The effect of professionalization of family businesses on their financial performance

Family businesses play an important role in the economic development and growth of our country contributing to national income, employment and economic prosperity. Family businesses, like other businesses, have to operate in an environment featured by intense competition and uncertainty. They need to achieve superior performance in such an environment, to provide long term survival and grow their assets. It has been suggested in the literature that family businesses need to professionalize in order to survive and achieve superior performance. In this dissertation is is aimed to bring conceptual clarity to the professionalization of family business and to evaluate the effects of the level of professionalization on the financial performance of family business taking into account the factors that support and hinder the professionalization process. In this context, a questionnaire was created to measure the level of professionalization and financial performances of family businesses. The data collected from 111 family businesses most of which are among 'The Second 500 Largest Industrial Organizations of Turkey' which is announced by Istanbul Chamber of Commerce in 2016. The data was analyzed by appropriate statistical techniques. The research results show that the level of professionalization in family businesses has a positive effect on the financial performance of the business.