Family In Family Out: Social Capital Entrepreneurs...
Transcript of Family In Family Out: Social Capital Entrepreneurs...
Proceedings of the Fourth Asia-Pacific Conference on Global Business, Economics, Finance
and Social Sciences (AP15Malaysia Conference) ISBN - 978-1-63415-762-9
Kuala Lumpur, Malaysia, 7-9 August, 2015 Paper ID: KL569
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Family In – Family Out: Social Capital Entrepreneurs Perspective
Hernani D. Manalo,
Faculty of Business,
Abu Dhabi Men‘s College, UAE.
Ma. Riza T. Manalo,
Graduate School Faculty,
University of Negros Occidental-Recoletos, Philippines.
__________________________________________________________________________
Abstract This qualitative exploratory study focuses on how Family In and Family Out concept worked
as a social capital entrepreneur’s perspective. Chosen by purposive sampling, 26 Emirati
Entrepreneurs, 3 of whom are females and 23 males, aging 21 to 75, and all having
enterprises in Abu Dhabi, were interviewed using a validated open-ended questionnaire. The
records of interview were encoded and interpreted using mode and percentages, and rank
analysis was applied. Findings revealed that dream or ambition, influence, adventure, and
jobs have greatly influenced families to become entrepreneurs. Moreover, independence,
technical skills, jobs, trust or conflict issues, and home priority were the reasons for the
practice of Family Out concept. In addition, the natural desire to help, voluntarism, business
skills, and family responsibility were the reasons for practicing the Family In concept.
Entrepreneur’s age, gender, business status, and the type of business organization affect their
choice of enterprise concept. The social capital contributions of Family In entrepreneurs
include sales, networking, planning, administration, technical skills, and procurement and
management of funds. Family Out entrepreneurs hire qualified and competent staff, build
social network of people, and adopt other approaches like excellent services, advertising,
quality products, and competitive pricing. Findings also show that these entrepreneurs were
very satisfied in meeting their business goals. The study is expected to help enrich the
literature in entrepreneurship in the United Arab Emirates.
Key words: Social Capital Perspective, Family In, Family Out, Emirati Entrepreneurs
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1. Introduction
Are families -owned and managed firms more rationally and effectively managed by their
owners than other businesses? In some cases, blood and business seem incompatible. Such
problem has been indicated in family-owned businesses in the Western world. For instance,
the animosity between brothers, Adolf and Rudolph Dassler of Addidas resulted in the
creation of Puma brand, a brainwork of Rudolph. The Gucci family scandal has headlined
various tabloids. Lately, the famous celebrity Chef Gordon Ramsay fired his own father-in-
law from their family business. Stories of aggression among family have caused business
disintegration and even inevitable conflict and torment among families.
Fortunately, not all family-owned businesses are characterized by conflicts. Many of
them have existed harmoniously and have established family pride. In fact, experts argue that
family‘s participation in business is crucial to its existence and growth. The long-term
orientation, loyalty, and strong commitment to quality are related to the soundness of the
family name, and care and concern for employees who are often likened to an extended
family‖ (Kleiman and Peacock, 1996). ―More than 90 percent of the companies in North
America and a majority of businesses located around the world are family-owned. Some of
the more recognizable businesses managed by family members include Benneton, Beretta,
Estee Lauder Inc., Tootsie Roll, Gucci, Carnival Cruise Lines, Harley-Davidson, Inc., U-
Haul, Ford Models, Forbes Inc., and Ford Motor Co. They vary widely in regard to the
overlap of family and business issues, and much can be learned from studying their
experiences‖ (Encyclopedia for Business, 2nd
Ed.).
One may wonder if the above business conditions hold true in the Arab world. In United
Arab Emirates (UAE), the identity of a family is often used as tool for social connections.
Tribe names are closely associated with various types of businesses. Most of these businesses
have passed from one generation to another. Basing from this tradition, one observes that
strong family participation is almost always the main element in every type of business.
This study is done on a premise set by previous studies on entrepreneurship illustrating
that ―other family members offer a range of benefits while some suggest that family members
can actually constrain entrepreneurial activity‖ (McKeever and Jack, 2005). This research
also investigates the participation of family members (spouse, children, brothers, and sisters)
of selected Emirati entrepreneurs in their business, the value they add to the social capital of
their business, and whether prevalent practice has changed owing to modernity and changing
demography in UAE. The study further inquires why this condition is happening and how this
social capital affects their business.
2. Literature Review
2.1 Family and business
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Family- owned business, possibly the oldest form of business, is prevalent worldwide,
and is recognized to be an important backbone of the worldwide economy due to its
contribution to the global GDP of nearly 70–90% per year (MENA Family Business, 2007).
As unusual business entities, family businesses have been described by Bianco (1998) as
having a long-term concern for family business over generations, strong commitment to
quality, protection of family reputation, and expression of humanity in the workplace where
the care and concern for employees is often likened to that of an extended family. 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. This definition, however, has raised string of questions like: ―Does the
family have to own 100% or a majority of the business? Does the family have to manage the
business as well as own it? Is the certainty of succession essential, or can it be just a
possibility subject to future developments? Is it necessary for family members to plan for the
future of the business themselves, or can the business be guided externally? Is the size of the
enterprise relevant - turnover, number of employees, and so forth? Is a sole proprietorship a
true "family business" in that it is owned by a member of one family?‖
(www.cornerstoneresults.com).
According to Andrew Drake (2009) there is no legal definition of a family business, and
commentators tend to define family businesses in a variety of ways. He opined that some
authorities consider family business as any business that regards itself as a family business,
even if family members are no longer involved in management and/or ownership. In other
words a family business ethos is enough for the business to qualify as a family business. For
Drake (2009), a more common and narrow definition runs along the following lines: the
family owns a majority of the voting shares or effectively controls the business; one or more
family members (or their spouses) are involved in the management of the business; and more
than one generation is, or will in future, become involved in the business. It is really the last
of these three points that distinguishes family businesses from owner-managed businesses,
because owner-managed businesses are not necessarily passed down to the next generation.
In a practical sense, a business in which ―one or more family members (or their spouses) are
involved in the management of the business‖ would be the most valid definition.
The philosophy behind family firm is often anchored on a personalized mission related to
the integrity of the family name. Successful family enterprises offer family members prestige
and prominence in their communities. To preserve their reputation, Lyman (1991) argues,
family firms are more involved with customer service and more committed to quality than
their non-family counterparts. Exposure to various aspects of the business positively affects
Proceedings of the Fourth Asia-Pacific Conference on Global Business, Economics, Finance
and Social Sciences (AP15Malaysia Conference) ISBN - 978-1-63415-762-9
Kuala Lumpur, Malaysia, 7-9 August, 2015 Paper ID: KL569
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children. As children grow, they assume new and varied roles, develop skills in the business,
and take on each new role. With positive attitude and encouragement from their parents,
children‘s interest in business is heightened.
