Pierre de Maret is Professor of Social Anthropology at the University of Brussels and has been Rector of the University since October 2000. He has been engaged in extensive fieldwork in Africa for over 30 years and is a consultant for major international institutions.
Family is important not only in the formation of entrepreneurial spirit, but also in the continuity and change of family business
I am not a businessman, a banker, a head hunter, nor a consultant. Rather, I am an anthropologist. And as a professional "outsider", I have the advantage (and disadvantage) of being able to take a step back and have an outsider's view on family business.
As an anthropologist, I pay special attention to the culture of different groups, particularly the various aspects of "kinship" – the study of all kinds of family relationships. Kinship studies are essential if one wishes to understand most of the activities of traditional societies, be it food production, settlement patterns, political organisations or rituals.
There is little doubt anyone would refute the idea that family is important. In many societies, all members of the community are connected by blood or marriage with one another; in some places, a person is either your relative or your enemy. Such systems have probably prevailed through most of time.
However, travelling extensively through Africa for three decades, I have often wondered why some cultures, some ethnic groups are more dynamic, more adaptable and produce more entrepreneurs than others. In many countries one ethnic group has emerged as the "wheeler-dealer", the entrepreneurs, such as the Ibo in Nigeria, the Luba Kasai in Congo, the Fang in Gabon or the Bamileke in Cameroon.
Entrepreneurship, in the classic sense, is the combining of resources in a novel way so as to create something of value. Much of the recent management literature on entrepreneurship focuses on business founding, and the dimensions of innovation and risk are particularly salient in this respect. So, what does it take to produce this very special being, the entrepreneur?
After analysing the personalities of very successful entrepreneurs some years ago, Fortune magazine concluded that, "[E]ntrepreneurs who have what it takes to succeed, are not concerned with risk or with getting rich, but behave as if they were possessed by a vision or the chance to seize an opportunity and driven by that only."
Among the three drivers of human behaviour beyond the primary needs – power, relationship and desire to accomplish – entrepreneurs are driven most by the last need. They want to create something significant and tangible: a building, a bridge, a company. This need, which manifests itself early in life, is nourished by a large ego and by the capacity to adapt to new situations. Those who consider uncertainty as an adventure rather than a threat to their comfortable lifestyle are most likely to become entrepreneurs. Driven by a vision, an extraordinary internal force and the need to be recognised through their accomplishments, they also have a remarkable ability to adapt to change.
That being said, it is, however, difficult to pinpoint exactly what moves an individual to undertake large or small initiatives. Is it the individual, his genetic heritage, his personality? What is the role of his upbringing, his education and the society in which he lives?
Cultural patterns and values
Looking at recent issues of the major journals in the field of anthropology, the role of cultural patterns and values on entrepreneurship has been a topic of interest. Different authors have focused their research on identifying values that could be specifically associated with entrepreneurial behaviour.
This is, of course, directly linked to Max Weber's seminal book, "The Protestant Ethic and the Spirit of Capitalism" (1904), which points out a direct causal relationship between a person's values and his entrepreneurial behaviour. Since then, Weber's ideas have been modified somewhat to highlight not so much the role of religious beliefs, but rather the role of one's family.
Indeed, family is by far the most fundamental and reliable social structure for transmitting cultural values and practices across the generations. In families, values and practices are closely interconnected and they are transmitted in childhood.
At the macro level of the world, this has been brilliantly demonstrated by Emmanuel Todd in the early 80s: Todd correlated the diversity of old family structures with the various ideological systems around the world. The ideological sphere is the intellectual result of the family structure, and also of the basic values that organise the relationship between individuals: liberty or authority, equality or inequality, exogamy or endogamy.
Todd distinguished between four major family types in Europe:
- The absolute nuclear family;
- The egalitarian nuclear family;
- The authoritarian family; and
- The communitarian exogamous family.
The two family types that are most closely associated with entrepreneurship are the absolute nuclear family (the Anglo-Saxon model) and the authoritarian family. Both succession systems foster individuality and thus entrepreneurship.
