essay about successful family business

Essay on Family Businesses

Family Business Overview

Currently, business family is becoming more influential and simpler to manage. This type of business is mainly owned by people with close relation to other forms of business internationally (Aguila and Briozzo, 2020 pp 49). Therefore, a family business can be defined as a business type in which two or more family members or related people form a cartel, thus operating as one firm. In most cases, the business’s complete control lies within the family members since they have common objectives to achieve. According to the research, the family business is recognized as one of the international forms of business contributing to the growth and development of most countries’ economies. Nowadays, the family business is believed as the engine of industrialization in most countries since they have contributed significantly to revenues and tax provision, especially to the governments (Ahmad and Yaseen 2018 pp 345). For any country to achieve its Gross Domestic Product (GDP), micro-business, such as family business and other small operating businesses, should provide taxes and revenues to the government.

Even though family business is categorized as micro, multinational family corporations can operate in more than two countries. Most of these multinationals’ family businesses are located in the United States of America, the United Kingdom, and Colombia. Basing the research conducted by the Institute of Family Business (IFB) 2012, about 5millions micro-businesses operating internationally are private sectors. These macro businesses contribute approximately 76% internationally to create job opportunities for the family members and other none related people (Antcliff  et al.;  2020 pp 34 ). In the United States of America, micro-businesses such as family businesses are more considered than governmental sectors. Family businesses are believed to have contributed positively to providing affordable products and services to most unstable people.

In most cases, the family business is owned and directed by family members, thus minimizing the chances of loss due to poor organization. The main strength of a family business is that there are no interferences since its characterized by monopolistic. Here are some examples of the most successful family business in the world.

Family-owned businesses are believed to be the oldest form of business organizations. Since the 1980s, the research shows that family business has distinct significance, especially in raising the county’s Economy; that’s why most countries consider operating micro-businesses as big firms and companies.

These family businesses are currently recognized as crucial and dynamic participants contributing to the highest world economy (Brenkman, 2020 pp 67-89). Basing U.S statistics, 90 percent of the United States of America owned family business. The growth and development of family business have mainly contributed in some countries such U.K. and Colombia. According to the IFB, the United Kingdom record more than a 4.8million family business which occupies more than 88 percent of the total business conducted within the United Kingdom. Currently, family businesses are the backbone of the United Kingdom economy, thus contributing about $ 150 billion annual tax. Within the age of huge businesses, it is significant to understand why family businesses are emerging to be the most successful than other forms of enterprises. In the United Kingdom, family business is growing at a higher rate, thus tending to outperform other close companies in physical markets. Naturally, United Kingdom is a unique country dominated mainly by heritage and encourages most families to inherit their parents’ work even if they pass away (Caputo  et al.; 2018). The aspects of origin in the country elaborates on why the percentage of family businesses is rapidly increasing every year. In most cases, the family businesses are operated depending on the types and complexity of each. For instance, the chart below shows different kinds of family businesses and how they are managed.

The main reasons family businesses are more than other private sectors are that they are easy to perform and operate since they do not need to hire specialists or managers. Instead, they are primarily used and ran by related people. Additionally, these types of businesses do not incur much labor costs since they mostly rely on family members who are always available to offer free assistance (Seaman  et al.;  2019 pp 345). According to Bolton Consulting Groups (BCG) arguments, the analysis shows that family businesses contribute about 45 percent of all the companies and organizations. To prove this, Dyson and JCB are good examples of the most prominent family businesses in the United Kingdom, which participate within their country and internationally. In connection to this, family businesses are the largest employers in the United Kingdom. So, it’s clear that family businesses have more benefits since people are derived by their determinations and what they need to achieve after operating their business.

Characteristics of Family Business

Family businesses are characterized by several features, which makes them operate successfully, unlike other companies. Family businesses are monopolistic by nature since only family people, and other relatives can run the business. In most cases, the business will only operate depending on the culture and norms of the family, thus not satisfying customers’ needs. From a perspective, a family business has operating hours and mostly may limit people from purchasing since customers have different times of purchasing. Basing the analysis of 33 countries, family businesses are simple to manage since their structure is less complex than other operating businesses (Chang  et al.; 2020 pp 56). The design and characteristics of a family business depend on the number of people involved in the business operations. Concerning this, some features can be tangible while others are intangible. One of the most crucial characteristics of a family business is its strong trust and the inter-relationship between the family members.

In contrast to the other companies, there exist constant ideological differences between the management and other stakeholders within the industry. Regardless of the type of ownership and management team, the entire family members remain the critical participants in the company and can immediately decide to manipulate the nature of products they deal with. Another characteristic of a family business is that the management is always informal, and it’s hard to recognize any mistakes arising from the way of operations.

Most managers of these businesses have no definitive ideas to promote the business’s operations from one level to another.

The excessive intermingling between the company and family members may encourage financial problems since most of the business’ capital can be directed to family issues that were not planned in the money. In some family businesses, there is no working time and private hours. Therefore, the operation of the company may become monotonous to some members. Naturally, doing one thing over a long time reduces interests (Pham  et al.; 2019). Even though a family business may consist of other non-family members, the ownership and management of the company lie within the family members only. The figure below shows an example of business ownership and its structure. This is one of the main characteristics of family business currently

Therefore, the family business needs more management teams to ensure proper supervision is achieved. In some countries such as Canada and Australia, family business focuses on the companies’ long-term sustainability rather than gaining considerable profits. Most family businesses have limited access to goods and services; therefore, all characteristics of family business are passed from one generation to another. The generation to come will have to use unique features but what they think it’s good. However, according to Ryann’s arguments, family businesses have supported entrepreneurship since most family members another characteristic of a family business is complete control in terms of productions since the family is responsible for any required materials. However, most companies produce limited goods and services, such that there are no suppliers that can benefit none family people. To have a robust business, most families form cartels and partners with other more developed cooperation’s thus getting more chances of thriving in business.

Challenges facing family business

Even though family business is simple to manage, there are several challenges. The main challenge affecting family businesses is a generation gap. When many generations of different families are administering the company, the rate of changing from one technology to another might take long since not all people may understand it (Friar and Clark, 2021). For instance, the founders of some family businesses may resist handing off the management responsibilities to other upcoming families. This action creates characteristics of monopoly since most leaders make decisions based on their perspectives and ignoring the opinions of others. Even though younger generations may have some great ideas on how the business can operate efficiently and accurately, they are never involved in the business operations. This means that the company will continue working within flawed and outdated technologies since they lack the knowledge and skills to implement the new ideas (Heinonen  et al .;2020 pp 1-34). Due to this, there may occur conflicts and frustrations since some employees feel that their voices and opinions are not considered in the implementation of the business.

Currently, most family members fail to understand that everybody can contribute positively to the industry. To overcome such challenges, the family should negotiate towards the succession of leadership without chaos. Another challenge associated with family businesses is business culture. In this type of business, it’s tough for the company to accept all cultures and values from different families. Even if related people form the industry, some people have different cultural opinions that may not match other family members involved. For example, Samsung business involves different families with different ideological thinking thus may be difficult to operate within the same culture. In this case, most family businesses use basing the cultural system of the paramount families. The interferences of business can lead to low turnover rates, thus reducing the productivity of the company. Setting up payment strategies can currently face other problems facing family business (Núñez  et al.,  2018). Determining payments in the industry may raise conflicts because some members cannot be paid equally. The prices should be determined based on the duties and responsibilities of the individuals; however, some family members may demand equal payment, thus building uncertainty and mistrust. Some employees may get annoyed in the reaction to such cases since they don’t expect to work hard and get fewer payments.

When employees are not positively encouraged, they may lose morale, while others may decide to leave the job to look better. Therefore, this means some family members will lose business morale and, with time, will seize supporting business operations. Another challenge affecting family business is mixing business with home life. According to the research, when family members work in the same companies and organizations, it becomes challenging to make definitive decisions without basing personal feelings. (Kanade  et al.; 2020) Due to this, family businesses can operate poorly due to family events, whereby families may decide to make frequent holidays that do not concern business operations. The issue of holding every family member in the same standard is another challenge facing family enterprises. For instance, some employees may be spending a lot of time in the breakfast rooms than in the business desk operations. The aspects of some members westing time in the busines may contribute low output thus reducing the business’s productivity.

When some people in the business are not operating according to business formalities, the other employees may develop negative implications. They may not work smart to achieve the objectives and anticipated target of the organization. Additionally, these behaviors will create laxity and mistrust in the organizations. According to the research, the most family business faces interferences and challenges from within the family members especially those in the top management (Michiel  et al.; 2017 pp 369). Planning for the future is another upcoming challenge facing the operations of most family businesses. Since most family enterprises are characterized by solid planning, it becomes difficult to modify the planned decisions.

Consequently, making decisions becomes tedious because of the extended channels to be followed. If the business involves more than two families, the decisions are made based on both families’ final discussions. Therefore, before plans and decisions are made, there must be consultations from all the family and relatives. Nowadays, there is a need for family members to understand how the business should be conducted to avoid such challenges.

Recommendations

To overcome the social and economic contributions made by the family businesses, there are crucial aspects that we need to look at. Both characteristics and challenges associated with family businesses can be overcome if the family members get serious with business and stop focusing on things that do not relate to the business (Michiel  et al.;,  2017 pp 369). According to the discussions, most family businesses are affected by top management’s ignorance since they think they control everything in the business basing their knowledge. According to my perspective, family businesses can only improve if the management team considers the opinions of others. To have good business, there is a need to involve all the employees in the decision-making process. To have a better understanding of family businesses, the following recommendations should be taken into account. The performance of the business should be optimized and act as a reference to other generations to come. Family businesses are believed to have contributed positively to providing affordable products and services to most unstable people.

In most cases, the family business is owned and directed by family members, thus minimizing the chances of loss due to poor organization. Additionally, the operation of a family business should not base on the specific family since it may promote hatred and non-stoppable conflicts within the related people (Musso  et al.;  2020 pp 23). Also, the business should be in the position to serve the general population without considering if the buyers come from the same clan. The family business will act as a catalyst that speeds the growth and development of the Economy. For better family business success, the younger people should be involved in the management team since they might have more technical skills to help family businesses thrive well.

To have peace and harmony within the industry, there should equal distribution of the profits gained from the company since its efforts of every individual performing in the industry. For instance, when some industries are not operating according to business formalities, the other employees may develop negative implications. They may not work smartly to achieve the objectives and anticipated target of the organization (Musso  et al.;  2020 pp 23). The family should be considered as the primary influence both on the companies’ operations and strategic orientations. For this reason, the management and combination of the several families will positively contribute to the growth and prosperity of the business even in the future.

Self-reflection on family businesses

The family business is one the best enterprise to operate despite its challenges. Basing the research analysis, the family business is simple to use compared to all other forms of business internationally. Basing my views, the family business has benefited most people worldwide by providing employments to non-employed people. Even though the company operates without physical interference from governments, it faces some challenges which can be solved basing its structure. This reflection is a way of considering all the characteristics and challenges that have been facing family businesses. According to my arguments, a family business can improve if they follow all the above recommendations. Additionally, there is a need for the managers and supervisors to understand that the success of most companies depends on decision-making.

To sum up, the family business has contributed to social-economic growth, especially in European countries. According to the research, these businesses have contributed about 67% of Gross Domestic Products, especially in the United States of American and the United Kingdom. Regardless of the type of ownership and management team, the entire family members remain the critical participants in the company and can immediately decide to manipulate the nature of products they deal with. Another characteristic of a family business is that the management is always informal, and it’s hard to recognize any mistakes arising from the way of operations. Even though family business is categorized as micro, multinational family corporations can operate in more than two countries. Most of these multinationals’ family businesses are located in the United States of America, the United Kingdom, and Colombia. The prosperity of many family businesses depends on their structure and operational structure. Basing the research arguments, the family business will continue been in the top in European’s countries since families believe in amalgamation is more effective than individualism.

Aguilar, V.G. and Briozzo, A., 2020. Family businesses: capital structure and socio-emotional wealth.  Investigación administrativa ,  49 (125).

Ahmad, Z. and Yaseen, M.R., 2018. Moderating role of education on succession process in small family businesses in Pakistan.  Journal of Family Business Management . pp 345

Antcliff, V., Lupton, B. and Atkinson, C., 2020. Why do small businesses seek support for managing people? Implications for theory and policy from an analysis of U.K. small business survey data.  International Small Business Journal  pp 34

Brenkman, A.R., 2020.  Exploring the management succession process in small and medium-sized family businesses  (Doctoral dissertation, North-West University (South Africa)). pp 67-89

Caputo, A., Marzi, G., Pellegrini, M.M. and Rialti, R., 2018. Conflict management in family businesses.  International Journal of Conflict Management .

