Family business = Tribal chiefdoms??


Published on

"Chiefdoms and family firm regimes: Variations on the same anthropological themes?"

Family owned and managed firms exhibit remarkable parallels to pre-industrial chiefdoms because the typical economic environment in which they exist limits them to a size and scale equivalent to that of a chiefdom. Using anthropological research this study inventories all known procedures of accommodating multiple heirs to the paramountcy of pre-industrial chiefdoms. It uses this exhaustive inventory to characterize the succession process in modern family owned and managed firms.

pre-print version of: Rogers, E.D., Carsrud, A.L. & Krueger, N.F. Chiefdoms and family firm regimes: Variations on the same anthropological themes. Family Business Review, 9(1): 15-27.1996.

Possibly the most fun article ever.

Published in: Business, Technology
  • Be the first to comment

  • Be the first to like this

No Downloads
Total Views
On Slideshare
From Embeds
Number of Embeds
Embeds 0
No embeds

No notes for slide

Family business = Tribal chiefdoms??

  1. 1. CHIEFDOMS AND FAMILY FIRM REGIMES: VARIATIONS ON THE SAME ANTHROPOLOGICAL THEMES Elizabeth (Beth) D. Rogers, Ph.D. Rogers Family Foundation Alan L. Carsrud, Ph.D. Anderson School at UCLA Norris F. Krueger, Jr., Ph.D. Entrepreneurial Strategies The authors wish to thank Drs. Alfred Osborne, Jr., Karen Stephenson, Max Wortman, Jr., and Marta Vago for their encouragement concerning this paper. Rogers, E.D., Carsrud, A.L. & Krueger, N.F. Chiefdoms and family firm regimes: Variations on the same anthropological themes. Family Business Review, 9(1): 15-27.1996.
  2. 2. CHIEFDOMS AND FAMILY FIRM REGIMES: VARIATIONS ON THE SAME ANTHROPOLOGICAL THEMES ABSTRACT Family owned and managed firms exhibit remarkable parallels to pre-industrial chiefdoms because the typical economic environment in which they exist limits them to a size and scale equivalent to that of a chiefdom. Using anthropological research this study inventories all known procedures of accommodating multiple heirs to the paramountcy of pre-industrial chiefdoms. It uses this exhaustive inventory to characterize the succession process in modern family owned and managed firms. The major theoretical concept adopted from anthropology is that of polity, defined as an autonomous system of institutional finance and organizational support (resource control and governance). Using terms such as polity helps us to recognize the universality of succession processes. Thus, succession processes in family firms are less idiosyncratic than we once thought. Thus, we can fruitfully explore structural similarities between pre-industrial organizations and modern family firms, using the considerable body of field research literature on chiefdoms (Goody, 1958; Barrett, 1965) which finds that every scheme to accommodate multiple successors falls into one of two categories: (a) personnel strategies and (b) asset strategies. A second critical concept is that while it is possible to inventory all possible outcomes (here, succession strategies) in any dynamic system, no single outcome can be accurately predicted in advance. The purpose of this paper is to provide an exhaustive inventory of possible outcomes of the succession process, rather than trying to predict the strategy chosen in a given case. Rather, the anthropological perspective provides a much-needed, empirically-based, comprehensive model of succession processes in family firms and permits a more nomothetic approach to family firm research.
