Many amongst us think that the best form of business is managed by the family. This opinion has both pros and cons, as many other form of businesses family run business too has flip sides in all aspects of business.
To begin with, the trust level amongst the senior management in a family owned business is way higher than other form of businesses. When the senior management is of one family they know each other quite well and hence the conflicts are minimised since miss understandings are reduced to a great extent. For example TATA is a family owned business and it is known for its values and ethics, all the senior managers have followed the ethics throughout the history of the company.
Another benefit of a family owned business is that, since people know each other they know the capabilities and strengths of the peers. Hence, they can use the people as per the needs and requirements. For example if one of the person is good as an orator then he can be used in places where client or the third party needs to be convinced.
But despite of all these advantages, there are many disadvantages also that comes with family business. One of the major disadvantage of the family business is that many times they don't innovate, since the company don't innovate their chances of failing as a business is more.
Moreover, many a times people in family business dont push and learn new trends or hire new talent hence at times it leads to increase in losses, because competition is hiring young blood and innovating at a faster rate.
In the end, I would like to conclude by saying that although family business comes with its fair share of pros, but if proper attention is not given to the business it could end resulting in huge financial turmoil and problem for the founders.
Many
amongst us
think
that the best form of
business
is managed
by the
family
. This opinion has both pros and cons, as
many
other
form of
businesses
family
run
business
too has flip sides in all aspects of business.
To
begin
with, the trust level amongst the senior management in a
family
owned
business
is way higher than
other
form of
businesses
. When the senior management is of one
family
they know each
other
quite well and
hence
the conflicts are
minimised
since miss understandings are
reduced
to a great extent.
For example
TATA is a
family
owned
business
and it
is known
for its values and ethics, all the senior managers have followed the ethics throughout the history of the
company
.
Another benefit of a
family
owned
business
is that, since
people
know each
other
they know the capabilities and strengths of the peers.
Hence
, they can
use
the
people
as per the needs and requirements.
For example
if one of the person is
good
as an orator then he can be
used
in places where client or the third party needs to
be convinced
.
But
despite of
all these advantages, there are
many
disadvantages
also
that
comes
with
family
business
. One of the major disadvantage of the
family
business
is that
many
times they don't innovate, since the
company
don't innovate their chances of failing as a
business
is more.
Moreover
,
many
a times
people
in
family
business
dont
push and learn new trends or hire new talent
hence
at times it leads to increase in losses,
because
competition is hiring young blood and innovating at a faster rate.
In the
end
, I would like
to conclude
by saying that although
family
business
comes
with its
fair
share of pros,
but
if proper attention is not
given
to the
business
it could
end
resulting in huge financial turmoil and problem for the founders.