The Impact of AI-Induced Downsizing on Family Businesses
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Maria Bartekova
Abstract
The advent of artificial intelligence (AI) has significantly influenced business operations, leading to shifts in employment patterns, particularly in family businesses. This chapter offers a detailed analysis of AI-induced downsizing within family firms, known for their unique management styles and deep-rooted values. Unlike non-family businesses, family firms prioritize long-term sustainability and maintain stronger employee relationships, affecting their downsizing decisions. Downsizing, defined as job reduction to enhance efficiency, presents ethical dilemmas, especially in family firms where kinship ties and shared values play a crucial role. Research shows that family businesses are less likely to downsize compared to non-family firms due to their commitment to preserving socio-emotional wealth and maintaining employee trust and loyalty. However, AI integration poses dual challenges and opportunities: it can enhance operational efficiency and competitiveness but also risks job displacement. This chapter emphasizes the importance of strategic intent in adopting AI to balance technological advancements with employee welfare. It suggests future research should focus on frameworks to help family businesses navigate AI-induced transformations while upholding their values and ensuring long-term sustainability.
Abstract
The advent of artificial intelligence (AI) has significantly influenced business operations, leading to shifts in employment patterns, particularly in family businesses. This chapter offers a detailed analysis of AI-induced downsizing within family firms, known for their unique management styles and deep-rooted values. Unlike non-family businesses, family firms prioritize long-term sustainability and maintain stronger employee relationships, affecting their downsizing decisions. Downsizing, defined as job reduction to enhance efficiency, presents ethical dilemmas, especially in family firms where kinship ties and shared values play a crucial role. Research shows that family businesses are less likely to downsize compared to non-family firms due to their commitment to preserving socio-emotional wealth and maintaining employee trust and loyalty. However, AI integration poses dual challenges and opportunities: it can enhance operational efficiency and competitiveness but also risks job displacement. This chapter emphasizes the importance of strategic intent in adopting AI to balance technological advancements with employee welfare. It suggests future research should focus on frameworks to help family businesses navigate AI-induced transformations while upholding their values and ensuring long-term sustainability.
Chapters in this book
- Frontmatter I
- Contents V
- Preface VII
- Strategy Development in the Light of Radical Change: A Perspective on the Evolution and Revolution of Family Businesses 1
- The Importance of VUCA and BANI in Developing Sustainable and Long-term Oriented Strategies in Family Businesses 27
- Employee Resilient Behavior and Its Leadership Prerequisites: Strategies for Founder Generation Family Firms 53
- The Impact of Family Ownership on SME Resilience: A Three-Circle Model Analysis 73
- Implications of Company Succession on Resilience of Small and Medium Size Companies 85
- Passing the Torch: Perceived Risks and Opportunities in Family Business Succession 103
- Convenience Study of Criminal Deviance in the Entrepreneurial Family Business: Husband as Lawyer and Wife as Accountant in the Law Firm 119
- The Adaptive Capacity of Tourism Family Firms – An Owners’ Perspective on Risk Resilience 147
- Corporate Social Responsibility during the COVID-19 Pandemic: Learnings from Austrian Family Businesses 169
- Resilience beyond Metrics: How Hidden Resources in Small Family Firms Challenge the Resource-Based View 183
- The Impact of AI-Induced Downsizing on Family Businesses 201
- List of Contributors
- Index
Chapters in this book
- Frontmatter I
- Contents V
- Preface VII
- Strategy Development in the Light of Radical Change: A Perspective on the Evolution and Revolution of Family Businesses 1
- The Importance of VUCA and BANI in Developing Sustainable and Long-term Oriented Strategies in Family Businesses 27
- Employee Resilient Behavior and Its Leadership Prerequisites: Strategies for Founder Generation Family Firms 53
- The Impact of Family Ownership on SME Resilience: A Three-Circle Model Analysis 73
- Implications of Company Succession on Resilience of Small and Medium Size Companies 85
- Passing the Torch: Perceived Risks and Opportunities in Family Business Succession 103
- Convenience Study of Criminal Deviance in the Entrepreneurial Family Business: Husband as Lawyer and Wife as Accountant in the Law Firm 119
- The Adaptive Capacity of Tourism Family Firms – An Owners’ Perspective on Risk Resilience 147
- Corporate Social Responsibility during the COVID-19 Pandemic: Learnings from Austrian Family Businesses 169
- Resilience beyond Metrics: How Hidden Resources in Small Family Firms Challenge the Resource-Based View 183
- The Impact of AI-Induced Downsizing on Family Businesses 201
- List of Contributors
- Index
