Successful family business: Harmonious family structure with clear role of each person is important – Dainik Savera Times

New Delhi: A harmonious family structure with clearly defined roles of each person is vital to running a successful family business. Researchers from Indian Institute of Management (IIM) Lucknow and Management Development Institute (MDI) Gurgaon found this in their study. According to a study published in the prestigious research journal Journal of Small Business Management, family unity and conflict resolution strategies are necessary to increase the longevity of a family business.

The study evaluated various family businesses around the world and explored how they maintain a healthy balance between their family life and business side. The research also explored how successful family businesses around the world structure their operations and manage economic and non-economic benefits.

The working framework includes ground rules for resolving conflicts, promoting effective communication, strengthening family relationships, and fostering a sense of attachment to the business among family members. Sabyasachi Sinha, associate professor of strategic management at IIM-Lucknow, said managing businesses becomes complex as multiple generations are involved and the size of the business also increases.

Identifying 4 important family structures
The research team identified 4 important family structures – family meetings, a formal family council, a family office for money management, and a family constitution. A family constitution is a written document of policies and principles. Apart from this, various family functions are also considered important.