Caught in the spider's web: an investigation of dysfunctional behavioural patterns in a family firm

Abstract

Purpose

Drawing on the theory of goal systems applied to family business this case study focuses on the interdependence between non-economic goals and family goals, in order to identify if and how achieving non-economic goals generates dysfunctional behavioural patterns for family members in the long term.

Design/methodology/approach

This study used an inductive, 20-year longitudinal case-study based methodology.

Findings

This case study shows how the business family faces ethical/affective dimensions, struggling every day for a balance and often undermining the legitimisation and differentiation of its children. Findings show that the achievement of non-economic goals can occur to the detriment of family goals, such as by generating a dysfunctional system, specifically in business family adaptability.

Research limitations/implications

The principal limitation is that this single case study evidently does not allow for complete generalization of the findings.

Practical implications

This case study makes a contribution to alerting the family business system to the long-term risk they face in trying to simultaneously maintain both harmony/cohesion and ethics/responsibility. Practitioners and consultants are therefore called on to help family firm owners with adopting a strategic vision by considering possible long-term counterfinal (i.e. mutually incompatible) goals.

Social implications

SMEs are the most widespread type of firm in the world, and consequently dysfunctional behavioural patterns within business families represent a prominent socio-economical problem for policy makers and institutions.

Originality/value

This study shows that, in the long term, that which is perceived to be a desirable goal can transpire to be a dysfunctional pattern. In doing so, this research introduces a new point of view to the literature on goal systems in family business.

Citation

Ferrari, F. (2023), "Caught in the spider's web: an investigation of dysfunctional behavioural patterns in a family firm", Journal of Family Business Management, Vol. 13 No. 3, pp. 798-817. https://doi.org/10.1108/JFBM-09-2021-0112

Introduction

Research provides copious evidence of the impact that the family-business overlap has on governance in general, and on goals in particular (Gagnè et al., 2014). For instance, the literature suggests that “family firms are typically motivated by, and committed to, the preservation of their family-centred non-economic goals, referring to non-financial aspects or “affective endowments” of family owners” (Berrone et al., 2012, p. 259). Research has shown that pursuing non-economic goals does have positive effects on business (Kellermans et al., 2012; Zahra et al., 2004; Zahra et al., 2008), but also negative effects (see McKee et al., 2014 for a review).

Increasingly, family business scholars have recognized the heterogeneity of family firms in pursuing in the pursuit of non-economic goals (Bird and Zellweger, 2018; Randolph et al., 2019). However, the available literature shows that all firms can have non-economic goals (Cyert and March, 1963), and that even non-family-owned firms benefit from family type goals (Randolph et al., 2019). The construct of a non-economic goal in itself is hence not sufficient for investigating the heterogeneity of family businesses. It is t therefore more effective to adopt a more finely tuned approach in identifying the goals of a family business, differentiating between economic goals (related to the business), family centred non-economic goals (which arise from the overlap between family and business) and family goals (which characterize all families). To date, the literature on family centred non-economic goals has placed non-economic goals and family goals under the same umbrella, without further distinction (see, e.g. Chrisman et al., 2012; Williams et al., 2018). The psychological literature instead shows that families have both socio-psychological and relational goals not coinciding with non-economic goals (Fiese, 2018; Scabini, 2016), and which are related to specific outcomes of family relationships such as affective/care goals and ethical/responsibility goals (Fincham and Rogge, 2010; Scabini and Iafrate, 2003). Failing to meet these goals leads to dysfunctional behavioural patterns in the relationships between family members (Olson, 2000; Scabini, 2016). The firm goal systems approach (Randolph et al., 2019), also highlights that firms have intertwined goal systems. The architecture of these relationships between goals determines the mutual influences and the related long-term effects of mutually incompatible goals (counterfinal goals) (Kruglanski et al., 2015). Following this approach, this case study focuses on the interdependence between non-economic goals and family goals, in order to identify if and how counterfinal goals generate dysfunctional behavioural patterns for family members in the long term.

Considering the methodology adopted in investigating goal dynamics, in their literature review Williams et al. (2018) highlight the paucity of research investigating the potential effects that goals may have on relations among owner-family members. Due to the fact that a large majority (>80%) of research investigating family firm goals is quantitative, they concluded that there is a need for future qualitative research. In addition, the recent family business literature (De Massis and Foss, 2018; Picone et al., 2021; Zachary, 2011) advocates for a better understanding of the psychological foundations of family firms, by adopting a long-range point of view especially. Other authors showed that, within a family, dysfunctional behaviours often arise in the long-term (Kaye, 1996; Kets de Vries, 2007; Jennings et al., 2013). In summary, the available literature suggests the investigation of goal-related family dynamics requires a qualitative longitudinal approach.

Given the theoretical and methodological limitations of the previous empirical literature, this study aims to highlight if and how pursuing family centred non-economic goals can hinder the achievement of family goals in the long term. In doing so, it aims to broaden scholars' knowledge about family firm goals and give new insights into the heterogeneity of family firms, contributing to explaining their peculiar strategic behaviours, as advocated by the current literature (Williams et al., 2018).

