Description
On this paper talk governance in immigrant family businesses.
Governance in
Immigrant Family Businesses
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Governance in
Immigrant
Family Businesses
Enterprise, Ethnicity and
Family Dynamics
DAPHNE HALKIAS and
CHRISTIAN ADENDORFF
XV
© Daphne Halkias and Christian Adendorf 2014
All rights reserved. No part of this publication may be reproduced, stored in a retrieval
system or transmited in any form or by any means, electronic, mechanical, photocopying,
recording or otherwise without the prior permission of the publisher.
Daphne Halkias and Christian Adendorf have asserted their moral right under the Copyright,
Designs and Patents Act, 1988, to be identifed as the authors of this work.
Gower Applied Business Research
Our programme provides leaders, practitioners, scholars and researchers with thought
provoking, cuting edge books that combine conceptual insights, interdisciplinary rigour and
practical relevance in key areas of business and management.
Published by
Gower Publishing Limited Gower Publishing Company
Wey Court East 110 Cherry Street
Union Road Suite 3-1
Farnham Burlington, VT 05401-3818
Surrey, GU9 7PT USA
England
www.gowerpublishing.com
British Library Cataloguing in Publication Data
A catalogue record for this book is available from the British Library
Library of Congress Cataloging-in-Publication Data
Halkias, Daphne.
Governance in immigrant family businesses : enterprise, ethnicity and family dynamics / by
Daphne Halkias and Christian Adendorf.
pages cm
Includes bibliographical references and index.
ISBN 978-1-4094-4557-9 (hardback) -- ISBN 978-1-4094-4558-6 (ebook) -- ISBN 978-1-4724-
0239-4 (epub) 1. Family-owned business enterprises--Cross-cultural studies. 2. Corporate
governance--Cross-cultural studies. 3. Entrepreneurship--Cross-cultural studies. 4.
Immigrant families. I. Adendorf, Christian. II. Title.
HD62.25.H34 2014
338.6--dc23
2013042242
ISBN 9781409445579 (hbk)
ISBN 9781409445586 (ebk – PDF)
ISBN 9781472402394 (ebk – ePUB)
Contents
List of Figures vii
List of Tables ix
About the Authors xi
Notes on Case Study Contributors xiii
Acknowledgements xv
Introduction: Why Today’s Global Marketplace Cares about
Good Governance in Immigrant Family Businesses 1
1 The Immigrant Family Business in Today’s Global Marketplace 5
Case Study: The al-Awadhi Brothers:
The Story of Two Emirati Entrepreneurs 10
2 The Family and the Business 15
Case Study: A Family Restaurant Blends Cuisines
across Cultures 49
3 The Impact of Culture on Immigrant Entrepreneurship 53
Case Study: An Immigrant Entrepreneurial Culture is Born:
The Greeks of South Africa 64
4 The Immigrant Family Business: Defning Concepts 85
Case Study: An Entrepreneurial Immigrant Family in Colombia 100
Case Study: Domenico Napoli: An Italian Immigrant
Entrepreneur in America 104
5 Family Dynamics Impacting Governance and
Sustainability of Immigrant Family Businesses 109
Case Study: Transfeld and Tenix: Endurance and
Weakness in Two Migrant Family Businesses in Australia 112
Case Study: It’s a Sweet Life: An Indian Daughter Successfully
Manages an Immigrant Family Business in the United States 116
GOVERNANCE IN IMMIGRANT FAMILY BUSINESSES vi
6 Entrepreneurship Issues Impacting Good Governance
within the Immigrant Family Business 123
Case Study: Good Governance within the
Immigrant Family Business: Y.K.Crystal Ltd 128
7 Cultural and Family Dynamics in the Governance of
Immigrant Businesses 133
Case Study: Governing the Asian Family Business:
Entrepreneurship and Aspiration 139
8 The Sustainable Immigrant Family Business Model of
Good Governance 143
Case Study: A Chinese Immigrant Family Business in Pakistan 156
9 Epilogue: Discussion and Recommendations for
Future Research 159
Bibliography 163
Index 201
2.1 From start-up to family business to succession 25
2.2 The dimensional model 34
2.3 Family FIRO conceptual model of family business 44
2.4 Sustainable family business models 46
4.1 Factors that determine entrepreneurial migration 87
8.1 The sustainable immigrant family business model 145
8.2 Path diagram of causal relationships: revised theoretical model 146
List of Figures
This page has been left blank intentionally
2.1 Structures of the family-business relationship 24
2.2 Evolutionary stages of a family business 31
2.3 Ownership issues in the evolving family business 32
2.4 Management issues in the evolving family business 33
3.1 A selected list of words of the South African-Greek dialect 67
List of Tables
This page has been left blank intentionally
About the Authors
Daphne Halkias, PhD is a distinguished academic, researcher, published
author, and consultant in the areas of immigrant entrepreneurship, family
business, coaching and mentoring family businesses, organizational
psychology, education and sustainable entrepreneurship. She is a Fellow
at the Institute of Coaching, McLean Hospital at Harvard Medical School;
Research Affiliate at the Institute for Social Sciences, Cornell University;
Research Associate at the Center for Comparative Immigration Studies,
University of California, San Diego; and Senior Research Fellow at The
Center for Youth and Family Enterprise, University of Bergamo. Dr Halkias
is CEO of Executive Coaching Consultants, and Editor of International Journal
of Teaching and Case Studies and International Journal of Social Entrepreneurship
and Innovation. She is a Member of the Family Firm Institute.
