The Essential Evolution of the family business, going from Conventional to New and Experimental
By Ankit Agarwal
A family business being run in India with a legacy of several years would have been set in times of protective and conservative economic and political environment. Past generations weren’t as technologically advanced and hence, focused on intellectual and manual power of beings. This resource mix has seen a sea change over the years and today’s generation lives in times of conveniences, so much so, that at times, our want for convenience and comfort becomes limiting and begins to impact our thought processes. Therefore, the experience of hard work from the past, combined with smart technology and advantages of digitization and connectivity available to us today, is what will bear sweet fruits of success for family businesses.
Another hugely favorable factor is opening of industries, supportive government policies and bureaucratic environment. Most sectors are observing better levels of governance, transparency and smoother working mechanics which contribute positively towards a business’s success. Looking at the conventional practices in the family business, they hold unique ownership structure of the businesses, which gives a long-term orientation. And to sustain that the new generation continuously needs to add an element of innovation into the process, which will ultimately be more stimulating, thus increasing the probability of more meaningful plans leading to success. While going from conventional to experimental, the members of the family working together need to keep in mind that they leave no stone unturned in trying to be logical and basing their decisions on past evidences and points that explain the relevance of the idea to help lead the family business ahead.
Family Businesses infused with ideas by the new generation give way to new thinking. It aids positive and productive changes in the current functionality of the business, all with an intrinsic view of strengthening the business in the market. In terms of family business, things don’t come easily for the new generation as it seems to the outside world. One needs to put in a lot of effort to add up to the growing empire. It is vital for them to be receptive in nature. They should be willing to experiment with new concepts at all times. There might be some healthy opposition and difference in outlook between two generations on certain business aspects but that will eventually help to strengthen the relation at large and build the family business from its core.
Below are some aspects that will help the journey of the essential evolution of a family business and the second-generation member belonging to it in the righteous way:
1. Joining the business because of wanting to and not needed to- That comes out as the basic rule, to be into something you desire and not just because there is an obligation. It is paramount for an individual to put in his heart and mind and carry this huge responsibility with sheer dedication.
2. To get to the other side of the table- It is especially important to understand and experience first-hand the plight of the other side of the coin- the employees, before you make decisions that impact them. Also, it is vital to understand how best to make profits while keeping the very base of the organization, its employees, content and happy.
3. Keep your family values and relation intact- This is the fundamental rule; the respect, understanding and love must not change, be it the conventional practices or the evolving new ones. The art is to blend in and move together as one with all honesty of heart on the part of both.
4. Be Open to Learning & Criticism- Be open to learning at each stage. Even if you face criticism, one should always take that positively, as a help to improve for the better.
5. Back ideas with Right Instances- Just because of the surname, your ideas cannot hold the value and power to stay for long and succeed; logic and examples of success stories can help you implement things in a systematic fashion.
6. Innovation must be feasible- Innovation is a great tool, it can work wonders if done the right way but only if it’s feasible and relevant enough to your business line. Not everything is for everyone, at some point one needs to accept that and once you do, you can segregate things better.
7. Take failure sportingly and never let it pull you down- Taking failures sportingly should be the basic rule of life; also, that failure is unavoidable. Even if a person faces failure, they should not stop trying and taking initiatives. Take measured tones of analysis and find the error along with possible solutions for rectification.
8. Make sure succession is a process, not an event- Succession needs to be planned in advance which gives you, your family and the rest of the business-the time to adjust and prepare for the transition.
It wouldn’t be wrong to say that the evolution is never easy; the road to change is always complicated but one should believe, it is mandatory as well. It is neither simple nor too complicated to accept the new vision or the refreshing approach presented as it is vital to keep the quality in sync. But the key fact remains that there cannot be any accomplishment in the absence of due change. An organization must focus on continuous evolution – from conventional practices to the new digital age, and creating an altogether different perception for the company as time demands.
The writer is Managing Director, Alankit