Theoretical background

Given their hybrid nature (the family and the business), in addition to economic goals family businesses pursue two other categories of objectives related to the family side of the business: family centred non-economic goals and family goals (see for instance Chrisman et al., 2012; Gagnè et al., 2014; Poza, 2007; Randolph et al., 2019). Family firms are hence goal systems – i.e. a mental representation of objectives, means, and the interdependencies between them (Kruglanski et al., 2015; Unsworth et al., 2014). According to the literature, this goal system can lead to conflicting goals (the so-called counterfinal goals), for instance pursuing a goal with detriment to others, or prioritizing certain goals (erroneously) by renouncing the achievement of others which are perceived as less important (Randolph et al., 2019). A well-established body of the literature highlights that family firms pursue family centred non-economic goals related to relational, emotional and affective dynamics in particular (Astrachan and Jaskiewicz, 2008; Basco and Pèrez-Rodriguez, 2009; Chua et al., 1999; Gomez-Mejia et al., 2011; Martinez-Romero and Rojo Ramírez, 2016). In general, the available literature agrees about considering, among others, at least three fundamental dimensions of non-economic goals strictly related to the family side of a family business (Berrone et al., 2012; Martinez-Romero and Rojo Ramírez, 2016): (1) the control and influence of family members (Berrone et al., 2010), (2) the close identification of the founder (and the family) with the firm (Dyer and Whetten, 2006), and (3) the intention to hand the business down to future generations (Zellweger and Astrachan, 2008; Kellermanns et al., 2012).

Although widely adopted by scholars, a family centred non-economic goals approach is however not sufficient to fully explain the complexity of the goal systems of a family business. For example, the current literature does not clarify if and how the goals of the entrepreneurial family, as a family, change or are conditioned by non-economic goals. Heterogeneity among family businesses may hence be due to the long-term effect that goal systems have on relationships between members of the entrepreneurial family (Williams et al., 2018). Therefore, it could be useful to add a specific set of family-related goals to family centred non-economic goals. Indeed, business families, as families, have additional goals belonging to two different structural dimensions (Aunola and Nurmi, 2005; Fiese, 2018; Olson, 2000; Scabini and Iafrate, 2003; Scabini, 2016). The first dimension includes affective/care objectives such as; maintaining harmony between members, achieving detachment from the previous generation, and guaranteeing the right distance (physical and psychological) between the members, between the generations, and with the environment (Beavers, 1982). The second dimension concerns ethical/responsibility goals such as; the flexibility of roles and the consequent ability to adapt to the environment (Finley et al., 2008), the realization of a generative connection between maternal affective instances (continuity, memory, care), and paternal ethical instances (material goods, order, justice) (Fiese, 2018), and the achievement of intergenerational differentiation (Olson, 2000). Finally, for the parents, the preparation for their children leaving home, and the reinvention of themselves in their relationship as a couple once their children have left home (Scabini, 1995). Figure 1 summarizes the overlapping between economic, non-economic and family goals.

As suggested by the theory of goal systems recently applied to family business (Randolph et al., 2019), a goal system results in several peculiar configurations, or architectures, linking the various means and goals relevant to an organization together. In such a scenario, the organization should properly manage the specific interdependencies between different means and goals (business goals vs family goals), and between different temporal horizons (short-term vs long-term goals). The family business literature shows that business families, in pursuing their goals, must achieve a balance between different needs and objectives (Kaye, 1996; Labaki, 2011; Martinez-Romero and Rojo Ramírez, 2016; Olson, 2000; for a review, see Daspit et al., 2017). This topic is relevant as, while working to achieve non-economic goals (e.g. identification, intergenerational control), a healthy business family should strive to prevent negative, undesired consequences for their family goals and especially for their next generations (Scabini, 2016).

Although there is ample and articulate literature on non-economic objectives of family businesses (e.g. Chrisman et al., 2012; Martinez-Romero and Rojo Ramírez, 2016) and their impact on firm performance (e.g. Basco and Pèrez-Rodriguez, 2009; Berrone et al., 2012; Stockmans et al., 2010), this literature lacks specific analysis of the impact of non-economic goals on family goals. Research has also widely highlighted the “dark side” of family-centred non-economic goals (Poza, 2007; Ward, 1987; see McKee et al., 2014 for a review), suggesting that some negative effects are not immediately clear but emerge in successive phases of the business and family cycle (Kaye, 1996; Kets de Vries, 2007; Jennings et al., 2013). At a family level, a meta-analysis conducted by Proulx et al. (2007) demonstrated a longitudinal positive association between relational quality and personal well-being. The biggest challenge for a business family is thus to achieve and maintain a good balance between ethical and affective demands in the long-term (Fiese, 2018).

The family literature shows that families often struggle with balancing these dimensions, thus enacting dysfunctional behavioural patterns (Beavers, 1982; Davis and Herrera, 1998; Proulx et al., 2007), and such behaviours often emerge in the long run, after lurking silently for years in the background (Kaye, 1996). For example, such behavioural patterns can lead to the boycotting the legitimization and differentiation process of the next generation (Ferrari, 2019a, b; De Massis et al., 2008; Kaye, 1992; Kets de Vries, 2007; Lansberg and Astrachan, 1994), and eventually generating the so-called enmeshed family (Olson, 2000).

