SAES-422 Multistate Research Activity Accomplishments Report

Status: Approved

Basic Information

Participants

*Sharon Danes, University of Minnesota<br> *Margaret Fitzgerald, North Dakota State University<br> Grace Fong, University of Hawaii at Manoa<br> Karen Goebel, University of Wisconsin<br> *George Haynes, Montana State University<br> *Ramona Heck, Baruch College<br> *Cynthia Jasper, University of Wisconsin<br> *Yoon Lee, Utah State University<br> *Diane Masuo, University of Hawaii at Manoa<br> *Glenn Muske, Oklahoma State University<br> *Linda Niehm, Iowa State University<br> Kay Obendorf, Cornell University, Administrative Advisor<br> Alma Owen, Guest<br> Edward Rogoff, Baruch College<br> *Holly Schrank, The Purdue University<br> Myung SooLee, Baruch College<br> *Kathryn Stafford, The Ohio State University<br> Jane Swinney, Oklahoma State University<br> John Yanagida, University of Hawaii at Manoa<br><br> * State Project Leader. Others are additional researchers.

Present: Margaret Fitzgerald, North Dakota; Diane Masuo, Hawaii; Sharon Danes, Minnesota; Helen Pushkarskaya, Kentucky; Cindy Jasper, Wisconsin: Maria Marshall, Indiana; Jane Swinney, Oklahoma; George Haynes, Montana; Kay Stafford, Ohio; Holly Schrank, Indiana; Yoon Lee, Utah; Linda Niehm, Iowa; Kay Obendorf, Administrative Advisor.

Unable to attend: Ramona Heck, Baruch; Glenn Muske, Oklahoma; Jane Schuhardt, CSREES.

Diane Masuo and Margaret Fitzgerald served as co-chairs. Holly Schrank served as recording secretary.

Administrative Advisor report: The reviews of the Multi-state Project Research Committee are on NIMSS. The new number is NC-1030. There are two more steps to final approval with Daryl Lund reporting to the NC Directors at their summer meeting and then forwarded to CSREES. Then each station will have to prepare forms for participation (CRIS forms AD 416 and 417) to establish the project locally. Kay Obendorf anticipates multi-state approval would be effective October 1, 2006. Local approval is up to each of us in our states

Administrative Advisor for new project. The NC Multi-state committee assigns the administrative advisor. Kay Obendorf is temporarily assigned, but another advisor assignment from the NC region will be made at a later date.

Termination of NE-167. The annual report, which documents the completion of all objectives, will serve as the project termination report. It communicates project research achievements, results, outcomes, impacts, and benefits to stakeholders over the lifetime of the project. The final report is due 60 days after this meeting.

State termination reports. We will also have to do individual state termination reports after the project ends, and those reports must then be accumulated.

Voting protocol: Diane clarified voting protocol, which is that only current members can vote on NE167 matters, while matters relating to NC 1030 will include the new members. There is one vote per state. New members should also consult the group's governance rules for other rules and guidelines. These are located on the website at www.human.cornell.edu/NE167.

Our funds. Our account account balance is $5500. We just received $1,000 for use of our data by PSID, University of Michigan. The remaining funds are left over from the shared data collection fund. Some was spent for data set preparation by CISER, and on a statistical consultant. The funds are in a Cornell account that has no overhead or administrative fees. We need to to spend the funds or move them to another location. Margaret will investigate the relocation of the funds to North Dakota.

Website, public versus private: Kay Stafford raised a question about our two web-sites, one on Cornell server (private) and the other at Ohio State (public). At present, a list of publications , are on both websites. Committee business is only on the Cornell website. We need to identify a webmaster and migrate information on the Cornell site to a new location (e.g., administrative advisor or executive committee members' university) and maintain only 1 site. Ideally, links to online journal articles should be public, but we should consider password protection for our declarations and other private materials we may wish to post.

Elgar chapter update. It is currently in press. The citation format is: Poutziouris, P.Z., Smyrnius, K. X. and Klein, S. (Eds.) (2006, in press). Handbook of Research on Family Business. United Kingdom: Edward Elgar Publishing, 600 pp. (Each contributor will receive a copy.)

New Business

Election of Officers for proposed NC-1030, effective October 1, 2006 for period noted.
Nominations were made for the executive committee for NC-1030 and voted upon.
The members elected unanimously were:
Chairman: Margaret Fitzgerald, North Dakota (1 year)
Secretary: Yoon Lee, Utah (2 years)
Member at large: Linda Niehm, Iowa (1 year)
Current officers will continue through the end of NE-167 and be responsible for completing the termination annual report.

State Reports. Diane circulated a compiled list of state reports to be checked for completeness. Diane has already been asked to write the final impact statement. We reviewed our current declarations and discussed work in progress.

