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The weakness of strong ties : sampling bias, social ties, and nepotism in family business succession
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Liu, Chengwei, Eubanks, Dawn L. and Chater, Nick (2015) The weakness of strong ties : sampling bias, social ties, and nepotism in family business succession. The Leadership Quarterly, 26 (3). pp. 419-435. doi:10.1016/j.leaqua.2015.02.007
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Official URL: http://dx.doi.org/10.1016/j.leaqua.2015.02.007
Abstract
Decision-making is a complex cognitive activity filled with bias. Leader decision-making is unique because it occurs in a social context. We examine how biases resulting from social network dynamics complicate leaders' decision-making. In particular, we focus on a specific case of leader cognition: nepotism in the succession decisions in the context of family businesses. Succession often leads to a decline in performance because leaders frequently choose family members as their successor, a form of nepotism. We show that even when a leader can overcome individual decision biases, a bias in sampling resulting from families' strong ties can still allow a leader to wrongly conclude that family members are better qualified than external candidates when the opposite is true. We demonstrate this phenomenon using simulation modeling and explore solutions to family business succession planning.
| Item Type: | Journal Article | ||||||||
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| Subjects: | H Social Sciences > HD Industries. Land use. Labor | ||||||||
| Divisions: | Faculty of Social Sciences > Warwick Business School > Behavioural Science Faculty of Social Sciences > Warwick Business School |
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| Library of Congress Subject Headings (LCSH): | Family-owned business enterprises -- Succession, Nepotism | ||||||||
| Journal or Publication Title: | The Leadership Quarterly | ||||||||
| Publisher: | Pergamon | ||||||||
| ISSN: | 1048-9843 | ||||||||
| Official Date: | June 2015 | ||||||||
| Dates: |
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| Volume: | 26 | ||||||||
| Number: | 3 | ||||||||
| Number of Pages: | 16 | ||||||||
| Page Range: | pp. 419-435 | ||||||||
| DOI: | 10.1016/j.leaqua.2015.02.007 | ||||||||
| Status: | Peer Reviewed | ||||||||
| Publication Status: | Published | ||||||||
| Access rights to Published version: | Restricted or Subscription Access |
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