Research Highlights 51 - Interview

Interview de Rania LABAKI, directrice de l'EDHEC Family Business Centre

Rania Labaki, you are an Associate Professor in Finance and Family Business, and Academic Director of the EDHEC Family Business Global Executive MBA. You just took the Direction of the EDHEC Family Business Centre itself (FBC), aimed to provide both top-tier Education and relevant research for family businesses. Could you tell us more about your background and your motivations to join the EDHEC FBC?
Growing up in an entrepreneurial family myself made me aware early on about the particularities of family businesses. Although their competitive advantage is often rooted in the family, the latter can turn into a major weakness that threatens its survival the family business. Scholars have, however, insufficiently researched family businesses and developed family business educational programs. Being intrigued by these gaps, I wrote my Ph.D. dissertation in Management Sciences on the family business at the University of Bordeaux. My research was amongst the first to analyze the role of family factors in shaping the governance and performance of family firms. In collaboration with scholars in the field, I showed that several decisions in the family business, whether entrepreneurial or financial, are driven by the family viewed as a multigenerational emotional system. I also connected my research with practice by developing teaching materials, courses and conference programs on the family business with a special focus on family dynamics, next generation succession, and financial decision-making.
I therefore gradually developed a unique mix of academic and practical knowledge throughout extensive experience with the leading international organizations specialized in family business education, networking, advising and research. These include: The Family Business Network, The Family Firm Institute, Business Families Foundation, the International Family Enterprise Research Academy as well as numerous academic institutions worldwide. I decided to join EDHEC Business School in 2016 given its commitment to Make an Impact with a strategic positioning oriented towards the family business field of study. While I feel honored to become the Director of the Family Business Centre, I take upon the challenge of building on my experience to serve the vision of EDHEC and the notable family businesses that inspire and support the Centre.
What are the research topics that FBC will be looking into for the next 3 years? What are the Centre’s priorities?
The FBC aims at becoming a leading reference for the family business communities throughout pioneering, impactful and top-tier educational and research activities. One of the strengths of our Centre is its multidisciplinary and international approach. Whether on the research or educational levels, we focus on three major axes which represent the imperatives for the resilient and sustainable family businesses of tomorrow: Strategic Entrepreneurship, Family Dynamics Management, and Family Business Governance and Performance. These axes are closely permeated by the social, financial, fiscal and legal policies relative to those businesses. The Family Business GEMBA is an exemplary testimony of this perspective since it is the first Global Executive MBA on Family Business in Europe. It offers a unique program to prepare the family business future leaders for success(ion). The learning map includes courses from different fields of study, such as strategy, finance, and organizational behavior as they specifically apply to the family business by being based on the latest research. The program intends to support the next generation of leaders in their transformational journey to become agents of change who Make an Impact in their families, businesses, and communities. Last August you co-organized a workshop in Anaheim (California) on the following topic “A governance approach of emotions for more meaningful entrepreneurial and family businesses”. The research barely begins to show an interest about the link between Corporate Governance and emotions. Why is that now and not before? In which regard this question is more relevant and attached to the family businesses? 
While research on the role of emotions in organizations started taking off only three decades ago, research on emotions in family businesses is still very scarce. Different from non-family businesses, members in family businesses not only share the same organization but also the same family. Emotions flow from the family to the business, and vice versa, affecting both the family and the business. This adds another level of complexity to the analysis since researchers are required to account for two systems rather than one and explore the deep roots of the family business over generations. Our researchers at the EDHEC Family Business Centre have taken upon the challenge of investigating this field, either by analyzing specific emotions in the family business or the family emotional dynamics in a holistic view. This being said, the global initiatives to study family business emotions are still scattered today across continents.
Together with Professor Georgia D’Allura from the University of Catania (Italy), we decided to go one step further. We have chosen to tackle this issue by organizing a Professional Development Workshop at the leading Academy of Management Conference. How did you manage to deal with this complex topic throughout the workshop you co-organized?
In this Workshop, we brought together renowned scholars from different fields to inspire us on the latest research and methods of study on the emotional dimensions. After an introduction by the Organizers, Professors Giorgia D’Allura and I; we talked about the state of the art of emotions in the family business field, Professor Sigal Barsade from Wharton – University of Pennsylvania (USA) shared her insights from a study on Hope and Fear in the Escalation of Commitment in Entrepreneurial Settings. Professor Amir Erez from the University of Florida (USA) introduced us to a promising and groundbreaking method for studying emotions: the Experience Sampling Method. Professor Ronald Humphrey from Lancaster University (UK) made a presentation connecting the dots between major constructs in relation with Authentic Leadership: Emotional Intelligence, Empathy, and Positive Affect.
Following these inspiring presentations, we invited additional experts on specific emotions - such as happiness, anger, hostility, envy, regret or guilt - to head and moderate round table discussions with the participants of the workshop: Professors Pauline Schilpzand from Oregon State University (USA), Anita Van Gils from Maastricht University (The Netherlands), Marina Biniari from Alto University (Finland), Yochi Cohen-Charash from Baruch College (USA), and our colleague Fabian Bernhard from EDHEC Business School (France).

