What is a family firm? Academics have been trying to define this type of company for more than 40 years. Jess Chua and colleagues (1999) proposed a definition that would summarize the definitions that previous scholars had proposed stating that “the family business is a business governed and/or managed with the intention to shape and pursue the vision of the business held by a dominant coalition controlled by members of the same family or a small number of families in a manner that is potentially sustainable across generations of the family or families” (p. 25).
Family firms are a way to be entrepreneurial. Like all firms, it starts with a founder, and mostly this founder will raise capital from friends and family members. Family members may join at any given time, and after some time, they pass the leadership to the next generation. So, it is the job of the next generation to be entrepreneurial to keep the family firm growing. Making connections with other family firms, with brilliant students, and with people that dedicate their careers to helping such firms can be a way to make sure that the family firm is successful and passed on to the next generation.
The Schlesinger Global Family Enterprise Case Competition (SG-FECC) can be an excellent way to make such connections.
The University of Vermont has been organizing the SG-FECC for ten years. The 2023 edition took place during the second week of January. It is an event that has been attended by 800 competitors from 67 universities, 219 student-led teams representing 26 countries around the world, and 558 family firm expert judges. The competition is filled with camaraderie, creativity, insight and profound knowledge revolving around family business management. In the words of some attendees, it is the world cup of family firm scholarship, where the best universities with a family business program battle for that year’s cup.
This year’s competitors comprised 11 teams in the undergraduate league from Canada, Colombia, Ireland, Mexico, Netherlands and the United States. The graduate league consisted of teams from Canada, Germany, Guatemala, India, Spain, Sweden, Thailand and the United States. This year’s winners came from Canada, Wilfrid Laurier University for the undergrad league and the University of Manitoba for the graduate league.
The competition asked the teams to resolve four real-life cases that were selected by an independent committee whose members are family business educators and advisors. The teams had one week to resolve the first case and only four hours to resolve the other three, before delivering their presentations to a judging panel. This year I had the pleasure of representing DePaul University on the panel, which comprised of family firm leaders, consultants, advisors and scholars.
What makes family firms so important to study? EY and the University of St. Gallen have published a study on the economic importance of family firms worldwide. They have ranked the 500 largest family firms, and the numbers are impressive. These 500 companies are growing twice the rate of advanced economies, collectively generating $8.02 trillion in revenue and employing 24.5 million people around the globe. If that is what the 500 largest family firms worldwide can do, then we can only imagine what the rest of these firms would be able to do.
Contributor Bio
Luis Jimenez-Castillo is a Clinical Professor of Entrepreneurship at the Driehaus College of Business, where he teaches entrepreneurship and management courses. His expertise in family firms stems from experience as he comes from an entrepreneurial family that owns and manages a firm in Guadalajara, Mexico. He also has studied family firms in his doctoral dissertation, published business cases, and book chapters on different topics that affect these firms. Jimenez-Castillo is a board member of his family firm, which his father founded.