Christian Adendorff, PhD has been a business entrepreneur since 1985 and
developing a family business that is owner-managed internationally. He has
an MS and a PhD in Commerce from Rhodes University, and an MPhil and
DBA in Future Studies from Stellenbosch University with specializations
in research methodology, corporate governance, and turnaround strategies.
Prof. Adendorff is on the faculty of Nelson Mandela Metropolitan University
(NMMU) Business School teaching future studies, family businesses,
entrepreneurship, and research methodology. He serves as Associate Editor
of International Journal of Teaching and Case Studies and on the editorial board
of various international peer-reviewed journals. He is a published author and
researcher in the areas of governance and immigrant entrepreneurship, future
studies, family business, technological entrepreneurship, culture, strategic
management, demographics, systems management, and turnaround strategies
and a Member of the Family Firm Institute and International Family Enterprise
Research Academy.
This page has been left blank intentionally
Notes on
Case Study Contributors
Ms. Shehla Riza Arifeen is Associate Professor of Marketing and Management
at the Business School of Lahore School of Economics, Pakistan.
Dr. Mary Barrett is Professor of Management at the School of Management &
Marketing, University of Wollongong, Australia.
Dr. Nina Gorovaia is Assistant Professor of Management at the Department of
Business Administration, Frederick University, Cyprus.
Ms. Maryam Khazaeli is a graduate student in management at the School of
Management & Marketing, University of Wollongong, Australia.
Dr. Melquicedec Lozano is Director of Research and Special Projects at the
Center for Entrepreneurship Development, Universidad Icesi in Cali, Colombia.
Dr. Leann Mischel is Associate Professor and founder of the Entrepreneurship
program at Susquehanna University, United States of America.
Dr. Meenakshi Rishi is Associate Professor of Economics at the Albers School
of Business and Economics at Seattle University in Seattle, United States
of America.
Dr. Claire Seaman is Director of the Scottish Forum for Family Business
Research at Queen Margaret University in Edinburgh.
Prof. Paul W. Thurman is Clinical Professor, School of International and Public
Affairs, Mailman School of Public Health, Columbia University in New York,
United States of America.
Dr. Athanasia Tziortzi is Lecturer of Marketing at the Department of Business
Administration, Frederick University, Cyprus.
GOVERNANCE IN IMMIGRANT FAMILY BUSINESSES xiv
Dr. Franco Vaccarino is Senior Lecturer of Cross-Cultural Communication at
the School of Communication, Journalism and Marketing, Massey University
in Palmerston North, New Zealand.
Dr. Ioannis Violaris is Dean of the School of Economic Sciences and
Administration, Frederick University, Cyprus, Associate Professor of
Economics, and Doctoral Adviser for the Middlesex University’s Work-based
program in Cyprus.
Acknowledgements
The realization of this book lies squarely in the lap of my good friend and
respected colleague at Nelson Mandela Metropolitan University, Dr. Christian
Adendorff, who spent two years on a groundbreaking and vast research
project on corporate governance in immigrant family businesses of South
African Greeks. Plainly put, this work would have never come to fruition
without Chris’s original research. It is my honour to publish this book with
him where we now break new theoretical ground in the area of sustainable
immigrant family business. Chris’s original conceptual model, The Model of
Perceived Good Governance in Immigrant Family Business, which he originally
published in 2005, has since evolved and extended through Chris’s continued
scholarly work over the past decade. In this book we present the latest version
of Chris’s original theoretical model, now termed The Sustainable Immigrant
Family Business Model. Our hope is that the next step for this model is its
validation through a cross-national study, which will be the basis of our next
book. Chris, it has been an amazing journey working with you and I send you
my gratitude for opening this door to me so I may take part in some small
way to supporting immigrant families worldwide starting business ventures
in their adopted lands.
