The 17 PROPAT Characteristics
- A willingness to change and take risks
- Acceptance of interdependence
- Trust
- Seeking absolute not relative advantage
- Long-term Commitment
- Capacity to learn
- Communication
- Coordination
- Flexibility
- Objective self assessment
- Active membership in social networks
- Awareness about alliances
- Ability to resolve conflict
- Patience
- People before structure
- Loyalty to existing members
- Thrift
- <<Back to PROPAT in Detail<<
Thrift and the family business
Family businesses may miss out on alliance opportunities if they are less ready to spend
Owners of family businesses are commonly found to have most of their wealth tied up in the business. Surveys show that the value of the typical family firm represents about 80% of the family's total assets (Ward 1997).
This tends to cultivate a culture of thrift in the family businesses ("a penny saved is a penny earned"). Such a culture may hinder innovation and discourage family business owners to undertake the necessary initial investments required for cooperation arrangements.
This view is corroborated by Gallo and Cappuyns (2004) who argue that family businesses are more prudent in their expenditures and decision making related to new investments is a much slower process in family businesses. With the family's wealth being at stake, family businesses tend to be much more meticulous in their investment decisions and carry out detailed studies of every project before committing their funds.
This focus on economy also means that family businesses rarely have the organisational slack necessary to set up cooperation arrangements (Roessl 2005).