FAMILY BUSINESS MANAGEMENT

UNDERSTANDING FAMILY BUSINESS

Prepared by:

Mr. Donn Enrique L. Moreno, MBA

ENT 3106

To cite: Moreno, D.E.L. (2021). Family Business Management [Online Lecture]. Pamantasan ng Lungsod ng Maynila.
DEFINITION OF FAMILY BUSINESS
Family business, as the name suggests, is the business which is actively owned, operated
and managed by two or more members of the single-family. Here, members may be related
by blood, marriage or adoption. Basically, in a family business:

▪ Single-family owns majority percentage of ownership

▪ Possess voting control
▪ Has power over strategic decisions
▪ Has the involvement of multiple generations, and
▪ Senior management of the firm is drawn from the family
family businesses differ from non-family enterprises
as do business families from other types of family

It’s critical that business families understand these distinctions so that as owners or managers they
can begin to manage the challenges they face and make the most of their opportunities.
The Family Business
In the Philippines, it is estimated that at least 80% of businesses are family-owned. In fact, most big
corporations are family-owned or family-controlled. These companies, whose ownership may be
already dispersed, are still identified with the founding family.

Ayala Family George Sy Family Lopez Family Gokongwei Family

Although these companies are publicly listed and hence, ownership may include non-family
shareholders, each family’s influence on these companies is still far-reaching: the top position is
occupied by a family member. In addition, other family members are part of the board of directors
and/or are corporate officers.
Family Business Perspective: GOOD to GREAT to GONE

GOOD GREAT GONE

Survival Rates

1st Generation
2nd Generation - 33%
3rd Generation - 12%
4th Generation - Less than 4%
5th Generation - Less than 2%
Four Generation Genogram

Owner-Managed

Family Partnership

Sibling Partnership

Cousin Consortium

Family Syndicate
Source: The Family Business Consulting Group Inc.
[Presentation] – Adapted from John Ward
 COPING WITH CHANGE
Family businesses do not stand still, and change is a constant, particularly
due to the ownership life cycle, which broadly follows three stages:

Controlling Owner Sibling Partnership Cousin Consortium

Owner-Managed Second Generation Third Generation
Nuclear Family Controlled by Close Relatives A Network of Families
THE FAMILY BUSINESS OWNERSHIP CYCLE
Understanding these stages – and navigating the transitions between them
– helps families to manage the growth and sustainability of their business.

CONTROLLING
OWNER
SIBLING
PARTNERSHIP
COUSIN
CONSORTIUM

Source: Kelin E. Gersick, John A. Davis, Marion McCollom Hampton and Ivan S. Lansberg (1997)
Generation to Generation: Life Cycles of the Family Business, Boston, MA: Harvard Business School Press.
TWO SETS OF OWNERS
IN THE FAMILY

FAMILY FAMILY
MEMBERS MEMBERS NOT
WORKING IN WORKING IN
BUSINESS BUSINESS

HARMONIZE
Source: CEO in the News: SM Investments breaks the mold with outside appointment – Nikkei Asia.
Adjusting to Generational Viewpoints – Up to 4 Generations in the Workforce

Future

4th Gen

3rd Gen

2nd Gen GENERATION Z

( 1997 – 2012)

ages 7 - 22
1st Gen
MILLENNIAL
(1981 – 1996)

GENERATION X ages 23 to 38
(1965 – 1980)

BABY BOOMERS ages 39 - 54

(1946 – 1964)

TRADITIONALIST ages 55 - 73
(1900 – 1945)

ages 74 - 91

GENERATION DEFINED in 2019

BALANCING THE INTERESTS OF
FAMILY AND BUSINESS

Health of business impacts satisfying needs of

family and shareholders.

Health of family impacts strength of leadership

and governance of business.
VALUES bind the family and the business together
developing a shared vision, based on family values and goals,
is probably essential for long-term family business success
 PURPOSE
the higher order reason for being
for a brand/company beyond
“making a profit” or “driving shareholder value”
WHY ARE WE IN BUSINESS TOGETHER?
PURPOSE matters
Purpose-led businesses are proven to perform better.
They attract the best talent and keep
them motivated, and win loyal customers.
Vision Statement

▪ Identifies where the organization intends to be in the future or where it

should be to best meet the needs of stakeholders.