We thank our colleagues for lending to this book their valuable time and
expertise through their country case study contributions. The colleagues that
represented their countries or regions in this book through their case study
work gave their time generously to gather the data supporting the concepts
presented in each chapter. These contributing authors are researchers and
scholars around the globe collaborating with us to write each country/
regional case study. From nations across the globe – Australia, Colombia,
Cyprus, Greece, New Zealand, Pakistan, Philippines, South Africa, the
United Kingdom (Scotland), the United Arab Emirates, and the United
States of America – this applied research book is in the reader’s hands today
thanks to the collaborative efforts of this international network of colleagues
dedicated to giving a voice to immigrant family businesses and life stories
of hope, family support, work, identity, integration, and a profound love
for the adopted countries and communities that welcomed them, their
families, and their businesses. A special thanks to my colleague and research
GOVERNANCE IN IMMIGRANT FAMILY BUSINESSES xvi
partner at Columbia University, Paul Thurman, who generously gave us
his business acumen and insights by authoring the introductory chapter of
the book: “Why Today’s Global Marketplace Cares about Good Governance
in Immigrant Family Businesses”. Paul, it is a privilege to work with you –
and your amazing mind – and I look forward to our many future research
collaborations and projects.
Chris and I owe a great debt of gratitude to the book’s Managing Editor,
Sylva Caracatsanis. Sylva is unfailing in her work ethic and her ability to
handle our little editorial emergencies and remain calm and positive
throughout this process. Sylva has been integral in managing all the editing
details of the final manuscript and in coordinating the international network
of professionals that made this book possible. Sylva, after 18 years of working
together, you know you have a special place in our hearts always!
As always, many thanks to the fine team at Gower Publishing for their
continued professionalism, support, and encouragement of our research
work. The team at Gower believed in this project from the very beginning and
supported it in every way possible.
Daphne Halkias,
Athens, Greece
I wish to express my sincere gratitude to Prof. Daphne Halkias and all those
who have assisted us in the completion of this detailed study and book.
Daphne is most probably one of the most acute and driven professionals that
I’ve had the privilege to come across. As an intellectual her knowledge on any
particular field is impeccable. At the same time, she has the warm heart of a
giant. I would highly recommend anyone to get to know this special lady.
Daphne, the difference that you bring to this world is greatly appreciated
and noted.
This is a book of inspiring and important stories for anyone interested in
making the world of immigrant entrepreneurship a better place. Whether you
are a CEO, student or aspiring professional, this book provides a refreshing
perspective on how and why entrepreneurs around the world are pioneering
innovative business solutions to immigrant entrepreneurship. This book is also
a response to the authors’ perception that most research into immigrant family
xvii ACKNOWLEDGEMENTS
businesses has been based on a traditional, limited view of entrepreneurship
that largely ignores the ethnic and family contexts that create the culture from
which entrepreneurship emerges, making it impossible to understand the
complex and interdependent relationships between an owning family, its firm,
its governance, and the community context in which the firm operates.
Christian Adendorff,
Port Elizabeth, South Africa
This page has been left blank intentionally
Introduction:
Why Today’s Global Marketplace
Cares about Good Governance in
Immigrant Family Businesses
PAUL W. THURMAN
Columbia University
“A family that prays together, stays together.”
This timeless adage, often heard in the Southern Baptist church – and at the
dinner table – of my youth, reminds many of us that if a group of people share
and remind themselves of common goals, visions, and guiding principles,
long-term unity, and, perhaps by extension, success and prosperity will
follow. While certainly not as deterministic (or as pious) as it may sound,
there is a growing body of evidence that supports the conclusion that well
thought-out and well communicated goals, plans, and processes do help
create more sustainable, peaceful, and prosperous family businesses …
especially those run by families living outside the countries of their birth.
This text comprises some of the best contemporary research and data
to support this claim. By even the most conservative estimates, well over
half of all businesses around the world are run by families … and as labour
and family mobility increase, so too does the likelihood that something
you buy or a service you receive originates from a family business whose
family comes from a place – and a culture, value set, and ethnography – very
different from yours. Combine this “scope” effect with the broader trend
of globalization, or “scale” effect, whereby larger firms increasingly turn to
lower-cost local firms, producers, and services to complement or to augment
existing capabilities and staff, and we observe a striking similarity between
large multinational firms and much smaller, immigrant family businesses:
successful planning, business controls, and effective governance are highly
predictive of ongoing success.
GOVERNANCE IN IMMIGRANT FAMILY BUSINESSES 2
This is a difficult paradox to accept, at first. “Big firms”, with strategic
planners, controllers, and auditors, and independent (we hope) corporate
boards, tend to proliferate longer-term customer value, not to mention
employee morale, retention, and returns to shareholder capital, if their plans,
controls, and governance are world-class. This is true even with very large
family-owned businesses in competitive markets; for example, the Tata Group
in India and the Koch Companies in the United States.