  3. 3. CHIEFDOMS AND FAMILY FIRM REGIMES: VARIATIONS ON THE SAME ANTHROPOLOGICAL THEMES INTRODUCTION Family firms exhibit remarkable parallels to chiefdoms in pre-industrial societies. They both exist in economic environments that limit them to an equivalent size and scale. Anthropological research seeks to identify universal patterns from specific observations, rather than emphasizing the idiosyncrasies. This permits an inventory of all known succession procedures in pre-industrial chiefdoms. We can then use this typology to characterize the succession process in modern family owned and managed firms. That is, social anthropologists have observed that succession processes in chiefdoms can be categorized into a relatively small number of generic succession strategies (e.g., Johnson & Earle, 1988). This article has three key objectives. The first is to inventory modes of succession strategies that accommodate multiple successors to high office in tribal chiefdoms. Second, it grounds this inventory in the proposition that a business venture is a commercial polity similar to pre-industrial governmental entities of a similar scale. Third, the paper adopts ideas from social anthropology to present these modes of succession as recurring constraints on succession outcomes in modern closely-held commercial firms, thus offering a muchneeded comprehensive and empirically-derived model of the dynamics of the family firm. For the family firm practitioner, showing the structural similarity between family firms and pre-industrial chiefdoms opens the door to understanding the family owned and managed business as a logical outgrowth of the type of historic affiliation behavior seen in chiefdoms. We can thus clearly analyze family firms using well-documented anthropological concepts, moving toward a more nomothetic approach to studying family firms (Rogers, 1990). INTRODUCTION TO SUCCESSION AND INHERITANCE STRATEGIES To compare chiefdoms and family firms usefully it is necessary to introduce organizationally-neutral constructs, such as polity, from social anthropology. A polity is a named organization with an autonomous system of institutional finance, having both resource exchange and governance functions. That is, a polity is in essence a system to finance the mobilization of resources for desired activities. The term can thus refer to both self-sufficient hunting and gathering family households as well as to larger-scale groups formed for economic purposes in industrial societies. The senior officer in a polity is termed the paramount, whether the head of a chiefdom or the CEO of a closely-held firm, the individual who controls critical resources. The tenure of a given paramount in a given polity is formally known as a regime. Changes in regimes are termed regime shifts, thus succession in a family firm entails a regime shift. Regime shifts (successions) are thus necessarily
  4. 4. characterized by shifts in who controls the critical resources. Other useful terms are kinship and legitimacy. Kinship is a given polity’s definition of who ‘belongs’ inside the family, the degree to which they belong, and the corresponding privileges and responsibilities. Similarly, legitimacy reflects the polity’s rules for who ‘deserves’ a particular role in that polity (who is entitled to lawful, accepted control over resources). Using terms such as polity, regime, and paramount allow us to recognize that succession processes in family firms are less idiosyncratic than we once thought. Rather, succession in a family firm reflects broader phenomena anchored in human history. With the use of these terms one can turn to the analysis of field research literature on chiefdoms (Goody, 1958; Barrett, 1965) which finds that every scheme to accommodate multiple successors falls into one of two categories: (a) personnel strategies and (b) asset strategies. A recent exhaustive inventory of succession strategies in an industry comprised completely of family firms finds the same patterns (Rogers, 1990). In personnel strategies, the various contenders are either eliminated or given various assignments to lessen competition for a particular office. These distinctions are consistent with Rivers' (1914) view that inheritance is the transmission of property while succession is the transmission of a particular office. In asset strategies, polities are restructured and/or contenders are given wealth payments (paid off). When control of financial resources in the family firm is equated to control of military force in the pre-industrial setting, the two polities, firms and chiefdoms, appear startlingly similar. Benedict (1968) asserts that growth in both family and firm are sources of the tensions leading to succession crises that are equally characteristic of kindred groups. Barring violent regime shifts, aging necessarily affects the stability of the family firm as it would any group, as the death or retirement of a paramount necessarily results in a regime shift (Fortes, 1958; Goody, 1958; Yanagisako, 1979; Rogers, 1990). Further Delineating Succession Strategies. The initial concepts of successor management through personnel and asset