Multiple applications developed at The Unicist Research Institute and the use of the complexity science research methodology drove to the finding of the nature of family companies. This led to the discovery of the fundamentals that define their behavior in the market, and the conceptual distinction between Business-driven Family Companies and Family-driven Companies. These concepts explained the proactive and/or reactive strategies in the building of maximal and minimum strategies in family companies.
This work showed that Business-driven Family Companies and Family-driven Companies are highly conditioned by the family archetype of each culture and the solution given to the roles that this fulfills. In those cultures where the affective role predominates over the economic and social roles, families that have businesses are highly inefficient and are always at risk as they don’t stabilize as institutions (independently of their members).
In cultures where the roles are balanced, business-driven family companies and family-driven companies are distinct fundamentally for their capacity and speed of growth. Business-driven family companies grow more rapidly.
In cultures where the predominant roles in the family are social insertion and the economic role, families with companies have a powerful influence in the environment. Although structurally they have less capacity to grow, they compensate this with the influence exerted in the environment. In markets with imperfect competition they build very powerful empires.
When we are dealing with business-driven family companies we can state that they are more effective than family-driven companies in the active roles, which are hunting, where one goes out to seek the animal in the market, and agriculture where intensive activities are developed.
An efficiently organized business-driven family company is more effective in passive hunting where it works from the basis of the influence of the family brand, and passive agriculture where extensive is what counts.
Therefore each business-driven family company must know what market niche to occupy where it can best achieve results.
We want to highlight that in marginal markets with highly imperfect competition, these concepts have no effects in reality, which is managed by non-company relationships, where the family-driven company has the weight of the family in that society.
The organization of family businesses requires establishing these companies according to the needs of the market and building a bridge with the needs of the family. This allows establishing family businesses as structured enterprises ensuring permanence, growth and profitability.
NOTE: The Unicist Research Institute was the pioneer in using the unicist logical approach in complexity science research and became a private global decentralized leading research organization in the field of human adaptive systems. It has an academic arm and a business arm.