▪ Incorporates a shared understanding of the nature and purpose of the

organization and uses this understanding to move the organization
toward a greater purpose.

▪ A good vision statement will help when there are no clear answers, or
for critical decisions that will fundamentally impact your products or
services.
Mission Statement

▪ A role or purpose, by which an organization intends to serve its

stakeholders. It is simply an organization’s reason for existing.

▪ It describes what the organization does (current capabilities), who it

to serve (stakeholders), and what makes the organization unique
(justification for existence).

▪ Always exists at the top level of an organization but may also be set
for different organizational levels or components.
 Visionary Practical
Future Intent Day to Day

Vision Mission

VALUES

Your WHY Goals

A Deep Purpose Collection of Tasks
VALUES DRIVE POLICIES AND PRACTICES

❑ Underpin corporate culture

❑ Assist prioritization
❑ Enable challenging of conventional thinking
❑ Shape people’s personal contribution to the business
❑ Inspire exceptional performance
❑ Create stability and consistency in the face of ambiguity,
uncertainty and a constantly changing marketplace.
VALUES THAT CAN ENRICH THE BUSINESS AS WELL AS THE FAMILY

TRUE VALUES SHOW UP IN ACTIONS, NOT WORDS

VALUES EVOLVING AT SUCCESSFUL FAMILY BUSINESSES

A SENSE OF HIGHER PURPOSE AND STRONG VALUES

VALUES AND VISION – DISTINCTIVE ADVANTAGE FOR FAMILY FIRMS

ETHICAL VALUES BUSINESS VALUES
Integrity Customer Service
Honesty Quality
Openness Innovation
Fairness Efficiency
Responsibility Value for Money

Source: Business Ethics Briefing, 2010, Institute of business ethics, London, Charity no. 1084014, issue 6,
TRADITIONAL MANAGEMENT ENTREPRENEURIAL MANAGEMENT

Slow Quick
Heavy Light
Unguided (dumb) Guided (smart)
Static Targets Moving Targets
Inflexible Flexible
High Fixed Costs Low Fixed Costs
VALUES THAT CAN ENRICH THE BUSINESS AS WELL AS THE FAMILY

TRUE VALUES SHOW UP IN ACTIONS, NOT WORDS

VALUES EVOLVING AT SUCCESSFUL FAMILY BUSINESSES

A SENSE OF HIGHER PURPOSE AND STRONG VALUES

VALUES AND VISION – DISTINCTIVE ADVANTAGE FOR FAMILY FIRMS

 For VALUES statements to be meaningful – not just general or
aspirational they need to be tested against objectively defined behaviors.
CASE STUDY NISSAN
Several years ago, Nissan was selling 80% of its cars at a loss and had lost
almost $6 Billion in one year alone. The situation facing Carlos Ghosn, the
person sent to Japan to fix Nissan, was urgent.

He knew the only way to save Nissan was to take some steps that would
not normally be considered within Japanese business culture, such as
cutting more than 20,000 jobs.

As a French citizen coming to save a Japanese company, how could he

lead the required change without prompting vast resistance by Nissan’s
workers?

Faced with the need to respond to competitive pressures,

managers like Carlos Ghosn invariably find themselves having to
formulate and implement an organizational change.
VALUES THAT CAN ENRICH THE BUSINESS AS WELL AS THE FAMILY

TRUE VALUES SHOW UP IN ACTIONS, NOT WORDS

VALUES EVOLVING AT SUCCESSFUL FAMILY BUSINESSES

A SENSE OF HIGHER PURPOSE AND STRONG VALUES

VALUES AND VISION – DISTINCTIVE ADVANTAGE FOR FAMILY FIRMS

“In the first and second generations, values tend In later generations, when the family gets to be
to be very normative and may be expressed in quite large, the goal is to try to create a sense of
authoritarian, exclusionary ways.… family continuity and solidarity of support.