strategies can be distilled further. Personnel strategies include both contenders and shared appointments. Contenders can be eliminated through tests of competence, legitimacy, combat, or ostracism. Shared appointment strategies include appointment of a successor during the reign of the original paramount (CEO or owner), rotation of the office, and a division of labor in which potential successors are given other jobs. Asset strategies include both restructuring the polity and wealth payments. Alternatives to restructure the polity include start-ups, acquisitions, and fission and/or sloughing of revenue sources to form stand-alone polities or organizations. The polity may also choose to pay off one or more contenders. Finally, a polity may choose to handle succession with a combination of more than one strategy. Implications of Dynamism: A Caveat. The conceptual approach of summarizing constraints on succession processes in general is based on techniques employed in mathematical chaos theory. Dynamic systems generate an inevitable complexity that manifests itself in a finite range of possible outcomes given any
  5. 5. set of initial conditions. Yet, no single outcome to a succession crisis can be accurately predicted far in advance because of the complexity of the system and outcomes are highly sensitive to even small differences in initial conditions. Individuals have the freedom to act within the range but not outside the range of constraints (Crutchfield, et al; 1986). A finite list of possible succession strategies (as opposed to an infinite number of possibilities) suggests that we can offer choices of succession strategies to family firms. However, outcomes will be dictated by initial conditions far more than by outside interventions. (Please insert Table 1 about here) AN ANTHROPOLOGICAL APPROACH TO FIRM SUCCESSION Although succession and other processes in chiefdoms have been extensively studied (Goody, 1966), the role of succession in industrial societies has fallen primarily to family firm and entrepreneurship researchers from psychology, sociology, banking, law, and accounting (Davis, 1983; Dyer, 1988; Kets de Vries, 1993; Lansberg, et al., 1988). The family firm remains largely uncharted territory for social anthropologists despite a vital need to better understand the interactions between work and family (Kanter, 1989). More importantly, this failure of anthropology to adequately impact the study of family and closely-held firms has deprived those interested in the phenomena with potentially useful concepts to help understanding. This is quite similar to anthropology's lack of impact on entrepreneurship (Stewart, 1993). While fragments of industrial society have been studied, no comprehensive theory-driven vision of the family firm as a social/economic entity has emerged. Much family firm research focuses on the dynamics of family relationships, particularly focusing on pathologies. Meanwhile, anthropologists' studies of modern urban settings have typically examined single factories, neighborhoods, or small towns. A notable exception is Stewart's dissertation research (1989) on a rapidly growing Canadian entrepreneurial firm. The problem with most anthropological studies of modern economic processes is that the foci are generally based on geography, not on kinship or economic groups. Firms embedded within industries are unique to industrial society and are increasingly less geographically localized because of modern transportation and communication technologies. Social and cultural embeddedness thus get less consideration. Anthropologists have been biased by historical trends in methodology that view pre-industrial and postindustrial societies as two separate universes. The first universe is ‘embedded’ or has an economy built around social relations while the latter is ‘disembedded’ or solely driven by market-negotiated events (Polanyi, 1944). The reality in family firms today is clearly closer to pre-industrial societies than either modern market-
  6. 6. driven economists or social anthropologists care to admit. Economic sociologists such as Granovetter (1985, 1992) demonstrate that most behavior is deeply embedded in its social context and that interpersonal bonds make economic institutions socially constructed. Thus, family firms cannot be understood without understanding social context, including the centrality of the family dimension where interpersonal bonds simply cannot be ignored. Similarly, research that focuses on family dynamics alone risk ignoring that family firms are polities. Alfred Chandler (1977), the business historian, maintains that modern business activity in large decentralized organizations is carried on by administrative teams of managers. These managers have vested interests, both obvious and hidden. More important, he shows that legal ownership is generally divorced from control; managers operate the firm, not the shareholders. Management need not equal ownership. Similarly, ownership need not equal legitimacy. In family firms, issues of ownership, management, and control are even more entangled. Clearly, neither are family business activities