PROFESSIONALISING THE FAMILY BUSINESS
Small Enterprise|December 2020
Professionalizing the family business is critical for growth, continuity and perpetuity through multiple generations.
Dr N. Krishnan

What is a Family Company?

  • A family company is one whose ownership is controlled by a single family and where two or more family members significantly influence the direction and policies of the business, through their management positions, ownership rights, or family roles.

  • Current family owners intend to pass on control to another generation of the family

CHICKEN OR EGG?

  • Do we hire non-family professionals to prepare the work culture? OR

  • Prepare the work culture to hire non-family professionals?

My vote is clearly is in favour of the second option. Professionalization goes way beyond merely hiring non- family professionals. Preparing the family company is critical for the transformation to succeed and sustain.

What are some of these preparatory processes?

A.REFRAMING MINDSETS AND VALUES

Language: A change in language often heralds a change in culture. Consider using the term “family professional” and “non- family professional” instead of “family director”, “owner”, “promoter”. This signals a move away from the privileges of family ownership to accountability, obligations and merit.

Royalty and the Landlord Syndrome: Accept that non- family professionals are not hired hands to do your bidding – they are potential partners in progress. Don’t be royalty or landlord. Democratize your approach to people and situations. Treating people with disrespect – chiding them in public, having them run errands for you, keeping them waiting for your“ lordship” to arrive at any meeting and so on will blatantly compromise your good intentions.

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