affects most of the family firm’s decisions.How to help family businesses successfully implement firm-level entrepreneurship has always been a difficult problem in the academic and practical field.On the one hand,although the existing theoretical studies in the Western world have outlined certain characteristics of corporate entrepreneurship in family businesses and the competitive advantages it brings,the research on the mechanism that how family involvement affects the firm’s entrepreneurship is still insufficient.And also,taere is still some divergence in the conclusion.On the other hand,most of the family businesses in western developed countries have been passed down to three more generations.The family businesses in China are very young and owners are generally in the process of shifting from the first to the second generation.In addition,taking into account the special development background of the political and economic environment,it’s urgent for Chinese scholars to study the entrepreneurial theory of family businesses and fill the gaps in systematic research in this area.At the same time,it’s of great importance for them to provide experience and inspiration for the sustainable development of family businesses in China.This doctoral thesis takes a sample of family businesses surveyed across China and mainly focuses on the following research questions:1)Why some family firms are more inclined to corporate entrepreneurship than other family firms?2)How does the business successfully implement corporate entrepreneurship?In order to solve these two key issues,this article first systematically reviews the literature of corporate entrepreneurship,including its development,dimensions and its measurement methods.Then it summarizes the existing research on corporate entrepreneurship in family businesses and seeks the related theoretical basis.After the completion of these,the paper has three related sub-studies.Sub-study Ⅰ(Chapter 3)focuses on the sea turtles group of the second generation in Chinese family businesses.The results show that compared with those family firms without second generation returnees,the relationship between family ownership and corporate entrepreneurship is significantly enhanced in family firms which have second generation returnees.Furthermore,compared with the second generation returnees who stay overseas for a short time,those returnees who stay overseas longer are more likely to promote corporate entrepreneurship.It shows that the heterogeneous context of the second generation successors of Chinese family firms who return from abroad can provide the answer for "why some family firms are more inclined to corporate entrepreneurship than other family firms".And the results of this sub-study indicate that generational involvement is indeed an important source of heterogeneity in family businesses,but it cannot simply be included in the governance structure.The second generation who are successors of family firms,from our argument,should be regarded as an independent and important source of heterogeneity in family firms,and so constitute a phenomenon which needs to be especially focused on and particularly studied.Sub-study Ⅱ(Chapter 4)explores the relationship between family commitment and corporate entrepreneurship.The results show that high-family commitment has a significant role in promoting entrepreneurship in family businesses.And family businesses’ long-term orientation plays an intermediary role between family commitment and corporate entrepreneurship.Environmental uncertainty will moderate the relationship between the long-term orientation and corporate entrepreneurship of family businesses.In the process of family commitment affecting corporate entrepreneurship,the long-term orientation of the firm and the environmental uncertainty constitute a moderated-mediating effect.That is to say,when environmental uncertainty is at higher levels,the indirect effect of long-term orientation directing family commitment on corporate entrepreneurship is stronger.The research of Sub-study 2 answers the question of whether family commitment is conducive to entrepreneurship in family business.It not only reveals the positive interaction between family members and the positive effect of family business on innovation and entrepreneurship,but also promotes family involvement in the research of family businesses.Moreover,sub-study 2 provides a theoretical research basis for the understanding of "why some family firms are more inclined to corporate entrepreneurship than other family firms" from the perspective of family willingness,and provides empirical support for the heterogeneity of behavioral decisions of family businesses.Sub-study Ⅲ(Chapter 5)adopts longitudinal case study method and selects the benchmark of the entrepreneurial practice of the Chinese family business,Ningbo FOTILE Group as the research object.Based on the company development cycle(time dimension)combined with the actual situation of FOTILE,the process of FOTILE’s entrepreneurship was divided into the establishment phase,expansion phase,and maturity phase.Two core dimensions of the company’s entrepreneurial process were analyzed:family involvement and opportunity identification.The evolution of opportunity identification shows a dynamic long-term path for corporate entrepreneurship of family businesses.The study found that the success of FOTILE’s entrepreneurial success is due to two factors:Firstly,family involvement(management rights)has been gradually weakened in entrepreneurial process.Secondly,the identification of opportunity changes from passive search to active search.Through the research on the successful experiences of FOTILE,Sub-study Ⅲ also proposed the reference for the succession of Chinese family businesses.At the end of this thesis,the systematic summary and future prospect are presented.