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  • Unique Features of Family Business

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    Family businesses have some unique features such as patient capital, lower recruitment costs, and lower cost of debt. They also value integrity and relationships. Strong points include knowledge of the business, family culture and commitment, independence from stock markets, longevity, flexibility, and potential for success. Weak points can be limited access to capital markets, lack of defined roles, nepotism, family conflicts, resistance to change, and tensions during generational succession. The secret to the longevity of family businesses is transforming weak points into strong points through investing in human capital and long-term investments while staying committed to the founding mission. Leadership is particularly important for family businesses to navigate different goals and potential long-term conflicts, and to ensure successful succession across

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    Family businesses have some unique features such as patient capital, lower recruitment costs, and lower cost of debt. They also value integrity and relationships. Strong points include knowledge of the business, family culture and commitment, independence from stock markets, longevity, flexibility, and potential for success. Weak points can be limited access to capital markets, lack of defined roles, nepotism, family conflicts, resistance to change, and tensions during generational succession. The secret to the longevity of family businesses is transforming weak points into strong points through investing in human capital and long-term investments while staying committed to the founding mission. Leadership is particularly important for family businesses to navigate different goals and potential long-term conflicts, and to ensure successful succession across

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    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
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    10 views12 pages

    Unique Features of Family Business

    Uploaded by

    shubhangini_vaish
    Family businesses have some unique features such as patient capital, lower recruitment costs, and lower cost of debt. They also value integrity and relationships. Strong points include knowledge of the business, family culture and commitment, independence from stock markets, longevity, flexibility, and potential for success. Weak points can be limited access to capital markets, lack of defined roles, nepotism, family conflicts, resistance to change, and tensions during generational succession. The secret to the longevity of family businesses is transforming weak points into strong points through investing in human capital and long-term investments while staying committed to the founding mission. Leadership is particularly important for family businesses to navigate different goals and potential long-term conflicts, and to ensure successful succession across

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 12

    Unique Features of Family Business

    Family Businesses have patient capital.

    Continued.
    Family Businesses are characterized by lower recruitment and human resources costs. Family Businesses have a low cost of debt. Family businesses are generally recognized for their integrity and devotion to relationships.

    Strong points of Family Business


    Knowledge of the business Family culture & strong identification,commitment,motivation,c ontinuity in leadership performance Greater independence from the stock market

    Continued..
    Longevity Major capability of reacting to difficult times, orientation to self-financing Major flexibility and rapidity of decisional processes due to the minor bureaucratization of the structure; and Financial benefits , major possibility of success

    Weak Points of Family Business


    Minor access to the capital market which can limit growth opportunities; Organizational structure characterized by a not well-defined division of the tasks; Nepotism tolerance towards the family members not able to hold managerial positions, more difficulties to attract professional management;

    Continued. .
    Syndrome of the spoilt child Internal struggles, family conflicts transferable to the company; Paternalistic and autocratic rules Resistance towards change, secrecy

    Continued..
    Financial Tensions. Imbalances between contribution and rewards; and Dramatic tensions in generational successions.

    Conclusion..

    Secret of Long Lasting of family business resides in the capability of transforming weak points into strong points by investing in human capital, encouraging long term investments , following with persistence the missioni.e. the belief that the entrepreneur has to put his soul into the firm.

    Leadership for Family Business


    Leadership is important for family business for three specific reasons: First, family firms have different goals Second, family businesses are potentially more prone to long-term conflicts Thirdly, importance of leadership succession is greater for family business

    Succession Management in the Family Business


    Succession , by definition , implies the substitution of the founder or the incumbent management Succession process in family business means ensuring competent family leadership across generations.

    ~THE END~

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