A number of factors predispose children to be interested in the family business. First, they
spent time with their father in the business. Most family businesses currently operating in the
United States were started after World War II and were founded by men. As more women
start businesses, children also benefit in this way by spending time with their mother in the
family business setting (Bianco, 1998). This traditional and yet prevalent set up among many
family-owned businesses is what ―family in‖ concept is all about. It simply means that family
members involve themselves in the business affairs of the family. The major advantages of
―family in‖ are strong support network of family members, ability to take a long-term
perspective, quick decision- making, and unparalleled commitment. It is often believed that
family members have more passion and dedication in their very own business than other
people. On the other hand, there are some families that alienate their family members from
their very own business. Instead, they hire non-family members to manage their business,
hoping it will be run more professionally. This scenario can often be traced back to family
history such as conflicts among siblings.
Conflicts among the siblings who run the business or misunderstandings between
different family branches may spill over to the company‘s domain and create problems for
other share-holders (Family Business Governance Handbook, 2008). Quite often, especially
during the early, start-up stages of the family business, the company and family relationships
are not clearly distinguished. This is particularly true with respect to financial relations and
accounts—the company‘s and family‘s assets are not legally separated. This condition causes
problems in distinguishing company-owned assets and how company- owned assets can be
used by the family as a shareholder (Family Business Governance Handbook, 2008).
The concept of alienating family members from one‘s business is what ―family out‖
concept is all about. In this concept, all family members are strictly off hand in one‘s
business, or they just entrust all their rights to only one person. This person may likely be the
oldest sibling in the family. The family out concept prefers to hire professionals to run their
business rather than being manned by their own relatives.
2.2 Family-owned business in Abu Dhabi
How these modern family-owned enterprises flourish in UAE, particularly in Abu Dhabi,
came about in 1960‘s when oil revenue made a significant impact on the lives of the locals.
(Mohammed bin Abduljalil Al Fahim, 2007) describe it this way: ―The significant leap in
entrepreneurial activities amongst the people of Abu Dhabi came in at the helm of Shiekh
Zayed power. However, it was a calculated risk on the part of the government as none of the
Proceedings of the Fourth Asia-Pacific Conference on Global Business, Economics, Finance
and Social Sciences (AP15Malaysia Conference) ISBN - 978-1-63415-762-9
Kuala Lumpur, Malaysia, 7-9 August, 2015 Paper ID: KL569
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locals are educated at that time. As a matter of strategy, the government compensated the
locals for their ―barasti‖ huts. This compensation gave the locals the seed capital to start their
business. However, there were inevitable snags in the housing compensation scheme. ―Chief
among which was the fact that local Abu Dhabians were simply not accustomed to having or
handling large amounts of money. Many wanted to take physical possession of the
compensation funds. Some spent their money wisely, building new homes and getting
involved in entrepreneurial ventures. Some marched directly to car showroom‖. ―The
government also issued decree that favor the locals in the establishment of their businesses.
One decree was that all foreign companies have to be either sponsored by, or in partnership
with, a local businessman. The ruling gave the local entrepreneurs the reason to initiate
contact with foreign companies thus expanding their horizons‖. ―In the late 1960s, the use of
expatriate expertise was necessary. However, it sometimes meant the local entrepreneurs took
longer time to acquire the much needed business skills than they would have had they been
more directly involved in the day-to-day management of their companies. By confining their
role to marketing and public relations activities, they missed the opportunity to learn the
broader business management and administration principles.‖
―Like in the other GCC (Golf Cooperation Countries), family-owned enterprises represent
more than 90% of the business community in the UAE. According to a recent study published
in the UAE, it states that nearly 70% of the over 20,000 family companies in the GCC are still
dominated by the old founding members, who ―control these firms with traditional methods
and attitude‖ (Farouk, H., 2012).
2.3 Social Capital
―Social capital refers to the collective value of all social networks (who people know) and
the inclination that arise from these networks to do things for each other. The central premise
of social capital is that social networks have value. Social capital can be found in friendship
networks, neighborhoods, churches, schools, bridge clubs, civic associations, and even bars
(www.hks.harvard.edu.). The value of group of persons to other groups or individuals is a
matter of what one can benefit from each other. It is very close to norms of reciprocity.
Numerous studies have suggested that one good business model is to invest in network of
people. This model has worked well in families with large size of numbers, thereby giving
them opportunities to propagate their business. Politicians also use the social capital structure
to their advantage. In business, the assumption lies that the larger the social network is, the
better it is for business. The more people know your business the better it is for you as the
owner.
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3. Methodology
This study utilized the qualitative -exploratory design, a methodological approach that is
primarily concerned with discovery and with generating or building theory. In this context,
exploration is thought of as a perspective, ‗a state of mind, a special personal orientation‘
(Stebbins, 2001) toward approaching and carrying out social inquiry
(http://srmo.sagepub.com/, Accessed 25 April 2015).
The qualitative inquiry focused on the various responses of the respondents during the
interview. This design is predetermined, and the emerging method used open-ended
questions. The data were treated through the use of appropriate text analysis.
The utilization of the exploratory method in this study has led to the discovery of
significant issues and concerns on entrepreneurship. With the appropriate way of describing,
recording, evaluating, analyzing, and interpreting the data gathered, the question on why
some entrepreneurs engage in ―Family In‖ and ―Family Out‖ concept of entrepreneurship in
their business and how ―Family in‖ and ―family Out‖ concept worked in the light of the use of
social capital in business were answered and understood.
The study used the interview method. The interview lasted for 1 to 2 hours for each
respondent. The interview phase started 31 March up to 23 April 2015. The interviewers used
the ―Interview question protocol and guide‖ that was prepared by the researchers. There were
at least 2 interviewers for each interviewee. Some of the respondents were interviewed again
either by phone or personally whenever further clarifications were needed.
3.1 Instrument
The data gathering employed a questionnaire composed of two parts. The first part
contains the demographic profile of the respondents while the second contains six open-ended
questions that were formulated by the researchers.
This study used interview with a chosen group of entrepreneurs in Abu Dhabi. The
answers to the six questions were validated by another interview using an open-ended series
of questions. According to Fraenkel & Wallen (2003, retrieved 2013), the researcher is the
key instrument. Data gathering primarily depended on the interviewers‘ skill in asking the
right questions. In this method, the interviewers seek to encourage free and open responses.
The interviewers captured the respondents‘ experiences articulated in their own words to
present the meaningfulness of the experience from the repondents‘ perspective.