However, the available family business literature investigating causes and long-term consequences of firms' goal conflict is still inconclusive (Jenning et al., 2013; Zachary, 2011), and does not provide a clear explanation of the role played by the ownership (of the firm) in activating and maintaining these long-term negative relational dynamics. A longitudinal analysis therefore becomes essential in order to reveal the deep roots of dysfunctional behaviours, as suggested by the recent literature on psychological foundations of management in family firms (De Massis and Foss, 2018; Picone et al., 2021). Furthermore, although the dark side of non-economic goals is well known (Ferrari, 2020a; McKee et al., 2014), to date research has not investigated specifically the relationship between family-centred non-economic goals and family goals (ethical and affective dimensions), thus a theoretical gap should be filled, as advocated by the current literature (Williams et al., 2018).

The Italian context

The literature (Jennings et al., 2013), points out that the majority of empirical evidence on family business is related to the Anglo-Saxon world and to developing countries. In order to provide an original contribution, this case study relates to the Italian context – a developed western economy but non-Anglo-Saxon. This choice is due to some peculiarities of the Italian context, both socio-economic and psycho-educational, which make it worthy of specific attention. There is a large amount of bibliographic and statistical data (ISTAT, 2014) in support of how the family in Italy is a key factor in educational, social and economic dynamics, and accompanies young children throughout their lives, beyond not only their youth. In Italy between the ages of 18 and 34, 56.4% of daughters and 67.9% of sons still live with their parents. Mediterranean countries are characterized by the existence of strong family ties between parents and children and between siblings, which remain intense in all stages of life even after physical residential) separation from the family of origin. Thus, for example, in Italy there is a high occurrence of living proximity of next generation families with that of their origin (if/when children do move out of the family home, they often only move nearby). In addition to multi-generational cohabitation, frequent contact and exchange relationships (monetary and otherwise) are maintained between generations and continuous solidarity relationships are built over time (Livi Bacci, 2005; Saraceno, 2007; Dalla Zuanna and Micheli, 2004; Rosina and Sabbadini, 2006). The Italian context is therefore ideal and original (in its extremity) for investigating the effects of the family business overlap on the system of family relations.

Given this theoretical scenario and its limitations, the purpose of this study is hence to investigate if and how striving for non-economic goals affects family goals negatively, and could lead (recurrently) to negative psychological and relational outcomes for the next generation in particular. The research question of this study is therefore as follows:

RQ.

What are (if any) the negative long-term consequences on family goals for a business family pursuing non-economic goals?

Methodology

This paper used an inductive, longitudinal case-study based methodology (Murray, 2003). It is always very difficult to obtain reliable data about relationships in family firms, and often the elicited responses are biased, if not explicitly denied. For these reasons, this study used a qualitative protocol collecting data that would otherwise have been difficult to obtain through other means, such as questionnaires (Astrachan and Jaskiewicz, 2008; Zellweger and Astrachan, 2008). In a longitudinal case study, data is collected over an extended period in order to investigate “how certain conditions change over time” (Yin, 2003, p. 42). In-depth, holistic case studies are often carried out longitudinally to facilitate a “multifaceted treatment of change” (Pettigrew, 1990, p. 270). This approach was known and widespread at the time this study was initiated. The research group hence chose to systematically follow a group of companies to document if and how family dynamics developed year after year. Therefore, the original goal of the research was to investigate family dynamics as long as possible, at least for twenty years. More recently, this methodological option has been confirmed as the most suitable for investigating the deep roots of dysfunctional behaviours in family businesses (De Massis and Foss, 2018; Picone et al., 2021).

Selection criteria of the case-study

This qualitative research was carried out in Alfa Ltd., a small Italian family firm in the healthcare and wellness services sector, from 1998 to 2018. In 1998, Alfa Ltd was involved in an organizational development program promoted by an employers' association (“API – Associazione Piccole e Medie Industrie”) and sponsored by the European Social Fund 1992–1997. The purpose of the program was explicitly to follow the firms for a period of time over multiple years, accompanying the growth of the business. At the same time, the program had the purpose of a longitudinal data collection about relational dynamics and business transmission, in accordance with the priorities identified by the European Social Fund 1992–1997. This program was also funded additionally by subsequent Community programs.

The selection of participants was carried out with the help of the employers' association. Starting from the association's database, an exploratory mailing list was formed and a communication sent out in order to collect consensus to participate in the research. Following this, a second more specific mailing list was constructed and mail sent in order to find the firms with four specific characteristics:

1. A single family shares at least 50% of the ownership.

2. The family manages the strategic decisions.

3. At least two generations belonging to the same family are present/involved directly in the firm.

4. The company is in the early stage of the business (<2 years from its foundation)

Among the companies originally involved in the program (n = 6), the Alfa company has participated in the research the most, and for the longest and most continuous period, and therefore over all these years it has provided considerable homogeneous and comparable data, becoming the best candidate for the case study. The firm is composed of the mother-founder, Maria, currently (at time of writing this paper) 76; Gigi, father (and co-founder), 81; Giulio, son, 56; Sara, daughter, 50.