Chang, A.A., Mubarik, M.S. and Naghavi, N., 2020. Passing on the legacy: exploring the dynamics of succession in family businesses in Pakistan.  Journal of Family Business Management . Pp 56

Friar, J.H., Ippolito, J. and Clark, T., 2021. The challenges of transitioning to professional selling in family businesses. In  A Research Agenda for Sales . Edward Elgar Publishing.

Heinonen, J. and Ljunggren, E., 2020. It’s not all about the money: narratives on emotions after a sudden death in family businesses.  Journal of Small Business & Entrepreneurship , pp.1-23.

Kandade, K., Samara, G., Parada, M.J. and Dawson, A., 2020. From family successors to successful business leaders: A qualitative study of how high-quality relationships develop in family businesses  Journal of Family Business Strategy , p.100334.

Michiels, A. and Molly, V., 2017. Financing decisions in family businesses: a review and suggestions for developing the field.  Family Business Review ,  30 (4), pp.369-399.

Musso, F. and Francioni, B., 2020. The strategic decision-making process for the internationalization of family businesses.  Sinergie Italian Journal of Management ,  38 (2), pp.21-43.

Núñez-Cacho, P., Molina-Moreno, V., Corpas-Iglesias, F.A. and Cortés-García, F.J., 2018. Family businesses transitioning to a circular economy model: The case of “Mercadona”.  Sustainability ,  10 (2), p.538.

Pham, T.T., Bell, R. and Newton, D., 2019. The father’s role in supporting the son’s business knowledge development process in Vietnamese family businesses.  Journal of Entrepreneurship in Emerging Economies .

Seaman, C., McQuaid, R. and Pearson, M., 2017. Social networking in family businesses in a local economy.  Local Economy ,  32 (5), pp.451-466.

Visser, T. and van Scheers, L., 2020. HOW IMPORTANT IS ENTREPRENEURIAL ORIENTATION FOR FAMILY BUSINESSES?.  Management: Journal of Contemporary Management Issues ,  25 (2), pp.235-250.

Wang, Y. and Shi, H.X., 2020. Particularistic and system trust in family businesses: The role of family influence.  Journal of Small Business Management , pp.1-35.

Yoshida, S., Yagi, H. and Garrod, G., 2020. Determinants of farm diversification: entrepreneurship, marketing capability and family management.  Journal of Small Business & Entrepreneurship ,  32 (6), pp.607-633

Cite this page

Similar essay samples.

• Essay on Information, Technology and HIPAA Act
• Essay on State Income Taxes
• Mild Persistent Asthma: A Discussion
• Exploring groups and their dynamics
• Essay on Evidence-Based Practice
• Is Psychology a science and should it be?

Presentations made painless

• Get Premium

107 Family Businesses Essay Topic Ideas & Examples

Inside This Article

Family businesses are a cornerstone of many communities around the world. These enterprises are often passed down through generations, with family members working together to run and grow the business. Family businesses come in all shapes and sizes, from small mom-and-pop shops to large corporations.

If you are tasked with writing an essay about family businesses, you may be wondering where to start. To help you get your creative juices flowing, we have compiled a list of 107 family business essay topic ideas and examples. Whether you are looking to explore the challenges faced by family businesses, the benefits of working with family members, or the impact of family businesses on the economy, there is a topic on this list for you.

• The history and evolution of family businesses
• The role of family values in shaping a family business
• The challenges of succession planning in family businesses
• The benefits of family businesses for local communities
• The impact of family businesses on the economy
• The unique management styles of family businesses
• The importance of communication in family businesses
• The advantages and disadvantages of working with family members
• The role of women in family businesses
• The impact of technology on family businesses
• The benefits of family businesses for employees
• The role of innovation in family businesses
• The challenges of balancing work and family in a family business
• The impact of globalization on family businesses
• The importance of trust in family businesses
• The role of family dynamics in shaping a family business
• The impact of cultural differences on family businesses
• The challenges of managing conflicts in a family business
• The benefits of having a family business mentor
• The impact of family businesses on the environment
• The role of family businesses in preserving traditions
• The challenges of managing a family business during a crisis
• The benefits of family businesses for customers
• The impact of social media on family businesses
• The importance of ethics in family businesses
• The role of education in preparing the next generation to take over a family business
• The challenges of managing a family business in a competitive market
• The benefits of having a diverse workforce in a family business
• The impact of government regulations on family businesses
• The role of networking in growing a family business
• The challenges of balancing family and business responsibilities in a family business
• The benefits of having a strong company culture in a family business
• The impact of generational differences on family businesses
• The importance of succession planning in ensuring the longevity of a family business
• The role of branding in building a successful family business
• The challenges of managing family business finances
• The benefits of having a clear mission and vision in a family business
• The impact of mergers and acquisitions on family businesses
• The role of social responsibility in family businesses
• The challenges of adapting to change in a family business
• The benefits of having a strong support system in a family business
• The impact of family businesses on employee retention
• The importance of work-life balance in a family business
• The role of conflict resolution in maintaining harmony in a family business
• The challenges of managing a family business in a recession
• The benefits of having a diverse product line in a family business
• The impact of competition on family businesses
• The role of technology in streamlining operations in a family business
• The challenges of expanding a family business into new markets
• The benefits of having a strong marketing strategy in a family business
• The impact of industry trends on family businesses
• The importance of customer feedback in improving a family business
• The role of employee training in a family business
• The challenges of managing a family business with remote employees
• The benefits of having a family business advisory board
• The impact of customer loyalty on family businesses
• The role of family businesses in creating jobs
• The challenges of managing a family business with multiple locations
• The benefits of having a family business succession plan
• The impact of social media marketing on family businesses
• The importance of data analytics in optimizing operations in a family business
• The role of family businesses in promoting economic growth
• The challenges of managing a family business with limited resources
• The benefits of having a strong customer service team in a family business
• The impact of employee morale on family businesses
• The role of employee recognition in motivating staff in a family business
• The challenges of managing a family business with seasonal fluctuations
• The benefits of having a strong sales team in a family business
• The impact of customer reviews on family businesses
• The importance of employee training and

Want to create a presentation now?

Instantly Create A Deck

Let PitchGrade do this for me

Hassle Free

We will create your text and designs for you. Sit back and relax while we do the work.

Explore More Content

• Privacy Policy
• Terms of Service

© 2023 Pitchgrade

The five attributes of enduring family businesses

Family businesses are an often overlooked form of ownership. Yet they are all around us—from neighborhood mom-and-pop stores and the millions of small and midsize companies that underpin many economies to household names such as BMW, Samsung, and Wal-Mart Stores. One-third of all companies in the S&P 500 index and 40 percent of the 250 largest companies in France and Germany are defined as family businesses, meaning that a family owns a significant share and can influence important decisions, particularly the election of the chairman and CEO.

As family businesses expand from their entrepreneurial beginnings, they face unique performance and governance challenges. The generations that follow the founder, for example, may insist on running the company even though they are not suited for the job. And as the number of family shareholders increases exponentially generation by generation, with few actually working in the business, the commitment to carry on as owners can’t be taken for granted. Indeed, less than 30 percent of family businesses survive into the third generation of family ownership. Those that do, however, tend to perform well over time compared with their corporate peers, according to recent McKinsey research. Their performance suggests that they have a story of interest not only to family businesses around the world, of various sizes and in various stages of development, but also to companies with other forms of ownership.

To be successful as both the company and the family grow, a family business must meet two intertwined challenges: achieving strong business performance and keeping the family committed to and capable of carrying on as the owner. Five dimensions of activity must work well and in synchrony: harmonious relations within the family and an understanding of how it should be involved with the business, an ownership structure that provides sufficient capital for growth while allowing the family to control key parts of the business, strong governance of the company and a dynamic business portfolio, professional management of the family’s wealth, and charitable foundations to promote family values across generations (Exhibit 1).

Five dimensions

Family businesses can go under for many reasons, including family conflicts over money, nepotism leading to poor management, and infighting over the succession of power from one generation to the next. Regulating the family’s roles as shareholders, board members, and managers is essential because it can help avoid these pitfalls.

Large family businesses that survive for many generations make sure to permeate their ethos of ownership with a strong sense of purpose. Over decades, they develop oral and written agreements that address issues such as the composition and election of the company’s board, the key board decisions that require a consensus or a qualified majority, the appointment of the CEO, the conditions in which family members can (and can’t) work in the business, and some of the boundaries for corporate and financial strategy. The continual development and interpretation of these agreements, and the governance decisions guided by them, may involve several kinds of family forums. A family council representing different branches and generations of the family, for instance, may be responsible to a larger family assembly used to build consensus on major issues.

Long-term survivors usually share a meritocratic approach to management. There’s no single rule for all, however—policies depend partly on the size of the family, its values, the education of its members, and the industries in which the business competes. For example, the Australia-based investment business ROI Group, which now spans four generations of the Owens family, encourages family members to work outside the business first and gain relevant experience before seeking senior-management positions at ROI. Any appointment to them must be approved both by the owners’ board, which represents the family, and the advisory council, a group of independent business advisers who provide strategic guidance to the board.

As families grow and ownership fragments, family institutions play an important role in making continued ownership meaningful by nurturing family values and giving new generations a sense of pride in the company’s contribution to society. Family offices, some employing less than a handful of professionals, others as many as 40, can bring together family members who want to pursue common interests, such as social work, often through large charity organizations linked to the family. The office may help organize regular gatherings that offer large families a chance to bond, to teach young members how to be knowledgeable and productive shareholders, and to vote formally or informally on important matters. It can also keep the family happy by providing investment, tax, and even concierge services to its members.

Maintaining family control or influence while raising fresh capital for the business and satisfying the family’s cash needs is an equation that must be addressed, since it’s a major source of potential conflict, particularly in the transition of power from one generation to the next. Enduring family businesses regulate ownership issues—for example, how shares can (and cannot) be traded inside and outside the family—through carefully designed shareholders’ agreements that usually last for 15 to 20 years.

Many of these family businesses are privately held holding companies with reasonably independent subsidiaries that might be publicly owned, though in general the family holding company fully controls the more important ones. By keeping the holding private, the family avoids conflicts of interest with more diversified institutional investors looking for higher short-term returns. Financial policies often aim to keep the family in control. Many family businesses pay relatively low dividends because reinvesting profits is a good way to expand without diluting ownership by issuing new stock or assuming big debts.

In fact, some families decide to shut external investors out of the entire business and to fuel growth by reinvesting most of the profits, which requires good profitability and relatively low dividends. Others decide to bring in private equity as a way to inject capital and introduce a more effective corporate governance culture. In 2000, for example, the private-equity investor Kohlberg Kravis Roberts gave Zumtobel, the Austria-based European market leader for professional lighting, a capital infusion (KKR exited in 2006). Such deals can add value, but the downside is that they dilute family control. Others take the IPO route and float a portion of the shares. An IPO can also be a way to provide liquidity at a fair market price for family members wanting to exit as shareholders.

To keep control, many family businesses restrict the trading of shares. Family shareholders who want to sell must offer their siblings and then their cousins the right of first refusal. In addition, the holding often buys back shares from exiting family members. Payout policies are usually long term to avoid decapitalizing the business.

Because exit is restricted and dividends are comparatively low, some family businesses have resorted to “generational liquidity events” to satisfy the family’s cash needs. These may take the form of sales of publicly traded businesses in the holding or of sales of family shares to employees or to the company itself, with the proceeds going to the family. One chairman said of his company, “Every generation has a major liquidity event, and then we can go on with the business.”

Governance and the business portfolio

With clear rules and guidelines as an anchor, family enterprises can get on with their business strategies. Two success factors show up frequently: strong boards and a long-term view coupled with a prudent but dynamic portfolio strategy.

Strong boards

Large and durable family businesses tend to have strong governance. Members of these families avoid the principal–agent issue by participating actively in the work of company boards, where they monitor performance diligently and draw on deep industry knowledge gained through a long history. On average, 39 percent of the board members of family businesses are inside directors (including 20 percent who belong to the family), compared with 23 percent in nonfamily companies, according to an analysis of the S&P 500. 1 1. Ronald C. Anderson and David M. Reeb, “Founding-family ownership and firm performance: Evidence from the S&P 500,” The Journal of Finance , 2003, Volume 58, Number 3, pp. 1301–27. “The family is a true asset to the management team, since they have been around the industry for decades,” said the CEO of a family business. "Still, they separate ownership and management in a good way.”

Of course, it’s important to complement the family’s knowledge with the fresh strategic perspectives of qualified outsiders. Even when a family holds all of the equity in a company, its board will most likely include a significant proportion of outside directors. One family has a rule that half of the seats on the board should be occupied by outside CEOs who run businesses at least three times larger than the family one.

Procedures for all nominations to the board—insiders as well as outsiders—differ from company to company. Some boards select new members and then seek consent by an inner family committee and formal approval by a shareholder assembly. Formal mechanisms differ; what counts most is for the family to understand the importance of a strong board, which should be deeply involved in top-executive matters and manage the business portfolio actively. Many have meetings that stretch over several days to discuss corporate strategy in detail.