3.2 Validity
Internal validity is the strength of qualitative research (Creswell 2003, retrieved 2013)
while Lincoln and Guba (1985) as cited by Golafshani (2003, retrieved 2013) consider
―trustworthiness‖ of qualitative research and use terms such as ―credibility,‖ ―transferability,‖
―dependability,‖ and ―confirmability‖ to refer to validity. Credibility deals with the accuracy
Proceedings of the Fourth Asia-Pacific Conference on Global Business, Economics, Finance
and Social Sciences (AP15Malaysia Conference) ISBN - 978-1-63415-762-9
Kuala Lumpur, Malaysia, 7-9 August, 2015 Paper ID: KL569
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of identifying and describing the subject of the study; transferability deals with the
applicability of the findings to another context; dependability is the researcher‘s account of
the changes inherent in any setting as well as changes to the research design as learning
unfolded; and confirmability deals on whether the findings could be confirmed by another
researcher, thus removing some of the researcher objectivity.
A table with the corresponding set of questions for comments or remarks of the
participants was prepared.
Lastly, to establish reliability of the qualitative data and to confirm the veracity of the
obtained significant information, the researchers conducted a follow-up validation interview
with the respondents.
3.3 Data Analysis
Descriptions of the prevailing feedbacks from the transcribed notes of the interviewers
were constructed. Each of these descriptions were integrated in the prevailing feedbacks of
the other respondents. The iterative process of reading and re-reading was done in order to
look for the themes or concepts to represent the qualitative data. Direct quotations from the
interview transcripts to elaborate and illustrate the themes or concepts cited were used. Then
records of interview were coded and properly encoded in the spreadsheet for researchers‘
interpretation. Percentages and Mode guided the researchers‘ interpretation. The Rank
Analysis was also used.
Criterion purposive sampling was used in choosing the 26 out of the initial 28
respondents of the study. This technique involves searching for cases or individuals who meet
a certain criterion, e.g., that they own a certain business or have had a particular experience in
either Family In or Family Out business. This sampling technique developed a framework of
the variables that might influence an individual's contribution and was based on the
researchers‘ practical knowledge of the research area, the available literature, and evidence
from the study itself.
The data gathering employed a questionnaire composed of two parts. The first part
contains the demographic profile of the participants while the second contains six open-ended
questions formulated by the researchers.
This study used interview with a chosen group of entrepreneurs in Abu Dhabi. The
answers to the six questions were validated by another interview using an open-ended series
of questions. According to Fraenkel & Wallen (2003, retrieved 2013), the researcher is the
key instrument. The researchers were guided by an interview protocol (see appendix), but
data gathering primarily depended on their skill in asking the right questions. In this method,
the interviewers encouraged free and open responses. The interviewers captured the
respondents‘ experiences articulated in the latters‘ own words to present the meaningfulness
Proceedings of the Fourth Asia-Pacific Conference on Global Business, Economics, Finance
and Social Sciences (AP15Malaysia Conference) ISBN - 978-1-63415-762-9
Kuala Lumpur, Malaysia, 7-9 August, 2015 Paper ID: KL569
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of the experience from the respondents‘ perspective.
Data gathering was conducted in the following three phases:
3.3.1 Initial Phase
a. To determine the respondents of the study, the researchers utilized the 26 entrepreneurs
from among the initial 28 respondents chosen by criterion purposive sampling technique.
b. Since data gathering was conducted in participation with Business students enrolled in
Innovation and Enterprise course, two student interviewers were assigned to interview
one respondent.
c. The interview guide was prepared. Then, the interviewers were briefed on how to conduct
the interview to ensure gathering of appropriate information.
d. The researcher sought the permission of the respondents and assured them that the result
of the interview would be treated with confidentiality. There were no promises of
respondents‘ remuneration except that the result of the research will be communicated to
them.
e. An initial interview with two prospective respondents was conducted, and revision to
improve the questionnaire was made to cover crucial issues and useful information that
came out during the initial interview.
3.3.2 Immersion Phase
In consideration of the emic nature of the data treatment, where every experience has
structurally significant characteristics, the researcher extracted the data from the respondent‘s
point of view. As such, the interview adhered to the following process:
a. A desirable setting that provides comfortable atmosphere for conversation was identified.
b. A specific location where there were no distractions, and it was easy to hear the
respondents speak was chosen.
c. A non-threatening environment was identified.
d. A location that was easily accessible for the respondents was selected.
3.3.3 Final Phase
a. The researchers recorded the responses, undertook data ―sifting‖ to get into the process of
understanding the concepts, and coded the responses. Data sifting involved scrutinizing
and then organizing the data gathered from interviews to make a sense out of the
information gathered.
b. Issues were clarified.
c. Interview closure was made.
Finally, brief descriptions of the themes and meanings, called codes, were developed.
Similar codes were grouped together to form categories. Then, the researchers prepared the
report for analysis.
3.4 Research Questions
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The following research problems were advanced in this study:
a. What are the major factors that influence selected Emiratis in Abu Dhabi to become
entrepreneurs?
b. Why do some selected entrepreneurs in Abu Dhabi opt for Family Out and others for
Family In enterprise concept?
c. What factors affect Abu Dhabi entrepreneurs in their choice of Family Out or Family In
enterprise concept?
d. What are the Social Capital contributions of Family members in the enterprise of Family In
entrepreneurs?
e. How do Family Out entrepreneurs cope with the absence of family-based social capital
structure in their business?
f. How satisfied are the entrepreneurs who opt for Family Out and Family In concept in
meeting their business goals?
3.5 Data Interpretation and Findings
The tables and diagrams below aided the interpretation of the respondents‘ responses.
