Asian Family Firms
This digital exhibit examines the intricate dynamics within such firms, exploring the omission of material aspects when understanding the dynamics of Asian family firms as just interpersonal. From blood relations to fundamental disparities, this research delves into complexities and inherent differences between small and sizeable Asian family firms despite their seemingly similar interworkings. Family firms are those in which the family controls the business. Big or small, they rely on transgenerational intent, which is the resolved passing of leadership from one generation to the next, guanxi–the relationships that are crucial for facilitating smooth business transactions and maintaining them within the family, and Confucianism a concept rooted in respect of elders. Together, the three create the perfect combination of a functional corporation that is psychologically sound..
Thesis
The thesis of this exhibit is based on the de-orientilization of the family firm. Greenlaugh defines orientalist discourse as "a stereotype-filled discourse that constructs the Orient in terms of timeless essences and stresses the Orient's separation from and opposition to the West." She argues that the attempt to relate traditions to family firms is just an attempt to make them more Asian. Eric Kushin argues that scholars focus on the family when understanding family firms, but they should be focusing on the type of relationships within the family and how that is affected by extenuating circumstances. Ultimately, this exhibit examines the stereotypical explanation for ALL Chinese family firms [as is represented in my moving image] and the contradictions that lay within differences among smaller and larger family firms [represented in my media artifacts.]
Central Components of a Family Firm
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Personalization of business relationships is not only inevitable but also immediate. Trust is rooted in guanxi; trust is central to the first component of Asian family firms. While hierarchical structures are the basis of these firms, who assumes the lower level positions is up for discussion. In other words, deciding who gets to do what or “what they deserve” is ultimately based on the level of trust and the form of relationship the superior has with their inferior. When the positions are finally delegated, it causes trouble among those involved. Interpersonal relationships exist with every member of the firm, and those who do not assume the position they sought after taking it as a betrayal, not from the perspective of boss and worker but that of father and son. Transgenerational intent is also affected by the personalization present within these family firms. These relationships defined future leaders and agreed-upon plans from those who came before them.
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Paternalism plays a significant role in family firms, shaping organizational structures, decision-making processes, and interpersonal relationships. In the context of Asian family firms, the paternalistic position within the business is assumed by the head of the household, who is traditionally male. This centralized authority ensures stability and security within the family and company. Asian culture is explicit about the value of respect for their elders. As such, the family businesses will always begin and end with a hierarchal structure. Long-term orientation also contributes to paternalistic undertones within these family firms. With a hierarchy in place, the focus will always be on short-term success rather than the future. Often, leaders in non-family businesses are less focused on the quality of life for those who will succeed them and instead have very self-centered values. That being said, blood is always thicker than water. When your family is involved, you put them first and create a space where they can flourish. Paternalism, in combination with personalization, affects the treatment of employees. That's not to say it is always positive; it can frequently hurt the contributors. The pressure is abundant and leads to distress within the family. Finally, mentorship is a crucial aspect of paternalism. It creates a space of knowledge transmission from the older generation to the younger one, which ensures the continuation of the family's success.
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In their simplest form, centralized authority structures culminate in personalization and paternalism. It is the organization of the “inner circle,” or “leaders,” and their roles in the business, including but not limited to concentration of power, challenges, and adaptability. The concentration of energy is the distribution of positions in the hierarchy, i.e., not just the paternal figure but the levels below. Many potential challenges that centralized authority poses. For example, succession risk is the idea that unqualified candidates will control the hereditary inheritance system. However, mentorship can potentially resolve this. Another concern is resistance to change. While transgenerational intent is used to reassure stability, outside factors such as westernization, sudden growth, or inherent generational differences can cause changes that offset the attempted balance. This centralized model allows for quick decision-making, leading to adaptability, which can be advantageous in business environments.
While it feeds into stereotypes and Orientilization, many scholars find that family firms have three primary values: personalism, paternalism, and centralized authority structures, all coming with unique problems.
A common theme among sociological interpretations of Asian family firms is their connection to Confucian culture. According to the NIH, Confucianism is “a complex system of moral, social, political, and religious thought about an individual’s relationships with others and appropriate conduct.” Respect, honor, benevolence, hierarchies, and tradition fall under confusionism. They all also happen to be aspects of a functional Asian family firm. The maximization of Confucian culture is rooted in the institutions or governments surrounding the business. For example, in China, extortion and expropriation are norms within the governing system, and an emphasis on respect and honor provides guanxi and reliability.