Family businesses, like their nonfamily peers, face the challenge of attracting and retaining world-class talent to the board and to key executive positions. In this respect, they have a handicap because nonfamily executives might fear that family members make important decisions informally and that a glass ceiling limits the career opportunities of outsiders. Still, family businesses often emphasize caring and loyalty, which some talented people may see as values above and beyond what nonfamily corporations offer.

A long-term portfolio view

Successful family companies usually seek steady long-term growth and performance to avoid risking the family’s wealth and control of the business. This approach tends to shield them from the temptation—which has recently brought many corporations to their knees—of pursuing maximum short-term performance at the expense of long-term company health. A longer-term planning horizon and more moderate risk taking serve the interests of debt holders too, so family businesses tend to have not only lower levels of financial leverage but also a lower cost of debt than their corporate peers do (Exhibit 2).

Taking the long view

The longer perspective may make family businesses less successful during booms but increases their chances of staying alive in periods of crisis and of achieving healthy returns over time. In fact, despite the unique challenges facing family-influenced businesses, from 1997 to 2009 a broad index of publicly traded ones in the United States and Western Europe achieved total returns to shareholders two to three percentage points higher than those of the MSCI World, the S&P 500, and the MSCI Europe indexes (Exhibit 3). It is difficult to provide statistical proof that the family influence was the main driver. The results were surprisingly stable across geographies and industries, however, and indicate that family businesses have performed at least in line with the market—a finding corroborated by academic research. 2 2. See Ronald C. Anderson; David M. Reeb, “Founding-family ownership and firm performance: Evidence from the S&P 500,” The Journal of Finance , 2003, Volume 58, Number 3, pp. 1301–27; and also Roberto Barontini and Lorenzo Caprio, “The effect of family control on firm value and performance: Evidence from continental Europe,” EFA 2005 Moscow Meetings paper, 2005.

Healthy returns over time

This long-term focus implies relatively conservative portfolio strategies based on competencies built over time, coupled with moderate diversification around the core businesses and, in many cases, a natural preference for organic growth. Family-influenced businesses tend to be prudent when they do M&A, making smaller but more value-creating deals than their corporate counterparts do, according to our analysis of M&A deals worth over $500 million in the United States and Western Europe from 2005 to late 2009. The average deal of family businesses was 15 percent smaller, but the total value added through it—measured by market capitalization after the announcement—was 10.5 percentage points, compared with 6.3 points for their nonfamily counterparts. 3 3. The sample includes 78 deals for family-owned businesses and 494 deals for businesses not owned by families. The acquirers (both kinds of companies) were constituents of the US S&P 500, the German HDAX, or the French SBF 120 (Société des Bourses Françaises 120 Index) stock indexes. Value added through the deal is defined as the change in market capitalization, adjusted for market movements, from two days prior to two days after the announcement. The analysis includes all deals completed from 2005 to late 2009 with a value of over $500 million in which the acquirers’ ownership went from nothing to 100 percent.

Nonetheless, too much prudence can be dangerous. Family owners, who usually have a significant part of their wealth associated with the business, face the challenge of preventing an excessive aversion to risk from influencing company decisions. Excessive risk aversion might, for example, unduly limit investments to maintain and build competitive advantage and to diversify the family’s wealth. Diversification is important not only for overall long-term performance but also for control because it helps make it unnecessary for family members to take money out of the business and diversify their assets themselves.

That’s why most large, successful family-influenced survivors are multibusiness companies that renew their portfolios over time. While some have a wide array of unconnected businesses, most focus on two to four main sectors. In general, family businesses seek a mix: companies with stable cash flows and others with higher risk and returns. Many complement a group of core enterprises with venture capital and private-equity arms in which they invest 10 to 20 percent of their equity. The idea is to renew the portfolio constantly so that the family holding can preserve a good mix of investments by shifting gradually from mature to growth sectors.

Wealth management

Beyond the core holdings, families need strong capabilities for managing their wealth, usually held in liquid assets, semiliquid ones (such as investments in hedge funds or private-equity funds), and stakes in other companies. By diversifying risk and providing a source of cash to the family in conjunction with liquidity events, successful wealth management helps preserve harmony.

Success is not a sure thing. Many wealthy families around the world lost a lot of money in the financial crisis—losses that vary by geography but averaged 30 to 60 percent from the second quarter of 2008 to the first quarter of 2009. One European family investor with a portfolio mainly in the money market and in prime income-generating real estate lost less than 5 percent. At the other extreme, a family investor in the same country, with 80 percent of his assets in real-estate developments and hedge funds, both with 50 to 70 percent leverage, lost 30 to 50 percent of the value in these asset classes at the peak of the crisis.

These different outcomes highlight the importance of a professional organization with strong, consolidated, and rigorous risk management to oversee the wealth family businesses generate. For large fortunes, the best solution is a wealth-management office serving a single family—either a separate entity or part of a family office providing a range of family services (described earlier in this article). A wealth-management office that serves a group of unconnected families is an option when individual ones don’t have the scale to justify the cost of a single-family office.

Our work with family wealth-management offices has helped us identify five key factors that increase the chances of success: a high level of professionalism, with institutionalized processes and procedures; rigorous investment and divestment criteria; strict performance management; a strong risk-management culture, with aggregated risk measurement and monitoring; and thoughtful talent management.

Foundations

Charity is an important element in keeping families committed to the business, by providing meaningful jobs for family members who don’t work in it and by promoting family values as the generations come and go. Sharing wealth in an act of social responsibility also generates good will toward the business. Foundations set up by entrepreneurial families represent a huge share of philanthropic giving around the world. In the United States, they include 13 of the 20 largest players, such as the Bill and Melinda Gates Foundation.

Money alone does not guarantee a high social impact. In addition to the financial and operational issues facing any charitable activity, families must cope with the critical challenge of nurturing a consensus on the direction of their philanthropic activities from one generation to the next. Some family foundations have tackled the issue by creating a discretionary spending budget allowing family members to finance projects that interest them. Others give them opportunities to serve on the board or staff of the foundation or to participate directly in philanthropic projects through onsite visits and volunteering schemes. This approach is an especially powerful way to engage the next generation early on.

Family foundations also face organizational and operational choices about how best to use their funds. Several have concluded that in today’s complex environment, partnerships—for example, with nonprofits or nongovernmental organizations—can promote the family’s social goals. These foundations build on the experience and local presence of other organizations, particularly when implementing projects in unfamiliar geographies.

To ensure high performance and continual improvement, family foundations must combine passion with professionalism and a strict assessment of their impact. Despite the difficulties of assessing it, this is vital to make progress and allocate resources effectively. In our experience, family foundations should focus their monitoring and evaluation efforts around learning and improved decision making. They must also approach operations with the mind-set of an investor—minimizing operating costs and making prudent investments in strategy, planning, and evaluation as well as in highly qualified staff.

Almost all companies start out as family businesses, but only those that master the challenges intrinsic to this form of ownership endure and prosper over the generations. The work involved is complex, extensive, and never-ending, but the evidence suggests that it is worth the effort for the family, the business, and society at large.

Christian Caspar is a director in McKinsey’s Zurich office; Ana Karina Dias is an associate principal in the São Paulo office, where Heinz-Peter Elstrodt is a director.

The authors wish to acknowledge the contributions of Andres Maldonado, an alumnus of McKinsey’s São Paulo office.

Explore a career with us

About Stanford GSB

• The Leadership
• Dean’s Updates
• School News & History
• Commencement
• Business, Government & Society
• Centers & Institutes
• Center for Entrepreneurial Studies
• Center for Social Innovation
• Stanford Seed

About the Experience

• Learning at Stanford GSB
• Experiential Learning
• Guest Speakers
• Entrepreneurship
• Social Innovation
• Communication
• Life at Stanford GSB
• Collaborative Environment
• Activities & Organizations
• Student Services
• Housing Options
• International Students

Full-Time Degree Programs

• Why Stanford MBA
• Academic Experience
• Financial Aid
• Why Stanford MSx
• Research Fellows Program
• See All Programs

Non-Degree & Certificate Programs

• Executive Education
• Stanford Executive Program
• Programs for Organizations
• The Difference
• Online Programs
• Stanford LEAD
• Seed Transformation Program
• Aspire Program
• Seed Spark Program
• Faculty Profiles
• Academic Areas
• Awards & Honors
• Conferences

Faculty Research

• Publications
• Working Papers
• Case Studies

Research Hub

• Research Labs & Initiatives
• Business Library
• Data, Analytics & Research Computing
• Behavioral Lab

Research Labs

• Cities, Housing & Society Lab
• Golub Capital Social Impact Lab

Research Initiatives

• Corporate Governance Research Initiative
• Corporations and Society Initiative
• Policy and Innovation Initiative
• Rapid Decarbonization Initiative
• Stanford Latino Entrepreneurship Initiative
• Value Chain Innovation Initiative
• Venture Capital Initiative
• Career & Success
• Climate & Sustainability
• Corporate Governance
• Culture & Society
• Finance & Investing
• Government & Politics
• Leadership & Management
• Markets and Trade
• Operations & Logistics
• Opportunity & Access
• Technology & AI
• Opinion & Analysis
• Email Newsletter

Welcome, Alumni

• Communities
• Digital Communities & Tools
• Regional Chapters
• Women’s Programs
• Identity Chapters
• Find Your Reunion
• Career Resources
• Job Search Resources
• Career & Life Transitions
• Programs & Webinars
• Career Video Library
• Alumni Education
• Research Resources
• Volunteering
• Alumni News
• Class Notes
• Alumni Voices
• Contact Alumni Relations
• Upcoming Events

Admission Events & Information Sessions

• MBA Program
• MSx Program
• PhD Program
• Alumni Events
• All Other Events

Managing a Family Business for Success and Succession

Exploring the dynamics and decisions of running a family business in Kenya.

May 18, 2021

Meet Naomi Kipkorir and Annette Kimitei, the mother-daughter team leading Senaca East Africa, and Peter Francis, lecturer at Stanford Graduate School of Business, and hear about finding success and navigating succession in a family-run business.

Family dynamics can be challenging, not to mention emotional. But when you add in a business, things can get even more complicated, especially when the entire family is involved. That’s the story behind Senaca EA, a private security company headquartered in Nairobi, Kenya. Founded by Kipkorir’s husband, an ex-policeman, the business started in 2002 as a side hustle and now it’s a full-time, all-in-the-family-of-five affair.

After a failed merger with a European company, the family literally came together to pull their company back from the brink. Thinking about family succession came next. And as Kimitei learned, “Succession is not one event, it’s a process.” Formalizing corporate governance is key to that process, which for Senaca begins with introducing advisory board members who have skill sets the business is missing, and eventually independent directors.

Francis fully supports that plan. And he knows from experience: his family-run business has been going for six generations. Francis uses that firsthand knowledge to teach a class called “The Yin and Yang of Family Business Transition” at Stanford. Because issues that arise in a family business can often turn emotional, Francis advises seeking outside expertise and relying on education, transparency, and communication to handle tough issues.

“If you’re having a conversation about the business at home you might say, ‘You know what, we’re home, we should be wearing our family hat, not our business hat.’ And then communication … I don’t mean just communicating, but also learning how to communicate. That is a muscle that we can strengthen in the family.”

Listen to Kipkorir and Kimitei’s family story and Francis’ business insights to help think about your own company’s succession and governance plans.

Suggested Resources

Grit & Growth is a podcast produced by Stanford Seed , an institute at Stanford Graduate School of Business which partners with entrepreneurs in emerging markets to build thriving enterprises that transform lives.

Hear these entrepreneurs’ stories of trial and triumph, and gain insights and guidance from Stanford University faculty and global business experts on how to transform today’s challenges into tomorrow’s opportunities.

Full Transcript

Naomi Kipkorir: We are not just a family business that is by blood. Even the way we relate with our customers, the way we relate with our suppliers, the way we relate with each other, we came to realize that it was a strength and not a weakness.

Darius Teter: Naomi Kipkorir is the proud CEO of a family business, and she’s been on quite a journey with her company.

Naomi Kipkorir: I used to tell them, “Whatever brought us here won’t take us where we are going. So you have to accept change.” And they are telling me, “Now it’s not change, it’s even transformation.”

Darius Teter: For family businesses, planning for leadership change presents many challenges. But could the act of family succession itself give your business the tools to re-imagine

I’m Darius Teter, and this is Grit & Growth with Stanford Graduate School of Business, the show where Africa and South Asia’s intrepid entrepreneurs share their trials and trials, with insights from Stanford faculty and global experts on how to tackle challenges and grow your business. Today, we meet the mother-daughter team of CEO, Naomi Kipkorir, and managing director, Annette Kimitei, of Senaca East Africa, to hear about how they are facing family succession and board governance issues head-on.

