Family Business

Family Business
Powerpoint Templates
Page 1
Family Business: A Business in which one or more members of one or more families have a significant commitments towards the business Eg. Walmart -USA Samsung (South Korea) L'Oreal ( France) Tata Group (India) Fiat Group (Italy)
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Characteristics of Family Business in India:
Most loyal to principles and ideals of founder Family relationship determines the postion of the person in the business Family influences the business and business environment influences the family Family members who are not actively involved in business will be on thr Board of Directors Existence of family business is linked to true reflection of values of the founder Succession is the final test for family business
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Importance of Family Business:

About 85% of business in European Union and 90% of US business are family controlled World wide family business account for approximately 75% of the top 100 companies In Holland, Small family business represents 75% of all companies 1/3rd of fourtune 500 has family business Companies with founding family paticipation performed better than non-family businesses In India, it is estimated that 95% of the registered firms are family business
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Some of the largest Family Firms Worldwide:

Wal-Mart ( USA, revenues $245 billion second & Third generation Walton family controls 39% of Wal-Mart ) Samsung Group ( South Korea, revenues $ 98.7 billion, Lee Family) Fiat Group ( Italy, revenues $ 54.7 billion. Agnelli family) The Gap (USA, revenue $13.8 billion, Fisher Family) L'Oreal (France, revenues $ 12.2 billion, Bettencourt Family) IKEA ( Sweden, revenues $ 10.4 billion , Kamprad Family) Tata Group ( India, revenues $ 7.9 billion, Tata family) Grupo Modelo ( Mexico, revenues $ 3.5 billion , Diez Fernandez family)
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Various Types of Family Businesses:

A family owned business A family owned and managed business A family owned and led company
The '3-circle' Model of Family Business:

The three systems are The business system The family system The ownership System
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Governance of family Business:

Governance activities Policies & Rules Agreements Governance Objectives -Identify, Direction & Discipline Statements Plans Working through Governance Structures
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History of family Business:

Reasons to create a formal history:
Founder's vision and mission Historical accuracy Honoring longtime emplotees Thanking customers and vendors Background for the uninformed
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Primary Benfits:
Written Histories 'set the record straight' Can acknowledge and honor the hard work and perseverance of founders, Succeeding owners /interdependence between company and community is documented Succeeding family members will be b etter equipped Able to build a sense of confidence among clients, potential clients, vendors , financers and new employees Enhances company's image and reputation History books and history videos are additions to PR press kits Content created for books can be used for company brochures, Websites, Press releases, news letters or even television progrgam
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Responsibilities of share holders of a family Business Setting Family Policy Family vision & Mission Family organization Family ownership Policy Family education and information Family civic, political amd Philanthropic Roles Family Fun
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Setting Family Policy:

Develop Policy on family employement in the business Develop guidelines for family compensation Develop employment policy on non-family managers Deterrmine phiosophy on doing business Decide on principles of ownership succession Create family code of conduct Develop processes for resolving conflict Develop processes for family decision-making Decide rle of business in supporting family goals Determine family rle in helping needy members
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Develop guidelines for family visibility in the business Build family cohesiveness Sustain Family ownership Coordinate estate planning Development retirement or personal financial plan for business leader Set leadership succession principles Establish ownership successioj principles Decide on family linkage with the business
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Family Vision & Mission:

Encoraging positive family interst and business Articulate family values Indetify and articulate family goals Create family vision statemenmt Develop family mission statement Write family values statements Decide rle of family history in business Decide familyphilosphy of doing business Maintian family teamwork anf harmony Foster family commitment to the business
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Family Organization:
Decide how to administer, coordinate and fund shared interests Create a family bank or office Set rules for family membership organization
Family Ownership Policy:

Clarify the rights and resposibilities of ownership Decide principles for business governance Set goals for performance of family investment Develop principles of corporate capital allocation, including appropriate dividend and reinvestment levels
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Be knowledgeable about company operations ( Products, Services,
locations, top managers, industry, competition, measures of performance) Be knowledgeable about basic company finances and be able to read and ask questions about income statement and balance sheet of their company Attend shareholder meetings Understand board memeber qualifications and participate, when useful in the screening of the board members Constructively question management and offer suggestions Publicly support management decisions
Keep compsany info in confidence When possible and useful generate business
leads Where possible and useful, provide additional investment capital Powerpoint Templates
Page 15
Rights of Share holders:

Family shareholders can expect the following from the managers Timley info on company Strategy, important organizational changes, and the company's bsic financial status ( Especially before this info is released to public) Openness by the company's board and management to the shareholder's views on the above inforamtion The ability to participate in the election of board members
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Succession in Family Business

Contents of a Succession Plan: * Key goals for the succession Process * A Schedule of the transition stage * Contingency plan
Pitfalls of the family business:

*Failing to Documrnty the terms of the agreement in writing *Ignoring Fiduciary responsibilities in the event of a dispute *Failing to plan for the future *Nepotism
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Family business
In this four-part mini-series of video shorts, we look at the challenges facing family businesses. Each episode inside Pattersons, a fictional UK business is inspired by the problems faced by real family firms and deals with a different challenge. http://www.nw-businesssense.com/casestudies/family-business-video-Pattersons-1.html
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Strategies for improving the capability of a family Business:

Need for professionalism in family Business Demise of the joint family Replenishing Entrepreneurship Good Management Ability to change Have a strategic plan Have a active board of members
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Improving Family Business performance: Core business Values Training Future outlook Accountability Finances Addressing the issues
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Family Business

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Family Business

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Drepturi de autor:

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Family Business

Characteristics of Family Business in India:

Importance of Family Business:

Some of the largest Family Firms Worldwide:

Various Types of Family Businesses:

The '3-circle' Model of Family Business:

Governance of family Business:

History of family Business:

Setting Family Policy:

Family Vision & Mission:

Family Ownership Policy:

Be knowledgeable about company operations ( Products, Services,

Rights of Share holders:

Succession in Family Business

Pitfalls of the family business:

Strategies for improving the capability of a family Business:

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