Many of the systems put in place to maintain Asian family firms are rooted in the patriarchy. The “head of the house” is almost always a man, regardless if he has an elder who is female. Confucian influences reinforce patriarchal tendencies, and the respect that is so often valued is only accessible to men. The work-life balance is also thrown off – men are expected to run the business, and women are expected to prioritize domestic tasks. There is also a male heir preference. Often, it is exclusively the mentored sons, which excludes daughters from decision-making and sets the men up for being more qualified: the division of labor creates a male-dominated hierarchy. These male-centric institutions often lead to push-out. In other words, women experience exclusion from meetings, unwanted male advances, and a lack of resources to prevent any female desire to participate in the firm.
The Patriarchy and Confucionism In Family Firms
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The Patriarchy and Confucionism In Family Firms -
Thesis In Context
The conversation about how family firms function within smaller businesses vs larger ones interrogates the importance of similar experiences. Chief Executive Officer Siu Rui Quek reflected on his parents' response when he told them he planned on their e-commerce, Carousell, to work on a startup: “My dad’s face immediately looked grim. My mom looked away.” Parents often put pressure on the children, more often than not their sons, to continue the family business, whether or not that’s their desire. In her article Sweet and Sour: Social Networks and Inequality in a Chinese Restaurant Katherine Michelle Hill discusses the pressures put on immigrant children whose parents own smaller Asian family firms. Parents who went through hell and back to create and maintain this business are not so quickly willing to give it up. As a result, they heavily encourage their children to take over. Even those who sought higher education feel obligated to return to their working-class families. Many scholars would argue that this proves how concepts such as guanxi and Confucianism are central to defining Asian family firms. However, this is a romanticization of Asian businesses and an oversimplification.
The discussion creates a melting pot for Asian family firms, assuming they all share the same experiences. While not explicitly centering the article around familial businesses, in the piece Irresponsible Dtate Care and the Virality of Nail Salon Asian American Women’s Service Work, Vulnerability, and Mutuality Preeti Sharma highlights the racialized and gendered aspects of COVID-19 precautions. Rooted in necropolitics (who gets to live or die,) measures such as shelter in place disproportionally affect minority populations. The expandability of nail salon workers, a predominantly female and immigrant cohort, challenges notions of life, death, safety, and survival. This causes an interesting reflection upon the inherent differences between the success of smaller and larger firms; whether or not they present the same core principles of family firms, smaller firms experience the fallout of extenuating circumstances on a much larger scale than smaller Asian firms. For example, media companies run by Asian family firms were not only unaffected during COVID-19 but flourished. For them, it was never a question of life or death but instead one of how to leverage this international crisis to their advantage. Furthermore, this begs the question: if they are family firms that follow the same internal principles yet have such different experiences, will material differences preclude the similarities?
Crazy Rich Asians
The assignment was to find a sociological understanding of a moving image. For my moving image, I chose Kevin Kwan's film Crazy Rich Asians. The movie follows the relationship of Nick and Rachel, a couple whose relationship is tested when Rachel meets Nicks's family. While they eventually accept her, they, especially his mother, are the opposite of welcoming to her and do everything in their power to get rid of her: they also happen to be among the wealthiest families in China, owners of a major corporation. Throughout the film, the family pressures Nick to return home and take over the business. While he has created a life for himself in New York, one that he loves, including Rachel, he experiences constant criticism for choosing to leave behind the life they had built for him. There are also numerous instances of the patriarchal systems present in Asian family firms. Even though Nick has made it abundantly clear that he wants nothing to do with their company, neither of his sisters is in consideration for the position intended for him. Another exciting concept demonstrated is that Nick is still the preferable successor despite his absence and lack of knowledge of the company. It is further evidence of how exclusive the "inner circle" is – the family is willing to gamble their successes on their son, who hasn't been involved for years just because of his blood. This is a testament to how vital guanxi is to Asian family firms. Ultimately, the circumstances reflect succession risk, i.e., the business ends up struggling because there are no alternative entrusted, mentored, and male candidates.
Media Artifacts
Media Artifacts In Context
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Oceans 8 is a film about eight women who come together to pull off the heist of the century. I focused on just one of them, Amita, who is desperately trying to escape her family firm. Much like the Carousell example, both families put pressure on their kids to continue the family business. The differences, however, are too large to ignore. Quek had to watch his parents’ disappointment, but Amita had to risk going to jail. This means that the idea that guanxi and Confucianism are the leading factors of Asian family firms is inherently flawed.
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Samsung flourished during COVID-19. Their sales numbers skyrocketed and they used the pandemic as an opportunity. Sharma’s article about nail salon workers describes their experience with COVID-19 as nothing short of a disaster. Asian women lost almost everything, and it became a question of life and death. This is also true for the ASPAA media artifact about Asian business struggles in general. So, despite the fact that they are family owners, during COVID, the company’s experiences were like oil and water.
While the rest reflect concepts discussed above, two of my media artifacts are utilized to directly contradict the notion that all family firms have the same experiences because of their core values.