The values articulated may become a little blander and there may be fewer of them, but the focus
is on what values can be identified that bring people closer together rather than what values the
family will insist people hold and by which they will be judged if they don’t.”
VALUES increase in importance
with the passage of time
as families expand and scatter (geographically), a sense of
shared values becomes ever more important in binding family
members together and to the business
VALUES THAT CAN ENRICH THE BUSINESS AS WELL AS THE FAMILY

TRUE VALUES SHOW UP IN ACTIONS, NOT WORDS

VALUES EVOLVING AT SUCCESSFUL FAMILY BUSINESSES

A SENSE OF HIGHER PURPOSE AND STRONG VALUES

VALUES AND VISION – DISTINCTIVE ADVANTAGE FOR FAMILY FIRMS

 When families acknowledge their shared values, it sets
expectations for their actions and behaviors, and becomes a
rallying point in support of a collection strategic vision.
This provides both a framework for planning and decision-making as well as a
foundation on which to build family business competitive advantage.
 Personality
▪ Belief System ▪ Aptitude
▪ Self Concept ▪ Intelligence
▪ Instrumentality ▪ Education
▪ Motivation Psychological Ability ▪ Training
State
▪ Approval of Others ▪ Experience
▪ Fear

High Context Environment = Strong Influence on Behavior

VALUES THAT CAN ENRICH THE BUSINESS AS WELL AS THE FAMILY

TRUE VALUES SHOW UP IN ACTIONS, NOT WORDS

VALUES EVOLVING AT SUCCESSFUL FAMILY BUSINESSES

A SENSE OF HIGHER PURPOSE AND STRONG VALUES

VALUES AND VISION – DISTINCTIVE ADVANTAGE FOR FAMILY FIRMS

 If I’m with my family and we’ve taken the time to talk about what
values are important to us and how those values shape our vision.
But on top of that, we have focus.
We have a clear idea, and we are all going to the same place. So, values and
vision are really a distinctive competence of family businesses if it’s done right.
CHARACTERISTICS OF
FAMILY BUSINESS
 MEMBERS: POSITION MEMBERS: CONTROL:
A group of people, who are the members The position of family members depends As the family owns a majority share and
of the same family owns and runs the on the relationship which the family constitutes the senior management, it
business enterprise. members have with one another. can exercise control over the business.

MUTUAL INTEREST: MULTIPLE GENERATION: MUTUAL TRUST

As the family members occupy the key The operation and management of the Members have mutual trust in each other,
positions in the business, it can exercise business are looked after by the family, as they have a common origin, same set
influence on the policies of the firm. and so the reins are passed on. of values, ethics and orientation.
STRENGTHS
Family firms enjoy unique advantages: their shared family vision, values and
commitment can inspire employees and drive business performance; they’re
seen as stable, reliable organizations; and they have the opportunity to be
long-term oriented.

CHALLENGES
They can be inward-looking and resistant to change; they often face
difficulties around succession and transitioning to the next generation; and
they must recognize psychological, family-based, emotional dilemmas that,
unchecked, will interfere with the company’s decision-making
Two Opposing Positions

Support Family Involvement Resist Family Involvement

View family as an asset, promote successor Business and family should be separate and believe they
development, and facilitate of family business practices. must protect the business from the family.
 PURE FAMILY PURE BUSINESS

Family should be in all leadership positions. Family employees get no special privilege

Strategy and management influenced by family Pay is to market, merit determines how far you get

Loyalty is usually a key value Few family conflicts present

Non-family management “adopted” or considered Family often disconnected from the business

Company culture is “family system” Looks like a public company.

Generally not cutting edge or performance-driven Usually only those in the business can own stock

RESULT – USUALLY DECLINE RESULT – USUALLY SOLD

 WHERE SHOULD WE BE?