However, to believe that the same might be true of very small family
businesses – operating outside their countries of origin – seems to be a bit
of a stretch. Very few small businesses – let alone immigrant family ones –
have any “strategic plans”, “management consultants”, or “outside board
members”. And since these businesses are so small – and so tightly controlled
by a family operating, in some cases, far away from their cultural norms and
familial environments – would any planning or governance even be possible
or helpful?
As it turns out, the answer is absolutely YES! As we will demonstrate
in this compendium, we have discovered several examples – provided here
as case studies – that exemplify the improved economic, familial, and even
social returns that immigrant family businesses can embrace when equipped
with even the most basic strategic planning/visioning, goal measurement, and
(structured) governance. Immigrant family firms that use outside counsel, set
clear(er) goals for growth and financial improvement, and that simply write
down and communicate simple processes and longer-term goals – e.g. succession
plans, partnerships/alliances with other, similar firms – create economic entities
that last longer, live stronger, and serve customers more successfully.
So why does any of this matter? If my local grocer, who is not from the
United States but whose family has a “plan” for how succession will take
place or uses outside counsel and advice-givers to help his grocery make more
money, do any of these things matter on the global stage?
A great deal!
As it turns out, not only do customers notice the difference, but so do
larger firms, including firms that might partner with my grocer. His suppliers
might give him better pricing, and if another grocer wants to expand through
acquisition, chances are that the acquiring firm may be favourably impressed
with these plans and offer a higher price for my grocer’s location and customer
base. (And his customer base is likely to be more loyal and “lifetime valued” too.)
3 INTRODUCTION
Good business planning and governance by immigrant family businesses –
even if, in MBA terms, it is rather elementary – does make a difference. And a
family or firm doesn’t need a global management consulting firm hired to help
it, either. The value added is not just endogenous to the firm’s family owners/
mangers and customers, but can also extend to exogenous stakeholders such
as potential business partners, shareholders, and even civic and community
leaders. And that means the world cares about this. Good governance and
planning create better firms – even small family-led ones. These firms serve
customers and communities better. And when globalization comes calling,
these firms and business partners are simply more attractive than those
without any plans or management structure.
On behalf of the editors and contributors, I hope you enjoy the case studies
and trendsetting research we have in this edited volume. I think you will
find some interesting prototypes and business models that even the simplest,
most basic immigrant family firms can adopt – and realize value from – rather
quickly. And in that way, perhaps the family business that strives together,
thrives together. That sounds like a good phrase for the family business
dinner table any night.
This page has been left blank intentionally
Chapter 1
The Immigrant Family Business in
Today’s Global Marketplace
Even the most conservative estimates put the proportion of all worldwide
business enterprises owned or managed by families between 65% and 90%.
The economic importance of immigrant family businesses for the economies
of both the developed world and developing national economies are well
documented. What often goes unnoticed in the plethora of information
within the area of Family Business is that immigrant family businesses
are one of the most unique, complex, and dynamic systems in modern-day
society. Immigrant family business has even been dubbed by researchers “the
understudied entrepreneurial experience”. And, today, even the social and
economic phenomena that have been classically attached to immigrant family
businesses, such as cutting off all ties with their native country, emigrating
due only to conditions of poverty, immigrants lacking formal education and
working mostly within ethnic enclaves, have changed dramatically in many
countries hosting immigrant family businesses.
The development of today’s global marketplace over the past decades has
altered the traditional concept of immigrant entrepreneurship. If the concept
of immigrant entrepreneurship brings to most people’s minds the immigrant
and his family boarding a boat for a vast voyage to an unknown universe
known as a host country, the Internet has taken care of dissolving that reality.
The traditional immigrant entrepreneur started a business in the host country
as a means of survival – and usually never returning to the native land and
cutting off all familial and cultural ties. Today, the concept of the immigrant
entrepreneur is heterogeneous and refers not only to immigrant entrepreneurs
in the traditional sense.
Today’s immigrant entrepreneur, thanks to the ease of travel and
telecommunications, maintains strong ties with social and cultural capital
from the homeland. Many of this new breed of immigrant entrepreneurs start
their business not because of the usual obstacles faced by immigrants in the
doc_465965397.pdf
On this paper talk governance in immigrant family businesses.
Governance in
Immigrant Family Businesses
We’d love to keep you informed of other Gower books available to you from your
chosen provider. Why not join our monthly email newsletter? It features new books
as they are released, links you to hints and tips from our expert authors and highlight
free chapters for you to read.