Table 1: summarizes the Entrepreneurs’ profile in this study
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Name
Age
Gender
Civil
Status
Education
Employed/
Unemployed
Years
in
Business
Family
In/Family
Out
Type of Business
Forms of Business
No. of
Staff
1 Ahmad Ali 30 Male Married College Employed 1 Family In Car Cleaning Partnership 40
2 Ahmed Abdullah 30 Male Married College Employed 7 Family
Out
Export/Import
goods
Sole Proprietorship 14
3 Abdullah Al Ahmed 50 Male Married College Employed 5 Family In Café Shop Partnership 6
4 Nora Al Hosni 57 Female Married College Employed 8 Family In Clothes Trading Sole Proprietorship 3
5 Khalid Abdulqadi 22 Male Single College Unemployed 1 Family
Out
Sub Contracting Partnership 11
6 Rashed Al Mazrouie 39 Male Married Post Graduate Employed 5 Family
Out
Electronic Shop Sole Proprietorship 3
7 Mohamed Suwaidi 27 Male Single Post Graduate Employed 6 Family
Out
Photo/Print Shop Partnership 12
8 Khalid Ahmed 45 Male Married College Employed 15 Family
Out
Power System Partnership 260
9 Hamad Ahmed 31 Male Married College Employed 6 Family In Construction Partnership 50
10 Mohammed Khalifa 35 Male Married Post Graduate Unemployed 7 Family
Out
Multiple Type Partnership 29
11 Mohammed Awadhi 41 Male Married College Employed 8 Family In Restaurant Partnership 10
12 Ali Mohammad 75 Male Married Elementary Unemployed 48 Family In Weaving Factory Sole Proprietorship 120
13 Mohammed Ali 35 Male Married College Employed 3 Family
Out
Car Wash Sole Proprietorship 10
14 Kuloud Humai 27 Female Married College Unemployed 2 Family In Burger Resto Sole Proprietorship 5
15 Khalifa Saleem 63 Male Married College Employed 15 Family
Out
Shade
Manufacturing
Sole Proprietorship 60
16 Waleed AL Ali 31 Male Married Post Graduate Employed 3 Family In Safi Sweets Partnership 20
17 Anita 29 Female Single College Employed 1 Family
Out
Sports Materials Sole Proprietorship 1
18 Hamood 28 Male Single Secondary Unemployed 6 Family
Out
Local Dress Shop Partnership 30
19 Shehab Sajwani 46 Male Married Post Graduate Unemployed 10 Family In Resto/Coffee Shop Sole Proprietorship 150
20 Abdulla Al Hai 32 Male Single College Employed 2 Family In Engineering
nsultancy
Sole Proprietorship 25
21 Abdulla
Abdelraheem
52 Male Married College Employed 20 Family In Property Rentals Partnership 25
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22 Hisham Abdulla 40 Male Married College Employed 10 Family
Out
Retail Gifts Partnership 10
23 Ali Mohamed 34 Male Married College Employed 5 Family
Out
Gift Shop Partnership 12
24 Al Mansoori 33 Male Married Secondary Employed 11 Family
Out
Car Repair Shop Sole Proprietorship 4
25 Jamal Awadh 37 Male Married College Employed 7 Family
Out
Recruitment Sole Proprietorship 50
26 Faris Mohammed 35 Male Married College Employed 2 Family
Out
Resto/Coffee Shop Sole Proprietorship 10
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ChildhoodAmbition
42%
FamilyIn luence27%
Friend'sIn luence19%
Adventure/Accidental
Circumstances8%
JobFactors4%
ChildhoodAmbition FamilyIn luence
Friend'sIn luence Adventure/AccidentalCircumstances
JobFactors
Figure 1: Factors that Influence Entrepreneurship
Table 2: Top Reasons why Family Out and Family In was Chosen
Entrepreneurs who opt for Family Out
Entrepreneurs who opt for Family In
1. Strong Need for Independence
1. Family members just naturally helped each
other; They just volunteered to help the business.
2. Lacks of Business and Technical Skills from Family
members
2. Family members have business skills 3. Family members are busy. They have their own jobs
4. Trust/Conflict Issues
3. Family members were forced/required 5. Entrepreneurs want their wives to focus on family
matters only
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Figure 2: Reasons for Why Entrepreneurs Opt for Family Out
0
2
4
6
8
10
12
14
16
FamilyOut
15
9
7
4
2
Total
Reason1.StrongNeedforIndependence
Reason2.FamilyLacksBusinessSkills/FamilyisbusyReason3.Trust/Con lictIssues
Reason4.WantsWivestostayfocusonfamily
Note: Most respondents have multiple ―reasons‖ for why they choose Family Out.
Table 3: Factors Affecting Entrepreneurs Choice of Family Out-Family in Concept
Factors
Family Out
(15)
Family In
(11)
Total (26)
A. Age
40 and Below 14 (78%) 4 (22%) 18
41 and Above 1 (12%) 7 (88%) 8
B. Gender
Male 14 (61%) 9 (39%) 23
Female 1 (33%) 2 (67%) 3
C. Parents‘
Business Status
With Business 1 (11%) 8 (89%) 9
Without Business 14 (82%) 3 (18%) 17
D. Forms of
Business
Organization
Sole Proprietorship 9 (69%) 4 (31%) 13
Partnership 6 (46%) 7 (54%) 13
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Figure 3: Reasons as to why Entrepreneurs opt for Family In
11
8
43
Total
Reason1.NaturalFamily-BusinessEnvrionment
Reason2.FamilyMembershavebusinessskills
Reason3.FamilyMemberswereforced/required
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Table 4: Family members involved in the Social Capital Structure and their
Respective Social Capital Contribution
Table 5: Approaches Used by Entrepreneurs who lack Family-based Capital Structure (Family Out)
in their Enterprises
Name
(Entrepreneurs who
opted for Family Out)
Type of
Business
Approaches Used to Offset the
lack of Family-Based Capital Structure
1 Ahmad Ali 30 Male Car Cleaning Brothers, Sisters Manage the funds
Finding customers for the business
2 Abdullah Al
Ahmed
50 Male Café Shop Wife Prepare feasibility study
Suggest what is right or wrong with their
business
Provide technical know how
3 Nora Al
Hosni
57 Femal
e
Clothes
Trading
Children, Sisters Make good sales
Ability to find good customers
Help man the business
4 Hamad
Ahmed
31 Male Construction Brothers Ability to find good customers
Help source and manage the funds.
Good technical skills
Help man the business
5 Mohammed
Awadhi
41 Male Restaurant Brothers Make goods sales
Ability to find new customers
Good in networking and finding referrals
Good technical skills
Good in planning and administration
6 Ali
Mohammad
75 Male Weaving
Factory
Wife, Children,
Cousins Make goods sales
Strong abilities to find many customers
Good in finding referrals
Strong technical skills
Man the business
7 Kuloud
Humai
27 Femal
e
Burger Resto Brother, Sister,
Aunt Ability to find good customers
Help source and secure funds
Man the business
8 Waleed AL
Ali
31 Male Safi Sweets Brother Help in sales
Find customers and good in referrals
Manage the funds
Administration and technical skill
Man the business
9
Shehab
Sajwani
46 Male Resto/Coffee
Shop
Wife Business knowledge
Expertise in business
10
Abdulla Al
Hai
32 Male Engineering
Connsultancy
Brother Administration
Look for good customers
11
Abdulla
Abdelraheem
52 Male Property
Rentals
Brother Management of people
Cash keeping
Sourcing for materials
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Approaches Narratives
1
Ahmed Abdullah
Export/I
mport
goods
1. Hire competent staff
2. Offer Quality products
3. Offer excellent customer
services
4. Provide Competitive Price
Always get the best workers in our
business
The business has its own loyal customer
since decades. These loyal customers,
inherited their loyalty for our business to
their children and the generations after.
Moreover, we trust that we provide the
best quality products and services and
our prices are competitive.
2
Khalid
Abdulqadir
Sub
Contracti
ng
1. Hire competent staff
2. Build Social Network
We have a good staff.
I rely too much on my business partner
who has a lot of connections. He has a
good connection with many people
Also we have professional staff to rely on.