Our story begins in the Republic of Kenya. Here, the traditional economic bases are agriculture, trade, and tourism, but in recent years, tech, manufacturing, and construction industries have accelerated. At the same time, the threat of terrorism and insecurity has spurred the rapid growth and diversification of the private security industry, and that’s where family business Senaca East Africa got its start. Here’s founder and CEO, Naomi Kipkorir.

Naomi Kipkorir: Senaca was started in the year 2002 by my husband who was an ex-policeman. We are in the business of ensuring that the country, families, and businesses are safe as we offer private security. My husband started the company. By that time, I was in full-time employment in a government parastatal. I didn’t join him immediately because initially, it was just a side hustle. Later, I saw the passion and the seriousness he put in the business, and after five years I resigned and I joined him full-time.

Darius Teter: You came onto the business within about a year of your husband’s starting it, and then quite quickly, he handed increasing authority and control over to you. Who else is in the business from the family?

Naomi Kipkorir: I was blessed with three daughters. Annette is my firstborn. She’s in the business now as the managing director. My second born also did finance, a CFA, and she’s also in charge of finance. And my third born, who is the last born, she did legal, and she also takes care of the support services in the business. So all of them are working together.

Darius Teter: Naomi and John’s three daughters all found their place within the family business, and Annette, the oldest, joins us today.

Annette Kimitei: Annette Kimitei, and I’m the MD of Senaca East Africa, a woman very passionate about private security in the East African region.

Darius Teter: What were the security issues like in Kenya when your father started the business?

Annette Kimitei: I do recall private security was not common back then. The Kenyan scenario of a security officer was probably someone who couldn’t speak proper English or Swahili, which are the two national languages. So it’s just someone you get from the village and you put a couple of sweaters with a logo, and that’s it. And then you give them instruction. So yes, security was not really much of a need, but what happened is as a growing economy, of course, people started building homes. There was a little bit more urbanization. Factories started to come up, and then thefts also came in. Right now, the biggest threats we face, for example, are the threats of terrorism, the threats of cybersecurity, technological threats, reputational threats, and risk management. But then that was not the case.

Darius Teter: You’ve grown up in the business from childhood. I’m curious, what are your earliest memories of it?

Annette Kimitei: Well, I didn’t like it, to be honest. When my father was growing up, being a policeman was really cool. That was the career everyone wanted to aspire to. But by the time I was growing up being a lawyer, being an engineer, those were pretty cool courses. But what happened is when dad started the business in 2002, by the time he started growing in 2004, I joined university. So just to keep busy and probably not be naughty around the home, Dad would carry me to work and then just help me help him with filings. So my first encounter with the business was actually helping Dad and mostly was in registry. But I’m really grateful for that opportunity because I believe it’s through registry, through working in the file room, which is not something that many people, particularly family businesses, would appreciate, I actually learned how to do tenders, for example, official letters to customers, appointment letters, promotion letters. And that’s what actually changed my career.

Darius Teter: In time, Annette progressed from administrative tasks all the way to her current role as managing director, and we’re going to explore that succession process later. But to understand the unique dynamics at play here, I wanted to speak to someone with deep knowledge from both inside and outside a family business. Here’s Stanford Graduate School of Business lecturer, Peter Francis.

Peter Francis: My name is Peter Francis. I am a member of a family that has a rather large family business; it’s in the sixth generation. I ran that company as a chairman and CEO for 16 years. Currently, I am investing in small businesses, and I also teach at Stanford at the business school. I teach a course on family business transitions called the Yin and Yang of Family Business Transitions.

Darius Teter: So in Africa, our research has told us that something like 30 to 40% of the largest companies in Africa are family businesses, but I want to start with how would you define a family-run business?

Peter Francis: As far as I’m concerned, there are two key things. The first is that a family needs to have sufficient strategic control, if you will, over that business so that they can make key decisions such as who’s running the business or have very, very strong input to those decisions. And then the second characteristic is they have to have the intent to take their family ownership and move it from one generation to another.

Darius Teter: Interesting. Can we talk a little bit about the advantages and disadvantages of being a family-run business?

Peter Francis: It surprises people oftentimes to hear that family businesses actually perform better than their public counterparts. And it strikes me that there are four really important things. The first is what I call patient capital. The median tenure of a CEO in the Fortune 500, S&P 500 is something around the range of five years. The incentives for an individual who’s in that position, therefore, are on a very short timeframe, and yet investments often pay off over the long term. So what creates the incentive to pursue those things where you have to be patient about the capital, but you can end up with higher annual returns because of it.

The second is speed of decision-making. Oftentimes, people think of family businesses potentially being slow. However, that doesn’t have to be. Indeed, they can make decisions extraordinarily quickly because they may have a smaller shareholder base. The third is the ability to pursue unconventional strategies. You’ll find many family businesses over time end up in what I’m going to call a conglomerate, a multi-business structure because they can mitigate some risks by investing in other places. And the fourth is values-driven, pride of ownership if you will.

Darius Teter: So that’s patient capital, speed of decision-making, unconventional strategies, and values. Four advantages that we’re going to hear play out in Naomi and Annette’s story.

I’m interested in exploring the separation between the mother-daughter relationship and the boss-subordinate relationship. How does that work out for you Annette?

Annette Kimitei: I think with years of practice it switches automatically. The minute I get into the lift in the office, she becomes Madame Naomi. And my dad, even my kids call him chairman as long as they’re in the office. We learned that a lot. And then when you get into the car, she can switch back to mom.

Darius Teter: So you get in the elevator and now you’re in a professional relationship with your mother, with your siblings. You go home, and it’s back to being family. I don’t imagine that happened overnight. What was the effect of working with your sisters? Was that easy? Was it hard? Is it changing over time? I’m really curious.

Annette Kimitei: I came into the business very young, and despite the fact that I had gone to university, I still went and did the very clerical roles for nearly three years. Grew to HR, became an HR assistant, became an HR manager. Again, got HR and training manager, then again became general manager, again became a HR director. So my role changed. What happened is the business no longer remained a family business. As the family was growing, we were hiring professionals, professional accountants, and professional people in operations. So you’re not going to call mom, mom. And believe me, when it comes to work, if I don’t perform, she might look nice and cute right now, but she can bite. And she bites the same if it is myself or at the general manager who’s non-family or another manager or my sisters. There’s no discrimination when it comes to issues of performance.

Darius Teter: I think that’s fascinating. So part of what’s going on here is that for you, Naomi, it was important for you to treat all your staff the same and not to distinguish between family members of staff and non-family members. Is that your philosophy?

Naomi Kipkorir: Annette joined the company even before me. And as the other siblings also joined when I was there, they still had to learn that there’s a difference between being at home and also being in the office. Like now, what I’m doing with my grandchildren, I allow them to come to the office, and they know when you come to the office, if there’s a meeting, you sit and keep quiet. I’m training them when they are still young because that is the opportunity I didn’t have when I was bringing up my children. It is not very easy for us even to hold our board meetings and for them to be purely business issues discussed. So many times my husband has to keep on reminding us, “This is a board meeting, no mom, no dad. Let us be serious.” So it has been a journey. I say that where we have reached it is because of what we have gone through and even the training that we have also undertaken.

Darius Teter: Peter says that proactive engagement and training is key. In fact, although there’s no one antidote to issues that arise in family businesses, Peter believes that many problems can be addressed through three core practices; education, transparency, and communication.

Peter Francis: It’s so powerful for family members and owners to have a language to use so that they can communicate. If you’re having a conversation about the business at home, you might say, “You know what? We’re home, we should be wearing our family hat, not our business hat.” And then finally, communication. By that, I don’t mean just communicating but also learning how to communicate. That is a muscle that we can strengthen in the family. And so, that gives people a chance to be better at this as they go forward.

Darius Teter: Naomi and Annette have undergone training for everything from how to serve on a board, to how to differentiate between the family and the business. And it was during one of these coaching sessions that Naomi first heard about family succession planning.

Naomi Kipkorir: We have held workshops with consultants that are also experts in family businesses. I remember the first time we were told that I was running so many companies at the same time as the CEO, and I needed to let go of some of the responsibilities and the big sister was supposed to take over. I saw emotions arise. My two daughters, one of them was in tears. “Mom, you can’t leave. How is it going to be?” So emotions came and we were able to overcome that, but we took some time for them to digest and know that with or without mom, there at the top, a time had to come that I had to let go of some of the responsibilities.

Darius Teter: Tears from the family at the idea of Madam Naomi leaving might sound extreme, but the family had been through so much together. Senaca prioritized seeking expert advice because the business had been burned once before.

Naomi Kipkorir: There’s a time that we merged with an European company, and we had an independent board, and we had expatriates on the board. We were represented in so many countries, in Canada, in Europe, in Ireland. When it came to the board, we were so naive because we were just running as a small family business that now was almost swallowed by the big company from Ireland.

Darius Teter: They came in and bought a majority share, you are minority owners, but you had no representation on the board.

Naomi Kipkorir: Me, Annette, and my husband, the three of us were on the board, but we were toothless.

Annette Kimitei: It was a very painful lesson, but a lesson we needed to learn all the same because when we merged, we gave, we didn’t even sell, we gave majority shareholding, and we took a step back and some of us went to pursue other businesses.

Darius Teter: Senaca embarked on this journey because they were keen to explore new markets. In Kenya, residential security is less profitable, and late payments from state-owned companies led to cash flow issues. So they figured, “Why not find an international partner and start targeting corporate and multinational clients?”

Annette Kimitei: It started out very well. We started getting high-profile clients. We had expatriates working with us, but what happened is not everything that works in Europe is a copy-paste, that you can just cut it and paste it in Africa. And particularly even what we do in Kenya is not what we do in Uganda. The guards in Uganda we have are armed, in Kenya they are not armed. One of the mistakes we did as a board is we didn’t ask bold questions. We didn’t give that governance element to be able to ask, “Is this the right solution for this market?”

Darius Teter: The European company didn’t understand the local market, but you didn’t feel that you had the voice or the stature to stop these guys in the board meeting and say, “Hey, wait a minute. This idea is not going to work in Kenya.”

Annette Kimitei: We tried to highlight it. We did papers, we did comment, but again, what mom was mentioning was we either did not respect our positions as directors and probably took a backseat like employees giving a report, you know? So the result of all this was that the business ended up being overburdened financially. You have all these megaprojects, technology to run airports like the way it’s done in Europe. In Kenya, the airport is so tiny, and they didn’t care for technology at that time. So you’ve gone into heavy debt. And within no time, that debt caught up. So we were wondering because the management accounts are seeing profits, yet you can tell the cash flow strain is so bad. The clients are paying on time, and that was because we were recording losses. These partners from Europe, when they realized the debt was too much and what they owed the government, especially when it comes to taxes and loans and auctioneers were coming on board, they just packed their bags. Literally, this is a funny story, but they packed their bags and resigned on an email, and sold the shares at a very, very, minimal amount.

Darius Teter: This was a make or break moment, a reckoning for the family and for the business.

Naomi Kipkorir: They left the company under big debts. So by the time we were coming back as a family, we were coming back to a company that was supposed to be a basket case, and we were supposed to be auctioned. But then the family came together and we asked ourselves so many questions. “What was the problem?” The first one was we were not present. We were not even serving on the board as we were just listening to the partners and just doing what they were saying.

Annette Kimitei: We had to hire account consultants, auditors. And when they went through the books, they said, “Throw out this business, you can’t recover it.” I remember one of them, an international firm, actually bought mama a book that said “How To Know When To Give Up.“ But I’m grateful because we had another local auditor who came and said, “The business looks bad, but with the expertise you have, you know this market. Come back together as a family, utilize your different strengths, and it’s going to be a painful six months, but you can naturally help this.”

Darius Teter: What the consultants saw was that with their combined backgrounds; chairman John from the police, Naomi in sales, Annette in strategic management, and the two sisters in legal and accounting, this family had the tools to turn the business around.

Annette Kimitei: The family was the problem in terms of our governance and our lack of knowledge and drive to be able to understand what corporate governance requires out of us. But again, the family spirit and the values and the passion we have for the business and our reputation is, again, what saved the business. Fast-forward to who we are right now, Senaca is one of the most respected security companies across East Africa.

Darius Teter: Those family values that Peter Francis highlighted would prove to be the secret sauce that brought Senaca back from the brink. And along the way, they created a company that would be worth handing down to the next generation. But because of their rollercoaster experience, when the time came to start thinking about family succession planning, Naomi was a little hesitant.

Naomi Kipkorir: My initial reaction was fear after our previous experience of if I let go, maybe we would fail again. I was troubled a lot because I was not ready for that. But by and by, I could try to plan my weeks, my days, it was not adding up, and I saw that I was not adding a lot of value to some of the companies. So I had to let go of two of the companies. It was never taken lightly, but we kept on talking about it over the dinner table, and they have now come to buy in and they are now supporting the plan of me handing over the baton to Annette.

