The relationship between boards and planning in family businesses

Abstract

This study examines relationships between the existence of boards of directors and advi-sory boards and the use of planning in family businesses. It is argued that both of the primary roles of boards, the governance of a firm’s management team for the firm’s stake-holders and the provision of valuable business resources to the firm’s management team, are significantly related to the use of planning activities in family businesses. The empir-ical evidence, drawn from a survey of more than 130 family businesses, largely supports the hypotheses. Conclusions and suggestions for future research close the article. Research has established the importance of both strategic planning and the formation of boards for the success of family businesses (Sharma, Chrisman, & Chua, 1996, 2003; Ward, 1988). Like other forms of businesses, family-owned firms that have clear perspectives on how their man-agers run their firms and that have proper and effective governance structures are more likely t