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A recent report by Credit Suisse Research states that family businesses are the keystone of most national economies. From the Rothschilds, Waltons, Mars, Al Saud, Ambanis, Quandts, and Hermes, family businesses have often been an integral part of their country’s growth stories.
Surprisingly, half of wealthy family businesses survive to the next generation and 90% of them don’t make it to the 3rd generation. This happens because of a number of reasons including, mismanagement, hiring process, lack of interests, generation gaps, mistrust and so on. It takes proper planning, long term vision and a shared single minded focus to maintain the family’s wealth and take it to another level of success and prosperity. And while the process of course is multifaceted and complicated, here are a few simple practices to get the ball rolling.

1. Manage family dynamics.

A healthy boundary is important for a positive work environment. In a family business, a clear distinction between personal and professional life is difficult but important!

2. Be focused.

Keeping personal issues or family fights out of business is important. In order for the business to thrive, focus on the end goal must never waver.

3. A governing body 

An independent board with directors and advisors is important for the growth of the family business. When different family members are involved the smooth functioning of business can be affected, and a board or advisors can help maintain objectivity.

4. Assign roles according to ability.

Analyzing people’s ability and assigning roles are important for the growth of the business. If designations are based on legacy, the business will be affected.

5. Fun with the family

A personal life and family time is important to be productive. To ensure productivity, find time with family away from business/office. A family council as well as family gathering plays a great role in the growth of business!

In a nutshell, proper planning and effective execution while maintaining the long term vision are crucial to maintaining the prosperity of the family business. To know more, talk to us!

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