Many are unaware that Family Business Ownership requires a set of ownership choices and the failure to understand them may cripple the business, sometimes even resulting in buyouts or sales which nobody really wants. One must understand that there are different ways of owning a family business. Although there are hybrids most Family Business adopt […]
There are 3 prominent stages of development in a Family Business Founder or Owner stage Siblings Partnership stage Cousin Consortium stage A typical family business goes through these three stages, each having its own strengths and challenges. A thorough in-depth understanding of each stage would be mandatory for the long term prospects of the enterprise. Phase 1 […]
Good Ownership matters in any organization and can make all the difference. When Ownership is committed, stewardship becomes a reality, resulting in asset building for the future generations. Sustaining Ownership in the same family for over a long period can happen only when successive generations have been deserving owners and have developed mechanisms to transfer assets […]
The culture of a family reflects in the culture of the family business. Designing a Code of Conduct enables overcoming Family Business challenges and facilitates solving issues effectively and amending unacceptable behavior. Two important factors of Family Businesses that are instrumental in formulation of the Code of Conduct are Familial Values and Business Values. The above model will help reflect the current […]
Conflicts amongst family members can be time-consuming, costly, and have damaging ripple effects throughout the family-run organization. It will be in the interest of the Founder to resolve family conflicts before they become irreconcilable differences. Most conflicts in family business arise due to objectionable and detrimental behavior of the family members. The principal cause of such […]
Inter-generational Family Members as heirs to the business started generations ago are aware of the benefits of a joint legacy, but due to different life styles, values, and outlook etc., they may be strangers to the extended members of their own family. With such diverse background it may be extremely difficult to create an environment […]
Regular review of the Code will demonstrate the organization's continuing commitment of leadership. The Key factors influencing the need to revise a Code are: Changes in the organization’s business or the environment/ locations in which it operates Changes in relevant laws and regulations Constructive feedback from other Family Members, employees or stakeholder groups as to […]
Contents of a code can be broadly segregated into three segments based on the content. Inspirational: The inspirational content of a Code should necessarily be idealistic and relate most clearly to the organization’s mission, vision, values and long-term goals. Descriptive: The descriptive content of the Code is to outline the specific behaviour sought by the […]
The purpose of developing a Code of Conduct has to be established first. Once it is developed in consultation with all the Family Members, it should be implemented in the family as well as business. A Code is always a work in progress. It’s better to make a start with an unsophisticated Code, developed or […]
Few family businesses can grow and thrive without a Code of Conduct in place while other businesses may break down. It is therefore very important for a Family to develop a Code of Conduct document to improve the overall health of the family business. The Code of Conduct is a written document that articulates expectations […]