FAMILY BUSINESS
FIRST FIRST
 PARALLEL PLANNING

VALUES
CORE VALUES GUIDING PRINCIPLE

STRATEGIC THINKING
STRATEGIC
FAMILY COMMITMENT
COMMITMENT

SHARED FUTURE VISION

FAMILY VISION BUSINESS VISION

FORMULATING PLAN
ENTERPRISE BUSINESS STRATEGIC
CONTINUITY PLAN PLAN
 ALIGNMENT – VALUES, VISION, AND MISSION

FAMILY BUSINESS
VALUES VALUES
Underlying principles that guide family decisions and Underlying principles that guide business decisions
actions. and actions.

VISION VISION
Picture of the family’s desired future. Picture of the business’ desired future.

MISSION MISSION
Core Purpose: What we want to accomplish Core Purpose: What we want to accomplish
together as a family. together as a business.
FAMILY BUSINESS BEST PRACTICE PROCESS MODEL

The process requires that a number of things happen:

❑ Separate the Family from the Business – to work on each of them, separately.

❑ Align respective values, visions and goals to create complementary plans.

❑ Establish appropriate Structures and Systems within each entity – to help

implement, support, monitor and enforce their individual Plans

❑ Ensure the right people are in the right roles, with the right attitudes and skills,
in both the Family and the Business, to discharge allocated responsibilities.
Foundation of Family Business Planning

Source: The Family Business Consulting Group Inc.

[Presentation] – Adapted from Jennifer Pendergast, FBCG
 MANAGING AND BALANCING
3 ROLES IN A FAMILY BUSINESS
Governance
refers to the ability to optimally discipline and control the nature
of the relationship between family members, shareholders, and
managers in such a way that the enterprise prospers.

Source: The Family Business Consulting Group Inc.

by Dart, B. & Hargrave, A. (2016)
 In order to ensure no one person has too much power, the responsibilities of
corporate governance are spread among three major players.

Management
Headed by the
Chief Executive Officer (CEO)

Shareholders Board of Directors

The Owners / Investors Elected by the Shareholders to
Contributed Capital Represent their Interests
WHERE DO BOARDS FIT?

Owners Council
As the Business grows and becomes more complex – role of
Board providing sophisticated advice becomes more important.

Board of Directors

Family Council As Family and Ownership grow in numbers and complexity – oversight
function of board becomes more important, to give comfort to owners that
their interests are protected and well managed.
WHERE DO BOARDS FIT?

OWNERS / FOUNDERS
▪ Board serves at pleasure of owners

BOARD OF DIRECTORS
▪ Elected by Owners
▪ Hold business leaders accountable

BUSINESS LEADERSHIP
▪ Responsible for day to day management
Corporate Governance Framework

Wealth Creation Wealth Management Wealth Sharing

Profit (NIAT) Distribution

Happiness and Prosperity of all
Output – Input = Wealth Created Cash Flow
Stakeholders

Sales / Revenue Suppliers (Adequate Returns)

Employees (Adequate Remuneration)
Reinvestment
Customers (Affordable Prices)
Public (Investment and CSR)
Enhanced Capabilities
Government (Payment of Taxes and CSR)

Corporate Sustainability

Investing Activities
Growth and Development

Best Management Practices are Vital Here Law And Ethics Are Vital Here
THE THREE CIRCLE MODEL OF FAMILY FIRMS

Non-Family Non-Manager Owners:

These are an external investor or say outsiders, who own a certain
proportion of business but do not work.

Family Owners:
This group include those family members who own a part of the business
but do not take part in its operations.

Family Owner-Employees:
As the name specifies, these are the owners of the business, as well as work
as an employee in the firm, usually in top managerial positions.

Non-Family Owners Employees:

This group covers those individuals who are employees of the concern and
are not family members, as well as own a certain proportion of the firm’s
share capital.
THE THREE CIRCLE MODEL OF FAMILY FIRMS

Family Members:
This group includes all those family members who neither own shares in the
company nor they are actively involved in the family business.

Family Employees:
In this group, all those members of the family are covered who work for the
company, but they do not own part of the company’s share capital.