Data gathering

The research began when the firm (in its current form), started its business. The researcher met the senior(s) and/or the junior(s) on average once a month from 1998 through to 2018. Each meeting had a variable duration (one to two hours), depending on the progress of the work and the data that emerged. Interviews were recorded when possible and the researcher always took notes. These notes, (taken from different sources), have been systematically integrated into a single story. One member at a time or the whole family was involved as needed/required. The twenty-year participation allowed the researcher to observe and document the natural unfolding of events. The researcher is not a family member, and was not financially (or otherwise) rewarded directly by the firm, this allowed for an approach based on detached concern. Thanks to this approach inspired by process consultation (Schein, 1999), the trust the family members have in the researcher/consultant has grown year after year, and with this trust the quality and quantity of the data collected has also increased. The impartiality of this role obviously does not mean a completely unbiased view, but allows an external point of view, complementary to that of those directly involved. The following sections summarize the main evidence that emerged from this research.

The case study

This story begins at the beginning of the 1990s: after an experience working in a large hospital as a nurse, Maria retired early, when she was around 50 and she then worked as a freelance masseuse. Her husband, Gigi, was already retired too. The couple had a low socio-economic background (their parents were farmers), and they had two children: Giulio, the first born (at that time 22), had just become a dental technician, compelled by his mother (although she really wanted him to become a dentist). The daughter Sara, (at that time 16), was still studying accountancy at secondary school.

When Giulio returned from military service, “the problem for the family was to find him a job” as Maria said. Consequently, as a solution, the parents made a business acquisition, started up a dentist's surgery, and then began renting it to a non-family member dentist. They made an agreement that they expected their son to become the dental technician for this dentist.

A few years later, pressured by Maria, Sara tried once to enrol at university (to study dentistry) however, she did not pass the admission exam. Maria really wanted Sara to work as a dentist with her brother Giulio, a dental technician. The second time Sara pretended she was going to take the admission test, but she did not actually even attend!

In Sara's words, this was “an attempt to escape [maternal] control”. However, in the end, she compromised by taking a course to be a Physiotherapist, thus starting her collaboration with her mother's business instead in 1995.

After five years, in 2000, the mother and daughter's business prospered, which led Maria to buy new premises in order to expand. On that occasion a new company was founded, in which the father (retired) and the son (who continued his dental technician job) joined as capital partners. From that moment, the situation involved the whole family in the legal ownership of the firm: the parents and the children were all associated with the company.

The business started in its new form without difficulty, and an employee was hired to follow the administration, carrying out secretarial and front office tasks. In addition, the company hired several other non-family member employees, who carried out their work exclusively for the company. In the first four years, however, the employee turnover rate was high (over 30% annually). Among the co-workers, regardless of the job they were carrying out, no one remained for more than a few months. This was an anomalous and worrisome factor, in particular for a business in the service sector that requires continuity of care by operators, and a certain personalization of customer relations. This employee turnover rate is still high today with few exceptions, and on almost every occasion has involved resignation. Maria blames the employees systematically, complaining about the low level of reliability shown by them. While discussing the situation with the consultant Maria did not retract her position, and she was often opposed by her daughter on this issue who was more inclined to sympathize with the colleagues who had resigned.

One day in 2004, the mother was involved in an accident and she experienced complete (although temporary) physical disability. This critical event could have been an occasion for the daughter to improve her independence and responsibility. It was also the perfect occasion for her to start a legitimization and differentiation process.

Sara: “For me it was a relief, I was all alone, I got along with the others and the atmosphere was calm and positive … but of course my mother wanted to come back, she had nothing else outside of the company.”

Evaluating that episode “through the lens of the external consultant”, eventually, this unexpected event resulted in a lost opportunity. The organizational system (composed of the daughter and the other employees) chose a spoon-fed approach: every day the daughter went to her mother's bedside in order to receive instructions. After some months, the mother recovered and the situation returned to how it was before the accident. The daughter was relieved, and the business went on.

In the same period, recommended by a consultant, Sara asked for redistribution of the company shares in her favour, in order to have her contribution to corporate assets formally recognized. The recent real estate acquisitions were financed by the income from the mother and daughter's business, but legally the property was also the brother's (who was not involved in the business at all) and the father's (marginally involved in small daily activities). The opposition from the mother was very strong and the consultant was accused of undue interference, but after long negotiations (mediated by the accountant), they proceeded to recognize property rights for Sara, equal to those of her father but less than her mother's.

Maria: “In my opinion Sara was conditioned by the consultant, who knows what he put in her head, she would never have pushed so much, she had never complained about anything. After all, we divided the shares because the law required it, the important thing is that everything remains in the family. What is mine is also the children’s and my husband’s, I do not understand why we should spend money at the notary to change a situation that is only a formality and not important …”

Since it was founded, on two occasions (in 2000, and later in 2010) the firm has modified and enlarged its premises, expanding into an adjacent building. This required restructuring and considerable economic investment. The growing business and development of new services have forced the firm to expand regularly and, on these occasions, the daughter has suggested some innovations both for processes and services but without any real results.

