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Presented By Vaishali Rochan Ashish Benny Uday Kiran

BRIEF INTRODUCTION
We

have chosen to agree with the idea dont mix personal life with business. To come to the above consensus we have studied various real life examples which are mentioned in the following slides. There are always two different sides to every coin and so does this statement has, We will see what are those...

PROS OF MAINTAINING PERSONAL

RELATIONSHIPS IN BUSINESS

Strong understanding and similar views between partners due to their personal equation can benefit the business. Since you already know your partner, you are aware of their positives and negatives and are more accepting of their nature. Your partner will be able to understand if you are having a personal problem or crisis. Work can really be fun if you share great chemistry and enjoy each other's company.

CONS

You need to tread carefully and cannot always be blunt as this may offend your partner. Finances may cause severe tension if not sorted out in an organized manner.

Due to your personal equation with your partner, they may often end up taking undue advantage of this relationship.
If a problem arises, often family and friends get dragged into the equation and they too have to suffer the consequences.

A REAL LIFE EXAMPLE OF A NEWLY FORMED BUSINESS

As we all know that the amount of things a first time CEO has to carry on his back in order to create a successful company is beyond overwhelming. The major issue haunting them today is a decision they made months ago which now looks like it may have been quite impulsive. When registering the company the upper management consisted of Mr Raj, Mrs Raj, and their mutual good friend. Mr Raj assuming role of CEO, Mrs Raj COO, and their friend Ms Geeta the CMO. Based on Mrs Rajs late entrance into the actual involvement in company operations, we think their personal relationship came into play in the judgement and that their friend was entitled to a portion of the equity of the company.

They split the company in three with Mr & Mrs Raj taking the majority and leaving Ms Geetha with a rather decent portion. The couple managed and run the company but Mrs Raj progressively became less involved. the time that was put in on her side was not efficient and things started to become clearer. They finally sat down and spoke about it but it was a difficult decision because again there were personal relationships involved. She agreed that it was unfair to the company to be dead weight as she held vested interest in it. Their relationship was now at an end, and not just the relationship with the company.

CURRENT POSITION OF THE COMPANY

Fast-forwarding to today they have made amazing progress and are readying launch for a new product and finally theyre creating buzz. At points like this is always where things find a way to take a turn for the worse. On paper their previous partner still holds equity in the company. After research and involving their advisors it seems that this is an issue that must be handled legally.

Some golden rules that can avoid such conflicts for the people who are already dealing with personal relationships in their professional life Always segregate roles and responsibilities and have clear cut defined roles for your partner and yourself

Give your inputs and suggestions but do not make decisions for your partner If there is a difference of opinion, sort it out rationally keeping in mind the benefit of the business as your priority Do not get into heated arguments, screaming matches and hurling accusations with your partner

SOME GROUND RULES FOR FAMILY BUSINESSES

WHO ARE THE BIGGEST VICTIMS TO THESE SITUATIONS.

Dissolving or selling the business. Decide now what will happen if one or both partners want out, then hire a lawyer to draft the agreement. Future plans. Work together to create a clear Business Plan to ensure all family partners pursue set goals. Chain of command. Someone should ultimately be in charge of certain business decisions, especially if you hire employees. Figure out whos doing what to avoid confusion. Separating family from business. Set some boundaries such as no shop talk at family functions. Such rules will help preserve your personal and business relationship.

Increased financial risk. Whether your team is husband-and-wife, father-and-son or sister-andbrother, youll both depend on one business to generate a living. Perhaps one partner should keep outside employment until your new venture can generate two incomes. The next generation. Passing the business torch to children can become messy. Hire a Succession Planning Consultant to work out issues such as purchase price, transferring assets and transitioning day-to-day business management