Family Business in India - Coursework Example

After the recent disintegration of the vital family firm groups, very little literature was available on the factors causing the recurrence of such to follow up.

India being a country with people who have rich shared values and communication within the family, will never like to allow such family feuds. This is the prime area of the current research to identify the attitude and circumstances with family firms after the reported major family feuds.

Hence the study has considered a case analysis as well as quantitative analysis to identify the factors that aided for such feuds as well to observe the trend in the remaining family firms. The study was conducted with the family firms that are in the first, second, and third generation of transition. Very few cases include successors after the 4th and 5th generation also. The study found a remarkable preparedness among the family firms with high professionalism and education. More than half percentage of the studied family firms are executing the succession plan, by training and communicating the succession plan with the successors. Though a minor part of the study group exhibited conflict and sibling rivalry, still they feel the need for a smooth succession plan. The remaining considerable amount of the study group is in the stage of preparation of succession plans. The study found that education and communication are directly influencing the preparedness of the successors. With this knowledge, the research found out that Indian firms are acknowledging the need for succession planning and are developing preparedness for succession management. 

Introduction:

Most of the Indian Economy is amassed from Family businesses. It is estimated that 95 percent of the registered firms are family businesses. The success of these Family firms has been attained from the rich family culture and values nourished throughout generations.

 The family business is a dominant organization form worldwide. According to Steven family is not only a viable factor of the economy but is in many ways an exemplary form of business. He writes: "The family business is being rediscovered as the embodiment of management practices and business values needed to help the nation's industries regain their competitive edge" (I991).
Though there are many papers that observed the scene in the past, the current trend is to be observed with variable factors involved in causing the trend.  Most family businesses, though relatively small in scale, involve highly complex interrelationships between two analytically separate but inextricably linked social systems: the family and the business. (Lansberg, 1983).