By joining a table labeled with a specific emotion of their interest, participants were able to exchange with each other in order to draft the future agenda for family business scholars and engage in cross-collaborations. Speakers from each table finally reported back to all participants the outcomes of their discussions. This Workshop stands therefore at the first stage of ongoing future meetings in this direction.
Several questions come to mind when one thinks about emotions in the family business: “How these emotions can have an impact on the decision making? How do you scale these impacts? Which governance for which emotions? ». How did the research and the collective work done during the workshop in California helped you engage in a future framework of analysis of the “emotions management” that is family business oriented?
Although no consistency exists in research today about whether the influence of specific emotions on decision-making, creativity or performance is positive or negative, one thing is for sure: the influence is to different extents real. This Workshop has built basis for further research and pedagogical collaborations on emotions in the family business field.

The participants agreed on the relevance of analyzing the differences between family and non-family organizations and the inter-connectedness of different emotions in the family business.

The theoretical perspective that was suggested to study emotions was the family business systems view. This entails taking into account the whole system, by exploring all stakeholders’ interactions in the family and the business, instead of focusing on the emotions of one key-family member per se.

In methodological terms, researchers emphasized the relevance of triangulation of data, by using neurological and other biological measurements in combination with scenario analysis, quantitative scales of emotions, and in-depth interviews with family business stakeholders.

Among the outcomes of the discussion, it appeared clear that researchers analyzing regret, guilt, envy and jealousy should take into account the history of the family to explain patterns that people carry from childhood. The family is a place with a lot of stakes, was it about power or money, which makes it a fertile ground to shape emotions.
As emotions can be mutually influential, it is important to have a dynamic perspective by taking into account how certain governance mechanisms helping deal with an emotion on the short-term might trigger another one on the long-term. By reducing envy because of injustice perceptions for example, one might create or increase jealousy. In the same time the emotion of guilt can be felt by the current generation for wrong-doings by the past generation. Emotions can carry different dimensions. The emotion of regret takes into account past experiences and can be anticipated based on them when it comes to decision-making. While the dimensions of empathy can range from “cognitive empathy” that is being aware of emotions the others are feeling to “affective empathy” that is feeling other’s emotions to some degree, the “interactive empathy” allows a better understanding of the leaders’ influence in the workplace. Empathetic family business leaders negotiate change in emotions and shape the emotions of their followers to move into a more productive stage.
Among the research questions to be explored in further collaborations: what is the role of family education in shaping the personality of family members, which in turn impacts the way their emotions are felt and expressed? How one type of emotion would undermine or trigger another one in different time frames? What timing and type of family governance should the family business leader initiate to deal with the different types of stakeholders’ emotions?

Last but not least, scholars reflected on how to teach family business students about emotions. Unlike other topics, professors are encouraged to account for the different sensibilities of the students in the classroom pertaining to their background. It has been therefore suggested for the professors to use an iterative pedagogical process: to start by building on research findings to stimulate the awareness of students on the topic, following-up with reflective cases and scenarios to be discussed with their peers, then introducing experiential learning techniques backed by personality tests and family genograms, and finally moving to the students’ personal analysis of their own emotions on a voluntary basis.

The exchanges around emotions that this workshop has instigated are intended to be developed into collaborative research outputs, which would be invited for submission to a Special Issue of the Entrepreneurship Research Journal.
Co-edited by Rania Labaki - EDHEC Business School, France, Ramona Zachary, The City University of New York - Baruch College, USA, and Thomas Lyons, Michigan State University, USA, the journal posits as the new premier research journal within the field of entrepreneurship.

[More : EDHEC Family Business Centre]

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