Family business

Family business

• 1.
  PRESENTATION
• 2.
  REASONSOFFAMILYBUSINESSES’ FAILURE
• 3.
  OutlineWhat is theimportance of family businesses’?Why do businesses fail?
• 4.
  What are themain reasons of family businesses’ failure?
• 5.
  Family BusinessesFamily Businesscan be managed by one member of a family or by multiple members of a family who are employed in the business. Family BusinessesAccording to researches;
• 6.
  65-80% of businesses around the world are family business.
• 7.
  30-65% of GDP
• 8.
  50-75% of workforceFamily BusinessesFigures of 2005
• 9.
  Family BusinessesTUNISIAN ECONOMY
• 10.
  Surviving Through Generation % Surviving Through Generation
• 11.
  Why do businessesfail?Global crisis
• 12.
  Foreigncompetition
• 13.
  No governmentgrants
• 14.
  Insufficient Capital andhighdebt ratio
• 15.
  Instable economy
• 16.
  Bad location andbad transport links
• 17.
  High Taxes andinterest rate
• 18.
  High exchange rate
• 19.
  Unskilled staff ….Whydo businesses fail?Poor management and no business plan that includes management, marketing, production and financial strategies
• 20.
  Culture and personalities clashes
• 21.
  Bad network
• 22.
  Conflicts and lackof communication
• 23.
  Overexpansion and nocreativity
• 24.
  No innovation andbadqualityproductFamily Business’ FailuresFamily business’failures were not often the result of market or macro enviromental forces.
• 25.
  Family business’ failurereasons generally occur from family and management issues.Lack of Succession PlanningIn many cases are compulsory successions
• 26.
  Next generation lacksessantial skills and experiences
• 27.
  Next generation havenot been well prepared for job
• 28.
  Lack of credibiltyEmployingChildren Employing children according to sex and age status
• 29.
  Oldest son formost important and critical position
• 30.
  Daughter for basicor not so important position
• 31.
  Ignoring abilities andmanagement skills
• 32.
  Occure clans andcoalitionYoung Members’ BehaviorsDont change their behaviors (during transition period)
• 33.
  Disagree with newrules and are impatient
• 34.
  Generation gap
• 35.
  Restrain young members’activities
• 36.
  Look at parentsas an oldfashionOld Members’ BehaviorsParents:
• 37.
  Cannot recognize thatsecond or third generation members are old enough
• 38.
  Do not wantto be out of game and loose control, refuse to step down
• 39.
  See their childrenas their competitors and don’t accepte changing
• 40.
  Are tied totradition and finddifficult to adapt
• 41.
  Do notwant to see external people in company Deciding who willbe involved in family businessIf more than one candidate, parents haven’t the abilityto choose right family member for right position. They have to decide who will be in, who will be out.
• 42.
  Theycan’tseperatefamily’smattersfrom business’ matters
• 43.
  Parents force childrento involve in family business. They do not pay attention what their children want to do.
• 44.
  Competence canbe outthe family
• 45.
  Damage relationships betweenfamily membersUnfair Promote or AssignmentMakes other employees disappointed
• 46.
  Decreases theirwillingness
• 47.
  Ignoring experience,skills, abilities, and education
• 48.
  Damages corporateidentity
• 49.
  Favouritism & selfishnessFraternalFightingsand Estate Conflicts According to researches, the biggest two reasons were fraternal fightings(43%) and estate conflicts(19%).
• 50.
  Conflicts between familymembers in and out of the business and with non-family members
• 51.
  QUESTIONS ? [email protected]
• 52.
  Thank you foryour attention For your precious time & patience!