FAMILY BUSINESS

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FAMILY BUSINESS
THE STRATEGIC PRINCIPLES OF HIGH PERFORMANCE
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Our subject is about family businesses
irrespective to the entities of these family
businesses whether they are acting under
shareholding companies OR limited liability
companies OR joined partnership companies OR
limited partnership companies , so family
businesses might be posted under all above
entities. Our subject is , the strategic
principles of high performance of this family
business where we can witness a very
prosperous, successful , promising, and
sustaining family businesses from all
over the world from Japan to Mediterranean to
Europe up to the U.S.A.
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Family businesses have many elements of strength
and this have been proven through the recent
financial economical crises, flexibility in
taking actions allows strategic changes rapidly
to comply with prevailing circumstances also the
long term vision provides a kind of prudent
conscious acting simultaneously in both cases of
recession and prosperity, in addition, family
businesses are not exposed to fast growth
pressure in order to satisfy investors (partners
/ shareholders).
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Factors of strength can be observed in family
businesses on various fields
1- Commitments and dedication, the care to
transfer the business to the incoming
generation, the family unity and
the ambitions generated for further
expansion and growth , and inself
reinvestment. 2- Know-how becomes a
priority to the owners successors and
how the new generation will join the
company even at their early stages enabling
them to run the company and perform functions
properly, and at an early age, while
responsible and entrusted with their own
money.
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3- Honor ( pride ) whereby the family name
appears on products and services, quality
attributed to the family business initiate the
utmost care and effort to best business relation
with both customers and suppliers including
acting employees and the surrounding society
in general, this will motivate the whole
business to safeguard the reputation of the
family name and the business itself , thus
always acting within the highest ethical
standards.
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• Consequently, we see that in order to
  safeguard the family businesses preserve it, and
  insure its continuation from one generation to
  another, changing legal entity is not only the
  sole solution but by taking various
  administrational and financial rules, also
  behaviors in accordance to the status of this
  specific family business.
• This process varies whether that family
  business is still under the command of the
  founder OR is it under the control of his sons
  OR under cumulation of cousins !!

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There are at least three main actions to be
fulfilled as principles of high performance A-
Management Successor Planning It is
imperative to have a plan for the
potential successor candidate to the
executive directors Of the Company , so to
take over the various administrational
positions from the family members and for their
better orientation and upgrading
their Qualification enabling them to take over in
case they Have the will to afford that.
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Also to keep the business properties
within the family New members who have
concrete interest for the business
continuity. Such new members shall act so to
avoid the infiltration of other owners / family
members who might not have the same
values and therefore, effect negatively the
synergy between the company and the family. B-
Communications These are the tools which
will insure the successful Communications
among the family members and the Family
members actively running OR not running
the business by establishing a family
business council Then having a periodic
meeting in addition to setting Ways and
means to solve disputes and maintain
one vision for the business and its future.
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C- Companys Governance These are to set
mechanisms to professionally run the company
and to avoid family feuds
including conditions of employing family
members based on evaluating, fairly, their
performances and qualifications, In comparison
with other none-family employees, including
credible personalities in the board council of
the company having experience in
business management. As for Syria, the
situation is comparatively up to these Standards
in addition to the following
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No doubt the Syrian authorities are keen to
safeguard The widely spread family
businesses and firms , and therefore a legal
decree No. 61 for the year 2007 have been
issued and put in force to smoothly transfer
the Privately owned businesses to new
legal forms allowing re-evaluation of
assets and properties. Unfortunately, this
decree has, so far, not utilized widely. No
doubt, there are complaints about the fees
imposed by that decree, but there is also
lack of awareness of future dangers.
Moreover, there are reluctance, hesitati
ons ,family existing feuds, legal status
whereby Some family members feel more in
control / stronger in the existing form. Finally,
there is a lack of culture and also
lack of Successful Examples.
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• There are examples of success and examples of
  failure in order not to generalize we are
  witnessing cases of new generations which might
  be classified as success stories and there are
  suffering and ingratitude, and there are stories
  whereby they have been ended up badly at the hits
  of some golden spoon generation.
• How to move forward, we need all to think
  deeply twice and take painful decisions since
  money management in many cases is much more
  difficult than some war management.

FAROUK JOUD