mindlessly transacted in the marketplace, but have very strong intrapersonal and interpersonal attributes. To Chandler, wealth (or resources controlled by social units) is key to studies of any political economy, a situation especially true in the family firm. Thus changes in the control of resources (i.e.,succession) is critical to understanding family firms in modern industrial societies. COMPARING POLITIES One frequently hears that a firm failed because of financial reasons. While this may certainly be one frequent cause, the reality is that the polities in any industry reflect the same human processes of aging that affect other domestic and kinship groups. It is important to note that ‘kinship’ is an style or method of carrying out transactions and warfare. In today's societies, warfare has generally moved from the battlefield to the courtroom. At this point it is appropriate to examine personnel and asset management strategies in more detail (please refer to Table 1). First, personnel strategies subsume two major types of strategy: Elimination of Contenders and Shared Appointments. Personnel Strategies: Elimination of Contenders We can classify strategies for eliminating contenders into four types: (a) tests of competence, (b) legitimacy, (c) combat, or (d) ostracism. Competence. Barring cases of extreme mental and physical inadequacy, competence becomes relative to the scale and specific demands of the office or position. In a medium-scale polity with a relatively stable revenue base, the paramount must carry some of the leadership burden. Thus, prospective chiefs must prove
  7. 7. themselves or at least make significant efforts to acquire critical skills. For example, in the Polynesian chiefdoms described by Bell (1932) the chief was expected to fish, be skilled in crafts, maintain prestige displays, and manage redistribution of resources such as food. In modern family firms we certainly observe cases of mentally incompetent successors. If a firm survives under new leadership for the better part of a decade, it is hard to assume incompetence, and in fact most CEO's demonstrate a wide variety of skills. Competency may also be questioned where potential successors disagree vigorously over the firms' future strategic direction as in the current battle at Dart Group (Swisher, 1994; Torry, 1994). In general, achievement-based succession in chiefdoms strongly implies the assumption that kindred represent a very viable pool from which to take competent heirs. In the family firm this may be increased if heirs have been general managers, a natural training and recruiting pool for competent successors. One need only look at century-old family firms in North America such as Levi Strauss, Nordstrom, and Seagram to see the ability of families to produce sufficiently competent heirs, especially in non-technology based firms. The same is true in other regions of the world. Negotiating Legitimacy. An examination of the field research literature on pre-industrial societies illustrates the slippery and negotiated character of many supposedly ‘sacred’ principles of legitimacy. That is, legitimacy has both substantive and symbolic aspects. Even ‘divinely’ selected paramounts must live up to certain obligations to others outside the clan (which may, or may not, include competence). Conquering rulers such as the Normans (Searles, 1988), depended on local nobles to provide their military organization. Thus, they were vulnerable to some form of election or consent by the elders of other local kinship groups. In successions based purely on substantive achievement, a successor may marry one of the previous monarch's relatives or acquire the paraphernalia of office in order to gain symbolic legitimacy. An example of this is the Franks who had Pippin. Here was a man without royal relatives, who was "anointed by God" in a ceremony from the Old Testament revived especially for the occasion (Goody, 1966). Kinship Issues in Legitimacy: The idiom of how pre-industrial societies conceptualize legitimacy reflects the interplay of kinship ties and supernatural and religious sanctions, as shown in examples both historical and current. Most of the contenders for the status of ‘chief’ in the Hawaiian Islands had ties with many dynastic lines, and genealogies could be easily adjusted to prove membership in the current royal dynasty (Earle, 1978). If all else failed, the former monarch could be proved a tyrant to justify a return to the ‘rightful’ dynasty. This was done to Richard III by the Tudor propagandists of Henry Vll (Kendall, 1965). The internecine family struggles in the Dart Group offer a current example where the father went on television to accuse his son of malfeasance (Swisher, 1994). Recall that, as a rule, kinship does not in and of itself carry rights to succession or even property. Its role depends on the particular polity. Julius Caesar's biological son did not inherit Rome. John Paul Getty gave the bulk of his monies not to his children, but to his art foundation,
