Non-family CEOs in privately owned family firms: Searching for fit

Abstract

This article contributes to the understanding of why some management experiences of non-family CEOs (NF-CEOs) in privately owned family firms (POFFs) are successful, while others are not. It uses the flexible pattern-matching technique to examine seven case studies of POFFs with different experiences in recruiting NF-CEOs. Drawing on human capital specificity and heterogeneity, as well as socio-emotional wealth perspectives, our analysis suggests that NF-CEOs and owning families must invest time to gain knowledge of each other. Consequently, longer minimum tenures are required compared to non-FFs, making the alignment of NF-CEO and successor life cycles crucial for success. A cooperative and long-term-oriented personality of NF-CEOs is also relevant to fit the context of family businesses. This article is the first to adapt the specificity of human capital theory to the study of NF-CEOs

The authors have received support from the Chair of Family Business at the University of Girona and from the Catalan Government Research Grant 2021SGR01589

Open Access funding provided thanks to the CSUC agreement with Cambridge University Press (CUP)