Live long and prosper: the search for business longevity

Abstract

Purpose This paper aims to discuss key aspects of the longevity of business enterprises across the world. It explores the parameters that set apart a company which had survived for more than 1,400 years from most large companies which survive for a fraction of this time. Design/methodology/approach The paper integrates observations from two important research papers on the topic, and from the author’s own research. Findings Contrary to expectations, long-surviving firms are usually conservative about change, exploit their opportunities rather than explore more, diversify in relevant areas, and co-operate even with their competitors to live long. Research limitations/implications To those companies that live long, age becomes a valuable resource in itself. Consumers see a continuous track record of a firm as a proxy for good quality, and long history can provide managers institutional memory to leverage toward further sustainability. “Long history” not only can provide anecdotes and stories to employees that exemplify the tacit core values of the firm but also, quite counter-intuitively, could be useful in transforming cultures and traditions. Practical implications Longevity challenge encompasses both continuity and change, but the experience filtered from many long-lived firms across the globe provides companies with insights that could inspire many more to live long and prosper.

Corporate Sustainable Longevity: Scale Development and Validation

“…With respect to the elements that enable a firm to sustain longer, the literature is contradictory. For instance, K. R. Sharma and Dixit (2017), while investigating the longevity of century-old firms identified five keys to the longevity of such firms: be conservative, be rooted, diversify sensibly, compete but also cooperate, and look back. To some extent, these aspects seem contrary and conservative to the established findings in the existing literature that suggest adaptation (Hatum & Pettigrew, 2004), fast learning, and timely response to environmental changes (Pishdad & Haider, 2013) and customers' needs (E. W. Anderson, Fornell, & Lehmann, 1994).…”

“…Though CSL is a related concept, it is primarily different from "longevity" because it addresses the "ability" of a firm to sustain its longevity beyond average firm age. Some studies have partly contributed toward the conceptualization of CSL (Ibrahim, McGuire, & Soufani, 2009;Napolitano et al, 2015; K. R. Sharma & Dixit, 2017) and a few others have partly contributed to its operationalization (Fahed-Sreih & Djoundourian, 2006;Fatoki, 2013). However, these studies are neither converging toward a common concept nor are they thorough enough to incorporate all aspects of CSL.…”

The contribution of digitalisation to business longevity from a competitiveness perspective

“…Second, this study extends the general knowledge on the digitalisation of long-lived firms that has been proposed in the literature (e.g. Hicks and Hegde, 2005; Sebastian et al , 2017; Sharma and Dixit, 2017; Erdogan et al , 2019) by highlighting actions, conditions and effects of digitalisation for the long-lived firms’ development and providing empirical evidence on how these activities can be carried out by the firms themselves.…”

“…As regards innovation to support the digital transformation process in long-lived firms, scholars have tended to define the minimum threshold for company longevity as 100 years of continuous activity. Sharma and Dixit (2017, p. 1), in particular, analysing key factors for longevity in a detailed Japanese case study, observed that it is very important for this kind of firm to be conservative, asserting that “the pressure to exploit newer opportunities and invest resources to ward off potential threats is high, particularly in the digital era. However, long-established firms are known to stay true to their core values and principles and usher in large-scale radical changes very selectively”.…”

“…In spite of scientific contributions on digitalisation increasing, very few studies analyse how long-lived firms face this challenge (e.g. Hicks and Hegde, 2005; Sharma and Dixit, 2017; Erdogan et al , 2019); in particular, there is scant empirical evidence in the management literature on how digitalisation can contribute to enhancing long-lived firms’ competitiveness and enable them to continue to survive over time.…”