We have special relations with other
people in the business also.
3
Rashed Al
Mazrouie
Electroni
c Shop
1. Hire competent staff
2. Offer Quality products
3. Offer excellent customer
services
I do follow everything by my own. All
customers are more than welcome to
contact me if they face any problem with
their items (if they didn’t have the proper
support from my worker in the shop).
In addition, before buying items from
suppliers, I always make sure that my
staff and I will be able to fix any problem
in all sold items to customer.
4
Mohamed
Suwaidi
Photo/Pri
nt Shop
1. Hire competent staff
2. Build Social Network I used social networks, word of mouth. I
work for free in some occasions and for
charity works
Train your staff well to keep your
customers.
5
Khalid Ahmed
Power
System
1. Hire competent staff
2. Build Social Network
I do have good people. They can be
trusted. They are I think better than my
relatives in finding customers
Network for friends with reputable
customers.
6
Mohammed
Khalifa
Multiple
Type
1. Hire competent staff
2. Build Social Network
I hired skilled people from different
nationalities.
It is sometimes difficult if your family
members are not supporting you but if
you are a good entrepreneur or
businessman, all you need to do is to
value your customers by adding after
sales services plus good relation
Your fellow businessman will also
provide you clients and you should do the
same.
1. Hire competent staff I advertise more using social media and
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7 Mohammed Ali Car Wash 2. Keep on advertising also in newspaper and talk to a lot of
people
I look for best person to work for me
8
Khalifa Saleem
Shade
Manufact
uring
1. Hire competent staff I have a marketing that works on that.
They are expats. Hardworking and saving
money from career
9
Anita
Sports
Materials
1. Build Social Network
got my clients through referrals and word
of mouth
10
Hamood
Local
Dress
Shop
1. Hire competent staff We have many good expats who work for
us and they are good. So there is no
problem if family members are not
helping me in this business
11
Hisham Abdulla
Retail
Gifts
1. Build Social Network
I look for some friends and previous
partners
12
Ali Mohamed
Gift Shop
1. Hire competent staff
I have good people who are professionals
13
Al Mansoori
Car
Repair
Shop
1. Hire competent staff I have some expat workers. They are
enough to help me in my business
14
Jamal Awadh
Recruitm
ent
1. Build Social Network You need to focus on new customers in
the market to meet them first and
strengthen your relation with your own
customers
15 Faris Mohammed Resto/Cof
fee Shop
1. Build Social Network
I use my reputation and relations so that I
was able to get good numbers of
customers
Table 6: Level of Satisfaction of meeting Business Goals for “Family Out” Entrepreneurs
Entrepreneurs who
opted for Family Out
Type of Business
Level of Satisfaction
of Meeting Business
Goals
Narratives
1
Ahmed Abdullah
Export/Import
goods
Very Satisfied
We have achieved our objectives and goals
since year one. This is one of the benefits of
taking after a successful existing business and
injecting new blood in the process.
2
Khalid
Abdulqadir
Sub Contracting
Very Satisfied
Yes, we have made so many contracts with
(name of company) and got good returns
specially that there is a big project at Abu
Dhabi Airport.
3
Rashed Al
Mazrouie
Electronic Shop Very Satisfied Yes. Absolutely.
4
Mohamed
Suwaidi
Photo/Print Shop
Very Satisfied
Yes. so far I am on track and my business is
getting bigger and better.
5
Khalid Ahmed
Power System
Very Satisfied
We are on the right direction.
Mohammed Yes. I am the only one controlling how
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6 Khalifa Multiple Type Very Satisfied everything is going.
7 Mohammed Ali Car Wash Very Satisfied Yes, It is a good business.
8
Khalifa Saleem
Shade
Manufacturing
Very Satisfied
Yes, they have been achieved. Lack of family
members in my company does not affect my
business because I have my own goals.
9
Anita
Sports Materials
Very Satisfied
Yes, it is achieved and my goals do not require
the help of other people at this time.
10
Hamood
Local Dress Shop
Very Satisfied
Yes, together with my partner, we are happy
that we have more customers and our business
is growing.
11
Hisham Abdulla
Retail Gifts
Very Satisfied
Yes, the business is growing and I am looking
for other fields to go on.
12 Ali Mohamed Gift Shop Very Satisfied Yes, everything is fine.
13
Al Mansoori
Car Repair Shop
Very Satisfied
Yes, I know how to manage my employees. No
issues at all.
14
Jamal Awadh
Recruitment
Very Satisfied
Yes, I am achieving my goals by learning
continuously new skills and by the help of
more experience people in the market.
15 Faris Mohammed Resto/Coffee
Shop
Not yet satisfied
Not yet. I am looking to achieve my goals to
pen a new branch at Dubai, looking to change
the style of my café and restaurant and create
a better image.
Table 7: Level of Satisfaction of meeting Business Goals for “Family In” Entrepreneurs
Entrepreneurs who
opted for Family In
Type of Business
Level of
Satisfaction of
Meeting
Business Goals
Narratives
(About Family Contributions)
1
Ahmad Ali
Car Cleaning
Very Satisfied
Yes, they had helped me a lot to succeed my
business . . . We are satisfied with our business
goals.
2
Abdullah Al
Ahmed
Café Shop
Very Satisfied
Yes, I am happy for her contribution and our
business is fine.
3
Nora Al Hosni
Clothes Trading
Very Satisfied
Yes, they are very valuable. When they are not
around, especially during peak hours, it is a big
problem. They give a lot of new ideas and if they
don't support me, it is a big loss. Our aim is
achieved.
4
Hamad Ahmed
Construction
Very Satisfied
We are on the right track. Everything is achieved
so far.
5
Mohammed
Awadhi
Restaurant
Very Satisfied
Yes, it certainly has been beneficial, we would not
have been able to accomplish our desired goals
and reaching out to our target market.
6
Ali
Mohammad
Weaving Factory
Very Satisfied
All contributions, great and small are very
important to us. We can not stay this long if we
are a failure. For the past generations, we have
been doing well and we achieved almost all goals
we dreamed of in this business.
7
Kuloud Humai
Burger Resto
Not Satisfied Yet
Yes for sure. Their contribution helped me a lot to
avoid any mistake and secure my funds. Also they
played very imported role to create a good
network of customers my word of mouth among
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their friends. So slowly but with their help with
coming years I can sure to a famous brand name
in local marker. I am still looking for that goal.
8
Waleed AL
Ali
Safi Sweets
Very Satisfied
Yes, Since my brother is my partner, we help each
other. I am satisfied of what we have done so far.
9
Shehab
Sajwani
Resto/Coffee
Shop
Very Satisfied
I doubt if our business goal is achieved with out
her. I am happy that we have done good so far.
10
Abdulla Al
Hai
Engineering
Consultancy
Very Satisfied
The help of my brothers has resulted in positive
look of the business.