  8. 8. much to the pleasure of the art world and the citizens of Los Angeles. Also, the nature of ‘kinship’ can vary between polities (e.g., matriarchal versus patriarchal). As kinship is defined by the polity, a family firm might re-define ‘kinship’ to include a promising in-law or long-time manager. Legal Issues in Legitimacy: Legitimacy in the modern family firm takes a much more legalistic form, but it is often still driven by ancient traditions. For example, males, not females, are still frequently seen as the preferred legitimate successors. Legitimacy today can be purchased as when general managers are successors after a buyout. In modern economies, questions of legitimacy have moved primarily to the legal arena and away from the kinship and supernatural (or religious) arena of pre-industrial settings. Kinship group participation in family firms is normally underscored by some set of vested ownership rights that can be bought and sold. These rights also confer authority. The key similarity between the two types of polities is the system of "legitimizing through ideological or legal claims," or the ‘rights’ to an office. No system works purely on ‘might’ (or even legal ownership, as Chandler noted) in today's industrial societies. Regardless of how ruthless the takeover, the event still is clothed in legal language that is the legitimacy ceremony of modern society. That is, legal settings are often designed to convey symbolic legitimacy as well as substantive legitimacy. Combat. Gluckman (1954) argued that in Basutoland, multiple heirs disperse the rights to office and paralyze or fragment the state. Combat and eventually reunification by a powerful individual then followed. Murder to eliminate excess relatives is still endemic to chiefdoms dependent on military force for authority. Goody (1966) describes Hogan's work on the Cene'l Eoghain, one of the two kinship groups to rule Ireland between 879 and 1260. Hogan calculated a rate of "dynastic homicide" and found that approximately 46 percent of the men in that dynasty met with violent death, and of these approximately 50 percent died at the hands of their own kinsmen (Goody, 1966). While not to be condoned, murder as a succession tool occurs even today in criminal organizations (and elsewhere, at least according to lurid media accounts). Battles today are often over ‘stock.’ A clear tension exists between the frequent practice of giving equal shares of stock to all siblings while appointing one, normally the senior male, as president. Combat related to succession and inheritance in American family firms is now fought largely with battalions of pin-striped professionals. Battles to the death are now conducted with substitutes where heirs to a company dispute control using lawyers and accountants as ‘warriors.’ It is not unheard of to see a sibling forced out of a firm by another sibling after extensive litigation. This was certainly the case in the family control of Campbell Soup. Most recently, father and son are wrestling for control of the Dart Group, with family members using fifteen different law firms (Torry, 1994). Ostracism. Banishing, or ‘firing’ a potential successor was not easily accomplished in the pre-industrial setting, since surrounding territories were often hostile, and the ‘royal’ identity of the successor could serve as a rallying point for potential contenders for a throne. For example, William, a son of the Norman
  9. 9. dynasty, was shipped to Sicily to avoid conflict with an elder brother (Searles, 1988). One can see the same mode of ostracism when relatives vote a founding entrepreneurial CEO out of office, pushing him/her out of the company. Since kinship alone is not sufficient to establish ownership rights in a firm, heirs could be excluded from share ownership unless they do undertake legal warfare. Finally, ostracism can lead an heir to simply choose another career and become irrelevant to the firm. Personnel Strategies: Shared Appointments Other personnel strategies include appointing successors before formal regime shifts, rotation of offices, and division of labor (potential successors are given other jobs). Below is a discussion of each alternative personnel strategy. Shared Appointments: Pre-Mortem. Various mechanisms short of outright murder have been tried to alleviate the problem of too many royal successors. Goody (1966) refers to pre-mortem succession as a process in which the aging incumbent appoints his own successor, a phenomena repeated today in several northern European monarchies. Goody equates the resulting leadership situation to dual paramountcies where the successor assumes some duties of the paramount, such as that between two nephews of the K'Awas lineage recorded among the Haida at the Kiou village (Stearns, 1984). A less anthropological situation is dramatized by Shakespeare in King Lear. This strategy may precipitate rather than quell rebellion. For example, Lear divided his kingdom between two of his daughters, excluding a third. Although a seemingly legitimate and substantively equitable arrangement, it served to pit his children against one another and cause civil war. Family firm practitioners can certainly identify with this oft-recurring phenomenon. For example, in modern family firms a successor