Togetherness In Indian Family Businesses
9th February 2015 Professor Kavil Ramachandran
Latest research report from the Indian School of Business on trying to understand 'togetherness' in the family business
Family businesses are known to have unique competitive advantage over professionally managed firms. Habbershon and Williams (1999) suggest that this competitive advantage is derived from the ‘familiness’ of the business – i.e. a bundle of resources that are distinctive to the firm as a result of the owning family’s involvement. The controlling family’s shared beliefs, practices, policies, philosophies and doctrines are crucial family inputs that shape this ‘familiness’ of the firm. It is the higher degree of convergence on these counts, which enhances goal-congruence and trust among family members.
Being ‘together’ is thus conventionally considered a tremendous source of strength for the family and the business. However, all across the world, societies have been undergoing changes.
For instance, economic liberalization followed by rapid expansion of the middle class and further integration with the global economy have been instrumental to a number of changes in India.
Indian business families have also been influenced by these changes. It is in this context that we started exploring the meaning of family togetherness in the Indian context. Some of the questions we attempted to find answers are the following.
What does togetherness actually mean to family business managers? Are there some underlying patterns or constructs of togetherness?
Why do business families that claim to be “together” break up easily?
Are family members increasingly asserting themselves even at the cost of “togetherness”?
Do they mean different things when they say “we are together”?
On which issues do they stand apart? How strongly are they together to take the family and the business forward?
In order to seek answers to these pertinent questions on ‘Togetherness’ in family business, the Thomas Schmidheiny Chair of Family Business and Wealth Management at the Indian School of Business has undertaken a two-staged comprehensive research study among family business owners. This paper reports the key findings from this ongoing study.
Download the report here or using the button below