11
Abdulla
Abdelraheem
Property Rentals
Very Satisfied
Very much valuable, and it helped achieved our
business goals.
4. Results and Discussion
There were 26 Emirati entrepreneurs in this study, 3 females and 23 males. Since this study
used purposeful sampling, the researchers determined that the list of entrepreneurs provided by
Innovation and Enterprise class of 3 sections of Business students at Abu Dhabi Men‘s College
for Semester 2, 2014-2015, is composed of valuable respondents ideal for this research. These
entrepreneurs were students‘ resource persons for their respective projects.
4.1 Basic Findings
1. Civil Status. 21 (81%) of the respondents are married and 5 (19%) are single.
2. Age. The youngest respondent is 22 years old and the oldest is 75 years old. 18 (69%) of the
respondents are 40 years old and below and 8 (31%) are 41 years old and above.
3. Employment Status. 20 (77%) of the respondents are employed and 6 (23%) are not
employed elsewhere. All female respondents are employed.
4. Education. 18 (69%) have finished College education, 6 (23%) have Post Graduate Studies,
and 2 (8%) have finished Elementary or Secondary courses only.
5. Forms of Business Organization. 13 (50%) of the respondents are in Sole proprietorship and
another 13 (50%) are in Partnership. All female respondents are into Sole proprietorship.
6. Number of Years as Entrepreneurs. The range of years is from 1 year to 48 years. 12 (46%)
of the respondents are those with 5-10 years of experience. 5 (19%) have over 11 years of
experience and 9 (35%) have below 5 years of experience.
7. Types of Business. The types of business the respondents engaged into are varied: 20
different types. There are 4 entrepreneurs engaged in restaurant/coffees shop business; 3 in
car care/maintenance service-related, and 2 Gift shops.
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8. Number of staff. The respondents‘ number of staff ranges from 1 person to 260 persons per
enterprise. 10 (38%) of the respondents have 10 or less number of staff; 7 (27%) have 11-15
staff; 5 (19%) have 26-50 staff; 1 (4%) has 51-100 staff, and; 3 (12%) have over 100 staff.
The entrepreneurs in this study have identified 5 major factors that influenced them to
become entrepreneurs. Some entrepreneurs have multiple answers to this question. These are the
main factors:
1. Childhood Dream/Ambition
11 out of 26 (42%) entrepreneurs considered ―Childhood dream/ambition‖ as the top factor.
Kuloud Humaid, a restaurant entrepreneur explained it this way: “It has been my wish since I was
a child. I like to create my own business and spend time to earn money and become a brand
manager in a local market.” Jamal Awad, Recuitment company entrepreneur, further added,
―Since I was a child, I really want to have my own business.”
2. Family Influence
7 out of 26 (27%) entrepreneurs considered “Family Influence” as another factor. Ahmed
Abdulah of Al Salami & Sons Trading sum it up perfectly in this way: ―My Family Influenced
me. My grandfather, Ahmed Al Salami the 1st, established this company 67 years ago (in 1948).
As children, we used to visit the establishment and look at the new products introduced and my
grandfather negotiations. It is when I developed an interest of making this business prosper. With
the change in mentalities and style of people, the market demands new approaches and products.
It is why I decided, as a third generation, to take after my grandfather and keep the business
going with my own aspects as a young Emirati, with keeping our tradition and heritage alive.
Undoubtedly, ―family is a social influence in a business start-up, (Burns, Entrepreneurship and
Small Business, 3rd
Edition).
3. Friend’s Influence
5 out of 26 (19%) entrepreneurs considered ―Friends’ Influence‖ as another factor. Khalid
Abduqadeer, a student entrepreneur mentioned, “My father was approached by his friend to have
a business partnership.” Likewise, Khalid Ahmed, an entrepreneur that deals with power supply
aptly said, ―My friends just influenced me.‖
4. Adventure and Accidental Circumstances
2 of 26 (8%) respondents attributed ―Adventure and Accidental Circumstances” as another
factor. Rashed Al Mazrouie, an entrepreneur of Double Star Electronic Shop, shared his
experienced as follows: “It was an accident. I always like to buy unique things such as
headphones, covers, cloths, devises, electronics. etc. These unique things mostly can be found
outside UAE such as USA, UK, Australia.etc. All my friends were asking where I bought these
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things and asked me to buy them the same items as these. By the time, I’ve got the idea to open
my own business to sell unique electronic items which is demanded by my friends which mean
that it will be demanded by others as well. So I start ordering bigger quantities and sold it out to
my friends and others through social media. Eventually I decide to open my electronic shop to be
able to import big quantities under my shop name.”
5. Jobs Factor
Only 1 of 26 (4%) respondents considered this as a factor. Abdulla Al Hai, an entrepreneur of
Engineering consultancy share his experienced: “While at work, I like to deal with multi national
people hence the knowledge they have are very interesting to me. This the reason why I started
my own business.
There are 26 entrepreneurs in this study. 15 of them opted for Family Out while 11 opted for
Family In. The entrepreneurs who opted for Family Out, identified 5 reasons while those who
opted for Family In identified 3 reasons. Some entrepreneurs have multiple responses to this
question.
A. Reasons for Entrepreneurs who Opted for Family Out
1. Strong Need for Independence.
9 out of 15 (60%) entrepreneurs considered this as the main factor as to why they prefer to
venture alone, that is, without family intervention in their business. Rashed, an entrepreneur that
deals with electronics described it this way: “I don’t want them to participate or help me in my
business. I look after my business by my own. I do trust my family but I feel comfortable more
when I do everything by my own.” A ―strong need for independence is a personal characteristic
traits. It is one of the common start up influences‖ (Burns, Entrepreneurship and Small Business,
3rd
Edition). Furthermore, Khalid Abdulqadeer, an entrepreneur in Sub-Contacting business has
this simple words, ―I prefer to do it alone, a sort of secret one”. Khalid believes that it will be
good for him if he does the management alone. He points out the importance of doing it alone so
that he can trust his self well in the future, but he readily answered that he will share his business
to his family if his father will ask him to do.
2. Their family members lack business and technical skills.
7 out of 15 (47%) entrepreneurs considered this as another factor as
to why they opt for Family out. They opined that it is not good to let
their family members be a part of their business if they have nothing to contribute at all.
Mohammed Khalifa said, ―I don't want them because they don’t
have the skills required for the business. They are not needed. They
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are just excess personnel to his business‖. Mohammed Ali, an entrepreneur with car wash
business said, ―For some members of the family, they don't have knowledge or skills about my
business.‖ These 7 entrepreneurs are just short of saying that family members who lack business
skills do not contribute to the social capital of the business at all.