Non-Family Owners:
These are the employees of the company, who work for the company under
an employment contract, and are not family members. They also don’t own
shares in the company.
THE THREE CIRCLE MODEL OF FAMILY FIRMS

Source: BanyanGlobal. HBR

Benefits of Family Business Ownership
FOR FAMILIES
▪ Provides cohesive focus that brings family
together.
▪ Offers family members a shared sense of
responsibility
▪ Serves as a source of family pride and gives
the family a means of values into action.
▪ Helps family members develop leadership
skills and build wealth.
FOR BUSINESS
▪ Enables a company to outperform and outlast
others.
▪ Provides support through the deep caring of a
team of people aligned in values and goals.
▪ Assures continuity through long-range vision
and family’s desire to pass it to future.
▪ Enjoys a corporate culture grounded on
conscious values.
3 Proven Factors to Family Business Success

Active Board Family Meetings Planning

Strategic Planning
Succession Planning
Sample Governance Structure

OWNERS
SHAREHOLDERS
COUNCIL

FAMILY ADVISORY
BOARD OF DIRECTORS
COUNCIL COUNCIL

CEO / PRESIDENT

Marketing Operations Finance

Time for a Family Council?

WHAT IS A FAMILY COUNCIL? CONSIDER WHEN….

▪ Standing body ▪ Family expanding

▪ May be representative ▪ Growing ownership complexity

▪ Guided by Charter ▪ Need organization to maintain multi-year agenda

▪ Rules for functioning

 BUSINESS OF THE FAMILY BUSINESS OF THE BUSINESS

FAMILY SHAREHOLDER

STRENGTH FROM BALANCE OF THREE

BOARD OF
FAMILY DIRECTORS
GOVERNANCE
MEETINGS
MANAGEMENT

Family Education Committee

Family Employment Policy Committee Next Generation Committee

Family Foundation Committee Family Assemblies/Planning

The Two Pillar Governance

Source: Father Knows Best? Management Accountability in Family Businesses (2018) by Mercer Capital.
The Two Pillar Governance

BUSINESS FIRST: THE ENTERPRISE PILLAR

Most successful family businesses create the
enterprise pillar first as they build an increasingly
complex enterprise. Distilled to its most basic form,
the enterprise pillar has the following elements.

As the family expands into multiple assets (e.g.,

operating businesses, real estate, investments,
shared properties) owned by multiple branches or
households, there is a pressing need for alignment
and integration. Between the owners and their
assets sit layers of enterprise governance and a
myriad of financial, legal, advisory, and
administrative functions and entities.

Source: The Two Pillars of Governance…(26 August 2020). FFI Practitioner.

The Two Pillar Governance

EMERGENCE OF THE FAMILY PILLAR

At a certain level of financial success, a business
family must turn its attention to constructing the
family pillar of governance. The impetus to
establish family governance may arise within the
family, perhaps from proliferating branches
seeking a forum in which to communicate and
align their interests.

The family pillar may be likened to a form of

representative government, managing the social
and community relationships and affairs of the
extended family. Unlike the weighted power of
shareholdings, family members are equal citizens,
independent of how many shares they own.

Source: The Two Pillars of Governance…(26 August 2020). FFI Practitioner.

The Two Pillar Governance

EMERGENCE OF THE FAMILY PILLAR

FAMILY ASSEMBLY (all family members)
A family assembly may come first, starting small
and growing over time. It may be comprised of
bloodline family members as well as
spouses/partners who may never be entitled to
become shareholders but with vested interests in
how the family is run. Some agenda items
(education, cohesion, conflict, legacy, etc.)

FAMILY COUNCIL (officers)

A family council may be formed first. If a family is
large enough, information-sharing and decision-
making on timely basis with everyone in the family
becomes unwieldy. The family may instead create
an “executive team” drawn from the full family,
typically called a family council or family board.

Source: The Two Pillars of Governance…(26 August 2020). FFI Practitioner.

