Integrating family, friendship and business networks in family firms

Purpose: This paper considers the multiple social networks of small family businesses and the dynamic interactions between them. It analyses family, friendship and business networks and the way additional ties within the networks become visible when they are considered together rather than separately. Design/methodology/approach: Semi-structured interviews of thirteen family-owned and managed businesses are used to establish the patterns of networking. A detailed case study is then presented, allowing a deeper qualitative analysis of the interaction of different types of networks. Findings: The findings explore multiple rationalities employed in the networking of family businesses and how different aspects of their individual family, friendship and business networks contribute to business development. Research limitations/implications: The paper suggests that a multi-rational theoretical perspective of the family, rather than a solely business-related perspective, deepens the understanding of the dynamics of family businesses behavior and that different types of businesses may be influenced to varying degrees by different rationalities. Practical implications: Business networking tends to be deliberately encouraged by business support agencies, often via the deliberate development of events. A deeper understanding of the manner in which small businesses use and develop networks would enhance the direction and effectiveness of such investment. Social implications: Family businesses, especially micro- small- and SME businesses, are often integral to the communities in which they are based. By viewing family businesses within their social space, we acknowledge the importance of the community around them and the integrated nature of family, business and community in rural areas. Originality/value: The value of this research lies in the proposition that smaller businesses in rural areas are often surrounded by the inter-woven networks of family, business and community.