Maria evaluated each suggestion, and seldom agreed, showing a strong resistance to change but also to Sara's autonomy. The mother, with at most the business consultant, makes all decisions. Strategy, and its implementation, is completely controlled by the mother. All relationships with the most important suppliers (mainly the bank and the physicians' staff) and clients are managed directly by the mother. For example, despite the fact that the daughter has an accountancy background, the tax strategy is handled by her mother with the help of an external consultant. One day the daughter bought a property and she arranged for a mortgage with the bank. Consequently, she developed a desire to earn more, (for example by producing much more profitable performance), in order to pay off the mortgage as soon as possible but the ongoing described mechanism made it impossible. During the consultation, the daughter showed a high level of frustration and frequently advocated for a reward system based on equity rather than equality, showing a low level of organizational justice.

In 2011, Giulio faced a business crisis. He has always been affected by psychiatric problems, such as alcohol abuse and bipolar syndrome. Immediately the mother decided that her son would join the family business too, to be able to follow and better control him too. He attended a massage course and, after a few months, entered the company. Then the family was all together.

What about the future? During the interviews, the discussion was often focussed on the business succession process: the mother is aware that it is unavoidable and succession is a matter of discussion, nevertheless there is no planning.

Findings

In the analysis of this case study, collected data was systematically coded following the rules for interpreting text suggested by Kets de Vries (2007). The first is the rule of thematic unity: Kets de Vries and Miller (1987), and Miller and Friesen (1984) have highlighted the extent to which a number of common themes underlie the structural and strategic inadequacies of failing. Second, it is necessary to be engaged in pattern matching, that is searching for structural parallels and looking for a “fit” between present day events and earlier incidents in the history of an individual or organization. In accordance with this methodological approach, the processing of raw data followed this interpretative path. First, the materials collected over the years have been classified and thoroughly analysed in the search for revealing repetitions (Geertz, 1973; Kets de Vries, 2007). Subsequently, and recursively, the researcher merged the revealing repetitions into thematic unities. This data comparison work was guided by the theoretical model, in the first instance by the categories available in the literature on non-economic goals (Berrone et al., 2012; Martinez-Romero and Rojo Ramírez, 2016). The subsequent work of interpretation highlighted the specific relationships between non-economic goals and undesired consequences at the level of the family system (emerging dysfunctional patterns). Table 1 shows a synopsis of the findings (below), and Table 2 shows the interpretative work (see discussion section below).

Revealing repetitions

Several biographical events show the mother's systematic desire to create professional relationships within the family. Ever since the children were at school, the mother has explicitly manifested a strategy aimed at creating business opportunities by activating partnerships between the children and with herself. Sometimes even school choices were forced in this direction.

Maria: “I started working early, when I was 16, straight after nursing school, and I did not have the chance to attend secondary school or university. I hoped that the situation would be different for my children … my wish was that they would go to university. Unfortunately, the eldest achieved only a Secondary School diploma/qualification, and became a dental technician … as a result I put a lot of pressure on his sister (6 years younger) in order to ensure that she became a dentist …, in that way they could have worked together! But, she failed the admission test twice, and then she became a physiotherapist, so she was able to work with me instead”.

The mother's centralized leadership style is another recursive repetition in the story. There is a complete lack of delegation regarding supplier relationship management, except on marginal aspects. Maria's prevailing attitude is therefore absolute control and micro-management and hardly any delegation at all. Maria imposes business-related educational and work choices on her children. The important school choices and career paths of the children were all forged by the mother, with the perception that it was the best solution simultaneously as a family and as an enterprise. The result is the systematic boycotting of any attempt to leave the family firm by the children/next generation, another revealing repetition.

Giulio: “After Secondary School I did not care about my future … she [the mother] wanted me to be a dentist, but I did not even think about going to university, I had already struggled to finish secondary school”

Sara: “For me, the five years studying to be an accountant was a real sufferance, so I would not have chosen to study anything at university, and definitely not medicine … medicine would have meant at least six more years of studying! On one occasion, I actually did the admission exam, but the second time I did not even go! My mother was furious …”

Mistrust of both family and non-family members is another feature that frequently emerges. The high staff turnover is a negative symptom of the relationship with non-family members.

Maria: “Employees are not aware of how favourable their situation is … they just make demands … I can understand they do not want responsibility, but to find someone that takes real care of your business just is not possible. They seem to be the best in the world, then, after a few months, they stop working. And they do not realize how much they cost the company!”

Sara: “In a certain way I understand them [resigning employees], my mother is sometimes impossible to manage, she becomes aggressive. I try to mediate but she accuses me of being weak, it would be more natural for me to avoid conflict and please employees … but I have seen that then they always take advantage, so maybe in the end she [the mother] is right”.

Furthermore, on the occasion of the work crisis faced by Giulio, they preferred to hire a person without experience or actual qualifications (being a family member) rather than hiring a trained professional who was not a member of the family.

Maria: “His [Giulio’s] work had no future, so I found him a re-qualification course to do … then he could also join the firm, the business was growing, and so it was useless to hire a stranger.”

Finally, another feature that emerges recursively is the systematic marginalization of the father. For all the years of analysis, the father participated in the interviews, but provided insignificant and repetitive contributions. He has always highlighted his role in the domestic, supportive sphere, to allow his wife to focus on the business.

