Five things Gen-Next should consider when joining their Family Business
As India continues to be among the fastest-growing economy in the world, the Indian family business owners also remain optimistic for quick and aggressive growth. A recent survey conducted by PWC suggests that 89 percent of family businesses in India expect to grow in the next two years, with 44 percent of them looking at growing aggressively and 45 percent expecting steady growth.
With the blooming prospects, joining the family business always looks like a rewarding option for the Gen-Next and is a matter of great pride and responsibility. But before you step onto this journey, make sure you think through these elements –
Finding a Balance Between Family Values and Building a New Culture
Every family business has some underpinning values which are passed on from generation to generation and becomes a vital driving force. They also percolate into the business values and the vision of the company; thus, it’s important you understand these values and ask yourself, “What is your stand on them?” At times you might not agree with a few, but instead of rejecting them, you need to look at working around them with humility and forge a way to build a modern-day organization.
The new generation always comes with fresh new ideas and enthusiasm; they are open to expansion, adoption of new technology and have a more collaborative approach. With the growing business and the fresh new outlook the Gen-Next brings, the synergy between the traditional values and future business might not match. Aligning these values with the new age requirements requires a proactive and sensitive approach. At times bringing in a third party can be a helpful idea. Once a unified purpose is established and agreed up, it’s also important to keep revisiting them with an open mind.
Family Communication and Succession Planning
Over the years of working together, family members have an assumed method of communication which turns out to be less formal. But in the competitive business world, you must build a system which is transparent and creates trust. Start with moving the decision-making desk from home to the meeting room. Talking shop all the time is common among Indian business families, but now it’s time it stops and keeps the family dynamics away from the decision board.
Emphasize on establishing a clear vision and mission for the company, which all family members agree on. Laying importance on documentation and written communication can take you a long way. Get clarity on the roles and responsibilities of the members, looking at their strengths and areas of expertise. Aim at creating a structure that emphasizes accountability. Conflicted ambitions and diverse interests can only be resolved with an unbiased approach and clear communication.
A family business should never underestimate the importance of succession planning; earlier, you prepare the plan, smoother it will be to implement it. The plan, when made with coherence, gives a trajectory to the next generation. As the business needs to be reinvented for new business challenges, so should be the ownership and leadership model. The Gen-Next must bring this issue at the forefront and align its vision accordingly. Recognizing the importance of the issue, many Entrepreneurship development programmes in India have started offering Succession Planning as a prominent course.
Decision Making Should be Based on What’s Best for the Business
Sometimes the business decision making is based on what’s best for the family, but this is a significant pitfall and should be avoided. All business decisions should be independent of the family dynamics and should consider what’s best for the company. It has been observed that bringing innovation and digitization of business is one of the major ambitions of Gen-Next. This would be easy when the current generation enthusiastically supports the concept. We suggest that instead of significant overhauling, the Gen-Next should start implementing their ideas on smaller projects to gain the confidence of the current management.
Inducting Fresh New Talent into the Business
As the business grows, it becomes crucial to induct fresh new talent to keep up with the growing pace. Operating business over the years, business owners tend to rely on a set of employees who have been working with them for long. But today the companies are mainly competing on the basis of talent. Hence it’s important the family takes some timely decisions and maintain an efficient pool of talent in the organization.
When you look at recruiting a non-family member, it’s essential that you offer them a professional environment and also including an experienced non-family member in senior management with real authority helps in creating a balance. The sooner you accept that a business needs not just loyal but competent employees and empower them for their talent, the standards of performance would keep increasing. Politics is a part of any company or family, but families need to overcome their dynamics and allow managers to focus on the fundamentals of business.
Explore Intrapreneurship Opportunities
Running a family business can be a complicated affair, but it comes with rewarding advantages as well. Your authority is respected in the internal as well as external settings and you have access to a pool of resources that otherwise would have been a challenge to assimilate. With the booming Startup culture in India and abroad, it always seems like an exciting and adventurous path for the Gen-Next. This makes Intrapreneurship an increasingly lucrative option. Intrapreneurship keeps the next generation rooted within the Family organization and helps tap into new opportunity of launching a new business or create a subdivision with the family. Intrapreneurship also comes with the freedom to design your own personal and professional path, while making your place in the entrepreneurial family.
By including senior family members as mentors, the Gen-Next can build a strong and sustainable relationship. This also puts the family business on the Innovation roadmap, making it a new-age organization. You can also try doing an Entrepreneurship course to kick start this journey.
Research suggests that family businesses across the globe are more resilient to highs and lows of the business cycle and with the rising Startup culture, the family businesses have also started making innovation and modernization a priority. Family businesses hold great gratification in the role they play in people’s lives and the asset they have created over generations. Becoming a part of this legacy is a matter of big responsibility for the Gen-Next and to help a smooth transition getting a professional education in family business management would be a great idea.