Core Concepts in Family Enterprise
It’s hard to believe that although family enterprises go back for forever, the field itself is less than 30 years old! And the related professions are even younger. Still…there’s been considerable knowledge created thanks to scholars, advisors, consultants and enterprise members around the world.
And… today people from law, finance, behavioural and management science are engaged in ongoing education and collaboration to bring the best professional services to the families and companies that drive the global economy. Not to mention the families themselves, who are trying to sort out the best approaches to company longevity, wealth creation and family harmony.
To help organise, categorise and make core concepts available internationally, the Family Firm Institute has published an eBook entitled Family Enterprise: Understanding Families in Business and Families of Wealth. In nine chapters and a series of online assessments, you can see if all the things you thought you knew (or knew about) are actually true!
For instance, could you easily explain these core concepts in the family enterprise field to a colleague or family member?
Family system vs. ownership system vs. enterprise system otherwise know as the 3-circle model?
Family governance vs. business governance and the appropriate (inappropriate?) interaction between the two? Or, do you know the difference between what the law requires and the family desires?
Equal and fair – are they the same when it comes to children in multi-generational family business?
Optimism, loyalty and vigilance – how do these characteristics play into a family enterprise?
The popular conception that most family businesses do not survive to the third generation has been challenged by recent research. What if this concept, so near and dear to the hearts of many any the field, is actually wrong? Or no longer true?
The historic rule of primogeniture (custom of giving the eldest child beneficial treatment as it related to the enterprise) is being challenged in many countries and cultures. What if competence is all that matters?
Of course, behind these concepts – new and relatively classic – lie real people, real companies, real industries – everything that makes the field so challenging. Knowing more about these core concepts won’t guarantee success and prosperity, but knowledge encourages critique, which usually encourages more research and thoughtful consideration – which usually promotes more knowledge. And so it goes.
Dr. Judy Green is the president of the Family Firm Institute (FFI) and a co-author of Family Enterprise: Understanding Families in Business and Families of Wealth. The mission of FFI is to be the most influential global network of thought-leaders in the field of family enterprise, providing research-based learning and relevant tools for advisors and consultants, academics and owners to drive success.