Our Family Business Grew. Resource Allocation Perspective

The research of family business is a topic having modern meaning, while theresearch of family-business growth is a topic having great significance. On the basic of agreat deal of studies relating to the growth of family business done by many scholars athome and abroad, this study involves economics, management, sociology and economicsociology, makes use of resources-allocation theory, enterprise-growth theory, social-capital theory, network theory and enterprise-cluster theory, and adopts the researchmethod of combining theory analysis and experience analysis together to study thegrowth of family business in our country from the angle of resources allocation. On thepremise that the growth of family business needs to merge social resources continuouslyand effectively, this study tries to answer the following questions: How does the resourcesthe growth of family business in our country needs get allocated? What changes willhappen in the mode of resources allocation during different stages of the growth of familybusiness? What kind of enlightenment or suggestion will the changes give us?On the structure as a whole, this study adopts the argument method of "puttingforward proposition——developing analysis". Firstly, this study tells that there are mainlythree modes of resources allocation for the growth of enterprises, namely market,government and social network, discussing briefly their charecteristics and the relationbetween them. Then, this study puts forward three propositions related to the growth offamily business in our country. Proposition 1: The allocation of resources the growth offamily business in our country needs depends mainly on social network; small-mediumfamily business depends on social network to allocate resources more than large one.Proposition 2: During the process of resources allocation for the growth of family businessin our country, the function of social-relation network weakens gradually, while thefunction of enterprise-cluster network strengthens gradually. Proposition 3: During theprocess of resources allocation for the growth of family business in our country, thefunction of social network will become weaker, while the function of market andgovernment will become stronger. Secondly, this study adopts the research method ofcombining theory analysis and experience analysis together to analyze the propositions mentioned above carefully. After the analysis, this study has the preliminary discovery thatproposition 1, proposition 2 and proposition 3 get theoretic and empirical support. Hencethe enlightenment is got as follows: The mode of resources allocation for the growth offamily business in our country needs to transform on different stages of its growth. Even ifthe mode stays the same, the strength of its function will be different. With the furtherdevelopment of family business in our country and the further perfection of formalinstitutions in our country, such as market and government, the function of formalinstitutions will strengthen gradually, while the function of informal institutions will weakengradually. Although it substitutes the informal institutions gradually, the formal institutionswill never substitute the informal institutions completely. Therefore social network, marketand government are complementary and helpful to each other. The efficiency of resourcesallocation for the growth of family business in our country depends on the optimalcombination of three modes. Finally, on the basic of the analysis and summarizationabove, this research puts forward some related suggestions for the growth of familybusiness in our country, and an outlook to the follow-up research.