may be appointed while the paramount was still serving. The successor then works in the firm as the heir apparent. This can result in serious family conflict, such as forcing a parent to retire, or causing unsuccessful siblings to resent, or even sabotage the chosen heir. Shared Appointments: Rotation. Two types of rotation occur in the ethnographic literature. In the first, the paramountcy moves between brothers, instead of between sons, giving each member of the dynasty an opportunity. The current Saudi monarchy operates in this manner. The awkwardness of such arrangements is apparent when the issue arises of moving the paramountcy to the next generation. Another such arrangement was documented among the Haida in the Pacific Northwest (Stearns, 1984). The second type of rotation is through several different lineages. Among the Nupe in western Africa, three clans, the families of Umar, Masaba, and Usman Zaki, rotated the paramountcy while other lineages were shed (Nadel, 1942). In the modern American family firm, no equivalent norms exist about rotation between siblings, but it is not unheard of as in the case of Roy Disney, brother of Walt, at the Disney Company. Shared Appointments: Division of Labor. An alternative form of accommodating excess successors
  10. 10. is to assign various members of the dynasty to different positions in the polity. Robert, the younger brother of Richard founder of the Norman dynasty, became the archbishop of Rouen (Searles, 1988). The modern family or closely-held firm often offers similar jobs. A father is the CEO while the elder son is a manager, the younger son a salesman, and the daughter, son-in-law and sister all at other jobs. Asset Management Strategies Asset strategies can be classified as restructuring or wealth payments. Below is a brief discussion of each alternative. New Polities Started, Acquired, Divided or Sloughed. At times, a portion of an existing polity may be used to form a new polity to give to a dissident successor. Among the Trobriand in the South Pacific (Malinowski, 1922) and the Haida (Steams, 1984), separate villages were established by collateral branches of the main chiefs at South Boyowa and Xaina, respectively. William the Conqueror invaded England in part to extend domains for the younger generation of Normans. Similarly, a previously consolidated entity such as the Carolingian Empire may be broken up among heirs (Searles, 1988). Similar strategies are used today in buying and selling firms. A wealthy family may acquired a company for a daughter and son-in-law and transfer part of their customer base to help two sons establish a new organization. Rather than dissolve or pass on the older structure, the family may use the connections provided by the older structure to start new ones in areas more suitable for the heirs, a process occurring today in Hong Kong. Another way to view this is new product line which can be started to manage non-succeeding (or dissident) members of the organization. We might observe this where a non-successor has competence, but not legitimacy, or where success demonstrates competence and thus legitimacy. Wealth Payments. Capital disbursement may be made to cancel rights in succession. Cases are documented among pre-industrial settings of royals selling their patrimony. One only need recall the Old Testament story of Esau selling his birthright. Firth (1936) records such an incident on Tikopia in the Solomon Islands where a chiefly contender, Taupe, was bought off by being given an orchard in perpetuity. His father was a high chief, but his mother was from another island, and the local chiefs did not want him as a successor. In another case, Mauger, one of the Norman heirs, was given a wife with a substantial dowry to step out of the line of succession (Searles, 1984). In the modern family firm this can be seen when a sibling is bought out with a payment of land, money, or some other hard asset. IMPLICATIONS Now that an exhaustive typology of succession has been described, it is appropriate to look at the
  11. 11. various implications this has on different groups interested in family business. These are the family business professional, the family firm member, and the academic research community. Succession may be the most salient phenomenon in a family business, but family business research lacks a comprehensive model of succession. Too often, research treats succession as essentially idiosyncratic, or at least too complicated to deal with parsimoniously. Too often it is merely viewed as the conflict of the personal ambition of the entrepreneur with that of an heir, solved only by legal techniques. Findings from social anthropology firmly contradict this, offering evidence that there are a finite number of possible strategies for handling succession. As in any dynamic system, one may not be able to predict which strategy will be chosen, but one can identify the advantages and disadvantages of each strategy. Finally, there is the obvious implication is that anthropological concepts offer a comprehensive model of the family firm itself. For Family Business Professionals. Danco (1984), the well-known