The Two Pillar Governance

COLLABORATION: HOW THE SYSTEM SUCCEEDS

Each pillar represents a unique system with
different goals, constituents, and concerns. But
they are highly interdependent. These connections
are not reporting relationships, as within each of
the pillars. These are channels of discussion,
information-sharing, and integration of the
authority vested in each governance entity.

The family council may, for example, weigh in on

enterprise questions such as the sale of a major
operating company, but the ultimate authority for
that decision remains with the shareholders. The
board of directors or the holdings board may
present information and answer questions about
the status of the family’s assets at a family
assembly or a family council meeting.

Source: The Two Pillars of Governance…(26 August 2020). FFI Practitioner.

The Two Pillar Governance

ADDING COMPLEXITY AND INDIVIDUALITY

Every family creates a governance system that
builds out these basic elements in their own way.
Figure 4 displays a model drawn from a global
third-generation family enterprise, showing the
committees that make up their family governance
and the collaboration relationships between
business and family.

This fundamental model, with complexity

customized to each family, eliminates the common
confusion surrounding the creation of governance.
Various functions or responsibilities are easily
assigned to either the family pillar or enterprise
pillar.

Source: The Two Pillars of Governance…(26 August 2020). FFI Practitioner.

A Typical Family Enterprise Progression

Source: Family Office Exchange Research. Developing a Family Enterprise Governance Model
Stages of Family Governance

Source: The Family Business Consulting Group Inc. by Dart, B. & Hargrave, A. (2016)
FAMILY DYNAMICS
WHY NOT PLAN AN EXIT?

❑ Ponce de Leon Syndrome (fear of getting old)

❑ Family politics and infighting – to avoid conflicts

fair is not always equal; equality is not always fair

❑ Confusion about succession planning options

❑ Confusion or misunderstanding over tax and financial implications

❑ Fear that succession discussions will scare non-family executives

business objectives and rules versus family priorities and emotions
This is often a culture clash, and it leads to long-term tensions,
friction and values conflicts

In most societies the family is a fundamental institution for transferring values to succeeding
generations, and for ensuring their physical and emotional development (legacy).
Source: Manfred F.R. Kets de Vries and Randel S. Carlock with Elizabeth Florent-Treacy
(2007) Family Business on the Couch: A Psychological Perspective, Wiley, p.9.
 THE FAMILY BUSINESS LIFE CYCLE
The course of a product’s sales and profits over its lifetime.
It involves five distinct stages:
The BLC stage in which a product’s sales growth slows or levels off.

The BLC stage in which a product’s sales decline.

The BLC stage in which a product’s sales start climbing quickly.

Succession Planning or Regeneration

Product Planning
and Development

The BLC stage in which a new product is first

distributed and made available for purchase.

Introduction Growth Maturity Decline Life Extension

 READINESS – THE DIFFERENCE

LEADERSHIP OWNERSHIP

▪ Responsible for guiding and leading a ▪ Control of the stocks and assets of a
business business

WHAT COMES FIRST IN A SUCCESSFUL TRANSITION?

 SUCCESSION STEPS
Family Business Foundational Strategies (Values, Vision, and Mission)
Business Strategic Direction and Plan
Organization and Governance Structure

