EXPLORE (Pacardo & Lotayo & Mercado) Activity 1-2
Activity 1. Using two to three sentences, define the following terms found in
Module 2. Practice paraphrasing and cite your sources on the last page of your
assignment. (20 points)
1. Strengths (in the business context)
2. Weaknesses (in the business context)
3. Role Ambiguity
4. Parsimonious
5. Conflict of Interest/Agency Problems
6. Altruism
7. Succession Challenges
8. Entrepreneurial Orientation
9. Bivalent
10. Familiness (by Habbershon and Williams)
Pacardo & Lotayo & Mercado Activity 1-2
Activity 2. MODIFIED TRUE OR FALSE. Write TRUE if the statement is correct
and write FALSE if otherwise and provide the correct word/phrase that will
correct the statement. (10 points)
1. Strengths and weaknesses can be used as a self-assessment tool that
may indicate critical issues and opportunities for improvement in a
given firm.
2. If the family has connections with clients, suppliers, industry experts,
capital providers, and community leaders that they can draw support
from and can help their family firm, the family and the business
possess human capital and knowledge resources.
3. Multiple roles are often played by family members in family firms.
4. Conflicts may impair a firm’s ability to take important strategic
decisions and can lead to organizational paralysis.
5. Nepotism signals to other firm members that ability and performance
are not the essential criteria for employment or promotion.
6. The resulting atmosphere of trust and mutual support is absent in
many nonfamily firms, which tend to promote a more personal
corporate culture.
7. Family firms may be spared from costly control and incentive
mechanisms if there is interest alignment.
8. “Family Alignment” was the term proposed by Habberson and Williams
(1999) that is considered to be a source of the competitive edge of
family firms.
9. Employees may not earn the highest wages, but they often benefit
from greater job security when the family firm has a culture of
commitment and support.
10. In mature family firms, family orientation, and an excessive focus on
harmony and continuity, may lead to a sort of strictness that is
incompatible with entrepreneurship (Lumpkin, Martin and Vaughn,
2008).
Prepared by Rae Marie G. Leong-on, MBA
Central Philippine University
College of Business and Accountancy
Department of Business Administration
ELABORATE (Lastimoso and Mabaquiao)
Activity 3. Answer the following question in not less than five (5) thoughtful
sentences. Base your answers on the Module 3 PPT. If the answers are
unavailable, you may use reliable sources on the internet. (30 points)
1. What is the practice of “glass ceiling” which is usually present in family
firms?
2. Why are there lesser conflicts of interest within family businesses?
3. Why do you think there are more efficient leaders leading family firms?
EXTEND ( Naquita)
Activity 4. MINI CASE STUDY (40 points). Read the case below and provide your
answers to the following questions as elaborately as possible. Answer each question in
more than four (4) sentences.
Lucky Dream Corporation is a food and beverage company known for its fast
food chains, bakeries, and drink shops. Behind the public’s knowledge, it is a family
business being run by the Lee family and established by the first generation’s patriarch
Romeo Lee in the 1960s. In the 1980s, Romeo was replaced by Anthony, his eldest son
among the four children he had with his wife, Minn. Immediately after Anthony held the
position, he recognized unusual problems with the way his father managed the
corporation for decades. These problems were
The written rule in employment contracts of nonfamily employees wherein
there was a clause stating that they are only allowed to hold the job position
“supervisor”. They cannot be promoted further into managerial positions
because those are “reserved” for family members thus glass ceiling was
practiced ever since.
The role ambiguity of family members working for the firm affected their job
scope and accountability. Family members, specifically his brothers Sally and
Lito ranted on Anthony weeks after his appointment. According to his
brothers, they were tasked to be the branch managers of their bakeries,
however, they also had to prepare taxation requirements for the BIR and the
financial reporting to external audits. They believe these were beyond their
job descriptions.
Anthony’s niece, Nisha, reported that their fast food branches have been
suffering from stagnant sales. It was found out that they were not able to
innovate or introduce new menu dishes for over one year and a half which
was a sign of a declining entrepreneurial orientation.
1. What is the solution for the first problem? Explain thoroughly.
2. If Sally and Lito’s claims were true, what should be done to correct the practice of
role ambiguity? Explain well.
Prepared by Rae Marie G. Leong-on, MBA
Central Philippine University
College of Business and Accountancy
Department of Business Administration
3. If Nisha and Anthony sought your advice since you manage a business
consultancy firm, what advice/s will you give them?
4. Do you think the Lucky Dream Corporation will last for 20 more years? Justify
your answer.
Prepared by Rae Marie G. Leong-on, MBA
Central Philippine University
College of Business and Accountancy
Department of Business Administration
