Businesses with family firm pride, community social ties and long-term orientation create a positive family firm image that leads to better performance, according to recent study results. A strong family firm image and family influences on the firm can be leveraged to create a competitive advantage for family owned and led businesses..

“The purpose of the study was to address what motivates or helps family firms to build a positive family firm image and how family firm image impacts firm performance,” Esra Memili, PhD, assistant professor at the Bryan School of Business and Economics at the University of North Carolina at Greensboro, told O&P Business News. “By drawing upon organizational identity theory and family business literature, we developed and tested a model investigating the effects of family firm pride, long-term orientation and community social ties on family firm image and the impact of family firm image on firm performance.”

Three drivers of family firm image

After obtaining a mailing list of privately held family businesses from a family business center at a major Swiss university, the researchers examined mail surveys from 179 family firms, defined through their affiliation with the family business center.

Study results showed that when stakeholders strongly perceive the business as a family firm, the business can more effectively create a positive cognitive image that positively affects firm performance.


Esra Memili


Family firm pride also has a positive impact on family firm image and performance. Researchers found when family members are proud of their firm and its history, they were more inclined to construct a strong family image that can be promoted in the marketplace.

Strong community social ties also create a positive impact on performance in family firms. These social ties that emerge from interactions with internal and external stakeholders help nurture the family firm image and strengthen performance.

Lastly, the researchers suggested that family firms that have been in business a long time can create a coherent and enduring image for their business. Businesses with long-term investment strategies may be better equipped to communicate their stable family heritage and traditional values via a family firm image. The researchers suggested that this may be a reason why family firms are often seen as trustworthy.

Capitalize on image

“Family firms vary in the extent to which they portray a family firm image. It is interesting that some family firms choose to portray themselves as “family firms” while others downplay their family firm identity,” Memili said. “When a family firm is aware of the benefits of positive family firm image on firm performance and what leads to the development of positive family firm image — ie, family firm pride, community social ties and long-term orientation — it can set strategies accordingly and capitalize on family firm image, which can lead to competitive advantages and transgenerational success.” — by Casey Murphy

For more information:
Zellweger TM, Kellermans FW, Eddleston K. Journal of Family Business Strategy. 2012;3:239-250.

Disclosure: Memili has no relevant financial disclosures.

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