LEADERSHIP OWNERSHIP

1. Leadership Succession Scenarios 1. Financial/Life and Estate Plan

2. Skill Requirements 2. Strategic Business Plan
3. Training and Development 3. Ownership Options
4. Performance Review Process 4. Leadership and Ownership Transitions
5. Selection Process 5. Business Valuation
6. Selection and Transition 6. Exit Plan
HOW TO INSPIRE THE NEXT GENERATION?
Without applying unfair pressure, how can seniors involve, educate and inspire
the next generation to ensure they develop a real interest in the business that
will be needed when they take on ownership or management roles?
allow the next generation to set its own path
How can we learn to balance the responsibilities and opportunities of the
family’s legacy, creating space for the next generation to plan their own futures
– not those set for them by their parents or by a sense of obligation?
 developing a parenting style that
fosters next generation autonomy
Important attitudes towards work and the family business are formed
during childhood, and the quality of parenting makes a real difference.
use real-time experiences to coach and teach
Look out for “teachable moments” when young people are ready to learn – help
develop their interests, talents and autonomy. Later, parents can become
mentors, focusing on sharing life experiences and insights.
 reduce parent-teen conflict
Too often, parenting methods cause conflict. “command-and-control” no longer works!
joining the business should be a
choice, not an obligation
They need: experience and self-confidence
❑ ideally gained in other businesses before joining;
❑ extra skills to address complex family business dynamics;
❑ credibility as well as competence to earn the respect of non-family
employees and other stakeholders;
❑ passion and commitment – motivation to succeed personally and
drive the family business forward.
empowering via training and career
development opportunities
Career development plans should be the product of inter-generational
teamwork with non-family input, providing timetabled education and
training that could include:
❑ work experience at the family business during school holidays;

❑ seeking high-quality formal education, and other graduate programs;

❑ boosting pride and a sense of connection via family projects;

❑ taking part in practical training courses and outside work experiences;

❑ involvement in entrepreneurial ventures including start-ups; and

❑ socializing with the extended family, fostering a teamwork spirit.

 STRATEGIC FAMILY OWNERSHIP SCENARIOS

CONTINUE AS IS SELL MINORITY STAKE SELL MAJORITY STAKE SELL TOTAL COMPANY

OWNERHIP
RISK OF FAMILY ASSETS
PROS AND CONS
VALUE AND CAPITAL FOR GROWTH
ESTIMATED SHAREHOLDER RETURNS
 TOOLS FOR ANALYZING FAMILY BUSINESS CASES

TOOLS TO UNDERSTAND THE CURRENT STATUS, PAST HISTORY, AND THE

DESIRED FUTURE OF THE FIRM BY ITS KEY STAKEHOLDERS
THE FAMILY ▪ David’s 3 Circle Model ▪ Rules of Entry and Exit
BUSINESS ▪ The 3 Axes Model ▪ Sharma Performance Matrix
▪ Governance Options ▪ Key Events

TOOLS TO UNDERSTAND THE PLAYERS, RELATIONSHIPS, DIVERSITY OF

PERSPECTIVES, AND HEALTH OF THE FAMILY SUB-SYSTEM
THE FAMILY ▪ Genogram
IN FAMILY BUSINESS ▪ Perceptual Map of Key Players
▪ Olson Circumplex Model

TOOLS TO UNDERSTAND THE LEVELS OF EFFICIENCY AND EFFECTIVENESS

OF FAMILY FIRMS
THE BUSINESS ▪ Organization/Ownership Chart ▪ Types of Conflicts
IN FAMILY BUSINESS ▪ Succession Issues ▪ General Business Assessment
▪ Exploitation and Explorations
REFERENCES
1. New Venture Creation: Entrepreneurship for the 21st Century 9th Edition (2012) by Stephen Spinelli Jr. and
Robert Adams. The McGraw-Hills Companies, Inc.
2. Family Business Consulting: Creating Synergy Between the “Family Strategy” and the “Business Strategy”
Webinar (24 June 2010) by Merrly Tracey Harrell.
3. Explain The Forces That Can Keep A Family Business Moving Forward by Albert Watkins.
4. Institute for Family Business (Source: https://www.ifb.org.uk/)
5. Analyzing Family Business Cases: Tools and Techniques (2013) Case Research Journal by Pramodita Sharma,
Robert Blunden, Rania Labaki, Nava Michael-Tsabari, and Juan O. Rivera Algarin
6. Photos, Icons, Vectors, and Illustrations are free stock contents from:
▪ pixabay.com
▪ iconfinder.com
▪ freepik.com
 FAMILY BUSINESS MANAGEMENT
UNDERSTANDING FAMILY BUSINESS
THANK YOU! ANY QUESTIONS?

Prepared by:

Mr. Donn Enrique L. Moreno, MBA

ENT 3106

To cite: Moreno, D.E.L. (2021). Family Business Management [Online Lecture]. Pamantasan ng Lungsod ng Maynila.