Sustainable management in family-owned small and medium-sized enterprises

Family-owned small and medium-sized enterprises (SMEs) are driving forces in many economies worldwide, and in Germany, they enjoy an excellent reputation regarding long-term management orientation. For example, recent studies show that German family-owned SMEs coped better than larger companies during the recession triggered by the global financial crisis in 2008 and that they also showed a high degree of adaptive capacity to the negative consequences of exogenous shocks (e.g., economic standstill) during the current Covid-19 pandemic. The reason for this resides in the family’s desire to preserve their business for future generations, and the company often being the main income stream for many of the owning families. However, the public focus is increasingly shifting towards traditional family-owned SMEs’ perceived backwardness compared to technology start-ups, which achieve higher growth rates, raising the question of how established SMEs can face the challenge of adapting their business to the new environment. This dissertation delves into the sources of family-owned SMEs’ success and longevity and examines management tools firms can use to ensure their survival in a globalized economy.