Gigi, the father: “I never put pressure on my children to take a certain path … I always let them do what they liked [ …] I always liked being quiet, it was Maria who was restless, who always wanted to do more, earn more, work more … and she tried to convey this attitude to our children, I would say with little success! But the important thing for me is to live peacefully”

Sara: “With the work I do I pay the mortgage on the new centre, and others like my brother who is not even in the company finds himself co-owner of something that he did not pay for … So, they recommended a redistribution but I did not think all this uproar would happen, my mother seemed crazy, my father, as usual, did not speak, it was a fight between me and her, the males pulled out completely, even if the conversation was of interest to them too”

Thematic units (non-economic goals)

The results show how the company has pursued three differing non-economic goals. First, the business family, dominated by the mother-founder, systematically seeks to pursue control over the company. This goal was fully satisfied, but this control appears pervasive.

Sara: “I work in the company 10 hours a day, with my work I contribute to paying off debts, but my salary is established by the accountant who has tax planning as a goal … as a result my workload increases but my salary is the same, there is something wrong, it seems very unfair”

Gigi, the father: “I've always told Sara: if you need something, we'll help you, we do not lack resources. Every now and then I joke with her: “your mother works 24/7, take advantage of it!”

Furthermore: “Once, she [the daughter] wanted to change the profit distribution system, and we told her 'what do you want to go and turn the whole system upside down for, just ask!' first of all we are a family not a company”

Not only does the mother establish the strategies, but also in the daily life of the business she directly manages the most important activities, and the relationships with the stakeholders.

Sara: “it was my intention to focus more on the sports target market and football and basketball players, as we had good contacts with many sports clubs, but my mother insisted on working with insurance companies, which represented a more reliable client, and in the end the sports sector has remained underdeveloped …”

Sara: “When I go to the bank alone they’re worried, they always ask for my mum immediately … and I know that when there is a problem they call her directly.”

Second, the evidence gathered over the years shows a close identification between the founder and the company, suggesting that this non-economic objective was also satisfied. However, from the point of view of flexibility/adaptability of roles, this fact generates a repetitive and blocked system. The mother does not delegate, the daughter has obtained a technical “niche”, but feels excluded from strategic decisions. The father is marginalized, he proposes himself as a “reluctant” mediator, often in order to avoid occasional conflict between mother and daughter. The son has no initiative, and shows a systematic acquiescence to the decisions of the mother and sister.

Finally, to date, the next generation is around 50 years old or more, but in their own opinions they are not able to run the business. The intention to hand the business down to the next generation remains an explicit goal, but nothing is being done to achieve it. Hence, there is a future-orientation but, at the same time, a generational cohabitation. The relational system is characterized by rigidity in the roles (compliance with expectations) and finally has entrapped the children in the company.

Sara referred to this; “My mother is over 70, but she regularly attends training courses and develops new services and products. She admits that she feels tired, but she never relents. We often speak about her retirement, but at the moment a plan does not exist”.

Discussion

As a goal system, family firms are prone to the risk of counterfinality: a mean to pursue one goal can undermine the pursuit of another (Randolph et al., 2019). However, until now the literature has considered non-economic and family goals as a whole singular entity; distinguishing between them instead allows researchers to reveal interdependencies between goals that would otherwise remain hidden. In following this approach, this case study provides evidence that striving for non-economic goals can undermine the achievement of several family goals (see Table 2 for a synopsis of the interpretative work).

From the theoretical point of view, this case study provides further insights to complete the family-centred non-economic goals approach (Basco and Pèrez-Rodriguez, 2009; Berrone et al., 2012; Martinez-Romero and Rojo Ramírez, 2016). Indeed, previous studies (Gomez-Mejia et al., 2003; McKee et al., 2014) have already highlighted that counterfinal goals could lead to dysfunctional behavioural patterns inside firms. This study is original in focusing on undesired side effects for the entrepreneurial family itself, rather than for the family business. This additional point of view is made possible by the conceptual separation between non-economic objectives and family objectives. Thus, in order to better understand the heterogeneity of family businesses, a distinction should be made both theoretically and empirically, between economic, non-economic, and family-emotional goals.

In accordance with this distinction, findings of this case study stimulate several considerations about the long-term relationship between family-centred non-economic goals and family goals.

First, non-economic goals such as the intention to hand the business down to the next generation and the close identification between the founder and the company in the long-term could lead to negative consequences. Both can impede the detachment of the next generation and not ensure the right distance, both physical and psychological, between the family members, between the generations, or with the environment (Finley et al., 2008; Aunola and Nurmi, 2005). As a further consequence of the close identification between the founder and the company, in this case study the father has a marginal role in the family dynamics, unlike that which has been highlighted in the literature on family business (Jennings et al., 2013). As suggested by the family literature, this case study shows that the exclusion of the father from the dynamics of power in the long term can generate imbalance between affective/care needs and ethical/responsibility issues (Scabini, 1995; Yaffe, 2020), hence generating dysfunctional patterns in the next generation (Erickson, 2015; Pakaluk and Price, 2020). This study shows that the prevalence of the affective/care over the ethical/responsibility dimension in the long term can generate a so-called enmeshed family (Olson, 2000). As a consequence, several family goals are not achieved in the long term, such as intergenerational differentiation and the generative connection between affective instances (continuity, memory, care) and ethical instances in particular (material goods, order, justice) (Fiese, 2018; also see Table 2).