Darius Teter: Annette, I’d love to hear this story from your side. Was it a shock to you that your mother was thinking it was time for you to take over?

Annette Kimitei: I’m always more comfortable as Madame fix-it. I like fixing where there’s a problem, but I didn’t want to take the leadership position. So at this time, yes, when mom said… We had the family business consultant, and he gave us that tough news and said, “I’ve seen your qualifications, I’ve seen your experience, it’s time.” And of course, for me, I said no, I’m not ready for it.

Darius Teter: So you doubted yourself?

Annette Kimitei: Yes, I did doubt myself, I’ll not lie.

Darius Teter: Naomi, did you doubt Annette?

Naomi Kipkorir: I didn’t because I could see beyond what she could see. I knew her capacity, and I knew she was equal to the task.

Darius Teter: That’s interesting. So Annette, did that give you confidence that your mother believed in you?

Annette Kimitei: No, no, no, not too much. I think succession is not an event, it’s a process. What happened is when I was supposed to be called MD, I actually asked that I be called deputy MD just to warm up to the seat. So for around three years, I was a deputy MD, executing everything an MD does, but just wanting to hide. And the reason for that is, number one, from an industry perspective, I’m one of the youngest managing directors. Number two, I have a really tiny frame and this is the security industry. Most of the people running security companies are way older. They are my father’s age. They are brigadiers, majors. And these are the people that I was going to meet with. And then that is even for my voice, I didn’t have that commanding security voice. So I had a bunch of excuses, Darius, very nice excuses as to why to hide.

Darius Teter: I don’t know. Honestly, those don’t sound like excuses, those sound like serious rocks and boulders that you have to push up a hill. Because it was not just about how you felt, your self-confidence, it was about how you felt you would be perceived in the market.

Annette Kimitei: I always joke that the general manager we currently have is an amazing guy, but he’s very big, and he’s ex-police, and he’s ex-CID. So every time we go to a meeting, guys will be like, “Hey, hello, Mr. MD.” It’s always an assumption that I’m probably his secretary because I’m a little bit tinier. And then by the time I introduce myself, somebody will say, “Oh, so you are Annette. Yeah, we’ve heard of Annette. We just thought she’s bigger.”

Darius Teter: The transition of leadership in any business affects more than just the C-suite executives. And Naomi knew that getting employee buy-in would be vital.

Naomi Kipkorir: My leadership style and Annette’s are very different. I remember even the members of staff calling me and saying, “If you go, this company is done.” Annette is very aggressive. Annette is very strict. I think they were used to the way I was leading them. Everybody was afraid, but then I had to let Annette prove that the company also needed to change the way it was led because things were also changing and the market demands were also changing. Annette, she’s a risk-taker, so she could bring in so many other different things, so many products. And some of them are like, “Are we ready for this?” But she was pushing and I could see the results. They are telling me, “Now it’s not change, it’s even transformation.”

Darius Teter: With Annette now in the managing director role, Senaca is diversifying, and they’ve gained a new perspective on the importance of a well-functioning board.

Annette Kimitei: The ideas come from everywhere, but all these ideas have to be conceptualized. And then we place together on the table the different concepts. And it is the board that’s now going to say, “Out of the five ideas, we felt that these two can work. This one can start this year. And once this one is stable, now we can move on to the next one.”

Darius Teter: So you’re trying to make sure that the proposals are supported by analysis to take some of the emotion out of the decisions?

Annette Kimitei: I feel most comfortable with a project if she says yes. Because if I can convince the whole world. But if I convince the chairman and Madame Naomi or mom, then I know I have worked my figures out.

Darius Teter: Has there ever been a proposal that you took to the board where it was shot down and you still are convinced that you’re right?

Annette Kimitei: Of course. This year is when they finally accepted a concept of diversifying to technology and risk when the numbers were shown. I’ll tell you what I did wrong the last two years was, I saw the dream, but I didn’t have the data to back it up to show that it’s not just the product, the expenses associated with this, at this amount. And guess what? The profit is this. I just did a small pilot by bringing in a few of the dogs, a little bit of the technology, and the bottom line really improved. So I’m really excited because they didn’t say no, they said, “Test this business model.” Because we are moving from 93% guarding and only 7% were other services. Now we are moving it to 30% guarding, 30% technology, and 30% risk. Just one year of doing that, our profits grew by nearly 6%.

Darius Teter: I love this story because that’s what a good board should do, is say, “This is an interesting idea, but you haven’t tested it. Go out and test it. Come back to us with the results, and then we’ll decide.” Would you say, Naomi, that this decrease in the guarding business and increase in risk management business and technology could not have happened without Annette’s leadership in driving for change?

Naomi Kipkorir: Yes, we were still calling ourselves the old school, and we just wanted to manage the guarding business. We worked in the government, we have our pension, so we were not really looking for money. We were not greedy for that kind of growth when it comes to a business. But we have seen that through her efforts and her ambition, she has really made the company now look like, “Oh, this is something that even outlives us, and it can even grow bigger.”

Darius Teter: Senaca is now two years into the transition, and they’re putting a major focus on solidifying their corporate governance.

Annette Kimitei: For a long time, we didn’t understand what is manager, what is director, what is shareholder. So when it comes to our corporate governance, we engaged an external consultant again this time. What we are working on is the family constitution, the family office, the shareholders’ agreement. We also want to bring in advisory board members. We’re bringing in three this year as board advisors. And then based on that is now when we move into independent directors. I think because of our previous experience with our European partners, we thought it’s good for us to be able to engage consultants. We’re going to see what are the skills we are missing in the business, what are the skills that we are missing in the board, and how do we bring in the right people. How do we induct them? How do we monitor their performance?

Naomi Kipkorir: We have seen where we’ve always gone wrong, and we are saying, “If we knew what we know today five years ago, we would be having even the independent boards and other boards that would be able to drive and steer the company to different levels.”

Darius Teter: Naomi and Annette’s plan to first introduce advisory board members and then independent directors is what Peter Francis describes as a best practice.

Peter Francis: There’s a real concern, “Oh gosh, I let an independent director in. He or she is going to take control. It’s going to be awful.” They often will go to friends to be board members because they trust them, and I think that’s a reasonable first step. Think of it as a board of advisors but not a fiduciary board. I would say that at some point creating a fiduciary board, especially as the businesses get somewhat larger, is a hugely powerful step. Only one person who’s actually in management, I think, should be on the board. That’s typically the CEO. I would suggest at least three independent outside directors.

Peter Francis: I think it’s incredibly important to pick those people based on the needs of the business. And this is where the power of a board comes. The Business Roundtable, I think, had a terrific definition of a good director. Effective directors maintain an attitude of constructive skepticism. They ask incisive, probing questions and require accurate, honest answers. They act with integrity and diligence, and they demonstrate a commitment to the corporation, its business plans, and long-term shareholder value. If you could get two or three or four independent directors that fit that, and you listened to them, it’s going to make your business better, it’s going to be worth it, and the business will make more money.

Darius Teter: Naomi and Annette have recognized the skill sets that the business is missing and are actively searching for independent directors that have that expertise. Partly due to the growth of the company and the formalization of their governance, Annette became extremely purposeful about her current and future role.

Annette Kimitei: I’m a little more aggressive now with succession planning for various reasons. Number one is the business is expanding at a higher rate. We are diversifying, and even our customers are demanding different skills now. So I am already working on my succession plan outside Senaca and actually outside Kenya into other countries. I think what we wanted to do was to say that the next successor after Annette has to be a family member. And my sisters, yes, they are good, but they are still young. And then the industry experience. So we had to actually be very bold and say, “For this next successor cannot be in the family. Maybe the next generation will have been nurtured. But at this point, we have a serious gap if Annette is no longer there because mom and dad are very clear that they just want to focus on board and shareholding roles.” I would say in three years I’d be very comfortable to leave not only the general manager but a good number of managers to be able to run this business so that we focus more on what is our key strength, which is entrepreneurship.

Darius Teter: It’s remarkable that Annette is already looking ahead to when she will hand over the leadership to her general manager. The first-generation family succession may still be a work in progress, but it seems that this delicate and lengthy process has taught Annette to plan with purpose.

Annette Kimitei: Procrastination, I would say, has been a bit of a challenge from our side. There was no deliberate plan, and now we have it. Actually, we had our board audit last week on Friday. We thought we were doing so well. I was actually very eager for that meeting. And when the audit was done, I was surprised that we were only at 5%. We are very good at preparing all the documents. So we have the shareholders’ agreement, we have the family constitution, but we just never sit down and sign it. And if it’s not signed, it’s not there.

Darius Teter: Sometimes procrastination is actually a symbol of something else, which is maybe a lack of underlying agreement, particularly if somebody else is drafting all of this stuff. Is there something more to the procrastination than simply, “We just didn’t get to it.”?

Naomi Kipkorir: I think as the founders, me and John, we thought that we are part of the business. And what does it mean? What are we handing over? Why do we need to be succeeded? It became a conversation that we really had to face. We have now fully understood what it means for the business continuity. But initially, that is why it took so long.

Darius Teter: So was it scary? The first time you read it, you said, “Wait a minute, that’s not what I signed up for.”

Naomi Kipkorir: Yes. So it’s like we are going to lose our positions. We are going to lose our titles. We are going to lose everything we’ve built with our hands. We could look back from where we’ve come from and how we were able to turn around the company, and it’s like, “Is it really time for us to hand over to these girls?” I think that has taken a backseat, but it has been a process.

Darius Teter: There’s a lot of businesses and a lot of CEOs and managing directors that are exactly in your position. What’s your message to them?

Naomi Kipkorir: It’s just to take a bold step and know that one day you have to leave. I remember sometime back I was overworking myself, and I had a mild stroke. And then I thought, “What if I died? What would happen to the company?” And I say it’s better for me to prepare for this when I’m still alive. So time has to come for you to let go at one time or the other. And for the business continuity, you have to trust and allow the children to make their own mistakes because you cannot keep on spoon feeding them all the way through. I’ve done that for the last, I think, one year. I’ve been on and off the business, and I’m telling you, they have lost business in the process. So they have to sit back and come up with their own plan on how they are going to recover the lost business. If they fail, they’ll fail. If they fall down, they will still wake up and move on with the journey.

Naomi Kipkorir: Annette, she’s saying that she’s preparing her successor early enough so that he doesn’t wait until she’s threatened by anything ahead. It is always very good to be prepared for any eventuality. We are now even thinking 50 years from now.

Darius Teter: After the initial fear of the unknown and what sounds like many, many pointed family discussions, Naomi has made peace with the act of handing over responsibilities. Annette has been with her all along and is now looking forward to taking some bold steps of her own.

Annette Kimitei: I’ve been in the nest of Senaca for a long time. I am now serving on other diversified boards to enrich my experience, but what I would be happy and say that a second generation we impacted is when I’m able to plant another Senaca in another five countries. That’s when I’ll say my parents started a good business and they left us to run, what did we do with it? We left many more businesses, feeding many more families. That would be the kind of legacy that I would be more proud of other than holding on to this MD seat.

Darius Teter: Whether it’s that generation one to generation two transition, or somewhere further down the line, Peter Francis suggests that it’s really all about process.

Peter Francis: I will say as we speak of Naomi and Annette, somehow they have done a terrific job as a family in having some really extraordinary conversations in this generation one to two transition, which is so critical. It is, I think, very common that certain human emotions rule the day. So denial and conflict avoidance, for example, they’re there in spades. When thinking about how you get started, the founder is the key and he or she can use the universal antidotes to begin to move things along, and I think starting with a vision. And the vision could be a simple, “We really do want this to be a family business that goes through the generations.” And then I would say get help and get educated. I do think there’s a tremendous role to be played by an outside voice, and that is because there are some very emotional aspects to it. So it’s really the process that counts, not so much the content.

Darius Teter: You’ve been through this amazing journey with foreign buyers and then taking control back and rebuilding it. What recommendations do you have for other family businesses who need to develop and implement a family succession plan?

Naomi Kipkorir: Succession is not an event. It is a journey. It is a process. The corporate governance is not enough. There are so many other tools that are needed. You need a very clear board charter that even talks about the third and fourth generation. You also need a family office with a very clear family constitution. You have to think of maybe another 100 or 50 years what kind of a company you’d want to see or you’d want even to leave to your children and even the country as a whole because this business does not just benefit the family alone. And knowing that the children are also different. Like now what I’m doing with my other children, because this one girl who is not really adding a lot of value, I had to look at her strengths and see what else can I do for her? I’ve opened a different business for her, and she’s thriving there.

Darius Teter: Those are really powerful messages. I mean, no presumption that because somebody is in your family they’re the right person for the specific business. And it needs really careful thought and planning. Annette looking back on the past few years, what recommendations do you have for other businesses where it’s still being run by the founders and are thinking about succession planning? What would you advise them based on your experience?

