A Family Business is not just a business, it is a legacy carried over from generation to generation. The thoughts, traditions, values, etc differ from family to family. It is a tradition that goes back several hundred years in India.
What makes the family business model different here is the practice of an Indian joint family. We all have practiced this at some point in life and many big families are living under one roof, with a common kitchen, and running one large business. As a concept, family businesses exist in every part of the world and like India, they too have gone through many iterations. A family Business sounds like whipped coffee, smooth and full of taste but managing it is not as easy as we think.
Let’s hear what 2nd and 3rd generation entrepreneur has to say about Family Business. To the next generations, whom we pass on the legacy second-generation entrepreneurs have a certain degree of advantage. However, the scope of bringing in your own fresh and young ideas is difficult because you are always welcomed on the red carpet. People recognize you for who you are and not for the talent you have. In a modern business scenario, irrespective of the inheritance, it is an entrepreneur’s talent, insight, and knowledge that makes a difference, not inheritance. it becomes difficult for them to gain acceptance and command as a leader, even for family-based businesses.
Over the last few years, we are seeing more instances of the second or third generation breaking away to do something different. The owners, too, are allowing them to discover new opportunities, and that is obvious in the prominent emergence of technology. They need to adopt new-age techniques and competencies to grow in today’s fast-paced world. They need to adopt new-age techniques and competencies to grow in today’s fast-paced world.
With the evolving world, there certainly are challenges and concerns in managing Family Business.
- Confliction between family members
- Retaining non-family employees
- No separations of emotions and business
- Biased decision making
With Family Business comes family investments for which we have Family Offices in trend these days. The family office serves a very different function. It is the place where the personal financial affairs of the owners and related family members are overseen and managed. A family office can provide a wide range of services to family members—from ministerial bill-paying services to oversight of the financial affairs of each family member, including income tax and estate tax planning, preparation of tax returns, investment management, asset protection strategies, entity administration, etc.
With Family Business comes family investments for which we have Family Offices in trend these days. The family office serves a very different function. It is the place where the personal financial affairs of the owners and related family members are overseen and managed. A family office can provide a wide range of services to family members—from ministerial bill-paying services to oversight of the financial affairs of each family member, including income tax and estate tax planning, preparation of tax returns, investment management, asset protection strategies, entity administration, etc.
In today’s evolving world, the way of running a Family Business evolved a lot and so does the family business entrepreneur. Family businesses are no doubt the backbone of India.
A Wealth Experience Manager for UpperCrust Wealth Pvt. Ltd. A person with a blend of creativity and emotions, who loves to discover new work angles.