To see a sample copy, please go to www.gowerpublishing.com/newsletter and then
simply provide your name and email address to receive a copy each month. If you
wish to unsubscribe at any time we will remove you from our list swiftly.
Our blog www.gowerpublishingblog.com brings to your attention the articles and
tips our authors write and, of course, you are welcome to comment on anything you
see in them. We also use it to let you know where our authors are speaking so, if you
happen to be there too, you can arrange to meet them if you wish.
www.gowerpublishing.com/ebooks
We hope you enjoy this ebook with its interactive features
and the wealth of knowledge contained within it.
Governance in
Immigrant
Family Businesses
Enterprise, Ethnicity and
Family Dynamics
DAPHNE HALKIAS and
CHRISTIAN ADENDORFF
XV
© Daphne Halkias and Christian Adendorf 2014
All rights reserved. No part of this publication may be reproduced, stored in a retrieval
system or transmited in any form or by any means, electronic, mechanical, photocopying,
recording or otherwise without the prior permission of the publisher.
Daphne Halkias and Christian Adendorf have asserted their moral right under the Copyright,
Designs and Patents Act, 1988, to be identifed as the authors of this work.
Gower Applied Business Research
Our programme provides leaders, practitioners, scholars and researchers with thought
provoking, cuting edge books that combine conceptual insights, interdisciplinary rigour and
practical relevance in key areas of business and management.
Published by
Gower Publishing Limited Gower Publishing Company
Wey Court East 110 Cherry Street
Union Road Suite 3-1
Farnham Burlington, VT 05401-3818
Surrey, GU9 7PT USA
England
www.gowerpublishing.com
British Library Cataloguing in Publication Data
A catalogue record for this book is available from the British Library
Library of Congress Cataloging-in-Publication Data
Halkias, Daphne.
Governance in immigrant family businesses : enterprise, ethnicity and family dynamics / by
Daphne Halkias and Christian Adendorf.
pages cm
Includes bibliographical references and index.
ISBN 978-1-4094-4557-9 (hardback) -- ISBN 978-1-4094-4558-6 (ebook) -- ISBN 978-1-4724-
0239-4 (epub) 1. Family-owned business enterprises--Cross-cultural studies. 2. Corporate
governance--Cross-cultural studies. 3. Entrepreneurship--Cross-cultural studies. 4.
Immigrant families. I. Adendorf, Christian. II. Title.
HD62.25.H34 2014
338.6--dc23
2013042242
ISBN 9781409445579 (hbk)
ISBN 9781409445586 (ebk – PDF)
ISBN 9781472402394 (ebk – ePUB)
Contents
List of Figures vii
List of Tables ix
About the Authors xi
Notes on Case Study Contributors xiii
Acknowledgements xv
Introduction: Why Today’s Global Marketplace Cares about
Good Governance in Immigrant Family Businesses 1
1 The Immigrant Family Business in Today’s Global Marketplace 5
Case Study: The al-Awadhi Brothers:
The Story of Two Emirati Entrepreneurs 10
2 The Family and the Business 15
Case Study: A Family Restaurant Blends Cuisines
across Cultures 49
3 The Impact of Culture on Immigrant Entrepreneurship 53
Case Study: An Immigrant Entrepreneurial Culture is Born:
The Greeks of South Africa 64
4 The Immigrant Family Business: Defning Concepts 85
Case Study: An Entrepreneurial Immigrant Family in Colombia 100
Case Study: Domenico Napoli: An Italian Immigrant
Entrepreneur in America 104
5 Family Dynamics Impacting Governance and
Sustainability of Immigrant Family Businesses 109
Case Study: Transfeld and Tenix: Endurance and
Weakness in Two Migrant Family Businesses in Australia 112
Case Study: It’s a Sweet Life: An Indian Daughter Successfully
Manages an Immigrant Family Business in the United States 116
GOVERNANCE IN IMMIGRANT FAMILY BUSINESSES vi
6 Entrepreneurship Issues Impacting Good Governance
within the Immigrant Family Business 123
Case Study: Good Governance within the
Immigrant Family Business: Y.K.Crystal Ltd 128
7 Cultural and Family Dynamics in the Governance of
Immigrant Businesses 133
Case Study: Governing the Asian Family Business:
Entrepreneurship and Aspiration 139
8 The Sustainable Immigrant Family Business Model of
Good Governance 143
Case Study: A Chinese Immigrant Family Business in Pakistan 156
9 Epilogue: Discussion and Recommendations for
Future Research 159
Bibliography 163
Index 201
2.1 From start-up to family business to succession 25
2.2 The dimensional model 34
2.3 Family FIRO conceptual model of family business 44
2.4 Sustainable family business models 46
4.1 Factors that determine entrepreneurial migration 87
8.1 The sustainable immigrant family business model 145
8.2 Path diagram of causal relationships: revised theoretical model 146
List of Figures
This page has been left blank intentionally
2.1 Structures of the family-business relationship 24
2.2 Evolutionary stages of a family business 31
2.3 Ownership issues in the evolving family business 32
2.4 Management issues in the evolving family business 33
3.1 A selected list of words of the South African-Greek dialect 67
List of Tables
This page has been left blank intentionally
About the Authors
Daphne Halkias, PhD is a distinguished academic, researcher, published
author, and consultant in the areas of immigrant entrepreneurship, family
business, coaching and mentoring family businesses, organizational
psychology, education and sustainable entrepreneurship. She is a Fellow
at the Institute of Coaching, McLean Hospital at Harvard Medical School;
Research Affiliate at the Institute for Social Sciences, Cornell University;
Research Associate at the Center for Comparative Immigration Studies,
University of California, San Diego; and Senior Research Fellow at The
Center for Youth and Family Enterprise, University of Bergamo. Dr Halkias
is CEO of Executive Coaching Consultants, and Editor of International Journal
of Teaching and Case Studies and International Journal of Social Entrepreneurship
and Innovation. She is a Member of the Family Firm Institute.