family firm consultant, once said that when dealing with family businesses, he was merely restudying and drawing upon the ancient Greek tragedies. Social anthropology research suggests that this is more than a clever metaphor. Given a lack of a coherent model of effective functioning in family firms, it is imperative for those interested in the institution to have available the perspective of humanity's historical methods for dealing with changes in regimes. It should be comforting to see that industrial society is an outgrowth of pre-industrial forms. For example, while we (and lawyers and accountants) can argue, often strenuously, for pre-mortem succession planning, the case of King Lear suggests that succession planning often has unintended consequences. For Family Firms. While each succession crisis in a family firm is a unique, and sometimes a painful situation, there are only a limited number of possible outcomes that can occur; The choice of which end result is up to the participants involved. Knowledge of those outcome options could help in communicating options to all concerned, but the pros and cons really depend on the players involved and their own personal ambitions. For lawyers, accountants, and organizational behaviorists, using historical and anthropological examples could be useful in reducing the barriers to insights that members of family firms often raise when more immediate, and personal, events are used in discussion. For Academic Researchers: Future Directions. The anthropological perspective allows for an understanding of the universality of human interaction processes. Much research on family firms focuses on an idiographic approach, often focusing on family dynamics and concepts from family therapy. This reflects the assumption that family firms are relatively idiosyncratic phenomena. To study family firms from a more nomothetic approach requires the assumption that critical processes are relatively universal. Anthropological research on chiefdoms lets us delineate a limited number of relatively universal succession structures and processes common to all polities across several millennia and across different levels of technological sophistication. Research in a more nomothetic direction has already proven useful in family business
  12. 12. (McCollom, 1990; Rogers, 1990). This discussion also illustrates how anthropologists can learn from family business research. One limit on classical anthropological research is that it underplays the influence of family dynamics. With the modern family firm, there are an enormous number of potential cases for possible study by social anthropologists. Anthropology provides the family firm researcher with a comprehensive, yet parsimonious model for understanding succession. The vast number of organizational units that constitutes the current industrial world provides researchers with the base of statistical and qualitative data necessary to understand more fully the patterns of constraints that characterize all social organizations. We may wish to focus research efforts in directions that bridge the differences between idiographic and nomothetic approaches. For instance, are specific patterns of family dynamics associated with specific succession strategies? (With successful succession strategies?) We also know that growing up in a family business significantly influences beliefs and attitudes toward family business (Krueger, 1993). Are specific succession strategies associated with prior experiences? (For example, is a specific succession strategy chosen because it was learned from past successions?) Finally, the most intriguing research challenge will be to use this typology to characterize future observations of succession in family firms (and to characterize past observations from the literature and archival sources). CONCLUSIONS This is not merely a list of all possible procedures for accommodating succession in preindustrial chiefdoms. We wanted to show how these seemingly abstract categories can be used to characterize any succession process in modern family owned and managed firms in industrial societies. To facilitate this comparison, we introduced the anthropological concept of polity that defines autonomous groups in terms of institutionalized financial and organizational support. The intent is to provide the consultant, the academic researcher, and the family firm member with an exhaustive inventory of possible outcomes of the succession process. This was done not to predict the outcome in any given case, but to provide a theoretical approach that accurately reflects the chaotic, yet limited range of alternatives that often characterizes succession in firms. As with any dynamic system, succession has a finite array of possible outcomes. However, no single outcome can be accurately predicted, we can only eliminate infeasible alternatives. Only through knowledge of the past can the family firm avoid being doomed to repeating it. In reality, chiefdoms in tribal Africa and family firms in the United States reflect the same robust social processes, a universality we can profitably use in research and in practice.
