The concept of Bhagya (destiny or fate) holds significant importance in many cultures and philosophies, particularly in Hinduism and other Indian traditions. It suggests that certain aspects of our lives are predetermined, often based on past actions (karma) or divine will. I had a remarkably interesting conversation with a family recently who explained their need to stay together as a family business. The explanation was each member of their family bring their own Bhagya into the family, as a result we can leverage on each other’s bhagya. In a family…
Author: Dr N. Krishnan
Ten Critical Factors That Impact the Business Ownership Transition Process
A guide to assist business owners and their advisors to identify core issues and then structure a successful business succession strategy Embarking on the transformative journey of transitioning business ownership is a complex odyssey fraught with challenges and opportunities. In this comprehensive guide, we illuminate the intricacies of the process, focusing on the ten critical factors that wield profound influence over a successful transition. Tailored for both visionary business owners and their trusted advisors, this roadmap provides invaluable insights to navigate the intricate landscape of ownership succession. By dissecting each…
What Your Estate and Trust Plans Say About Your Family Legacy
As successful business owners, you understand that carefully crafted estate and trust plans provide the tools for families to safeguard assets and protect their financial security. But these plans can also ultimately help families create their legacies. How can you have confidence that the planning strategies used in estate and trust plans, as well as the fiduciary appointments made to carry them out, accurately capture your legacy goals and objectives? We believe a legacy conversation—thought-provoking questions that go beyond the numbers—is a crucial prelude to crafting and updating estate plans.…
Enterprise Risk Management in Family Business – More than Financials
Risk Management (RM) is an essential part of any organisation. Family enterprise advisors need to be aware that the risk appetite of family decision-makers can make or break a family business. Although leaders in advisory or board positions are generally aware of the importance of the RM function within the organisation, the proper identification, comprehension, and understanding of risk and of how it impacts the organisation and its key stakeholders should be prerequisites in order to develop organizational strategy. When it comes to managing risk, it is important to ask:…
Managing Differences and Conflict Resolution – A Skill Must to be Developed in Family Business
Longstanding family conflict can bring a family business to its knees. It saps energy and happiness and holds back the business from functioning optimally. The first step in resolving longstanding conflict is recognizing that the consequences of avoiding an issue are worse than the emotional discomfort of discussing it. Let us look at an example of a family that succeeded in resolving longstanding conflict. The family, moving from its second to third generation of family operation and ownership, had hit a snag: Conflict was hindering the generational transition. The conflict…
Transitioning the Family Business from one generation to another
Family businesses are not only “the backbone of the Indian economy,” but also tend to perform better than nonfamily companies during economic crises. But what happens when the founders decide to retire and hand over the reins to a new generation? For many family businesses, that involves one of the most complex processes and generates the most challenges. The following are the eight most important aspects in the generational transition of a family business, according to several experts. 1. Business plan The transition from one generation to the next must…
Why Family Business Succession Planning is Important
Most family-owned business owners put off their succession planning because they don’t want to think about their retirement, disability or death, however, business succession planning should be a priority in every family owned business. A family owned business owner’s decision to eventually retire is not as simple as no longer going to the office. Key questions need to be answered before the family owned business owner can “leave” the business: i) will he or she have enough money at retirement; ii) who is going to own and manage the business;…
PROFESSIONALISING THE FAMILY BUSINESS
Professionalizing the family business is critical for growth, continuity and perpetuity through multiple generations. What is a Family Company? A family company is one whose ownership is controlled by a single family and where two or more family members significantly influence the direction and policies of the business, through their management positions, ownership rights, or family roles. Current family owners intend to pass on control to another generation of the family CHICKEN OR EGG? 1. Do we hire non-family professionals to prepare the work culture? OR 2. Prepare the work…
Managing Family Business Conflicts
THE MAJORITY OF INDIAN FAMILY OWNED BUSINESSES ARE LIKELY TO FAIL BECAUSE OF INTERNAL CHALLENGES – WITH THE KEY ISSUE BEING INEVITABLE – AND DESTRUCTIVE – FAMILY CONFLICTS. SO IF A FAMILY WANTS TO PASS A SUCCESSFUL BUSINESS ONTO THE NEXT GENERATION, IT NEEDs TO DEVELOP ITS OWN TOOLS AND SYSTEMS FOR MANAGING CONFLICTS 10 TIPS FOR MANAGING FAMILY BUSINESS CONFLICTS The majority of family firm conflicts are predictable. Conflict avoidance will do more harm to a family than facing up to difficult situations; instead it is important to have…
Family Businesses Challenges
All businesses face challenges, whether it is dealing with the changing economy, finding and hiring the right employees, or increased competition in the market. Family-owned businesses are not immune to these challenges. In fact, there is also a unique set of challenges that family-owned businesses have to face as a result of the nature of their business structure. It is important to understand what these hurdles are so that if you find yourself facing these issues, you can not only identify them, but you can proactively develop ways to overcome…