Advance employee development to increase performance of the family business
| DOI | https://doi.org/10.1108/ER-03-2022-0151 |
| Published date | 28 November 2022 |
| Date | 28 November 2022 |
| Pages | 27-45 |
| Subject Matter | HR & organizational behaviour,Industrial/labour relations,Employment law |
| Author | Pedro Victor Núñez-Cacho Utrilla,Felix A. Grande-Torraleja,Antonio Luis Moreno Albarracín,Cristina Ortega-Rodríguez |
Advance employee development to
increase performance of the
family business
Pedro Victor N
u~
nez-Cacho Utrilla and Felix A. Grande-Torraleja
Department of Business Organization, University of Ja
en, Ja
en, Spain, and
Antonio Luis Moreno Albarrac
ın and Cristina Ortega-Rodr
ıguez
Department of Finance and Account, University of Ja
en, Ja
en, Spain
Abstract
Purpose –The search for competitiveness by family-owned companies has led us to research topics that may
help these companies succeed. The management of human capital is undoubtedly one of the keys to success,
and the practices of employee development (training, promotion, succession, career planning, mentoring and
coaching) help improve the performance of these companies.
Design/methodology/approach –This paper is based on studying a sample of 560 family companies and
analyzing the relationship between performanceof the family businesses and the use of employee development
practices. The techniques used were confirmatory factor analysis and structural equation modeling.
Findings –The results show that employee development has a direct effect on the indicators of performance in
family companies. The authors have developed a series of practical implications for companies that justify
investments in and efforts with regard to employee career development.
Research limitations/implications–Family businesses need to understand the development needs of their
employees. In addition, the very processes and tasks performed. The authors have developed a number of
practical implications for companies that justify the investments and efforts made in employee career
development. This work validates the usefulness of the use of certain practices for the development of
employees in family businesses, allowing the company to generate human capital to build a competitive
position in the market.
Practical implications –The results of this study suggest that family businesses should understand the
development needs of their employees and that various practices are available to help detect these needs.
Family businesses should see individual development processes as an opportunity to improve the performance
of employees, which could avoid conflicts in such businesses (Qiu and Freel, 2020). Companies should develop
career and succession plans that enable these changes to be faced throughoutthe company, ensuring that when
handover occurs, the candidates are sufficiently qualified in accordance with their career paths. The present
research study shows that coaching is a powerful tool for improving performance. Moreover, mentoring
appears to be an important part of employee development. For this reason, mentoring programs should be
formally planned with designated objectives. In addition, family businesses should provide employees with
real opportunities for promotion and the development of their skills and abilities, which is a way to retain
nonfamily professionals (Ramankutty and Pujar, 2017).
Social implications –Family businesses area very important part of the productive activityof a country and
their continuity is necessary to maintain employment and income. The management of people in family
businesses is a key aspect for their success, therefore knowing the key aspects for the development of human
capital will have a positive influence on maintaining employment and income.
Originality/value–This paper address es the study of people development processes in family businesses
and proves its usefulness to improve performance, considering the formal planning of succession
processes and professional careers, providing qualifications to candidates and ensuring that they are show
satisfaction with their professional evolution in the company. Likewise, it is positive for family businesses
Employee
development in
family
businesses
27
© Pedro Victor N
u~
nez-Cacho Utrilla, Felix A. Grande-Torraleja, Antonio Luis Moreno Albarrac
ın and
Cristina Ortega-Rodr
ıguez. Published by Emerald Publishing Limited. This article is published under
the Creative Commons Attribution (CC BY 4.0) licence. Anyone may reproduce, distribute, translate and
create derivative works of this article (for both commercial and non-commercial purposes), subject to full
attribution to the original publication and authors. The full terms of this licence may be seen at http://
creativecommons.org/licences/by/4.0/legalcode
Authors do not declare any conflicts of interest.
The current issue and full text archive of this journal is available on Emerald Insight at:
https://www.emerald.com/insight/0142-5455.htm
Received 28 March 2022
Revised 4 October 2022
Accepted 9 November 2022
Employee Relations: The
International Journal
Vol. 45 No. 7, 2023
pp. 27-45
Emerald Publishing Limited
0142-5455
DOI 10.1108/ER-03-2022-0151
to use coaching relationships, formally scheduled and employing a coach from abroad. The other tool that
will favor the development of employees is mentoring, formally programmed, establishing objectives and
properly studying the mentor’s profile. For this tool to be applied successfully, it is necessary to get the
participants to commit to the mentoring process. Finally, the organization must provide its employees with
real opportunities to promote, training them and developing their skills.
Keywords Development, Family business, Coaching, Mentoring, Training, Performance
Paper type Research paper
1. Introduction
In recent decades, interest in human resource management-related activities has increased
among both researchers and practitioners (Hoon et al., 2019;Kaur and Kaur, 2020). This
interest is largely due to the influence of people management on organizational success
(Bhattacharya et al., 2005;Jiang et al., 2012) and its connection to employee attitudes and skills
(Pak et al., 2019;Van De Voorde et al., 2012) and firm performance (Van Esch et al., 2018).
This need to advance in the knowledge of people management is even more intense in family
businesses, which present their own distinguishing characteristics arising from the presence of
various factors, such as nepotism in decision-making, the presence of family members as
employees (Harris et al., 2004), the accommodation of family members (Qiu and Freel, 2020)and
the patterns of ownership, governance, succession and belief systems (Payne et al.,2011).
Management and ownership are usually concentrated in a small group of family members
(Debicki et al., 2016). Regarding people management, these particular concerns of family
businesses are especially sensitive, and as a result, unique relationships can be expected between
training and new employee development practices and performance. Matlay (2002) tackles the
differences between the training and development policies in family firms and those in
nonfamily firms and emphasizes the specific problems that may arise because of the presence of
family and nonfamily employees in the workforce, as well as the implications of the process of
succession (Ramankutty and Pujar, 2017). Le Breton-Miller and Miller (2006) state that family
companies pay more attention to these practices, are more attentive to employee training, and
make more effort to formulate career development policies than nonfamily companies.
Therefore, differential behavior between nonfamily businesses and family businesses in terms of
employment is clear given the existing empirical evidence (Lorenzo et al., 2022;Rivo-L
opez et al.,
2020). Therefore, the study of the management of people is a key topic for th ese organizations
and the number of research articles studying some aspect of human resources in relation to firm
performance is increasing considerably. Recently, studies have been conducted that pertain to
the effects on the relationship between perceived employability and performance (De Cuyper
et al., 2014), how competencies are essential for predicting employee performance and firm
performance (Ingram et al., 2020;Kaur and Kaur, 2020) and the effects of age and job
characteristics on job satisfaction, engagement and performance (Truxillo et al., 2012).
In studies on human resources, there is an increasing attention given to practices of
employee development, and organizations likewise are devoting significant effort and
investment to these areas (Harris et al., 2004;Hoffman et al., 2006;Ibrahim et al., 2004;Matlay,
2002;Vallejo, 2009) since human resources are the source of sustained competitive advantage
in family firms (Kaur and Kaur, 2020). In addition, research has evolved from the traditional
idea of career development to a new perspective called the “new career”or boundaryless
career, which incorporates new techniques and tools to facilitate the mobility and
transferability of employees between different areas of an organization (Zaleska and de
Menezes, 2007). The importance of lifelong learning and development driven by labor market
challenges has also been highlighted (Karpinska et al., 2015). These methods of development
enable employees to assume a wider range of jobs and perform more functions (Hall and
Mirvis, 1995). This new concept encourages the family businesses to use of techniques such
as promotion, lateral rotation, mentoring and coaching, coupled with the use of internal
ER
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