Annette Kimitei: As mom said, make it a bold decision, a bold decision to say that if you want the business to continue and outlive you and go all the way to your great-grandchildren, then the process has to start today. The conversation could be uncomfortable, but it’s a conversation that still has to be had. If it’s difficult for you as an individual or difficult for you as a family, seek help. There are so many bodies there that are willing to help. So go to school, get consultants, join family business associations, do performance assessments, have very deliberate training and induction or mentorship programs. But all of it has to be very deliberate.

Darius Teter: I think it’s really interesting that there are resources in Kenya and in Africa to help you think through these issues. There’s associations of family businesses. There are specific family business consultants. So I don’t know if that industry has always been around or if that’s becoming a bigger opportunity for other companies in Africa that you might say one or two words about how you found these resources.

Annette Kimitei: Initially, we never even wanted to confess we had a family business. We’d go into meetings, run a contract for five years, and nobody knows we are related because of that fear that people think family businesses are unprofessional. We thought we were very lonely and very few until we joined the Association of Family Business Enterprises. And then we went to Strathmore University, and they have a family business unit, and they had courses on family businesses. And then even for our board competence and even for our female leadership, there’s a program that is run in Kenya called the Female Future Programme that really just gives you that boost of confidence. And then from the Association of Family Business Enterprises, we learnt about it around three years ago. It’s a new phenomenon. And what we’ve realized is that there are so many strong businesses in Kenya that are actually family businesses. So what that does is that gives you a safe space to be able to interact. Because family businesses are either new or learning the ropes in Africa, most people don’t have that information.

Darius Teter: Naomi and Annette are still on their transition journey, but Senaca has already been through some big changes, and I wondered, “Where do they see themselves in two years?”

Naomi Kipkorir : Two years from now, I will not be managing the business at all, but I’ll still sit in the booth as a director for three of the companies. But for the two young ones that we started this year and last year, those ones I still have to work with for maybe another five years. That is my personal strategy for how I run with the companies. But for Senaca, I’ll have handed over the baton to Annette within the next two years.

Darius Teter: Annette, two years from now, what does your day look like?

Naomi Kipkorir: My day will be just scratching my head as to where is the next opportunity in another country, and even in that country, what particular products or services. I am also very keen on serving on an international board, not just for the look of it, but because I’ve realized that the world is that global and Africa does need to prepare for globalization. I would love to hone my skills in running an international brand. We have 10 ambitious goals as a family, and one of them is empowering 100,000 people in Africa. And one that stands out is to be an inspiration for family businesses in Africa, simply because there are no companies to look up to, that you say, “When I grow up, I want to be like that business.” I’d really love to be spending time talking to young businesses in Africa and just sharing what we just shared, the good, the bad, and the ugly, of where we got it right, where we got it wrong. I hope that by sharing that we’ll be inspiring more.

Darius Teter: As we come to a close on today’s episode, I’d like to thank Naomi Kipkorir and Annette Kimitei for sharing their personal journeys, and Peter Francis for his keen insights. Family succession planning can be a complex undertaking and it’s full of emotion, particularly for businesses that have had to fight for their own survival. But as we’ve learned today, the will comes from recognizing that continuity and long-term success means preparing mindfully and being ready to let go. And if you do that right, you’ll be handing over fertile ground to grow the ideas of the next generation. So it’s important to keep Peter’s universal antidotes in mind.

Peter Francis: I have those three; education, transparency, and communication. But then I don’t want to forget a fourth one, and that is there needs to be a sense of love. Maybe it’s just a sense of community, a sense of a tribe, a sense of something that pulls you together. That’s important as well.

Darius Teter: This has been Grit & Growth for Stanford Graduate School of Business, and I’m your host, Darius Teter. If you want to learn more about best practices in managing a family business and planning for family succession, follow us now. You’ll be notified about upcoming episodes, including one where I take a much deeper dive with Peter Francis. To learn how Stanford Graduate School of Business is partnering with entrepreneurs throughout Africa and South Asia, head on over to the Stanford Seed site at seed.stanford.edu/podcast. Laurie Fuller researched and developed content for this episode, with additional research by Jeff Prickett. David Rosenzweig is our production coordinator, and our executive producer is Tiffany Steeves, with writing and production from Isobel Pollard and sound design and mixing by Alex Bennett at Lower Street Media. Thanks for joining us. We’ll see you next time.

For media inquiries, visit the Newsroom .

Explore More

Brain trust: how to make an incredible advisory board, masterclass on the ins & outs of mergers & acquisitions, east meets west: an african strategic acquisition story, editor’s picks.

Seed Transformation Program Learn how to grow and scale your company in this 10-month program ​for CEOs and founders of established businesses in Africa, Indonesia, and South Asia.

June 01, 2021 Masterclass on Running a Family Business Peter Francis shares his expertise on how to effectively run a family business.

• Priorities for the GSB's Future
• See the Current DEI Report
• Supporting Data
• Research & Insights
• Share Your Thoughts
• Search Fund Primer
• Teaching & Curriculum
• Affiliated Faculty
• Faculty Advisors
• Louis W. Foster Resource Center
• Defining Social Innovation
• Impact Compass
• Global Health Innovation Insights
• Faculty Affiliates
• Student Awards & Certificates
• Changemakers
• Dean Jonathan Levin
• Dean Garth Saloner
• Dean Robert Joss
• Dean Michael Spence
• Dean Robert Jaedicke
• Dean Rene McPherson
• Dean Arjay Miller
• Dean Ernest Arbuckle
• Dean Jacob Hugh Jackson
• Dean Willard Hotchkiss
• Faculty in Memoriam
• Stanford GSB Firsts
• Class of 2024 Candidates
• Certificate & Award Recipients
• Dean’s Remarks
• Keynote Address
• Teaching Approach
• Analysis and Measurement of Impact
• The Corporate Entrepreneur: Startup in a Grown-Up Enterprise
• Data-Driven Impact
• Designing Experiments for Impact
• Digital Marketing
• The Founder’s Right Hand
• Marketing for Measurable Change
• Product Management
• Public Policy Lab: Financial Challenges Facing US Cities
• Public Policy Lab: Homelessness in California
• Lab Features
• Curricular Integration
• View From The Top
• Formation of New Ventures
• Managing Growing Enterprises
• Startup Garage
• Explore Beyond the Classroom
• Stanford Venture Studio
• Summer Program
• Workshops & Events
• The Five Lenses of Entrepreneurship
• Leadership Labs
• Executive Challenge
• Arbuckle Leadership Fellows Program
• Selection Process
• Training Schedule
• Time Commitment
• Learning Expectations
• Post-Training Opportunities
• Who Should Apply
• Introductory T-Groups
• Leadership for Society Program
• Certificate
• 2024 Awardees
• 2023 Awardees
• 2022 Awardees
• 2021 Awardees
• 2020 Awardees
• 2019 Awardees
• 2018 Awardees
• Social Management Immersion Fund
• Stanford Impact Founder Fellowships and Prizes
• Stanford Impact Leader Prizes
• Social Entrepreneurship
• Stanford GSB Impact Fund
• Economic Development
• Energy & Environment
• Stanford GSB Residences
• Environmental Leadership
• Stanford GSB Artwork
• A Closer Look
• California & the Bay Area
• Voices of Stanford GSB
• Business & Beneficial Technology
• Business & Sustainability
• Business & Free Markets
• Business, Government, and Society Forum
• Get Involved
• Second Year
• Global Experiences
• JD/MBA Joint Degree
• MA Education/MBA Joint Degree
• MD/MBA Dual Degree
• MPP/MBA Joint Degree
• MS Computer Science/MBA Joint Degree
• MS Electrical Engineering/MBA Joint Degree
• MS Environment and Resources (E-IPER)/MBA Joint Degree
• Academic Calendar
• Clubs & Activities
• LGBTQ+ Students
• Military Veterans
• Minorities & People of Color
• Partners & Families
• Students with Disabilities
• Student Support
• Residential Life
• Student Voices
• MBA Alumni Voices
• A Week in the Life
• Career Support
• Employment Outcomes
• Cost of Attendance
• Knight-Hennessy Scholars Program
• Yellow Ribbon Program
• BOLD Fellows Fund
• Application Process
• Loan Forgiveness
• Contact the Financial Aid Office
• Evaluation Criteria
• GMAT & GRE
• English Language Proficiency
• Personal Information, Activities & Awards
• Professional Experience
• Letters of Recommendation
• Optional Short Answer Questions
• Application Fee
• Reapplication
• Deferred Enrollment
• Joint & Dual Degrees
• Entering Class Profile
• Event Schedule
• Ambassadors
• New & Noteworthy
• Ask a Question
• See Why Stanford MSx
• Is MSx Right for You?
• MSx Stories
• Leadership Development
• How You Will Learn
• Admission Events
• Personal Information
• GMAT, GRE & EA
• English Proficiency Tests
• Career Change
• Career Advancement
• Daycare, Schools & Camps
• U.S. Citizens and Permanent Residents
• Requirements
• Requirements: Behavioral
• Requirements: Quantitative
• Requirements: Macro
• Requirements: Micro
• Annual Evaluations
• Field Examination
• Research Activities
• Research Papers
• Dissertation
• Oral Examination
• Current Students
• Education & CV
• International Applicants
• Statement of Purpose
• Reapplicants
• Application Fee Waiver
• Deadline & Decisions
• Job Market Candidates
• Academic Placements
• Stay in Touch
• Faculty Mentors
• Current Fellows
• Standard Track
• Fellowship & Benefits
• Group Enrollment
• Program Formats
• Developing a Program
• Diversity & Inclusion
• Strategic Transformation
• Program Experience
• Contact Client Services
• Campus Experience
• Live Online Experience
• Silicon Valley & Bay Area
• Digital Credentials
• Faculty Spotlights
• Participant Spotlights
• Eligibility
• International Participants
• Stanford Ignite
• Frequently Asked Questions
• Operations, Information & Technology
• Organizational Behavior
• Political Economy
• Classical Liberalism
• The Eddie Lunch
• Accounting Summer Camp
• Videos, Code & Data
• California Econometrics Conference
• California Quantitative Marketing PhD Conference
• California School Conference
• China India Insights Conference
• Homo economicus, Evolving
• Political Economics (2023–24)
• Scaling Geologic Storage of CO2 (2023–24)
• A Resilient Pacific: Building Connections, Envisioning Solutions
• Adaptation and Innovation
• Changing Climate
• Civil Society
• Climate Impact Summit
• Climate Science
• Corporate Carbon Disclosures
• Earth’s Seafloor
• Environmental Justice
• Operations and Information Technology
• Organizations
• Sustainability Reporting and Control
• Taking the Pulse of the Planet
• Urban Infrastructure
• Watershed Restoration
• Junior Faculty Workshop on Financial Regulation and Banking
• Ken Singleton Celebration
• Marketing Camp
• Quantitative Marketing PhD Alumni Conference
• Presentations
• Theory and Inference in Accounting Research
• Stanford Closer Look Series
• Quick Guides
• Core Concepts
• Journal Articles
• Glossary of Terms
• Faculty & Staff
• Researchers & Students
• Research Approach
• Charitable Giving
• Financial Health
• Government Services
• Workers & Careers
• Short Course
• Adaptive & Iterative Experimentation
• Incentive Design
• Social Sciences & Behavioral Nudges
• Bandit Experiment Application
• Conferences & Events
• Reading Materials
• Energy Entrepreneurship
• Faculty & Affiliates
• SOLE Report
• Responsible Supply Chains
• Current Study Usage
• Pre-Registration Information
• Participate in a Study
• Founding Donors
• Location Information
• Participant Profile
• Network Membership
• Program Impact
• Collaborators
• Entrepreneur Profiles
• Company Spotlights
• Seed Transformation Network
• Responsibilities
• Current Coaches
• How to Apply
• Meet the Consultants
• Meet the Interns
• Intern Profiles
• Collaborate
• Research Library
• News & Insights
• Program Contacts
• Databases & Datasets
• Research Guides
• Consultations
• Research Workshops
• Career Research
• Research Data Services
• Course Reserves
• Course Research Guides
• Material Loan Periods
• Fines & Other Charges
• Document Delivery
• Interlibrary Loan
• Equipment Checkout
• Print & Scan
• MBA & MSx Students
• PhD Students
• Other Stanford Students
• Faculty Assistants
• Research Assistants
• Stanford GSB Alumni
• Telling Our Story
• Staff Directory
• Site Registration
• Alumni Directory
• Alumni Email
• Privacy Settings & My Profile
• Success Stories
• The Story of Circles
• Support Women’s Circles
• Stanford Women on Boards Initiative
• Alumnae Spotlights
• Insights & Research
• Industry & Professional
• Entrepreneurial Commitment Group
• Recent Alumni
• Half-Century Club
• Fall Reunions
• Spring Reunions
• MBA 25th Reunion
• Half-Century Club Reunion
• Faculty Lectures
• Ernest C. Arbuckle Award
• Alison Elliott Exceptional Achievement Award
• ENCORE Award
• Excellence in Leadership Award
• John W. Gardner Volunteer Leadership Award
• Robert K. Jaedicke Faculty Award
• Jack McDonald Military Service Appreciation Award
• Jerry I. Porras Latino Leadership Award
• Tapestry Award
• Student & Alumni Events
• Executive Recruiters
• Interviewing
• Land the Perfect Job with LinkedIn
• Negotiating
• Elevator Pitch
• Email Best Practices
• Resumes & Cover Letters
• Self-Assessment
• Whitney Birdwell Ball
• Margaret Brooks
• Bryn Panee Burkhart
• Margaret Chan
• Ricki Frankel
• Peter Gandolfo
• Cindy W. Greig
• Natalie Guillen
• Carly Janson
• Sloan Klein
• Sherri Appel Lassila
• Stuart Meyer
• Tanisha Parrish
• Virginia Roberson
• Philippe Taieb
• Michael Takagawa
• Terra Winston
• Johanna Wise
• Debbie Wolter
• Rebecca Zucker
• Complimentary Coaching
• Changing Careers
• Work-Life Integration
• Career Breaks
• Flexible Work
• Encore Careers
• Join a Board
• D&B Hoovers
• Data Axle (ReferenceUSA)
• EBSCO Business Source
• Global Newsstream
• Market Share Reporter
• ProQuest One Business
• Student Clubs
• Entrepreneurial Students
• Stanford GSB Trust
• Alumni Community
• How to Volunteer
• Springboard Sessions
• Consulting Projects
• 2020 – 2029
• 2010 – 2019
• 2000 – 2009
• 1990 – 1999
• 1980 – 1989
• 1970 – 1979
• 1960 – 1969
• 1950 – 1959
• 1940 – 1949
• Service Areas
• ACT History
• ACT Awards Celebration
• ACT Governance Structure
• Building Leadership for ACT
• Individual Leadership Positions
• Leadership Role Overview
• Purpose of the ACT Management Board
• Contact ACT
• Business & Nonprofit Communities
• Reunion Volunteers
• Ways to Give
• Fiscal Year Report
• Business School Fund Leadership Council
• Planned Giving Options
• Planned Giving Benefits
• Planned Gifts and Reunions
• Legacy Partners
• Giving News & Stories
• Giving Deadlines
• Development Staff
• Submit Class Notes
• Class Secretaries
• Board of Directors
• Health Care
• Sustainability
• Class Takeaways
• All Else Equal: Making Better Decisions
• If/Then: Business, Leadership, Society
• Grit & Growth
• Think Fast, Talk Smart
• Spring 2022
• Spring 2021
• Autumn 2020
• Summer 2020
• Winter 2020
• In the Media
• For Journalists
• DCI Fellows
• Other Auditors
• Academic Calendar & Deadlines
• Course Materials
• Entrepreneurial Resources
• Campus Drive Grove
• Campus Drive Lawn
• CEMEX Auditorium
• King Community Court
• Seawell Family Boardroom
• Stanford GSB Bowl
• Stanford Investors Common
• Town Square
• Vidalakis Courtyard
• Vidalakis Dining Hall
• Catering Services
• Policies & Guidelines
• Reservations
• Contact Faculty Recruiting
• Lecturer Positions
• Postdoctoral Positions
• Accommodations
• CMC-Managed Interviews
• Recruiter-Managed Interviews
• Virtual Interviews
• Campus & Virtual
• Search for Candidates
• Think Globally
• Recruiting Calendar
• Recruiting Policies
• Full-Time Employment
• Summer Employment
• Entrepreneurial Summer Program
• Global Management Immersion Experience
• Social-Purpose Summer Internships
• Process Overview
• Project Types
• Client Eligibility Criteria
• Client Screening
• ACT Leadership
• Social Innovation & Nonprofit Management Resources
• Develop Your Organization’s Talent
• Centers & Initiatives
• Student Fellowships

