2016
Journal Article
Economics and Business Development › Family Businesses and Business Mentalities
Zheng, V., & Wong, S. L. (2016). Completing for leadership and ownership: The Li & Fung Group’s legendary and strategy. Journal of Entrepreneurship in Emerging Economies, 8(3), 304–320.
Chinese Family Businesses Hong Kong Inheritance
Abstract
Purpose
The Li & Fung Group, a century-old, family-controlled multinational group of companies based in Hong Kong, seems to be an exception to the traditional perception of Chinese family business. The aim of this paper is to explore why this company can overcome the fatalism that “family business could not pass on over three generations”.
Design/methodology/approach
This paper will use in-depth case study as key methodology for exploring key research question of family business sustainability. Archival data, including company registration records, newspaper reports, biographical materials and company annual reports, etc., are major secondary data that will be used for qualitative analysis.
Findings
The important findings in this paper is that the authors can identify key ways for solving family conflict and business continuity. Through in-depth study, the authors argue that because Li & Fung can effectively adopt the “pruning the family tree” mechanism and “listing and de-listing” mechanism during critical stages of succession and development, it has flourished for over a century and is therefore a model for other Chinese family businesses to follow.
Research limitations/implications
Because the authors did not conduct personal interviews with the family members of the company, the authors do not have “insiders’ view” on the company development. Also, it is a century-old company, and many historical data cannot be obtained, so some of the developments would not be fully explained and understood.
Practical implications
It can let family business owners, staffs working in family business and professionals serving family business know better that although there are negative sides of family business, their positive sides should not be underestimated. If a proper mechanism can be rightly executed, its negative side could be large reduced, whereas its positive side could be better enhanced.
Social implications
This paper can offer insightful implication to the society that family business, in fact, is highly dynamic. It not only creates jobs by offering services and producing goods but stimulates economic development as family the fertile ground for breeding entrepreneurship.
Originality/value
There is no analysis in the academia in exploring the Li & Fung Group’s development from the perspective of leadership and ownership competition. So, the originality of this paper is very high.