When transitioning from a moment of crisis to a fundamentally new normal, further reflection is required of us. We must ask ourselves not only how our decisions and action will affect this moment in time, but also we must ask how we foresee a future for all.
The Principles of Humane Entrepreneurship in Family Firms
Following the first Virtual Family Business Research and Practice Conference, it is clear that many family businesses model the key principles found in Humane Entrepreneurship (HumEnt). Borne out of passion and motivated by togetherness, these firms begin with a "virtuous and sustainable integration of Entrepreneurship, Leadership, and HRM."
Humane entrepreneurship centers on the people of business. Critical elements include:
* Participation and empowerment
* Employee ownership
* Training and skills development
* Employment security
* Selective recruiting and high wages
Resilience and Adaptability
Family firms’ ability to invest in their employees has historically led to stronger recovery after crises. During the 2008 economic downturn, many family-run enterprises survived by sacrificing profitability to preserve employment. This demonstrates that valuing social capital alongside financial capital provides a more significant opportunity for long-term success.
At its root, this resilience is the ability to adapt. A family’s potential to modify behaviors depends on their internal culture and trust. Families who are healthy and humanely oriented become very strong; however, those with internal divisions may struggle during periods of hyper-chaos.
Lessons for Non-Family Firms
While family businesses are not perfect—often struggling with nepotism and a reluctance to seek external advice—they possess a deep sense of responsibility for their communities. Key observations include:
* Gender Dynamics: Women-owned family businesses often outperform those directed by men, highlighting the success of equitable work practices.
* Crisis Management: During the COVID-19 pandemic, the internal strength and optimism of family firms have defied expectations of failure.
The success of family firms aligns clearly with the rational principles of Humane Entrepreneurship. It is time for these principles to move beyond family businesses, as they may be the saving grace for any enterprise during these unparalleled times.