Second, regarding the family flexibility and adaptability, this case study describes a model of family behaviour that is blocked and repetitive, with negative repercussions on the ethical dimension of family goals. This study shows the mother's (as the founder-entrepreneur) attempt to hold together the family business's non-economic goals by taking care of family members and keeping the family together, at all costs, can generate combined negative effects on the next generation's legitimisation and differentiation. Hence, the boycotting of the next generation's identity development and autonomy is another possible long-term side effect of the close identification of the founder with the firm (Kets de Vries, 2007). These findings are therefore consistent with that shown by the most recent family literature investigating intra-family dynamics (Yaffe, 2020). This study hence highlights how the excessive cohesion due to affective/care needs' satisfaction overwhelms the ethical dimension, and play a role in fostering counterfinality in multiple goal systems. Consequently, several family goals are not achieved in the long term: the detachment from the previous generation, the flexibility of roles and the consequent ability to adapt to the environment and the intergenerational differentiation especially (Olson, 2000; Fiese, 2018).

Finally, in this case study the “availability” of a family business is a suitable means for achieving at least two further non-economic goals: the control and influence of family members on the firm and handing the business down to future generations. However, this availability fosters counterfinality and becomes an additional risk factor for problematic family members. The family business can become a comfortable, protected environment to ensure resources for “problematic” family members (e.g. Giulio, the son), thus accomplishing care needs. In addition, this protective environment can, at the same time, start to be perceived as a trap (a “golden cage”) in the long-term, due to the rigidity of the role system. Once more, in the absence of an ethical dimension provided by the father, the affective/care dimension prevails with further specific long-term consequences for the next generation (for a recent review see Fiese, 2018, and here cited literature; see also Parke, 2002, 2004; Scabini, 1995). Leibowitz (1986) observed that, for the next generation, the decision to join the family business is often understood as a successful attempt to solve long-standing family problems that may not otherwise be easily resolved. In line with this position, Kaye (1996) remarked that family businesses are more often formed by people trying to resolve a problem in their relationship with a particular relative, or to fix dysfunction in their whole family. This case study shows that, tragically, it does not work and it only perpetuates the problem and sometimes even makes it much worse.

Conclusions

This study confirms that approaching family businesses as goal systems (Randolph et al., 2019) is a suitable strategy in order to highlight the architecture of the objectives, the related strategic choices and the long-term effects. In particular, findings suggest that the different levels of affective/care and the ethical/responsibility dimensions can explain the different choices that family businesses make in pursuing family centred non-economic goals. This study therefore confirms that, from a strategic point of view, family, family business, and business have very different goals. Within a business family, ethical/responsibility and affective/care issues are often conflicting. According to the seminal research of Kaye (1992, 1996), this case study suggests that “contrary to the course of normal life-cycle development, family-owned and/or family-managed enterprises are often actually used to resisting the differentiation and development of children who join the business, and sometimes even of children who do not” (Kaye, 1996, p. 355). This research shows that in a family firm, striving for family control impedes family employees from leaving (what Gomez-Mejia et al., 2003 called the “family handcuff”) and thereby preserves conflicting relationships, resulting in an enmeshed family (Olson, 2000). Eventually, the family firm becomes a trap (a spider's web) for the members themselves, and many long-term family goals will fail.

Furthermore, the growing realization that family firms are heterogeneous (Melin and Nordqvist, 2007) means that studies should focus more on the mediators and moderators of family involvement's effects on behaviour and performance. This case study suggests that family businesses differ in the type of dynamics underlying the strategic choices regarding the non-economic and family goals they pursue (Chrisman et al., 2012). The cultural context can contribute to explaining these strategic choices, for example: the systematic prevalence of the affective/care dimension over the ethical/responsibility dimension. Italy is a typically Mediterranean country, but some characteristics (e.g. remaining in the family home well beyond the age of youth and the financial help given to children throughout their lives) contribute to making it unique (Livi Bacci, 2005; Saraceno, 2007; Dalla Zuanna and Micheli, 2004; Rosina and Sabbadini, 2006). In such a context, the strategic choices of which non-economic goals to pursue and how to pursue them can be influenced by the priority given to family cohesion and the care of family members, rather than to the development of an ethical dimension oriented towards the autonomous development of children and the prevalence of business on family needs. As already suggested by Williams et al. (2018), further research is called upon to investigate these aspects in different cultural contexts.

Main contributions and implications

To date, the family business literature has held family goals and non-economic goals under the same umbrella: in supporting the usefulness of analyzing family and non-economic goals separately, this study offers an original theoretical contribution. But at the same time this paper shows important practical and managerial implications, for family businesses, for non-family-members, for practitioners and finally for policy-makers.

For instance, research has argued that those family businesses which are able to channel family members' commitment toward accomplishing the family firms' non-economic goals will experience the greatest growth and entrepreneurship (Kellermans et al., 2012; Zahra et al., 2004; Zahra et al., 2008). However, this study shows that, in the long term, that which is perceived as a desirable goal can often transpire to be a dysfunctional pattern. In doing so, this research brings a new point of view to the literature on goal systems in family business, as advocated by the recent literature (Randolph et al., 2019; Williams et al., 2018). Furthermore, by highlighting the long-term consequences on family goals of striving for non-economic goals, this paper bridges the gap between theory and practice; this article provides a clear framework for all those (entrepreneurs, consultants) who in everyday business have to make choices related to the search for non-economic goals (e.g stakeholders management, family members career path, or non family members involvement in business decisions).

