Family business resources and their contribution to long-term business survival: The case of Lewis Eady Limited, 1880-1957

Abstract

There are not many family businesses that survive for three or more generations, and the reasons why some do are still debated. This thesis examines one small New Zealand family business which has survived for over 130 years within a discrete industry sector, in order to establish whether or not it had some specific resources or capabilities which enabled it to survive for so long. The research focuses on the years from the company’s inception in 1880 until 1957, and employs the resource-based view of the firm and family capital theoretical frameworks to identify resources and capabilities that are necessary for the existence of any business, and also those that are considered to be particularly characteristic of family firms. Some of the latter are believed to enable family firms to survive longer than other businesses in the same industry, and also, on occasion, to give them a competitive advantage. As this is a longitudinal study, it has been possible to examine the case study business within the context of the diverse environmental changes that occurred throughout the time span studied, and to identify the different ways in which the business deployed its resources, and developed distinctive characteristics and capabilities in order to survive. The period encompassed in the study includes two World Wars, the Great Depression, radical changes in government policies, and technology, as well as considerable shifts in the public’s musical and entertainment preferences. The case study firm’s competitive market environment was not only subject to threats by others engaged in the same industry, but also from constant rivalry with other competing family-member music businesses. In this regard, although the use of the resource-based view of the firm and family capital frameworks has been helpful, neither seem to address what happens when a family business’s family capital in the form of its distinctive resources are appropriated by other family members for their own competing businesses. This study therefore supplements these theoretical frameworks, and highlights potentially interesting issues for future research.