• Branding and Marketing
• Business and Life Planning
• wjr business beat
• Management and Operations
• social media
• Technology and Web
• Inspiration for Entrepreneurs

• Grow Your Business
• Manage Your Business
• Plan Your Business
• Plan Your Life
• Start a Business
• Strategic Partnerships
• Succession & Exit Strategies

12 Keys to Family Business Success

Family members start a major portion of new businesses launched in the U.S. every year. Brothers come to mind, of course, when it comes to family business .

Whatever the family ties, however, starting a business with a spouse, parents, siblings, children or other family members presents unique challenges over and above the usual problems a startup faces.

That’s why only one in three family businesses survives to the next generation.

 How to Succeed in a Family Business — and Enjoy ‘Succession’ 

In the startup stage of family owned companies, the dangers can be especially acute. Relatives sometimes join the excitement of a startup business without a clear idea of their role once the business is underway. If family is involved in your startup venture, you should be clear up front about compensation, exit plans and other details before they become a problem.

We’ve given this a great deal of personal reflection and come up with 12 essentials for striking the right balance when starting a family business .

12 essentials for striking the right balance in a family business

1. set some boundaries.

It’s easy for family members involved in a business to talk shop 24/7. But mixing business, personal and home life will eventually produce a volatile brew. Limit business discussions outside of the office. That’s not always possible, but at least save them for an appropriate time — not at a family wedding or funeral, for example.

2. Establish clear and regular methods of communication.

Problems and differences of opinion are inevitable. Maybe you see them already. Consider weekly meetings to assess progress, air any differences and resolve disputes.

3. Divide roles and responsibilities.

While various relatives may be qualified for similar tasks, duties should be divvied up to avoid conflicts. Big decisions can be made together, but a debate over each little move will bog the family business down.

4. Treat it like a business.

A common pitfall in a family business is placing too much emphasis on “family” and not enough on “business.” The characteristics of a healthy business may not always be compatible with family harmony, so be ready to face those situations when they arise.

5. Recognize the advantages of family ownership.

Family-owned businesses offer unique benefits. One is access to human capital in the form of other family members. This can be a key to survival, as family members can provide low-cost or no-cost labor, or emergency loans. Family businesses run by trusted relatives can also avoid special accounting systems, policy manuals and legal documents .

6. Treat family members fairly.

While some experts advise against hiring relatives at all, that sacrifices one of the great benefits of a family business. Countless small family owned companies would never have survived without the hard work and energy of dedicated family members. Qualified family members can be a great asset to your business.

But avoid favoritism. Pay scales, promotions, work schedules, criticism and praise should be evenhanded between family and non-family employees. Don’t set standards higher or lower for family members than for others.

7. Put business relationships in writing.

It’s easy for family members to be drawn into a business startup without a plan for what they will get out of the business relationship. To avoid hard feelings or miscommunication, put something in writing that defines compensation, ownership shares, duties and other matters.

8. Don’t provide “sympathy” jobs for family members.

Avoid becoming the employer of last resort for your kids, cousins or other relatives. Employment in family businesses should be based on what skills or knowledge they can bring to the business .

9.Draw clear management lines.

Family members who often have a present or presumed future ownership stake in family businesses have a tendency to reprimand employees who don’t report to them. This leads to resentment by employees.

10. Seek outside advice.

The decision-making process for growing a family business can sometimes be too closed. Fresh ideas and creative thinking  can get lost in the tangled web of family relationships. Seeking guidance from outside advisors who are not affiliated with any family members can be a good way to give the business a reality check.

11. Develop a succession plan.

A family business without a formal succession plan is asking for trouble. The plan should spell out the details of how and when the torch will be passed to a younger generation. It needs to be a financially sound plan for the business, as well as retiring family members. Outside professional professional advice to draw up a plan for the next generation is essential for many family businesses.

12. Require outside experience first.

If your children will be joining the business, make sure they get at least three to five years business experience elsewhere first. Preferably in an unrelated industry. This will give them valuable perspective on how the business world works outside of a family setting.

Shattering Myths: Tips to Successfully Launch and Run a Family Business

Running a successful family business can be both rewarding and challenging. There are 12 keys to family business success, including clear communication, a shared vision, and a strong sense of family values. Family businesses have the advantage of a shared history and a sense of trust that can help them navigate difficult situations.

However, it’s important for family business owners to set clear boundaries between work and family life to avoid conflicts and ensure the business’s success. With the right approach and mindset, family businesses can thrive and provide a source of pride and financial security for generations to come.

Our bottom line

It’s hard enough launching a company without the added pitfalls and potential baggage of family relationships. But family owned businesses have some great advantages over others — mainly a dedicated pool of people ready to stand behind your effort. If your startup is a family business, you’ll need to take extra steps to avoid burnout , ensure on-the-job harmony and attract advice from business experts outside the family circle.

Originally published in August 2019.

• Family Business
• start your business
• startupnation

Leave a Reply Cancel reply

You must be logged in to post a comment.

Related Posts

Free Digital Skills Training This Week: From Branding to Pitch Practice

Navigating Tax Planning and Compliance for Small Businesses

6 Sustainable Packaging Solutions for Businesses

3 Trends in Dining (and Takeout) that Restaurants Need to Know

Original text

Family-owned companies help drive the U.S. economy—is your small business ready to take the wheel? Put these family business tips and insights to work so you can take control of your firm’s future. 

SCORE’s new infographic, The Family Business: Successes and Obstacles , highlights the value of family businesses as well as the challenges they face. 

A family-owned business is any company owned by two or more family members and the family holds majority control or ownership. The size of these companies runs the gamut, from mom-and-pop shops to Fortune 500 firms. 

Families definitely make their mark in the small business world. Of the 28.8 million small businesses in the U.S., 19 percent are owned by a family. Just over one million of small family-owned businesses are led by husband-wife teams.

Family-owned businesses mean business.

These companies stand at the forefront of the national economy. They employ 60 percent of the American workforce , and they’re responsible for creating 78 percent of all new jobs. In addition, they generate 64 percent of U.S. Gross Domestic Product (GDP). 

But family firms hit challenges transitioning into the next generation.

Every family has its struggles—like who gets stuck sitting next to Aunt Mimi at the next holiday get-together.  But when you combine business with family, those challenges become even more complex. 

Only 30 percent of family-owned companies successfully transition ownership from the first to second generation, while 12 percent transition from the second generation to the third. Just 13 percent of family businesses stay within the family for more than 60 years. 

One factor affecting generational transitions could be planning. Nearly half—47 percent—of family business owners expecting to retire within five years haven’t named a successor yet. Planning can play a key role in a business’s ability to transition into subsequent generations. Experts recommend creating a succession plan as many as five years—or more—in advance to reduce stress and transition peacefully .  

Which best practices lead to successful transitions?

Statistics suggest that successful family businesses don’t “wing it.”  A healthy 94 percent of family-owned companies with high annual revenue are controlled by a supervisory or advisory board . Just as importantly, only 31 percent, on average, of board membership was comprised of family, a number that suggests perspective from “outside” the family can contribute to good governance.  

And those boards are built with an eye on taking the business into the next generation. Over 40 percent of the companies included less-experienced family members on committees and boards, with the goal of nurturing the younger generation’s management and business skills. It’s a training ground that provides the valuable experience needed to move the family business successfully into the future. 

Family-owned companies have another big advantage over non-family firms: almost three-quarters (74 percent) of family businesses report stronger values and culture, which can be leveraged as strengths in areas like customer care, recruitment and employee retention.  

Set your family business on the road to success. 

SCORE mentors can’t tell you who should sit next to Aunt Mimi at dinner, but they can help you sort out other complexities with your family business tips. Whether you need to create a succession plan or navigate internal conflict, a SCORE mentor will guide you with fresh, objective perspective, so you can build a stronger business for this generation—and the next.   

Infographic: The Family Business—Successes and Obstacles From succession planning to company culture, these family business tips, based on SCORE’s latest infographic, will help you build a roadmap to success.

Taking Over Your Family’s Business? How to Transition Peacefully Don’t let the pressure of taking over your family’s business wear on you. Instead, take steps for a smooth transition.

Copyright © 2024 SCORE Association, SCORE.org

Funded, in part, through a Cooperative Agreement with the U.S. Small Business Administration. All opinions, and/or recommendations expressed herein are those of the author(s) and do not necessarily reflect the views of the SBA.

• Our Approach
• Our Programmes
• Our Members
• Find a Group
• Become a Member
• CEO Coaching Qualifications
• Meet our CEO Coaches
• Become a Chair
• Research Papers and Videos
• Superheroes

The Advantages and Disadvantages of a Family Business

Family-owned companies are good not only for the families involved, but also for both the local and global economies. However, many find it hard to survive. Around a third of the 100,000 family businesses that are passed to the next generation each year subsequently fail, while many small business owners struggle to ensure that they are financially independent from their businesses when they retire.

There are advantages and disadvantages to running any business, from a small business to a larger, publicly traded company. However, family firms come with their own unique advantages and challenges. Here we delve into the pros and cons of running a family business, along with tips to capitalise on the positives, and overcome the negatives.