Christian Adendorff, PhD has been a business entrepreneur since 1985 and
developing a family business that is owner-managed internationally. He has
an MS and a PhD in Commerce from Rhodes University, and an MPhil and
DBA in Future Studies from Stellenbosch University with specializations
in research methodology, corporate governance, and turnaround strategies.
Prof. Adendorff is on the faculty of Nelson Mandela Metropolitan University
(NMMU) Business School teaching future studies, family businesses,
entrepreneurship, and research methodology. He serves as Associate Editor
of International Journal of Teaching and Case Studies and on the editorial board
of various international peer-reviewed journals. He is a published author and
researcher in the areas of governance and immigrant entrepreneurship, future
studies, family business, technological entrepreneurship, culture, strategic
management, demographics, systems management, and turnaround strategies
and a Member of the Family Firm Institute and International Family Enterprise
Research Academy.
This page has been left blank intentionally
Notes on
Case Study Contributors
Ms. Shehla Riza Arifeen is Associate Professor of Marketing and Management
at the Business School of Lahore School of Economics, Pakistan.
Dr. Mary Barrett is Professor of Management at the School of Management &
Marketing, University of Wollongong, Australia.
Dr. Nina Gorovaia is Assistant Professor of Management at the Department of
Business Administration, Frederick University, Cyprus.
Ms. Maryam Khazaeli is a graduate student in management at the School of
Management & Marketing, University of Wollongong, Australia.
Dr. Melquicedec Lozano is Director of Research and Special Projects at the
Center for Entrepreneurship Development, Universidad Icesi in Cali, Colombia.
Dr. Leann Mischel is Associate Professor and founder of the Entrepreneurship
program at Susquehanna University, United States of America.
Dr. Meenakshi Rishi is Associate Professor of Economics at the Albers School
of Business and Economics at Seattle University in Seattle, United States
of America.
Dr. Claire Seaman is Director of the Scottish Forum for Family Business
Research at Queen Margaret University in Edinburgh.
Prof. Paul W. Thurman is Clinical Professor, School of International and Public
Affairs, Mailman School of Public Health, Columbia University in New York,
United States of America.
Dr. Athanasia Tziortzi is Lecturer of Marketing at the Department of Business
Administration, Frederick University, Cyprus.
GOVERNANCE IN IMMIGRANT FAMILY BUSINESSES xiv
Dr. Franco Vaccarino is Senior Lecturer of Cross-Cultural Communication at
the School of Communication, Journalism and Marketing, Massey University
in Palmerston North, New Zealand.
Dr. Ioannis Violaris is Dean of the School of Economic Sciences and
Administration, Frederick University, Cyprus, Associate Professor of
Economics, and Doctoral Adviser for the Middlesex University’s Work-based
program in Cyprus.
Acknowledgements
The realization of this book lies squarely in the lap of my good friend and
respected colleague at Nelson Mandela Metropolitan University, Dr. Christian
Adendorff, who spent two years on a groundbreaking and vast research
project on corporate governance in immigrant family businesses of South
African Greeks. Plainly put, this work would have never come to fruition
without Chris’s original research. It is my honour to publish this book with
him where we now break new theoretical ground in the area of sustainable
immigrant family business. Chris’s original conceptual model, The Model of
Perceived Good Governance in Immigrant Family Business, which he originally
published in 2005, has since evolved and extended through Chris’s continued
scholarly work over the past decade. In this book we present the latest version
of Chris’s original theoretical model, now termed The Sustainable Immigrant
Family Business Model. Our hope is that the next step for this model is its
validation through a cross-national study, which will be the basis of our next
book. Chris, it has been an amazing journey working with you and I send you
my gratitude for opening this door to me so I may take part in some small
way to supporting immigrant families worldwide starting business ventures
in their adopted lands.