Further implications of the present paper are managerial. This study can help family business owners learn how to choose appropriate transformational leadership (Judge and Piccolo, 2004; Odumeru and Ogbonna, 2013) by delegating responsibilities to their family/non-family members without the marginalization of anyone. Interpersonal trust is an important source of reliability and flexibility for a family system (Olson, 2000; Fiese, 2018); furthermore, trust is important in the professional family business sphere as a source for the next generation's development (Ferrari, 2020b, 2021b).

In addition to its theoretical and managerial contributions, this study has further implications for practice and society. This case study can make a contribution to alerting the family business system to the long-term risk they are facing in trying to simultaneously maintain both harmony/cohesion and ethics/responsibility. Operationally, every strategic decision should be taken by evaluating the long-term consequences for the family system, and especially on the next generation. Practitioners and consultants are therefore called on to help family firm owners to adopt a strategic vision by considering possible counterfinal goals.

Moreover, this article highlights the behavioural differences that derive from the type of family/business goals structure. This may be due to the specificity of the culture shared by family members, which guides the strategic choices especially of those who have family ownership, i.e. the founder Maria. The context chosen for this research is peculiar: and consequently this article offers new elements to contribute to the debate on the heterogeneity of the family business due to cultural aspects, as requested by the existing literature (Chua et al., 2012; Melin and Nordqvist, 2007; Williams et al., 2018). This paper also brings new insights to the discussion on the influence that socio-cultural factors have on business development in the long term. In doing so, it clearly identifies some implications for society. For example, this study suggests that familism can bring immediate benefits to the company but generate dysfunctional dynamics in the long run. Policy makers and, more in general, the institutional level are thus called upon to sensitize family businesses to these long-term risks, encouraging a more impersonal management of their company.

Finally, an additional factor that clearly emerges from this research is the need for family businesses to develop different strategies. From an economic point of view, family businesses usually have a market strategy, but it is not enough to guarantee longevity for the business. From the point of view of non-economic goals they also usually have strategies linked to non-economic objectives (Chrisman et al., 2012; Gagnè et al., 2014). This study suggests that family businesses should also equip themselves with long-term family strategies, to prevent possible dysfunctional effects arising from the success of economic and non-economic strategy. For example, in relation to intergenerational cohabitation, a formal strategy regarding business transmission planning and the career paths of the next generation, as previously suggested (Ferrari, 2017, 2020a, 2021a).

As a conclusion, an important insight that emerges from this study is the need to integrate the business transmission planning with an inter-generational transmission planning. Business continuity is, without doubt, one of the most challenging non-economic goal for a family business (Berrone et al., 2010, 2012; Chua et al., 2009; Gomez-Mejia et al., 2011). This paper highlights that psychological aspects are important in relation to long-term success as a business and as a family. As a practical consequence business consultants should integrate their knowledge with psychological skills; and employers associations should offer psychological support services to their members, in order to prevent dysfunctional dynamics in the long term.

Limitations and suggestions for future research

Beyond these results, this paper also has several limitations, which call for further development. The main limitation is that this single case study obviously does not allow for complete generalization of the findings. Further research should investigate the issues this paper has highlighted from a quantitative point of view.

There is growing evidence that family businesses are complex and diverse (Melin and Nordqvist, 2007; Westhead and Howorth, 2007) so a risk of this research could be to shift a prototype into a stereotype. The aim of this paper is however not for generalization but instead to offer an explanation for dysfunctional dynamics. Future research will need to apply longitudinal protocols to other companies in order to uncover any differences in goal systems.

Moreover, the results of this research may be due to pre-existing personality characteristics (dispositional causes) in the founder rather than situational causes (i.e. the actual carried out/defined role). Future research is called for to better clarify this element, as also suggested by a recent review (see Campopiano et al., 2017).

Finally, this research has explicitly focused on intra-family dynamics, leaving the role played by non-family members in the background: this literature gap should be addressed by future research.

Figures

Figure 1

Goal systems in a family firm

Table 1

Synoptical representation of the main findings

Revealing repetitions emerging from case study	Thematic unities (achieved non-economic goals)	Emerging dysfunctional long-term pattern
Desire to create professional relationships within the family Mother's centralized leadership style Father's marginalization Imposing business-related educational and work choices on children Systematic boycott of any attempt to leave the family firm	The control and influence of family members on the firm The close identification of the founder with the firm Intention of handing the business down to future generations	Striving for the control and influence of family members undermines the ability to adapt to change The system of family and business roles is rigid, without reciprocity The close identification of the family with the firm has generated abnormal (i.e. too high) levels of Harmony/Cohesion, thus resulting in an enmeshed family The intention of handing the business down to future generations caused rigidity in the roles (compliance with expectations) and entrapped the children in the company

Table 2

Interpretative work – identifying counterfinal goals