What are the advantages of a family-run business?

There are many advantages to running a family business, such as:

The leadership of a family business is normally determined by the position of each individual in the family. As a result, there is generally longevity in leadership, which ensures overall stability within a family-run business. In many family-owned companies, the business leader will stay in the position for many years, with life events - such as illness, retirement or death - being the trigger for change at the top.

Family firms tend to have a greater sense of commitment and accountability at their heart than non-family firms, as it is not just the needs of the business at stake, but the needs of the family too. This desire for both the family and business to stay strong fosters additional benefits, including a greater understanding of the industry, the organisation and the job; stronger customer relationships; and more effective sales and marketing.

One of the oldest surviving family businesses in the world is Hoshi Ryokan : a Japanese inn-style hotel which was founded in 718 and which has been in the same family for 46 generations. This longevity has led to an incredible understanding of the business and its history, which anyone outside of or relatively new to the business would simply be unable to replicate.

Elsewhere, the Ford Motor Company managed to stay afloat during incredibly tough economic times, when other large businesses like Chrysler and GM were desperate for bailouts. It is likely that there are several reasons for their success, but with the Ford family’s name, reputation and financial standing on the line, it is likely that this encouraged their fighting spirit.

Flexibility

Working in a family-run firm requires a lot of flexibility. While non-family businesses tend to have very clearly delineated responsibilities for every role, family members will sometimes be required to wear several different hats, taking on tasks outside of their formal remit where needed.

In a now-famous quote, Estée Lauder, who formed the famous cosmetic firm with her husband in 1948, once said of her company’s success, “I have never worked a day in my life without selling. If I believe in something I sell it, and I sell it hard”. The only woman on Time magazine’s list of the century’s business geniuses in 1998, Lauder was involved in every element of her business: preparing pots of face cream, giving free product demonstrations, designing product packaging, training saleswomen and more.

Long-term outlook

Non-family firms draw up their goals for the next quarter. Family firms, however, think years - or even decades - ahead. A longer-term perspective is a good way to foster a culture of clear strategy and decision-making throughout the business.

Second-generation CEO of German multi-billion dollar retailer, Otto Group, has used this long-term outlook for serious success. He took over the business - founded by his father in 1949 - in 1981, and almost immediately began to investigate the possibilities that computer technology could offer. As a result, the brand moved into ecommerce in 1995, becoming profitable in its online sales activities by 1998. The company has never been publicly traded, and still remains a family affair.

Decreased cost

Economic downturns and other challenging times can be a struggle for many businesses, where the board of directors needs to work out how to keep the business afloat while still paying staff. In family firms, however, it will often be the case that family members are willing to contribute financially to keeping the business afloat during times like these. It may be that this involves taking a temporary pay cut, contributing some of their own finances, or pausing the payment of dividends while the company gets back on its feet. For the family behind the business, long-term business success is crucial to their financial survival, which gives more flexibility where finances are concerned.

What are the disadvantages of family-run businesses?

While it is clear that there are plenty of benefits to family-owned companies, they also have their downsides:

A lack of family interest

In a family business, there can be a great deal of pressure on future generations to keep the business going, even if they have no real interest in doing so. This can result in a workforce - or worse, a management - consisting of family members who are apathetic, unenthusiastic and disengaged. In any other business, it is likely that such an approach would see employees having their contracts terminated. In a family business, this is more of a challenge.

Conflict between family members

The dynamic between different family members, family (and business) history and a blurred boundary between family life and work life can all cause conflict within any family-run business. And the family connections can often make such issues difficult to resolve. When Dhirubhai Ambani, founder of Indian petrochemical manufacturing company Reliance Industries, died in 2002 , he left no will. His older son, Mukesh, was made chairman and managing director, while younger son Anil became vice-chairman. The feud between the two brothers became public and, in 2005, their mother demerged the company, leaving Mukesh in charge of the petrochemical business, and Anil responsible for Reliance Energy, Reliance Communications and Reliance Capital.

A lack of structure

Family businesses rely firmly on trust - but trust alone may not be the best way. It is still vital to take rules seriously - both internal rules, and external corporate law.

In 2008, Samsung Group chairman Lee Kun-Hee was forced to hand in his resignation after being convicted of tax evasion, in addition to being investigated for selling stock to his son at unfairly low prices - demonstrating how good structure and management can make an enormous difference.

Some family businesses can fall into the trap of promoting family members to senior management roles, even when it may be clear that the individuals within these roles do not have enough education, experience or skills to fully embrace their responsibilities. In these situations, it would be far more sensible to place more qualified non-family members in these positions - but is this possible without causing friction within the family? While it can be a challenge to balance family relationships and expectations with finding the right person for the job, a lack of competence at a senior level can have a huge impact on a company’s success, as well as on talent retention.

Succession planning

Research reveals that 62% of employees say they would be “significantly more engaged” with their role if they knew their employer had a clearly defined succession plan in place. However, many family business owners fail to create succession plans, be this whether they feel that it is not needed until further down the line, or because they refuse to admit that the time will come when someone else will need to take the reins. The reality is that illness, death or even scandal can require a family business to appoint a successor in a very short space of time. Without the right plans in place, it can be very hard for a business to move forward in such an event. While family-owned companies clearly have plenty of advantages, their very nature can also make sustaining them in the long-term a challenge. The goal for any family business owner should, then, to be clear about what the strengths and weaknesses of a family business can be, in order to determine how to ensure future success.

Key Considerations:

• Build a long-term vision for the family business that is compelling and gives purpose to why you are doing this.
• Consider the type of family business structure you want to build and test out whether it can last three generations.
• Understand what family conflicts are brewing that need to be resolved with some professional mediation and coaching. In a future article, I’ll introduce you to the DNA Model. I’ll show you how to ensure you have all the strands necessary to develop a successful business and how to weave those strands together to ensure your business is strong, enduring, and successful.

These three considerations are an extract from a book by global family business advisor, Reg Athwal - Unleash Your Family Business DNA: considerations for family businesses that will help to ensure their survival. But what do they actually mean? Inspired by Reg, here are our thoughts.

How can I build a long-term vision for a family business?

Some businesses may be fortunate enough to have the next generation raring to go and with the skills and attitude needed to take the business forward. Others may have family members who are keen but who they do not feel are right to take on the business going forward, while others may have a next generation who simply has no desire to continue in their family’s footsteps. The key to developing the next generation of talent is to start early. Each year, approximately 100,000 family businesses are handed down to the next generation - and around a third of these businesses will subsequently fail. Part of the problem is a failure to plan early: by deciding on your successor early and briefing them on their hypothetical role, you will ensure that they are ready for the switch and know what to do, whether they take the reins next week or several years down the line. It could be that you create a “family council” - separate from business leadership meetings - where you discuss the business, its objectives, its issues and more with the entire family, so that everyone is aware of its current and likely future position. It could be that children are brought into the business in their secondary school years to shadow existing team members. Not only will this ensure that the whole family has a better understanding of how the business works, it will also help you to establish which of the next generation will be a good fit for the company. Whatever you do, it is also important to document your succession plan, your company goals and more so that when the time comes, the takeover is as smooth as it can possibly be.

Which structure is right for my family-run business?

A successful family business will need to be built upon an appropriate structure - and this structure may shift as it moves from generation to generation, or as the market evolves. Generally, there are five different business structures that a family business will choose from:

• Owner-operator. A business with a single owner, who runs the day-to-day operations of that business. In family businesses, the challenge here can be in deciding fairly who will take over this role when the current owner-operator retires. 
• Partnership . An approach where two or more partners have ownership of the business, and these owners are the people who benefit from any profits. While it works well for some family businesses, determining who will succeed current partners can be problematic.
• Distributed . A popular model for many family businesses, the distributed model avoids the tasks of having to choose new partners as successors. Instead, business ownership is passed down to the family’s descendants - whether or not they actually work within the business. However, the family may define a compensation policy that ensures that those who do contribute to the success of the business are better rewarded. However, the very existence of such a compensation policy can cause arguments between those who are involved in the business, and those who aren’t.
• Nested. “Nested” refers to the fact that in this type of business model, certain assets are owned by individual branches of the family, with other assets owned by the family as a whole. The core business is run as a profit-making enterprise, with dividends paid to the family branches so they can create their own profit-making ventures. While it can be a good approach to reduce tensions between family members, some may find that it can be a challenge to balance the needs of the core business with the dividends being paid to the smaller operations.
• Public. This model may mean that some or all of the shares in the business are traded publicly. However, it may also mean that the business simply behaves like a public company, with business owners playing a minimal role, and professional managers brought in to run the business. This approach can work well when the business is looking for a large amount of external funding, or when its owners simply don’t have the time, resources or inclination to be involved on a day-to-day basis. However, it may not work so well if the owners want to maintain significant control over how the business is run. 
• Want to build a family legacy that will last for generations? Buy Reg Athwal’s book for some fantastic advice!

How can I best resolve conflicts within a family-run small business?

Conflict is likely in any business setting. However, in family businesses - where personal histories, family relationships and potential quarrels between family and non-family staff can be involved - conflict can often be far more difficult to manage, and far more detrimental. Without handling disputes and conflict within a family business carefully, they have the potential to become far more serious problems, impacting on both the business itself and family relationships. While the ideal solution would be for these conflicts simply not to occur, this is unrealistic - which is why it makes sense to have formal processes in place to deal with disagreements as and when they arise. 

• Regular communication. By fostering an environment where all employees are encouraged to communicate about issues they face, speedy resolution is more possible. In some businesses, however, it may be that certain team members would prefer a more formal way of communicating their concerns, which brings us on to…
• Family councils. Family council meetings offer a formally structured means of expressing concerns, issues or anything else that family members want to discuss with the wider business. It may be that these councils include management, it may be that they are designed as a space where people can discuss issues without management’s involvement: different solutions will work for different businesses. The important thing is to ensure that your family members within the business know that they can safely air any concerns, and that they will be listened to with no judgment.
• Separating work life and family life. In a family business, keeping work at the workplace can be a challenge. However, keeping work life and home life as separate as possible can help to reduce the likelihood of serious family conflict. Some businesses choose to make certain times of the day “no-business zones”, or set ground rules that say that business issues can only be discussed in the workplace and not at home.
• External mediation. If a conflict has reached the stage where it seems unresolvable, then bringing in a trained mediator can make a big difference. An external mediator will help a family to discuss issues without emotion clouding judgments, focusing on the key issues that need to be addressed for the conflict to be resolved. 

Our gift to you...

Apply now for your personal leadership consultation with a Vistage Chair. They'll help you assess areas of strength of your business and identify areas of potential growth.

Subscribe to Vistage Insights

Home / Essay Samples / Business / Family Business

Family Business Essay Examples

The dynamics behind successful family businesses.

The landscape of business is diverse and dynamic, hosting a myriad of enterprises that vary in structure, goals, and operations. Among these, family businesses stand out as unique entities that combine blood ties with entrepreneurial aspirations. The question of what makes a family business successful...

Running a Family Business in Ireland: Challenges and Benefits

Throughout my assignment for Family Business, I will address the different challenges and problems as well as the benefits of running a family business in Ireland. I will be relating each one back to Irish family run business that I have chosen. Each challenge and...

Why Entrepreneurship is Better than Family Business

Entrepreneurial activities and traditional family businesses have helped the world develop more in the fields of advancement, innovation and some more. The comparison of entrepreneurship and family business is talked about in this paper. Family businesses being single family dominant are bound to be fruitful...

Pros and Cons of Running a Family Business in Mexico

Family businesses in Mexico are mostly companies, which are very small or do not have the success expected, due to the large amount of competition that exists in Mexico; Mexican companies that thrive, have planning from the first generation which are referred to the grandparents...

Analysis of the Strategy of Tijn Van Elderen – the CEO of Brabantian Company

Brabantia is an exclusive Dutch organization which manufactures house appliances, for example, squander receptacles, clothing racks, nourishment stockpiling compartments and different items. The organization was established in 1919 in Aalst, Netherlands, under the name van Elderen and Co, the company having some expertise in sheet...

Specificity of Family Entrepreneurship

Family business is considered a very important area of small business. Namely, we find it in different forms (in terms of its size, field of activity, number and structure of employees, legal organizational forms, etc.). Family business is a term that collectively describes the involvement...

Trying to find an excellent essay sample but no results?

Don’t waste your time and get a professional writer to help!

You may also like

• Southwest Airlines
• Charismatic Leadership
• Corporation Essays
• Mission Statement Essays
• Technology in Business Essays
• Women in Business Essays
• Disaster Recovery Plan Essays
• Pepsi Essays
• Enron Essays
• Nestle Essays
• Toyota Essays
• Total Quality Management Essays

samplius.com uses cookies to offer you the best service possible.By continuing we’ll assume you board with our cookie policy .--> -->