3. Family members are busy. They have their own work or business.
7 Out of 15 (47%) entrepreneurs consider this as a reason why they opt for family out. When
everyone in the family is pre-occupied with their respective work, chances are that no one will
lend a hand to family member‘s business. So they just opt for family out.
4. Trust or Conflict Issues
4 out of 15 (27%) entrepreneurs consider this reason why they opt for Family Out. Mohamed
Khalifa articulated his fear, ―I believed that it is difficult to manage family members. This is what
I observed in some family specially when business is going down.” Mohamed‘s reasoning is
actually anchored on reality. Family in-fighting often occur when the business is in heavy
problem. Like Mohammed, Khalid is also on the same reasoning when he said, ― I prefer to be
alone . . . I can avoid conflict in the family.” ―Conflicts among the siblings who run the business
or misunderstandings between different family branches may spill over to the company‘s domain
and create problems for other share-holders. Quite often, especially during the early, start-up
stages of the family business, the company and family relationships are not clearly distinguished.
This is particularly true with respect to financial relations and accounts—the company‘s and
family‘s assets are not legally separated. This causes problems in distinguishing company-owned
assets, and how company- owned assets can be used by the family as a shareholder (Family
Business Governance Handbook, 2008).
5. They want their wives to focus on family matters only.
2 married respondents who opted for Family Out pointed this as their reason. Mohammed Ali,
directly uttered this statement: ―I don't want my wife to participate in my business because I want
her to focus on family matters only.” This reason is self explanatory since a husband-entrepreneur
is often out of house doing business chores. It is therefore a must that a wife should look up
family matters at home.
B. Reasons for Entrepreneurs who Opted for Family In
1. Family members just naturally helped each other. They volunteered to help in the business.
8 out of 11 (73%) entrepreneurs who opted for Family In pointed this out. Ali Mohammed, 75,
the oldest entrepreneurs in this study has this novel explanation, “I did not require or forced
them. They just volunteered. The business we are in is a traditional family business which we like
to do and we do well. So, it was natural to cooperate with the relatives.” Ali, who just finish
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Elementary grade, and is not properly schooled compared to other entrepreneurs, is probably the
one with the highest wisdom of all. He has 48 years of experience in business after all. He has
valued the importance of social capital in their business. He has been serving his parent‘s
business way back then and he has this to say, “No one required or forced us to participate in
family business. Life used to be very difficult those days unless we cooperate for the whole family
wellbeing things would not work. That was my conviction.”
2. Family members have the business skills
4 out of 11 (36%) entrepreneurs consider this as another reason why they opt for Family In. In the
minds of these entrepreneurs, social capital is relevant when a family member has business skill
only. Otherwise, a member without a business skill will turn out to be just another excess
baggage, a liability in business. Once a husband has recognized his wife‘s business skills, he will
surely capitalize it for their business sake. This is the case with Abdullah Al Ahmed, an
entrepreneur with café shop business. He praised her wife‘s contribution when he said: “she
helped me a lot of things. For example, she did a feasibility about profits and told me of what is
wrong and right in our business.” This is also true with Shebab, an entrepreneur with a
restaurant. ―My wife is helping me in the business. For business expansion, she is assisting me
well because she has excellent knowledge and expertise”
3. Family members are forced/required to help the business
3 out of 11 (27%) entrepreneurs did this to their family members
and sighted this reason for the choice of Family In. Hamad Ahmed, an entrepreneur with
construction business has this to say, ―I don’t have more time to concentrate on this business
alone. This is a family business after all, so I asked them to spend their time in our business.‖ Al
Faheem, who inherited his business from his parents, required his brothers to help him. He said,
―It is a family business, so each of us has to help each other. We share the profit but we also
share expenses. These properties are in Abu Dhabi and Al Ain. We have to work together.”
Below are the factors affecting Abu Dhabi entrepreneurs in their choice of Family Out or Family
In enterprise concept.
a. Entrepreneur‘s Age.
78% of entrepreneurs aged 40 years old and below opted for Family Out while 88% of the
entrepreneurs aged 41 years old and above opted for Family In.
Young entrepreneurs tend to opt for Family Out while old entrepreneurs tend to keep the old
Family In concept in their enterprises.
b. Entrepreneur‘s Gender
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61% of male entrepreneurs opted for Family out while 67% of the female entrepreneurs opted for
Family In. Male entrepreneurs tend to opt for Family out while female entrepreneurs tend to keep
the old Family In concept in their enterprises.
c. Parents‘ Business status
82% of the entrepreneurs whose parents do not own a business opted for Family Out while 89%
of entrepreneurs with parents‘ business opted for Family In. Entrepreneurs whose parents are not
engaged in business tend to opt for Family out while those who have parents‘ business tend to
keep the Family In concept.
d. Forms of Business Organization
69% of entrepreneurs whose form of business organizations are Sole Proprietorship opted for
Family Out while 54% of Partnership form of organization opted for Family In.
Entrepreneurs in a Sole Proprietorship tend to opt for Family Out while those in Partnership tend
to keep the Family in concept n their enterprises.
4. What are the Social Capital contributions of Family members in the enterprise of Family In
entrepreneurs?
For entrepreneurs who opt for Family In concept
a. Family Members Involved in the social capital structure
1. Brothers/Sisters.
8 out of 15 (54%) entrepreneurs have their own brothers/sisters involved in their respective
enterprises.
2. Spouse/Wife
3 out of 15 (20%) entrepreneurs have their own wife involved in their respective enterprises.
3. Children
2 out of 15 (13%) entrepreneurs have their own children involved in their respective enterprises.
4. Other family members
2 out of 15 (13%) entrepreneurs have their Cousins and Aunt involved in their respective
enterprises.
b. Family members‘ social capital contributions.
Entrepreneurs who opted for Family In concept in their enterprises have identified 4 social capital
contributions of their family members. Most of these entrepreneurs have multiple
answers/responses to this question.
1. Generate Sales/Find Customers/Networking
14 out of 15 (93%) entrepreneurs who opted for Family In considered
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sales generation to their enterprises as the top contribution. This has truly supported various
Entrepreneurship literatures that suggest Sales/Income generation as the core of social capital
contribution.
2. Planning and Administration.
13 out of 15 (87%) entrepreneurs who opted for Family In considered
planning and administration as another novel social capital contribution in the enterprises.
3. Technical Skills
6 out of 15 (40%) of entrepreneurs who opted for Family In considered
Technical skills of family members as their social capital contribution in
the enterprises.
4. Manage/Secure Funds
5 out of 15 (33%) of entrepreneurs who opted for Family In considered
Fund management of family members as their social capital contribution in the enterprises.
Family Out entrepreneurs coping with the absence of family-based social capital structure in their
business
There are 15 entrepreneurs who opted for Family Out concept in their respective
enterprise. These entrepreneurs have identified 6 approaches to offset the absence of family-based
social capital structure in their enterprises. Some of them have multiple responses to this question.
