'Timely measures hold key to survival of family business'

'Timely measures hold key to survival of family business'

Family business can survive by adopting a few timely measures, said chief executive officer of Parampara Family Business Institute (PFBI) N Krishnan, on Thursday, here.

Addressing the gathering during an awareness programme on ‘Family Business’ organised by the Confederation of Indian Industry (CII) in association with PFBI, he said the founder/s should balance with sibling generation and cousin generations (first, second and third generations) well, without resulting in generation gaps and creating dependencies.

“Transition from one generation to another is an interesting stage, where one needs to prepare the next generation to take over the future and make the business interesting for them. Otherwise, the next generation may not want to even continue in the business, which could be critical,” he said.

Beginning with institute’s aim, he said, firstly, being part of a family business is a privilege in itself. “Over 60% of the Indian GDP is from family-owned businesses today. However, it is not easy to ensure sustainability, since there are several challenges such as capability, competency and governance issues, wealth and trust management that has to be handled wisely. There will be differences in any business, especially if more than one generation is involved. However, there are ways to handle disputes within the family and to channelise it,” said Krishnan.

Consultant for PFBI S V M Murthy said, “It is important to institutionalise family business because a family which goes into the fourth generation can have many employees and could be system-driven.”

R Guru, chairman of N Ranga Rao & Sons said, “Our family has been into business from many generations as we take conscious decisions for our betterment. We see to it that even children attend business visits with parents, just to help them see what respect their father commands in the world of business.”

CII-Mysuru chairman N Muthukumar said, “More than 75% of Indian family enterprises support various community initiatives, while over 80% Indian family enterprises go out of their way to help and retain their staff in adverse conditions, and more than 80% Indian family enterprises support employment in areas of their operation and more than 90% Indian family enterprises have performed well in the previous years and are bullish about achieving their predicted growth in coming years.”
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