We thank our colleagues for lending to this book their valuable time and
expertise through their country case study contributions. The colleagues that
represented their countries or regions in this book through their case study
work gave their time generously to gather the data supporting the concepts
presented in each chapter. These contributing authors are researchers and
scholars around the globe collaborating with us to write each country/
regional case study. From nations across the globe – Australia, Colombia,
Cyprus, Greece, New Zealand, Pakistan, Philippines, South Africa, the
United Kingdom (Scotland), the United Arab Emirates, and the United
States of America – this applied research book is in the reader’s hands today
thanks to the collaborative efforts of this international network of colleagues
dedicated to giving a voice to immigrant family businesses and life stories
of hope, family support, work, identity, integration, and a profound love
for the adopted countries and communities that welcomed them, their
families, and their businesses. A special thanks to my colleague and research
GOVERNANCE IN IMMIGRANT FAMILY BUSINESSES xvi
partner at Columbia University, Paul Thurman, who generously gave us
his business acumen and insights by authoring the introductory chapter of
the book: “Why Today’s Global Marketplace Cares about Good Governance
in Immigrant Family Businesses”. Paul, it is a privilege to work with you –
and your amazing mind – and I look forward to our many future research
collaborations and projects.
Chris and I owe a great debt of gratitude to the book’s Managing Editor,
Sylva Caracatsanis. Sylva is unfailing in her work ethic and her ability to
handle our little editorial emergencies and remain calm and positive
throughout this process. Sylva has been integral in managing all the editing
details of the final manuscript and in coordinating the international network
of professionals that made this book possible. Sylva, after 18 years of working
together, you know you have a special place in our hearts always!
As always, many thanks to the fine team at Gower Publishing for their
continued professionalism, support, and encouragement of our research
work. The team at Gower believed in this project from the very beginning and
supported it in every way possible.
Daphne Halkias,
Athens, Greece
I wish to express my sincere gratitude to Prof. Daphne Halkias and all those
who have assisted us in the completion of this detailed study and book.
Daphne is most probably one of the most acute and driven professionals that
I’ve had the privilege to come across. As an intellectual her knowledge on any
particular field is impeccable. At the same time, she has the warm heart of a
giant. I would highly recommend anyone to get to know this special lady.
Daphne, the difference that you bring to this world is greatly appreciated
and noted.
This is a book of inspiring and important stories for anyone interested in
making the world of immigrant entrepreneurship a better place. Whether you
are a CEO, student or aspiring professional, this book provides a refreshing
perspective on how and why entrepreneurs around the world are pioneering
innovative business solutions to immigrant entrepreneurship. This book is also
a response to the authors’ perception that most research into immigrant family
xvii ACKNOWLEDGEMENTS
businesses has been based on a traditional, limited view of entrepreneurship
that largely ignores the ethnic and family contexts that create the culture from
which entrepreneurship emerges, making it impossible to understand the
complex and interdependent relationships between an owning family, its firm,
its governance, and the community context in which the firm operates.
Christian Adendorff,
Port Elizabeth, South Africa
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Introduction:
Why Today’s Global Marketplace
Cares about Good Governance in
Immigrant Family Businesses
PAUL W. THURMAN
Columbia University
“A family that prays together, stays together.”
This timeless adage, often heard in the Southern Baptist church – and at the
dinner table – of my youth, reminds many of us that if a group of people share
and remind themselves of common goals, visions, and guiding principles,
long-term unity, and, perhaps by extension, success and prosperity will
follow. While certainly not as deterministic (or as pious) as it may sound,
there is a growing body of evidence that supports the conclusion that well
thought-out and well communicated goals, plans, and processes do help
create more sustainable, peaceful, and prosperous family businesses …
especially those run by families living outside the countries of their birth.
This text comprises some of the best contemporary research and data
to support this claim. By even the most conservative estimates, well over
half of all businesses around the world are run by families … and as labour
and family mobility increase, so too does the likelihood that something
you buy or a service you receive originates from a family business whose
family comes from a place – and a culture, value set, and ethnography – very
different from yours. Combine this “scope” effect with the broader trend
of globalization, or “scale” effect, whereby larger firms increasingly turn to
lower-cost local firms, producers, and services to complement or to augment
existing capabilities and staff, and we observe a striking similarity between
large multinational firms and much smaller, immigrant family businesses:
successful planning, business controls, and effective governance are highly
predictive of ongoing success.
