Managing Family Owned Business Essay Example | Topics and Well Written Essays - 3500 words

Managing Family Owned Business - Essay ExampleFrom this research it is clear that family businesses ar created for a variety of reasons, only a common belief among founders of family businesses is that working together as a family unit fag be more profitable than working alone. Family businesses, whether they are sm solely, local anesthetic enterprises or large, national companies cave in unique concerns, such as interrelationships between family members, the question of time in the next generation, maintaining talent, ownership and finance, in addition to all the problems that other businesses face. A family business has the argufy of balancing both the family and the business. Many times these two systems are in conflict with each other. Power struggles, end conflicting vested interests, leadership and mergers are other issues that arise on a daily basis. The importance of the consultant in supplying the guidance and expertise in the area of managerial skills is often overlo oked in the family firm either because of lack of financial resources or the erroneous belief that an outsider does not chicane the business and thus cannot offer effective solutions. As resources and energies shift from transaction based to value-added activities, there is mounting pressure to improve traditional measures of business might (Javier & Low, 2003). A family business has the challenge of balancing two distinct and often conflicting systems the family and the business. Despite family business significance in the economy, researches are showing that most of them are struggling to survive beyond a single generation. (Krebs, 2001 Carlock & Ward, 2001). According to Theune (2000) stories about family businesses that failed due to mismanagement or family conflict are very common.... and only trey out of ten family businesses survive into the third generation (p. 1). Researchers are concerned that the biggest factor in the success or failure of family businesses are the rel ationships between family members. thither are many things to consider including personal well being, family life, financial security and even standing in the community (Hubler, 1998). The implications are that each generation can either bequeath the business and the business skills to the next generation or choose to let the emotional, psychological or relational issues destroy the business (Kets de Vries, 1996). The challenge for trainers to overcome is to synchronise individual visions of the family and the business. It is this creation of a shared vision that is the work of the planner or trainer before designing and implementing any technological succession plan that sets up a family business for success (Theune, 2000). Siblings vie for positions within the company over power, status, influence and prestige. There are conflicts over succession with siblings, conflicts over succession with parents, as well as intergenerational conflict. Issues such as how a female successor dea ls with male resentment and domination and gains respect have also surfaced. Family businesses suffer from the complications of hiring unqualified