In Australia, $3.4 trillion is contributed to the national economy by family owned/operated businesses.
In Australia, $3.4 trillion is contributed to the national economy by family owned/operated businesses.
Family owned businesses comprise more than 80 per cent of all registered Australian business and they employ more than 50 per cent of the Australian workforce.
But why do family businesses make up such a significant proportion of operations in Australia?
Their pride and passion drive them to enormous heights, to achieve the unachievable. This provides good cause for celebration.
The downside of many of these family businesses is that they can be inherently and sometimes dangerously egocentric, where the separation of the persona of the business is indistinguishable from that of the owner/s.
Family-run business can have a significant competitive edge. This competitive edge may well come from the traditional family culture and support ethos, which is something that non-family business cannot have.
Your family gives you the passion, commitment, experience and dedication that are all vital in equipping family members with the right skills, management and operational principles to maintain a competitive edge.
Family members are in sync with each other and all are working towards that common goal, a goal that is sub-consciously reinforced at each family gathering.
The main elements of any business are people, assets and finance. Family businesses provide an additional dimension – emotion. Emotion provides the passion. It also includes the baggage that every family member collects on their way through life, by simply being a member of that family.
It is emotion fuelled by events and perceptions that drives many of the behaviours of family members. It is this emotion that must be recognised and dealt with when families get into serious problems or conflicts. Emotion can sometimes be the dominant and most powerful force during times of conflict.
A decision to change the direction of a family business can reap great rewards. However, such changes usually come about from a significant family/business event such as financial pressures, bankruptcy or the death of a founder or family head. These changes can also cause a great deal of family angst during these periods of turmoil.
The need to develop a professional level of management within a company to support an organisation’s longevity, prosperity and productivity will require the services of professional facilitators and motivational speakers.
Family members not involved in the day-to-day operations may have issues with accepting directional change, particularly if the company has continued to produce profits and dividends at levels that have previously afforded a comfortable lifestyle.
The overall game plan (the strategic plan) that develops from such facilitation may require the change to corporatisation and professional management to maintain the plan’s focus. The main assets of this plan are the people and the company brand.
The autocratic management style of the late 20th century has given over to one of consultation, consensus and co-operation. Training now has priority as companies attempt to capitalise on their most valuable asset, their employees.
Family companies spend years building and protecting their products and brands, as well as not alienating their customers. Many families have ensured that they have been able to incorporate these changes.
Are families and their businesses up to the challenge of re-engineering themselves to survive and prosper in the coming decade?
I believe that they are. They have that passion, emotion and the support network necessary to see them through the difficulties of any change period.
Australian family businesses are adaptable and resilient. They are also backed by a network of service providers and organisations with competencies necessary to ensure that our family businesses will thrive in the 21st century.