  13. 13. BIBLIOGRAPHY Bell, F. L. S. (1932). A functional interpretation of inheritance & succession in central Polynesia. Oceania, 3, 167-206. Benedict, B. (1968). Family firms and economic development. Southwestern Journal of Anthropology, 24, 1-19. Chandler, A. D. (1977). The visible hand: The managerial revolution in American business. Cambridge, MA: Harvard University Press. Crutchfield, J. P. et al. (1986). Chaos. Scientific American, November, 46-57. Danco, L. (1984). Personal communication to first author. Davis, P. (1983.) Realizing the potential of the family business, Organizational Dynamics, 12, 47-56. Dyer, W.G. (1988). Culture and continuity in family firms, Family Business Review, 1(1), 37-50. Earle, T. (1978). Economic and social organization of a complex chiefdom: The Halelea district, Kauai, Hawaii, Ann Arbor: University of Michigan Museum of Anthropology. Firth, R. (1936). We the Tikopia, Boston, MA: Beacon Press. Fortes, M. (1958). Introduction. In J. Goody's (ed.) The developmental cycle in domestic groups. Cambridge, UK: Cambridge University Press. Gluckman, M. (1954). Succession and civil war among the Bemba: An exercise in anthropological theory. Human Problems in British Central Africa, 16. Goody, J. (1958). The developmental cycle in domestic groups. Cambridge: Cambridge University Press. Goody, J. (1966). Succession to high office. Cambridge, UK: Cambridge University Press, 1-56. Granovetter, M. (1985). Economic action and social structure: The problem of embeddedness, American Journal of Sociology, 91 (3), 481-510. Granovetter, M. (1992). Economic institutions as social constructions, Acta Sociologica, 35 (1), 3-11. Johnson, G. A. (1988). Organizational structure and scaler stress. In C. Renfrew (Ed.) Theory and explanation in archaeology. New York: Academic Press. Kanter, R. (1989). Work and family in the U.S.: A critical review and agenda for research and policy, Family Business Review, 2, 77-114. Johnson, A. & Earle, T. (1987). The Evolution of Human Societies. Stanford: Stanford University Press. Kendall, P. M. (1965). Richard the Third. Garden City, NJ: Anchor Books.
  14. 14. Kets de Vries, M.F. (1993). The dynamics of family-controlled firms, Organizational Dynamics, 21, 59-71. Krueger, N. (1993). Growing up entrepreneurial? Paper presented to the Academy of Management, Atlanta. Lansberg, I., et al. (1988). Family business as an emerging field, Family Business Review, 1, 1-8. Malinowski, B. (1922). Argonauts of the Western Pacific. New York: Dutton & Company. Nadel, S. F. (1942). A Black Byzantium: The Kingdom of Nupe in Nigeria. Oxford: Oxford University Press. Polanyi, B. (1944). The Great Transformation. New York: Holt, Rinehart & Winston. Searles, E. (1988). Predatory Kinship & the Creation of Norman Power, 840-1066. University of California Press. Stearns, M. L. (1984). Succession to chiefship in Haida society. In J. Miller & C. M. Eastman (Eds.), The Tsimshian and their neighbors of the north Pacific coast. Seattle, WA: University of Washington Press. Stewart, A. (1993). A prospectus on the anthropology of entrepreneurship, Entrepreneurship Theory and Practice, 16 (2), 71-91. Stewart, A. (1989) Team entrepreneurship. Newbury Park, CA: Sage Publications. Swisher, K. (1994), Dart asks Herbert Haft to prove TV accusations, Washington Post, October 10, 117, WB7. Rogers, E. D. (1990). Succession in American rose-growing firms: A study of process in commercial polities. Unpublished doctoral dissertation, Department of Anthropology, University of California, Los Angeles. Torry, S. (1994). Haft vs. Haft, a one-family legal bonanza, The Washington Post, September 24, 117, p. D1. Yanagisako, S. J. (1979). Domestic groups. Annual Review of Anthropology, 8, 161-205.
  15. 15. TABLE 1 SUCCESSION STRATEGIES PERSONNEL STRATEGIES Elimination of Contenders Competency Negotiated Legitimacy Combat Ostracism Shared Appointments Pre-mortem arrangements Rotation of Paramountcy Division of Labor ASSET STRATEGIES Restructuring (New polities started/acquired/divided/sloughed) Wealth Payments