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Incubating the next generation to venture: The case of a family business in Hong Kong

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  • Kevin Au
  • Flora Chiang
  • Thomas Birtch
  • Zhujun Ding

Abstract

Many Chinese family businesses face the dilemma of building good operating and governance structures and systems while fostering an entrepreneurial spirit across generations. In this study, we explored trans-generational entrepreneurship in Automatic Manufacturing Ltd. (AML), a Hong Kong SME, to shed light on this problem. The first generation founded the company and chose a unique development path that emphasized quality, innovation, and learning before grooming a cadre of professional managers. To continue the family entrepreneurial spirit, AML used the “familiness” resources embodied within the family and its business to incubate the second generation. To test the wings of the second generation as entrepreneurs and then lure them back to AML to take over the responsibilities of the first generation, a unique succession plan nurturing spin-offs by the second generation was developed and implemented. Such a systematic approach, although still under experimentation, has the potential to become best practice for other family businesses. The implications of this approach for research in portfolio entrepreneurship and open innovation are also discussed. Copyright Springer Science+Business Media New York 2013

Suggested Citation

  • Kevin Au & Flora Chiang & Thomas Birtch & Zhujun Ding, 2013. "Incubating the next generation to venture: The case of a family business in Hong Kong," Asia Pacific Journal of Management, Springer, vol. 30(3), pages 749-767, September.
    • Handle: RePEc:kap:asiapa:v:30:y:2013:i:3:p:749-767
    DOI: 10.1007/s10490-012-9331-7
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    1. Sonja Franzke & Jie Wu & Fabian Jintae Froese & Zi Xuan Chan, 2022. "Female entrepreneurship in Asia: a critical review and future directions," Asian Business & Management, Palgrave Macmillan, vol. 21(3), pages 343-372, July.
    2. Miruna Radu-Lefebvre & James Davis & William Gartner, 2024. "Legacy in Family Business: A Systematic Literature Review and Future Research Agenda," Post-Print hal-04515862, HAL.
    3. Siew-Boey Yeoh & Chee-Wooi Hooy, 2022. "CEO age and risk-taking of family business in Malaysia: The inverse S-curve relationship," Asia Pacific Journal of Management, Springer, vol. 39(1), pages 273-293, March.
    4. Matthias Filser & Alexander Brem & Johanna Gast & Sascha Kraus & Andrea Calabrò, 2016. "Innovation In Family Firms — Examining The Inventory And Mapping The Path," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 20(06), pages 1-39, August.
    5. Randerson, Kathleen & Bettinelli, Cristina & Fayolle, Alain & Anderson, Alistair, 2015. "Family entrepreneurship as a field of research: Exploring its contours and contents," Journal of Family Business Strategy, Elsevier, vol. 6(3), pages 143-154.
    6. Majid Ghorbani & Michael Carney, 2016. "The changing face of China’s billionaire-entrepreneurs," Asia Pacific Journal of Management, Springer, vol. 33(4), pages 881-902, December.
    7. Shihui Chen & Hanqing Chevy Fang & Niall G. MacKenzie & Sara Carter & Ling Chen & Bingde Wu, 2018. "Female leadership in contemporary Chinese family firms," Asia Pacific Journal of Management, Springer, vol. 35(1), pages 181-211, March.
    8. Michael Carney, 2015. "Capacity building at the Asia Pacific Journal of Management," Asia Pacific Journal of Management, Springer, vol. 32(4), pages 827-833, December.
    9. Forough Zarea Fazlelahi & J. Henri Burgers & Martin Obschonka & Per Davidsson, 2023. "Spinoffs’ alliance network growth beyond parental ties: performance diminishing, then performance enhancing," Asia Pacific Journal of Management, Springer, vol. 40(2), pages 743-773, June.
