Last year, when I was being interviewed by CNN in India, I was
asked the question: "What is the difference between an Indian
family business and a Western family business?"
This made me think of the old adage which was so often used when
people first began speaking about family business: is it
'family first' or 'business first'?
I have a clear view on this, as I have done for some time: no
family business can be considered purely 'family first' or
'business first', because family businesses act like a
pendulum. There is no static position, and the emphasis swings from
family to business (and back again) as and when circumstances
require, although the pendulum always finds its way back to
This equilibrium is not necessarily the exact mid-point between
family and business, but depends on the particular family and
business at hand, as well as a diverse range of other influencers
(such as religion, socio-economics, matriarch-patriarch relations,
Back to the interview question. My answer was a very simple one
- I said that in my opinion, in India, it was typically
'family first', whereas in the West it was
typically 'business first'. In India the family
drives the business, whereas in the West, the business drives the
Having thought about it further, I believe that it is not only
India where family tends to be prioritised, but any country where
family is at the heart of society, such as Brazil, Spain, and
Italy. By contrast, my experience is that in other places with less
family-oriented social structures (such as the UK), the tendency is
for families to prioritise their business.
I've found that it can be very useful for families to ask
themselves which model they follow, and below I have outlined a few
key considerations for families attempting this exercise. Answering
the following questions can help to identify where on the scale
between 'family first' and 'business first' the
How well-defined are the boundaries between the business and
How flexible/structured is decision-making?
What is the 'emotional-temperature' of
Are business decisions ever made for family reasons? Are family
decisions ever made for business reasons?
How many family members work in the business? How rigorous is
the process for their appointment?
Do all family members working in the business sit in positions
commensurate with their skill level and experience?
Do emotions run high in the boardroom, or are they supressed in
order to 'get the job done'?
What is the prime motivator for management? Is it financial
success, or familial success?
So family first or business first? Ultimately, there is no right
or wrong answer. Each family should consider the benefits and
drawbacks of each approach, and try to understand and learn from
their current position, because over time it may change
unexpectedly. What is paramount is to be able to uphold both
positions (and the variations in between!) and be able to change
when the need arises according to circumstances.
I once suggested to a family grappling with these matters that
it would help if they were to organise their business as a family
and their family as a business, and so far so good....
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