Preparing the NE 167 Final Report. We identified accomplishments and impacts to be included in the final report.

Farewell. Gifts and messages of appreciation were conveyed to Kay Obendorf for her outstanding commitment and service as administrative advisor for NE-167.

New project

NRI and NSF submitted grant proposals. Both proposals are based at MN with sub-contracts to OSU and MSU. The NRI budget is about $500,000. NSF is approximately $300,000, with Iowa State University's (ISU) data collection targeted at $100,000. Overhead for NRI is 25% from all three schools; subcontracts are double charged. ISU would do 15 minute interviews with $20 incentives for respondents. Some hourly and GA help is identified for data preparation and cleaning. NRI requires travel by the PI to DC annually and travel to ISU to supervise pilot testing of interviews.

Governance issues. We discussed the need for a declarations process for grant proposals. This would involve a notification system similar to declarations, including collaborator response, maintenance of up-to-date collaborator forms, conflict of interest forms, and human subjects approval for each participating institution. All of this would be posted on our website. Perhaps each project leader needs to have a letter on file in their sponsored programs office for sub-contracting with other NC-1030 institutions. Funding options. We discussed options for funding data collection for NC 1030. No decisions were made, but the following are some options
1) NRI and NSF grant applications - 2 proposals were submitted.
2) A different NSF proposal -- in process at Purdue.
3) Use existing Family and Business data from 1997 NFBS and 2000 panel data together with 97, 98 SHELDUS disaster data (or other public data), and conduct re-interview in 2007 with our $5,500 project balance.
4) Collect funds by station.
5) Combination of the above options.

Miscellaneous. Greetings from Jan McCullogh, Dept. Chair of Family Social Science, and Marilyn DeLong, Associate Dean for Research, College of Human Ecology, and soon to be the Associate Dean for Research and Outreach, College of Design. We received an update on the transition for various CHE departments into other colleges.

Homework. A list of homework assignments, with due dates, was generated.

Next meeting. University of Minnesota, October, 8-10 2006 (Columbus Day weekend)
Sunday: Noon to 5, evening meal together
Monday, 8 to 5, working evening small group meetings
Tuesday, 8 to 12, depart afternoon.

Accomplishments

Accomplishments can be grouped into three categories: 1) specific data collection and analysis, 2) the development and testing of a conceptual framework and the influence of this work on the overall literature on family firms, and 3) the presentation of findings and implications through publications and presentations.

1. Accomplishments in the areas of data collection and analyses include the following:
  • In 1997, the NE-167 Family Business Research Group (FBRG) collected nationally representative data on family firms. This kind of data was previously nonexistent.
  • FBRG then developed the first panel data set on family firms through reinterviews in 2000. This longitudinal data has enabled researchers to identify for the first time, changes that family firms experience over time, which in turn increases understanding of the dynamics of business demise and manager departure.
  • While sample attrition between 1997 and 2000 affected the representativeness of the sample, this effect can be corrected by including measure of stability, such as age of the business manager and marital status.
  • Success of the family firm, measured both objectively and subjectively, is a function of continuity. Continuity, in turn, is affected by the age of the business manager and marital status.
  • Longitudinal data has increased support for the notion that business closure is not synonymous with failure. Some closures may be the result of failure, but others should be viewed as ordinary business or family developments, such as retirement, a health-related change, or a desire to do something different. Successful businesses are sold or gifted when the owner-manager leaves the business.
  • A socio-economic vulnerability scale (SEV) which incorporates the effects on business success of the external environment in which the firm operates, was developed. This scale consists of 18 measures of a county's social and economic vulnerability.

2. Accomplishments in the development and testing of a theoretical framework include the following:
  • The NE-167 FBRG has developed and tested a theoretical framework, the Sustainable Family Business (SFB) Model which illustrates the interface between the family and the business. The model has been used extensively and has been expanded to include the community.
  • Once the exclusive domain of business schools, the study of family business has expanded because of the interdisciplinary nature of NE-167 research team.

3. Additional accomplishments resulting from the publication and presentation of findings and implications include the following:
  • The marital relationship of family business-owing couples is affected by business tensions and spousal involvement in decision making in the business.
  • Decreased tensions by both spouses are observed when the husband prioritizes family over business, when the family system is marked by a high level of functional integrity, and when the wife is satisfied with her role in the business.
  • Family business owners with a succession plan tend to be older, work longer hours in the business, have fewer children, and have higher business management scores than those without a succession plan.

