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Family Business in Mexico: Responses to Human Resource Limitations and Management Succession

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  • Hoshino, Taeko

Abstract

Indigenous firms in Mexico, as in most developing countries, take the shape of family businesses. Regardless of size, the most predominant ones are those owned and managed by one or more families or descendent families of the founders. From the point of view of economics and business administration, family business is considered to have variety of limitations when it seeks to grow. One of the serious limitations is concerning human resource, which is revealed at the time of management succession. Big family businesses in Mexico deal with human resource limitations adopting measures such as the education and training of the successors, the establishment of management structure that makes control by the owner family possible and divisions of roles among the owner family members, and between the owner family members and the salaried managers. Institutionalization is a strategy that considerable number of family businesses have adopted in order to undergo the succession process without committing serious errors. Institutionalization is observed in such aspects as the establishment of the requisite condition to be met by the candidate of future successor and the screening by an institution which is independent of the owner family. At present these measures allow for the continuation of family businesses in an extremely competitive environment.

Suggested Citation

  • Hoshino, Taeko, 2004. "Family Business in Mexico: Responses to Human Resource Limitations and Management Succession," IDE Discussion Papers 12, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    • Handle: RePEc:jet:dpaper:dpaper12
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    References listed on IDEAS

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    1. Simon Johnson, 2000. "Tunneling," American Economic Review, American Economic Association, vol. 90(2), pages 22-27, May.
    2. Mike Burkart & Fausto Panunzi & Andrei Shleifer, 2003. "Family Firms," Journal of Finance, American Finance Association, vol. 58(5), pages 2167-2201, October.
    3. Rafael La Porta & Florencio Lopez‐De‐Silanes & Andrei Shleifer, 1999. "Corporate Ownership Around the World," Journal of Finance, American Finance Association, vol. 54(2), pages 471-517, April.
    4. Mike Burkart & Denis Gromb & Fausto Panunzi, 1997. "Large Shareholders, Monitoring, and the Value of the Firm," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 112(3), pages 693-728.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Antonio Ruiz Porras & William Henry Steinwascher Sacio, 2008. "Gobierno corporativo, diversificación estratégica y desempeño empresarial en México," Revista de Administración, Finanzas y Economía (Journal of Management, Finance and Economics), Tecnológico de Monterrey, Campus Ciudad de México, vol. 2(1), pages 58-73.
    2. Hyejun Kim & Jaeyong Song, 2017. "Filling institutional voids in emerging economies: The impact of capital market development and business groups on M&A deal abandonment," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 48(3), pages 308-323, April.
    3. Steinwascher, William, 2007. "Propiedad, gobierno corporativo y las estrategias de diversificación de las empresas mexicanas: Un estudio exploratorio [Ownership, corporate governance and diversification strategies of Mexican fi," MPRA Paper 11599, University Library of Munich, Germany.
    4. World Bank, 2007. "Democratic Governance in Mexico : Beyond State Capture and Social Polarization," World Bank Publications - Reports 7689, The World Bank Group.
    5. Jesus Sáenz González & Emma García-Meca, 2014. "Does Corporate Governance Influence Earnings Management in Latin American Markets?," Journal of Business Ethics, Springer, vol. 121(3), pages 419-440, May.
    6. Batiz-Lazo, Bernardo, 2008. "The emergence and growth of US-style business education in Mexico (1955-2005)," MPRA Paper 7473, University Library of Munich, Germany.
    7. Soto Maciel Argentina, 2013. "La empresa familiar en México. Situación actual de la investigación," Contaduría y Administración, Accounting and Management, vol. 58(2), pages 135-171, abril-jun.

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    More about this item

    Keywords

    Family business; Ownership; Management; Succession; Mexico; Home-based businesses; Family concern; Human resources; Industrial management; 経営; メキシコ; 家内工業; 同族会社; 人的資源; 企業経営;
    All these keywords.

    JEL classification:

    • K22 - Law and Economics - - Regulation and Business Law - - - Business and Securities Law
    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
    • M12 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Personnel Management; Executives; Executive Compensation
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups

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