GOVERNANCE IN IMMIGRANT FAMILY BUSINESSES 2
This is a difficult paradox to accept, at first. “Big firms”, with strategic
planners, controllers, and auditors, and independent (we hope) corporate
boards, tend to proliferate longer-term customer value, not to mention
employee morale, retention, and returns to shareholder capital, if their plans,
controls, and governance are world-class. This is true even with very large
family-owned businesses in competitive markets; for example, the Tata Group
in India and the Koch Companies in the United States.
However, to believe that the same might be true of very small family
businesses – operating outside their countries of origin – seems to be a bit
of a stretch. Very few small businesses – let alone immigrant family ones –
have any “strategic plans”, “management consultants”, or “outside board
members”. And since these businesses are so small – and so tightly controlled
by a family operating, in some cases, far away from their cultural norms and
familial environments – would any planning or governance even be possible
or helpful?
As it turns out, the answer is absolutely YES! As we will demonstrate
in this compendium, we have discovered several examples – provided here
as case studies – that exemplify the improved economic, familial, and even
social returns that immigrant family businesses can embrace when equipped
with even the most basic strategic planning/visioning, goal measurement, and
(structured) governance. Immigrant family firms that use outside counsel, set
clear(er) goals for growth and financial improvement, and that simply write
down and communicate simple processes and longer-term goals – e.g. succession
plans, partnerships/alliances with other, similar firms – create economic entities
that last longer, live stronger, and serve customers more successfully.
So why does any of this matter? If my local grocer, who is not from the
United States but whose family has a “plan” for how succession will take
place or uses outside counsel and advice-givers to help his grocery make more
money, do any of these things matter on the global stage?
A great deal!
As it turns out, not only do customers notice the difference, but so do
larger firms, including firms that might partner with my grocer. His suppliers
might give him better pricing, and if another grocer wants to expand through
acquisition, chances are that the acquiring firm may be favourably impressed
with these plans and offer a higher price for my grocer’s location and customer
base. (And his customer base is likely to be more loyal and “lifetime valued” too.)
3 INTRODUCTION
Good business planning and governance by immigrant family businesses –
even if, in MBA terms, it is rather elementary – does make a difference. And a
family or firm doesn’t need a global management consulting firm hired to help
it, either. The value added is not just endogenous to the firm’s family owners/
mangers and customers, but can also extend to exogenous stakeholders such
as potential business partners, shareholders, and even civic and community
leaders. And that means the world cares about this. Good governance and
planning create better firms – even small family-led ones. These firms serve
customers and communities better. And when globalization comes calling,
these firms and business partners are simply more attractive than those
without any plans or management structure.
On behalf of the editors and contributors, I hope you enjoy the case studies
and trendsetting research we have in this edited volume. I think you will
find some interesting prototypes and business models that even the simplest,
most basic immigrant family firms can adopt – and realize value from – rather
quickly. And in that way, perhaps the family business that strives together,
thrives together. That sounds like a good phrase for the family business
dinner table any night.
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Chapter 1
The Immigrant Family Business in
Today’s Global Marketplace
Even the most conservative estimates put the proportion of all worldwide
business enterprises owned or managed by families between 65% and 90%.
The economic importance of immigrant family businesses for the economies
of both the developed world and developing national economies are well
documented. What often goes unnoticed in the plethora of information
within the area of Family Business is that immigrant family businesses
are one of the most unique, complex, and dynamic systems in modern-day
society. Immigrant family business has even been dubbed by researchers “the
understudied entrepreneurial experience”. And, today, even the social and
economic phenomena that have been classically attached to immigrant family
businesses, such as cutting off all ties with their native country, emigrating
due only to conditions of poverty, immigrants lacking formal education and
working mostly within ethnic enclaves, have changed dramatically in many
countries hosting immigrant family businesses.
The development of today’s global marketplace over the past decades has
altered the traditional concept of immigrant entrepreneurship. If the concept
of immigrant entrepreneurship brings to most people’s minds the immigrant
and his family boarding a boat for a vast voyage to an unknown universe
known as a host country, the Internet has taken care of dissolving that reality.
The traditional immigrant entrepreneur started a business in the host country
as a means of survival – and usually never returning to the native land and
cutting off all familial and cultural ties. Today, the concept of the immigrant
entrepreneur is heterogeneous and refers not only to immigrant entrepreneurs
in the traditional sense.
Today’s immigrant entrepreneur, thanks to the ease of travel and
telecommunications, maintains strong ties with social and cultural capital
from the homeland. Many of this new breed of immigrant entrepreneurs start
their business not because of the usual obstacles faced by immigrants in the
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