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A family owned business is one that is owned and

managed by one or more family members. Family owned firms are-
³organisations where two or more extended family members influence the
directions of business through the exercise of kinship ties, management roles or
ownership rights´. It is also a complex, dual system consisting of the family and
business. Members involved in the business are a part of a task system and also
a part of a family system and these two systems may overlap. Family owned
business exists all over the world. In India, the highest generator and creator of
wealth are family owned business. Ove r 80% of the businesses are controlled by
family. Initially they were in small business which required small investments.

Some of the family owned businesses in India are Tata group, Reliance, Aditya
Birla. Indian family businesses have loyalty, family re lationship, grooming the
new generation, common values, steady growth, strong commitment, stability.
In spite of strong position of family business they are facing challenges in the
economy. Family and business are two different aspects, so there values an d
principles may clash at times.

It is believed family emotions create a vital role in business but having ego
clashes, deriving importance etc are some problems faced by business. It must
be controlled then only business and family can run smoothly. Suc cession
planning must do well by all the family members. It doesn¶t mean that to divide
into pie groups among the family members but it just allotting the work to
family members without any division.

Family is the fundamental for every other intuitions. Business evolved because
of the symbolic interaction between family and society. This symbolises can be
made eternal by strategically managing both the institutions ensuring family
remains united and business is given full autonomy to chart its way accordi ng to
changing needs of the time. When it comes to family business rules are very
different from other business because there are two different values of systems
working side by side and these may be often conflict with each other. Due to
changing face of global competition the time has to face trouble questions
related to family and business.

If the goal of the family business is to go global, it should institutionalize the

business system and develop transparent corporate governance structure so that
business does not feel the heat of the family emotions and is given free hand to
chart its own way.