Entrepreneurship by definition is the setting up or owning of an ‘independent’ business started by a single/group of individuals. The term of family business entrepreneurship seems to sound like an oxymoron. But the reality remains that in India and many other nations there are 3rd or 4th generation of businessmen emerging who wish to handle their family heirloom in the 21st century way, which is quite different and more innovative than their forefathers. However, in most cases the entrepreneurship is not encouraged and even frowned upon as the primary job of the posterity on family business is to maintain and grow the inherited legacy.
But in today’s competitive times, family businesses have little of a choice but to promote entrepreneurship inside and outside the business. Managers inside your core business who think like entrepreneurs (we call them intrapreneurs) can identify opportunities that move your family company into new lines of business, rejuvenate the founder’s legacy, and put the enterprise on a new growth path. Entrepreneurs (typically family members) working outside the business but with family financial support can keep talented kin inside a broader “family enterprise,” diversify business activities and build assets (Forbes,2014).
The entrepreneur/founder has to understand and accept that planning for succession is necessity for survival. In case of small businesses, probably it would make better sense to have one person with general management skills and few others for special skills. Whatever is the case, advance action in selecting and grooming management successor is necessary. Once successor is identified, the succession plan has to be developed keeping in view the specifics of the firm, implemented and monitored carefully with scope for necessary changes.
The entrepreneurial qualities of risk-taking, lean operations and seeing trends and opportunities can be utilized by the family businesses to adapt and change according to the prevailing and ready themselves for the future as well through entrepreneurial insights.
There are plenty of examples of family business entrepreneurs in India like the Ambani, Birla or the Wagh Bakri family as well who have managed to stay relevant today. The education of the generations from the correct institute is imperative and can do wonders to take their family businesses to another level.
The below infographic explains the family business topography in the Indian subcontinent, about its spread, economic activities in the various sectors that they are involved in. It also tells us about the ownership, percentage and the age of the family business in India.
EDI’s PGDM BE provides Family Business Management specialization where students learn how to leverage the strengths of family business management and successfully implement practices that drive high performance, shareholder loyalty and healthy family relationships. Here the issues, problems and concerns of the family business are dealt with great details so that students have an ambitious growth plan for their family business.