Understanding Entrepreneurial Family Businesses in Uncertain Environments Opportunities and Resources in Latin America
Opportunities and Resources in Latin America
Edited by Mattias Nordqvist, Giuseppe Marzano, Esteban R. Brenes, Gonzalo Jiménez and Maria Fonseca-Paredes
Chapter 6: Entrepreneurship in Transgenerational Processes by Means of Social Capital
6. Entrepreneurship in transgenerational processes by means of social capital Marcela Ramírez-Pasillas, Fernando Sandoval-Arzaga and María Fonseca-Paredes INTRODUCTION This chapter examines how entrepreneurship in family businesses occurs in transgenerational processes by means of social capital. Based on an in-depth Latin American case study and a theoretical framework that combines the literature of entrepreneurship, family firms and social capital, our aim is to explore the role of social capital in family businesses in realizing potential venture creation during transgenerational processes (that is, across generations). To investigate how entrepreneurship in family businesses occurs, we specifically explore the intersections between the relational and structural dimensions of social capital (Granovetter, 1992) and the autonomy and proactiveness dimensions of the entrepreneurial orientation (EO) (Lumpkin and Dess, 1996). The relational and structural dimensions of social capital are relevant concepts for addressing relationships and networks when studying entrepreneurship (Johannisson et al., 2002). Autonomy and proactiveness are two dimensions of EO that are of particular relevance to understanding entrepreneurship when studying culture (Hall et al., 2001; Zahra et al., 2004). Although we do not explicitly address uncertain environments, our research case has such a component as it occurs in a Latin American business context. We show that the development of the relational and structural dimensions triggers new businesses when the older generation supports the autonomy and proactiveness of the younger generation. This in turn permits family members of the younger generation to launch improved initiatives. These initiatives range from new and/or improved products to processes and...
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