If one combines, as Todd did, the level of parental authority with the role of women, their authority on children, their access to education and their status, one can draw world maps that match very closely cultural and economic developments. As development results from entrepreneurship, there is little doubt that the various factors highlighted by Todd are directly related to fostering entrepreneurial spirit.
When one sees the resilience over centuries and generations of the underlying family structure, ideology and values, and their impact on large scale policies and social structures, it is clear that at the family business level, they are a major factor in shaping the organisational structure and its capacity to change or to resist change.
The dominance of the founder, together with the fact that family members tend to stay long in leading positions, increases further the strength of the family business culture. One would also expect that if the founder's values system reflects this family background, then the way the ownership is organised, the business is operated and the family values are established mirror one another.
Thus, the well-known "three circles model of family enterprise systems" is likely to be interlocking much more than previously thought, from an anthropological point of view. As with the family sphere, over time the business sphere tends to separate gradually and a distinct ownership sphere emerges; the remaining common denominator may well be the underlying values and structures inherited from the founder's family of origin.
Succession and inheritance
While family values and structures help to create the entrepreneurial spirit and establish a business, it is during successions and the continuation of the business that the family characteristics are even more telling. Thus, it is no surprise that the typology of major family systems is based primarily on inheritance patterns.
Motivation in selecting heirs is influenced by material constraints or opportunities, mainly the amount of wealth owned, and by cultural rules defining who should get what and when. Testators seek to consolidate familial wealth by taking into account both their material surroundings and the number of eligible heirs. As a result, their decisions are inspired by the principle of rationality and by the need to conform to their culture and to do things "the right way". They want to follow the catalogue of prescriptions and proscriptions that they have experienced in their own family to regulate the selection of heirs as well as the form, amount and timing of bequests. This principle of legitimacy is crucial. Not following it will often create major problems, especially in family business.
The principles of rationality and legitimacy operate jointly, but their mix takes various forms. In many cultures, parents mobilise resources selectively for the establishment of their children, often according to gender and birth order. This is, of course, strongly culturally rooted, but it is also connected with the quest for efficiency. Culturally, sons are favoured almost everywhere, but also, in order to achieve the efficiency of an income-producing estate, many farmers favour sons over daughters (rightly or wrongly!).
Likewise, wealthy individuals are said to favour their sons because they are thought to be more likely to marry than their sisters (another mis-judgment!), have children and carry forward the family identity.
In my view, this is a typical pseudo-rational example based more on old cultural stereotypes than on true efficiency. Recent studies show that in family businesses, the choice of a daughter may be preferable. The relationship between a father and a daughter tends to be less competitive and more professional than between father and son.
But heirship is also very much a recognition of reciprocity, where logic of gifts plays a prominent role in contrast to the rational economic logic. We are back to the traditional society's logic where one is supposed to preserve and transmit unchanged, to the next generation, what has been received from the previous one. Hence the idea that grandchildren are more or less the reincarnation of their grandparents; that is why in Europe one still often gives a grandparent's first name to a grandchild. The first and major event in establishing an inter-generational link is a gift – the gift of life. And in English, like in many languages, the choice of words is very significant: giving birth. This initial gift is vital, but may be more or less well-received by its beneficiary. After all, the gift of life is not always followed by the gift of love.
Family remains a place where the various aspects of social, economic and emotional contradictions are expressed and experienced. Focusing on that crucial aspect of family is essential not only in the formation of business and entrepreneurial spirit, but also in the continuity and change in family business. When the boss is the descendent of the founder of the company, his legitimacy is reinforced as in any dynasty, and this strongly helps the employees to relate to the values and aspirations of the company. In fostering loyalty and commitment, pay is not everything – shared dreams, vision, emotion and relationship all play a key role.
In that respect, I strongly believe that family business has played and will play a crucial role in shaping the future, especially in the face of recent upheavals and the impact of uncertainty and globalisation. I see no other type of organisation that is better placed to articulate our original need to connect our social structure, our values and our behaviour with the need to adapt. This has been the driving force of humanity since its origin.
From an anthropological perspective, family business is ideally placed to link the past with the future and social values with economic ones. And especially in this period of uncertainty, families do indeed matter.