Impacts

  1. Conclusions that impact families, their businesses, their communities and their support networks include the following: <ul> <li>When family and business are managed by different individuals in a household, tensions arise between family members regarding these roles and the use of household and business resources. <li>Tensions in the family business can be reduced by encouraging increased commitment to the family on the part of the business manager, increased satisfaction by the household manager in her role in the business, and strengthening the functional integrity of the family. </ul>
  2. Implications of the findings that can lead to success for business-owning families include: <ul> <li>There are risks to using family funds to operate a family business. Those risks can be reduced by using fewer owner resources and utilizing financial bootstrapping strategies used by non-family owned businesses to run the firm. <li>Only about one-half of new business start-ups will survive after five years. For family businesses, the survival rate can be increased when manager-owners are male and older, and they perceive their businesses as being successful, and when the business is home-based. </ul>
  3. The direct use of findings in educational programming include: <ul> <li>Research instruments and findings have been translated into tools that family firms can use to assess the well being of families and their businesses, as well as the interactions thereof. <li>These tools have been used in 10 states and with approximately 530 university students in family business courses and 50 businesses by extension educators, consultants, academicians, and business-owning family members to generate discussion of issues, solutions and planning that will shape the future of the family business. </ul>

Publications

Objective 1: Interaction family & business in vulnerable & non-vulnerable communities

Amarapurkar, S.S., & Danes, S.M. (2005). Farm business-owning couples: Interrelationships among business tensions, relationship conflict quality, and satisfaction with spouse. Journal of Family and Economic Issues, 26(3), 419-441.

Danes, S.M. (in press). Tensions within Family Business-owning Couples Over Time. Stress, Trauma & Crisis. Danes, S.M., & Haberman, H. R. (2005). Gendered discourse about family business. Family Relations, 54,116-130.

Danes, S.M., & Morgan, E.A. (2004). Family business-owning couples: An EFT view into their unique conflict culture. Contemporary Family Therapy, 26(3), 241-260.

Danes, S.M., & Lee, Y.G. (2004). Tensions generated by business issues in farm business-owning couples. Family Relations, 53, 357-366.

Haynes, G. W., & Muske, G. (2004). Business and family income: Resource intermingling and financial success. In R. K. Z. Heck, A. N. Puryear, & P. A Tombline, (Eds). A Toolkit for Home-based Entrepreneurs (pp. 78-90). NY: Baruch College Lawrence N. Field Center for Entrepreneurship and Small Business.

Heck, R. K. Z, Danes, S. M., Fitzgerald, M.A., Haynes, G. W., Jasper, C. W., Schrank, H., and Stafford, K. Role of Family in Family Business Entrepreneurship. In Poutziouris, P.Z., Smyrnius, K.X. and Klein, S. (Eds.) (2006, in press). Part B - Conceptual Frameworks and Theoretical Issues, Family Business Research Handbook. London: Edward Elgar Publishing Company.

Heck, R. K. Z., Danes, S. M., Fitzgerald, M. A., Haynes, G. W., Jasper, C. R., Schrank, H. L., Stafford, K., & Winter, M. The family's dynamic role within family business entrepreneurship. In Poutziouris, P.Z., Smyrnius, K.X. and Klein, S. (Eds.) (2006, in press). Family Business Research Handbook. London: Edward Elgar Publishing Company.

Hsu, P., Masuo, D., Fong, G., and Yanagida, J. (2006, April). Characteristics of home-based family businesses: A comparison between Hawaii and the United States. Poster presented at the Hawaii Association for Family and Consumer Sciences meeting, Honolulu, Hawaii.

Jasper, C.R., Goebel, K.P., & Lee, Y. (2003). Business issues: Identification & retirement planning/ strategies succession. In R.K.Z. Heck, A.N. Puryear, & P.A. Tombline, (Eds.). A Toolkit for Home-Based Entrepreneurs (pp. 140-151). NY, NY: Baruch College, Lawrence N. Field Center of Entrepreneurship and Small Business.

Lee, Y.G. Danes, S.M., & Shelley, M. C. II. (in press). Work roles, management and perceived well-being for married women within family businesses. Journal of Family and Economic Issues.

Lee, Y.G., Jasper, C.R., & Goebel, K. (2003). A profile of succession planning among family business owners. Journal of Financial Counseling and Planning. 14, (2), 1-12.

McCann, G., Hammond, C., Keyt, A. Schrank, H., & Fujiuchi, K. (2004). A view from afar: Rethinking the director's role in university-based family business programs. Family Business Review, 17(3), 203-217.

Muske, G. & Fitzgerald, M. A. (in press). A panel study of copreneurs in business: Who enters, continues and exits? Family Business Review. Niehm, L.S. & Miller, N.J. (2006, in press). Entrepreneurship and the impact of managerial role on family business success. Journal of Marketing and Entrepreneurship, 7(2).

