This presentation includes some information about family business in General with suitable examples.

2. • Family business definition.
• Family business charactersitics.
• Strengths & Weaknessses in family business.
• Issues in Family business.
• The planning process of Family business.
• Global examples of Family business.
• Conclusion.

3. • A family business refers to a company where the
voting majority is in the hands of the controlling
family; including the founder(s) who intend to
pass the business on to their descendants.
• The terms “family business”, “family firm”,
“family company”, “family-owned business”,
“family-owned company”, and “family-controlled
company” are used to refer to a family business.

4. Strenghts
Commitment
Knowledge
countinuity
Reliability &
pride

5. • Commitment: The family –as the business
owner– shows the highest dedication in seeing
its business grow, prosper, and get passed on to
the next generations.
• As a result, many family members identify
with the company and are usually willing to
work harder and reinvest part of their profits
into the business to allow it to grow in the long
term.

6. • Knowledge Continuity: Families in business
make it a priority to pass their accumulated
knowledge, experience, and skills to the next
generations.
• Many family members get immersed into their
family business from a very young age. This
increases their level of commitment and
provides them with the necessary tools to run
their family business.

7. • Reliability and Pride: Because family
businesses have their name and reputation
associated with their products and/or services,
they strive to increase the quality of their
output and to maintain a good relationship
with their partners (customers, suppliers,
employees, community, etc.).

8. • Complexity: Family businesses are usually more
complex in terms of governance than their counterparts
due to the addition of a new variable: the family.
• Adding the family emotions and issues to the business
increases the complexity of issues that these businesses
have to deal with.
• Unlike in other types of businesses, family members
play different roles within their business, which can
sometimes lead to a non-alignment of incentives among
all family members.

9. • Informality: Because most families run their
businesses themselves (at least during the first
and second generations), there is usually very
little interest in setting clearly articulated
business practices and procedures.
• As the family and its business grow larger, this
situation can lead to many inefficiencies and
internal conflicts that could threaten the
continuity of the business.

10. • Lack of Discipline: Many family businesses
do not pay sufficient attention to key strategic
areas such as: CEO and other key management
positions’ succession planning, family member
employment in the company, and attracting
and retaining skilled outside managers.
• Delaying or ignoring such important strategic
decisions could lead to business failure in any
family business.

11. • Family versus Non-family Employees:
• There are a number of common issues that most
family businesses face at one time or another.
• Attracting and retaining non-family employees
can be problematic because such employees may
find it difficult to deal with family conflicts on the
job, limited opportunities for advancement, and
the special treatment sometimes accorded family
members.

12. • Employment Qualifications
• Many family businesses also have trouble
determining guidelines and qualifications for
family members hoping to participate in the
business.
• Some companies try to limit the participation of
people with certain relationships to the family,
such as in-laws, in order to minimize the potential
for conflicts.
• Family businesses often face pressure to hire
relatives or close friends who may lack the talent
or skill to make a useful contribution to the
business.

13. • Salaries and Compensation
• Another challenge frequently encountered by
family businesses involves paying salaries to and
dividing the profits among the family members
who participate in the firm.
• In order to grow, a small business must be able to
use a relatively large percentage of profits for
expansion.
• But some family members, especially those who
are owners but not employees of the company,
may not see the value of expenditures that reduce
the amount of current dividends they receive.

14. • Succession
• Another important issue relating to family
businesses is succession—determining who
will take over leadership and/or ownership of
the company when the current generation
retires or dies.
• The key to avoiding conflicts about who will
take over a business is having a well-defined
plan in place.

16. • Hyundai Motor
• Family: Chung
• Country: South Korea
• Sector: Automotive
• Revenue (2013): US$ 79.76 billion

17. • BMW Group
• Family: Quandt
• Country: Germany
• Sector: Automotive
• Revenue (2013): US$ 100.97 billion

18. • Fiat S.p.A.
• Family: Agnelli
• Country: Italy
• Ford
• Family: Ford
• Country: USA

19. • Mars
• Year Founded: 1911
• Founder: Frank C. Mars
• Samsung Electronics
• Family: Lee
• Country: South Korea

20. • Reliance Industries
•
Founded by Dhirubhai Ambani in 1966 as
Reliance Commercial Corporation, Reliance
industries is the largest private sector
conglomerate company in India. The company
was divided between the founder's two sons,
Mukesh Ambani and Anil Ambani in 2006.

21. • TATA Motors :
• Top IT exporter Tata Consultancy Services (TCS)
comes second in the list and the company belongs to
the most powerful and well-known family in India-
the Tatas.
• The Tata Group, founded by Jamsetji Tata, is one of
the largest private family business in India.

22. • FB is any business in which two or more
family members are involved and the majority
of ownership or control lies within a family.
• Family-owned businesses may be the oldest
form of business organization.