Family Dynamic and Family Business Financial Performance: Spousal Commitment

Abstract

The role that spousal commitment plays in thedecision to form a new venture is studied. It is postulated that the level of aspouse's common vision about goals, risks, and the rewards of a business play akey role in the decision process. Several models and hypotheses are developedto help guide future research on this topic. Two antecedents of spousalcommitment are discussed: the business owner's person-role conflict and thelevel of spousal involvement in family decision-making. With regard to the consequences of spousal commitment, several factors arehypothesized to influence the decision outcome. These include the spouse'sfinancial, human capital, and time resources, instrumental and emotionalsupport behaviors, family time demands on the business owner, whether thespouse is a man or woman, and criticism of the business. Furthermore, supportand conflict are discussed with regard to the financial performance of thebusiness. The models created suggest that the psychological commitment of aspouse can be a key asset to a business, particularly during initial startupphases, while an uncommitted spouse would add stress to the startup phase.(LKB)

Keywords: Family relations, Spouses, Conflict management, Commitment, Financial performance, Firm performance, Startups, Family firms, Uncertainty, Management decisions