Family Business

Family Business
Structural Master subtitle style Click to edit Definition Ownership control by the members of a single family Barry (1975)

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Family Business

Process Definition Interaction between family and business organisation that determines the nature and uniqueness of the business (1983) - P Davis .

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Types of family business in India

A family owned business A family owned and managed business A family owned and led company

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Importance of family business

According to William T.O Hara, reported in Family Business Magazine, Over 75 per cent of all registered companies in the industrialized world are family businesses(OECD) One-third of Fortune 500 has families at their helm 70% of firms in U.K are family owned

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Contd.,

Of Italys 100 top companies 43 are family owned Family companies employ about 50-60 per cent of the workforce in the industrialized world Companies with founding family participation performed better than nonfamily businesses ( study of Standard & Poors 500)

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Wal-Mart (USA, revenues $245 billion, Sam Walton family) Samsung Group (south korea, revenues $98.7 billion, Lee family) Flat Group (Italy, revenues $54.7 billion, Agnelli family) Tata Group ( India, revenues $ 7.9 billion, Tata family)

Some of the Largest Family Businesses worldwide

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Contribution of FB in india

The freedom movement Sprit of entrepreneurship Philanthropy Trust lowers transaction costs Small, nimble, and quick to react, and Information as a source of advantage

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Three Components of family governance

Periodic assemblies Family council meeting A family constitution 3- Circle model of FB system Family Ownership Business

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Ingredients for a healthy FB good governance

Clarity on roles, rights, and responsibilities for all members of the three systems Discipline to help members of the family, business employees, and owners act responsibly Regulating appropriate family and owner inclusion in business discussions

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Policies of a family council

Employment standards for the next generation Career development policies for family employees Family employee compensation Succession process, including retirement ages Ownership including buy-sell agreements; and

Dividends 3/1/13

First Family Succession Plan, then Business Succession Plan

Strategies to put business interests ahead of the family interests

Emphasize merit over family position Describe the role of the owner in the transition stage- will continue to work FT/PT or retire Family dynamics- some family members unable to work together

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Contd.,

Income for working members of the family of the family and shareholders The business environment during transition Treatment of loyal employees Tax consequences

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Pitfalls of the FB

Lack of focus and strategy Nepotism in family Lack of Professionalism Inability to separate the familys interest from the interest of the business Sibling rivalry in the family business

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How to save the FB?

Formulate policy framework and rules Families must serve the business There should be future outlook Family members should be accountable Issues should be addressed Create shared vision

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Women Entrepreneurship

an enterprise owned and controlled by a women having a minimum financial interest of 51 per cent of the capital and giving at least 51 per cent of the employment generated by the enterprise to women of India - Government

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Factors Influencing Women Entrepreneurs

Economic independence Establishing their own creativity Establishing their own identity Achievement of excellence Building confidence Developing risk-taking ability Motivation

Equal status in society, Greater freedom and mobility 3/1/13

Challenges in the path of Women Entrepreneurship

Lack of Confidence Problems of Finance and Working Capital Socio-Cultural Barriers Production Problems Inefficient Marketing Arrangement

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Institutions Supporting women entrepreneurs in India are

Consortium of women entrepreneurs in India (CWEI) Federation of Indian women entrepreneurs (FIWE) Federation of Ladies Organization (FLO), Womens India Trust (WIT) Central Bank of India Credit Schemes NABARD,SIDBI,

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Contd.,

Self-Employment Women Association(SEWA) Association of Women Entreupreneurs of Karnataka(AWAKE)

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Profile of some successful women entrepreneurs in india

Kiran Mazumdar Shaw- Biocon(1978) Shahnaz Hussain- Ayurvedic cure&care Ritu Kumar- (1960) Countrys leading designer in buildings, garments, fabrics and accessories

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