1. Hire qualified and competent staff
12 out of 15 (80%) entrepreneurs who opted for Family out consider this as the top approach
to cope the absence of family-based social capital in their enterprise. Ahmed Abdulah
recommends, ―Always get the best workers in your business.‖ For Mohammed Al Swaidi,
‖Train your staff well to keep your customers‖. Hamood echoed the importance of expat
workers. ―We have many good expats who work for us and they are good. So there is no problem
if family members are not helping me in this business.‖ Khalifa Salim even boast, ―I have a
marketing (team) that works on that.”
These entrepreneurs believe that competent staff are all you need to get the right customers
for your business. With the right person for the job, they are not worried even if their business
does not have family-based capital structure.
2. Build Social Network of people
8 out of 15 (60%) entrepreneurs who opted for Family out consider building social network
of people as a good approach in the absence of family-based social capital structure in their
enterprise. The premise of this approach is, to build one if you don‘t have one. Since capital
structure is not exclusive for family members alone, the alternative is to build one based on their
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present customers and those entrepreneurs in their circle. Khalid Abdulqadeer said. ―We have
special relations with other people in the business also.‖ Faris on the other hand use his
reputation and relations so that he can get good numbers of customers. Also, Mohammed Suwaidi
―used social networks, word of mouth‖. He further added, ―I work for free in some occasions and
for charity works.‖ Jamal Awadh explained it further, ― You need to focus on new customers in
the market to meet them first and strengthen your relation with your own customers.” Finally,
Mohammed Khalifa has this compelling statement on how to survive in business even if one does
not have the family-based social capital structure: ―It is sometimes difficult if your family
members are not supporting you but if you are a good entrepreneur or businessman, all you need
to do is to value your customers by adding after sales services plus good relation. Your fellow
businessman will also provide you clients and you should do the same.”
While it is true that a good social capital is family based; however, one can still create a
capital structure even in the absence of family support. This is evident by the initiatives used by 9
entrepreneurs in this study. They prove a point that social capital can be redeemed, even in the
absence of family support by building social network of people who are primarily their own
customers and their fellow entrepreneurs.
3. Other Approaches
The following approaches were also considered by 1 or 2 entrepreneurs in this study:
Offer excellent customer services
Keep on advertising
Offer quality products to customers.
Provide competitive prices
The point they wish to drive is that even if one business does not have a family-based
capital structure, it can still overcome the odds by using the above approaches. By using these
approaches, finding right customers and clients will not be a hindrance in their pursuit of a good
business.
5. Conclusions and Recommendations
Conclusion
Based from the major findings of the study, the following conclusions are derived:
1. There is a growing trend among young Emirati entrepreneurs to opt for Family Out concept in
enterprise creation. The ―Strong Need for Independence‖ is the primary reason for the choice of
Family Out. 8 in 10 (78%) entrepreneurs, aged 40 years old and below, opted for Family Out
while 9 in 10 (88%) entrepreneurs aged 41 years old and above opted for Family In.
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2. The family influence is a major factor in the choice of entrepreneurs‘ Family In concept. 90% of
those who opted for Family In have family-owned businesses prior to their enterprise.
3. The family members of entrepreneurs who opted for Family In concept have significantly
contributed ―add value‖ to their respective enterprises. Family members offer wide array of
contributions – from Customers‘ Networking to Business administration.
4. Entrepreneurs who opted for Family Out employ competent people in their enterprises to offset
the absence of family support.
5. Entrepreneurs from both the Family In and Family Out business enterprises have experienced
similar level of satisfaction in the achievement of their business goals.
6. The ―Strong Need for Independence‖ is the primary reason for the choice of Family Out concept
of enterprise.
Recommendations
The Family Out concept in business is a progressive idea among entrepreneurs since it
gives them the much needed ―independence‖ in running the affair of their enterprises. However,
the lack of family participation will isolate their family members from the business.
Consequently, family members will be unable to learn the trade of the business. Further more, it
will adversely affect the future of the enterprise once the entrepreneurs retire as nobody from the
family has the business skill to continue its operation.
Thus, the following are recommended:
1. Entrepreneurs who opted for Family Out concept should consider ―family involvement‖ in
their enterprise in the near future. Not only family members will add value to their enterprises but
will surely determine the future outcomes of their enterprises.
2. For entrepreneurs in the Family Out businesses whose family members are still too young to be
involved, they are encouraged to participate in the network of various business organizations so
as to offset the lack of social capital in their enterprises.
3. The Family In concept is an excellent business orientation as it provides family members the
opportunity to learn various business skills. The major drawback of this concept however, is
when the conflict among family members escalates to a ―blood bath‖ among them. In many cases,
the family breaks up to the point that legal consequences tend to overpower them.
Thus, this study recommends that Family In Enterprises must adhere to a clear Mission-
Vision Statement, Policies, and Programs, Tasks, and Activities in their enterprises that must be
understood by all participating members of the family. Likewise, the family members‘ duties and
responsibilities must be understood and respected by all. The ―figure head‖ of the family
enterprise must take a moral lead on this to avoid family conflict.
Proceedings of the Fourth Asia-Pacific Conference on Global Business, Economics, Finance
and Social Sciences (AP15Malaysia Conference) ISBN - 978-1-63415-762-9
Kuala Lumpur, Malaysia, 7-9 August, 2015 Paper ID: KL569
www.globalbizresearch.org
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4. On business areas in which competencies required are not available among family members.
The job position in this aspect should be given to outsiders until family members have mastered
these competencies. Hiring a business consultant is also recommended.
5. Hierarchical positions among family members must be made clear and over lapping with one
another‘s role must be avoided. Since conflict among family members in the enterprise often
happen when there is no clear delineation of different positions, constant review of the scope of
these positions must be done periodically to ensure organizational effectiveness.
References
Al Fahim, Mohammed, ―From Rags to Riches – A Story of Abu Dhabi‖, 2007 ISBN 978-1-4392-
1863-1
Bianco, David, 1998, The Pros and Cons of Family Business.
Burns, Paul, 2010, Entrepreneurship and Small Business, 3rd
Edition.
Drake, Andrew, 2009, Understanding Family Business.
Family Business Governance Handbook, 2008.
Farouk, Hisham, 2012, Rules of Engagement.
Feffer,David, 2007, Family Business Challenges
Flanagan, Ben, 2014, ―Keeping Business in UAE‖, The National,
Kleiman, Robert and Peacock Eileen, ―Family Businesses as an Economic Phenomenon.
McKeever, Ed and Jack, Sarah, 2005,―The Role of Family in Entrepreneurship: A Qualitative
Study,‖.
MENA Family Businesses‖ The Real Power Brokers? (2011)
Riel, Bob ―Cultural Context-United Arab Emirates‖, Eaton Consulting Group Newsletter.
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