Niehm, L.S. & Miller, N.J. (2006). The impact of managerial role on family business success: A longitudinal perspective. In Proceedings of the USASBE (United State Association for Small Business and Entrepreneurship) Annual Meeting, Tucson, AZ.

Paul, J., Winter, M., Miller, N. J., & Fitzgerald, M. A. (2003). Cross-institutional norms for timing and sequencing and use of adjustment strategies in families affiliated with family-owned business. Marriage and Family Review, 35, 167-191.

Philbrick, C. A. & Fitzgerald, M. A. Women in business-owning families: A comparison of roles, responsibilities and predictors of family functionality. Manuscript under review.

Winter, M., Danes, S.M., Koh, S., Fredericks, K., & Paul, J. (2004). Tracking family businesses and their owners over time: Panel attrition, manager departure, and business demise. Journal of Business Venturing, 19, 535-559.

Yilmazer, T. & Schrank, H. (in press). Financial intermingling in small family businesses. Journal of Business Venturing.

Zody, Z., Sprenkle, MacDermid & Schrank. (in press). Drawing the line: Do boundaries affect the functioning performance of the family and business systems? Journal of Family Economic Issues.

Objective 2: Effects of community structure & characteristics on families and businesses

Fitzgerald, M. A., Muske, G., & Philbrick, C. (2004). Business satisfactions: Relationships in the work environment. In R. K. Z. Heck, A. N. Puryear, & P. A Tombline, (Eds). A Toolkit for Home-based Entrepreneurs (pp. 101-112). NY: Baruch College Lawrence N. Field Center for Entrepreneurship and Small Business.

Haynes, G.W. & Ou, C. (2005, January). Finance companies and small business borrowers. United States Association of Small Business and Entrepreneurship/SBIDA Conference, Indian Wells, CA.

Haynes, G. W., & Muske, G. (2004). Business and family income: Resource intermingling and financial success. In R. K. Z. Heck, A. N. Puryear, & P. A Tombline, (Eds). A Toolkit for Home-based Entrepreneurs (pp. 78-90). NY: Baruch College Lawrence N. Field Center for Entrepreneurship and Small Business.

Muske, G., Fitzgerald, M. A., & Kollmorgen, N. (2004). How business management practices affect business success and the family. In R. K. Z. Heck, A. N. Puryear, & P. A Tombline, (Eds). A Toolkit for Home-based Entrepreneurs (pp. 125-135). NY: Baruch College Lawrence N. Field Center for Entrepreneurship and Small Business.

Ou, C. & Haynes, G.W. (in press). Uses of equity capital by small firms, findings from the NSSBF. Small Business Economics.

Objectives 1 & 2:

Danes, S.M., & Lee, Y.G. (2004). Tensions generated by business issues in farm business-owning couples. Family Relations, 53, 357-366.

Haynes, G., Muske, G., Fitzgerald, M., Fong, G., & Douglas, S. (2004). Developing a county-level socio-economic scale. 2004 Community Development Society Proceedings.

Haynes, G., Muske, G., & Fitzgerald, M. A. (July, 2004). Developing a socio-economic scale. Community Development Society Conference, Cleveland, OH.

Lee, Y.G., Jasper, C.R., & Goebel, K. (2003). A Profile of Succession Planning: Among Family Business Owners. Journal of Financial Counseling and Planning, 14, (2), 1-12.

Objective 3: Economic & social contributions of family businesses to communities over time

Danes, S.M., Loy, J. T., & Stafford, K. (2006, April). Family business success: Differences in female- and male-owned businesses. Manuscript accepted for presentation at the Family Enterprise Research Conference in Niagra Falls, Canada.

Fitzgerald, M.A., Haynes, G.W., Schrank, H., & Danes, S.M. (2005, September). For-profit family businesses as socially responsible organizations: Evidence from the U. S. National Family Business Survey. Proceedings of the International Family Enterprise Association/Family Business Network Research Meeting (on CD), Brussels, Belgium, 1-19.

Haynes, G.W. & Onochie, J.O. (2005, January). Is what's good for the business, good for the family: A financial assessment. In Exploring the family-business intersection with panel data: Past, present and future. United States Association of Small Business and Entrepreneurship/ SBIDA Conference, Indian Wells, CA.

Haynes, G.W. & Ou, C. (2006, January). How did households owning small businesses fare during the largest ever peacetime expansion in the U.S. economy. United States Association of Small Business and Entrepreneurship/SBIDA Conference, Tucson, AZ.

Niehm, L.S., Swinney, J., & Miller, N.J. (requested to revise and resubmit). The impact of socially responsible business strategies on family business success. Journal of Small Business Management.
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