Management Styles in Family Businesses

Developed vs Developing Countries

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In developing countries, the most common types of Management Styles include Directive
and Authoritative, while Participating and Affiliative styles are the most common in
Developed countries.

Most family businesses use a Top down approach in developing countries but in
developed countries, a bottom up approach is preferred.
Country Comparison using Hofstedes Cultural Dimensions Theory:

Canada
Power Distance individuals in society are

China
Power Distance hierarchy of power exists, not

considered to be equal

everyone is treated equally

Individualism- focuses on I in a society

Individualism- focuses on we within a society

Masculine and Feminine- values success

Masculine- Values success more

and quality of life

Uncertainty Avoidance- anxious regarding

Uncertainty Avoidance- accepting to change

change

Long Term Orientation- normative society,

Long Term Orientation- makes decisions based

respects traditions

upon now

Indulgence vs Restraint- Indulgent society,

Indulgence vs Restraint- Restrictive society

willing to act on impulses

Key Takeaways
1. Cultural values of a country have a huge impact upon an individuals family business.
2. Management Style can be a huge predictor of how well the business is going to perform.
3. While the three circle model lays out a basic foundation, family businesses are run in
different ways due to what each family is accustomed to.
4. Everything is quite different within each family, one businesss strength could possibly be
anothers weakness. For e.g.: tight knit relationships.
Related Quote:
If you can raise a family, you can build a business - Michael Port