Family business growth
A hostile business environment holds back entrepreneurial businesses.
Family businesses in NZ employ more than 50-70% of the NZ workforce, considered the engine room of the NZ economy. Many of today's large companies started out as small family businesses, but most are small with fewer than 20 employees if any. Many family business owners have non-financial goals as well as wanting to make a profit.
Olufemi Omisakin at our Auckland International Campus and collaborator Nurudeen Adegoke at Massey University examined the relationship between entrepreneurial orientation and business growth in New Zealand family businesses, taking into account possible environmental effects on this relationship. They included the following dimensions to make up entrepreneurial orientation: proactiveness, risk-taking and innovativeness. This research adopted a quantitative method, collecting data from 117 Auckland family businesses in a questionnaire.
Analysis of this data showed that proactiveness, risk-taking and innovativeness were a strong predictor of family business growth performance, but only when the business environment was not hostile to growth. This suggests that family businesses in dynamic environments need to take more calculated risks, be more proactive and be more innovative, however the key decision-making factor needs to be identifying and utilising the best available opportunities.
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