-
Essay / Managerial human capital and patient capital
Managerial human capital describes the repertoire of skills and knowledge of a central EFSME management team (i.e., long-tenured family CEOs, as well as as their non-family functional executives), as well as shaped by their educational, personal and professional experiences. Family and non-family management perspectives are integrated to enable a deeper understanding of the phenomena studied, particularly influenced by the seemingly idiosyncratic management practices of the top management team (TMT) within these companies (Cherchem, 2017; Chua et al., 1999 ;). In this regard, long-serving family CEOs within EFSME tend to possess in-depth knowledge of their company's operations and accompanying core competencies, influenced by their unprecedentedly long tenures, which last on average about twenty years. For example, this is a far cry from their competitors, non-family businesses, which have comparatively much shorter mandates, lasting on average around four to eight years (Khurana, 2003; Miller and Le Breton-Miller, 2005). . As such, EFSMEs would potentially benefit from a greater competitive advantage, under current circumstances. As a result, these perspectives would most likely enable EFSMEs to establish effective and substantive management regimes and, thus, determine the likelihood of achieving sustainable entrepreneurial growth. Say no to plagiarism. Get a tailor-made essay on “Why Violent Video Games Should Not Be Banned”? Get an original essay. Subsequently, long-tenured family CEOs within these firms are generally better able to adequately socialize their non-family functional top managers into the firm. – compared to their rivals. As a result, the tacit know-how of family CEOs and non-family functional senior management teams would likely be preserved within the firm for an extended period of time, resulting in increased positive team dynamics. In this way, coupled with their flat and ubiquitous organizational structures, these firms are likely to be in a conducive capacity to effectively manage their new markets and technological knowledge resources (in both tacit and explicit form) derived from their various portfolio partners. alliance. This arrangement therefore results in a better trained and highly motivated workforce that is more productive and performs a wider range of tasks – with minimized supervision. Therefore, a focal EFSME would be able to leverage its perceived patient capital to ensure the likelihood of successfully enhancing sustainable entrepreneurial growth. Patient capital denotes a deliberate preference for unusual and particularly extensive long-term oriented investments (typically lasting several decades) with the desire to perpetuate dynamic businesses over several generations. In comparison, their competitors, non-family businesses, generally adopt much shorter investment horizons, which occurs mainly due to various pressures mainly related to achieving short-term oriented results - as demanded by major shareholders inherent. From this perspective, having the discretion to formulate and implement a long-term investment horizon tends to counter the possibility of liquidation and allows EFSMEs to pursue innovative strategies such as the ability to build capacity dynamic alliance portfolio management required to – improve the likelihood of achieving growth.