Differentiating value orientations and unity in values as predictors of varying family business system processes

This study evaluates a human ecology conceptual framework for family businesses where the value orientations within the family business system are considered a distinct construct from unity in values. This study uses the 2007 American Family Business Survey to differentiate values from unity. Findings from this study support this human ecology differentiation and results include a lack of relationship between unity and values, and the disproportionate role of unity in the creation and maintenance of formal processes, whereas values, and specifically “family-first” businesses tend to preference the creation of family councils. Implications include relevance for future investigative studies focused on the role of family involvement, and practical implication for the creation and maintenance of formal processes such as family councils.

► We develop a conceptual framework proposing that value orientations and unity in values are separate and distinct constructs. ► We test our model using a sample of 650 family businesses drawn from the 2007 American Family Business Survey. ► Unity in values and family-first values are related with higher levels of formalization. ► Unity in values and family-first values increase the frequency of family councils among the sample firms.