The Nature Of Family Businesses
In recent times, as the concept has become better understood, Family Businesses have come to represent a dynamic area of interest among all classes of people; researchers, business theorists, investors, policymakers, academics, as well as emerging entrepreneurs. Over the years, research
has shown that family business account for two-thirds of all global businesses. Global awareness of emerging trends and the impressive technological advancements mean that global competition is on the rise among businesses.
However, all things being equal, it has been observed that family firms tend to outperform their nonfamily contemporaries in a highly volatile world. Family businesses are often hailed as the linchpin of economic stability. They are seen as the embodiment of the entrepreneurial spirit passed down through generations. Yet, it is common knowledge that only thirty percent survive into the second generation and a mere twelve percent make it to the third. Clearly, this means there is an ominous presence lurking in the dark ready to eat Family Businesses up.
The truth is, since Adam, Family Businesses have always faced grave challenges. These problems, threaten their very existence and calls into question their foundation. Take off the camouflage and you will uncover a complex interplay of factors such as leadership transition or succession,
governance, family cohesion and roles and responsibilities undermining the sustainability and longevity of the family business. The fall of Anheuser Busch, the brewer of Budweiser, a family business which once upon a time was a giant, lends credence to these peculiar challenges. This was a company of five generations but had to be sold due to succession issues stemming from internal family wrangling. Although family businesses are often faced with many obstacles, they also often possess unparalleled advantages that stem from their unique global position.
Take a look at greats such as BMW, Marks & Spencer, Walmart, Ford, JP Morgan, Barclays, Tesco and Ford among others. These family businesses have been able to navigate the very treacherous waters and survived many generations. They keep thriving and flourishing while their competitors wither and die. How do they do it?
This handbook chronicles the essential strategies that need to be implemented in the areas of managing, growing, and governing family businesses, in order to ensure the continued existence of family businesses and business families. These practices will allow for the amplification of the unique strengths and competencies of the Family Business. Every aspect of the business that has the propensity to cause pain or gain is treated analytically. Nothing in this regard is left to chance.