    10. Campopiano, Giovanna & De Massis, Alfredo & Rinaldi, Francesca Romana & Sciascia, Salvatore, 2017. "Women’s involvement in family firms: Progress and challenges for future research," Journal of Family Business Strategy, Elsevier, vol. 8(4), pages 200-212.
    11. Zhujun Ding & Sunny Sun & Kevin Au, 2014. "Angel investors’ selection criteria: A comparative institutional perspective," Asia Pacific Journal of Management, Springer, vol. 31(3), pages 705-731, September.
    12. Cristina López-Duarte & Marta M. Vidal-Suárez & Belén González-Díaz, 2018. "The early adulthood of the Asia Pacific Journal of Management: A literature review 2005–2014," Asia Pacific Journal of Management, Springer, vol. 35(2), pages 313-345, June.
    13. Hauck, Jana & Prügl, Reinhard, 2015. "Innovation activities during intra-family leadership succession in family firms: An empirical study from a socioemotional wealth perspective," Journal of Family Business Strategy, Elsevier, vol. 6(2), pages 104-118.
    14. Hanqing “Chevy” Fang & Kulraj Singh & Taewoo Kim & Laura Marler & James J. Chrisman, 2022. "Family business research in Asia: review and future directions," Asia Pacific Journal of Management, Springer, vol. 39(4), pages 1215-1256, December.
    15. Pramodita Sharma & Jess Chua, 2013. "Asian family enterprises and family business research," Asia Pacific Journal of Management, Springer, vol. 30(3), pages 641-656, September.
    16. Jing Zhao & Michael Carney & Shubo Zhang & Limin Zhu, 2020. "How does an intra-family succession effect strategic change and performance in China’s family firms?," Asia Pacific Journal of Management, Springer, vol. 37(2), pages 363-389, June.
    17. Martin R.W. Hiebl & Zhen Li, 2020. "Non-family managers in family firms: review, integrative framework and future research agenda," Review of Managerial Science, Springer, vol. 14(4), pages 763-807, August.
    18. Yuan Lu & Kevin Au & Mike Peng & Erming Xu, 2013. "Strategic management in private and family businesses," Asia Pacific Journal of Management, Springer, vol. 30(3), pages 633-639, September.
    19. Basco, Rodrigo & Calabrò, Andrea & Campopiano, Giovanna, 2019. "Transgenerational entrepreneurship around the world: Implications for family business research and practice," Journal of Family Business Strategy, Elsevier, vol. 10(4).
    20. Huiling Guo & Yuan Zhang & Yijia Sun & Wenqian Yang, 2024. "The Effects of Trans-generational Conflict on Trans-generational Entrepreneurship Performance from the Perspective of First-generation Entrepreneurs’ Networks: Evidence from China," SAGE Open, , vol. 14(2), pages 21582440241, June.
    21. Hossein Samei & Alireza Feyzbakhsh, 2016. "The Effect of Mentoring on Successor Nurturing in Family Businesses," Journal of Entrepreneurship and Innovation in Emerging Economies, Entrepreneurship Development Institute of India, vol. 25(2), pages 211-231, September.
    22. Thomas A. Birtch & Kevin Yuk-fai Au & Flora F. T. Chiang & Peter S. Hofman, 2018. "How perceived risk and return interacts with familism to influence individuals’ investment strategies: The case of capital seeking and capital providing behavior in new venture financing," Asia Pacific Journal of Management, Springer, vol. 35(2), pages 471-500, June.
    23. Dou, Junsheng & Wang, Ning & Su, Emma & Fang, Hanqing & Memili, Esra, 2020. "Goal complexity in family firm diversification: Evidence from China," Journal of Family Business Strategy, Elsevier, vol. 11(1).
    24. Kevin Au & Flora F. T. Chiang & Thomas A. Birtch & Ho Kwong Kwan, 2016. "Entrepreneurial financing in new business ventures: a help-seeking behavior perspective," International Entrepreneurship and Management Journal, Springer, vol. 12(1), pages 199-213, March.

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