Having considered the surveys about family business in the UK, the US, Australia and South Africa, the following issues of the family business have been considered: succession planning, conflicts, governance, and the necessity for innovation implementation. Overall, the main aspects of family business are similar in all the countries; however, some differences still exist. The main objectives for creating family businesses in the US are to meet the needs of the current family members (96%), to fund the retirement of the older owners (89%) and to work for the benefit of the future generation (76%) (International Centre for Families in Business 1). About 70 percent of all businesses in Australia are family ones; it means that they are interested in all three issues mentioned above. Family business aspects and strategies are mostly similar in all countries, but the approaches may differ.
Family owned companies plan to continue growing and 53% of South African respondents confirm this fact (PWC 7). Since 2006, more family companies have been planning to grow in the UK, namely 46% in 2006, 51% in 2008 and 58% in 2010 (Institute for Family Business 28). According to the US surveys, between 26% and 35% of respondents plan to increase the revenues, while 60% do not plan any changes which may influence their income. It means that the US businessmen are not too preoccupied with succession planning and business development (Rathgeber and Dino 4). About 90% of Australians promote succession business planning (Family Business Australia 4). Therefore, most of the members of the family business see the advantages of business planning with the purpose to increase revenues. Speaking of the succession of the business in general, 52% of Americans are ready to give their business to the future generation (Rathgeber and Dino 6). British family owned companies will be given to the successors in 48% of cases if they want and in 30% of cases if they can cope with the responsibility; 22% do not want to apply succession practices (Institute for Family Business 3).
Conflict solving is one more aspect which requires additional consideration to understand the similarities in family businesses globally. Conflicts are an inevitable part of business world, especially when business is run by a family. According to the UK survey, 18% of respondents feel that they are always at work and it creates problems; 17% are referred to business economical conflicts; 16% see the reason in emotions; 10% are sure that conflicts appear when the family members try to deliver some knowledge and experience to the next generation; 5% of respondents have lost their individuality in family business, and the last reasons for conflicts is the past deeds (See Appendix 1 for more details) (International Centre for Families in Business 5). Australian family business also has many difficulties which may result in conflict situations. The business issues related to family and business interests are the main factor of conflict situations. Then, the survey points to maintenance of family control, financial compensations for each family member involved in the business, and the family conflicts caused on the basis of the business running. Fewer conflicts appear because of buying out the shares of family members who do not take part in business running (see Appendix 2 for more details). Overall, the number of conflicts rises with the increase of the number of family members involved in the government process (Family Business Australia 7). The US has the same problems as other countries, namely compensation issues, succession, communication, and the absence of personal environment (Rathgeber and Dino 3). Overall, the conflicts appear because of the similar reasons.
The governance of the US family based companies is mostly concentrated in the hands of one person (51%), while 31 respondents share power between two family members. Others apply the group government strategy (Rathgeber and Dino 3). As for the Australians, the formal board of directors is supported by 34.4% of respondents, 42.6% support the informal board, 68.7% are likely to have business management team, and 28.7% are pleased with the family council (Family Business Australia 9). The UK family ties are too close in family business (71%), and the communication level is friendly and welcome. However, 76% of all family business companies are based on one owner structure. 14% have minority shareholders, and only 9% use team management (Institute for Family Business 4).
Speaking of the family members’ perception of the innovations, it is impossible to imagine a company which may refuse from implementation of information technologies in their business. Unfortunately, none of the surveys considered in this research presents the percentage rates of their attitude to innovations or the level of implementation of new technologies in the field. Nevertheless, paying attention to the fact that most of the family business companies tend to continue working and are sure to make the next generation adapt to running business, the family owned companies are interested in applying innovations to business. Overall, the global business is similar in many companies and the cultural aspects do not make much difference. One of the main reasons of why it occurs is that modern business world is involved in the globalization processes which presuppose sharing experiences and practices.
- Family Business Australia. KPMG and Family Business Australia Survey of Family Businesses 2009. Melbourne: KPMG, 2009. Print.
- Institute for Family Business. The UK Family Business Sector Working to Grow the UK Economy. London: Institute for Family Business, 2011. Print.
- International Centre for Families in Business. The Family Business Survey. Bristol: International Centre for Families in Business, 2008/2009. Print.
- PWC. The Future Is Now Family Business Survey: South African edition. PricewaterhouseCoopers, 2012/2013. Print.
- Rathgeber, John R., and Richard N. Dino. CBIA/UCONN Family Business Program Survey. Hartford, CT: CBIA, n.d. Print.
Table 1: The causes for conflicts in the UK family business (International Centre for Families in Business 5)
|1||Family members can never get away from work||18%|
|2||Business disagreements can put strain on family relationships||17%|
|3||Emotional aspects can get in the way of important business decisions||16%|
|4||Transition to the next generation is more difficult than a third party sale||10%|
|5||There can often be conflicts regarding the fairness of reward for effort||9%|
|6||The business rewards are not necessarily based on merit||8%|
|7||Family members find it difficult to be individuals in their own right||5%|
|8||Difficulties arise in attracting professional management||5%|
|9||Children can be spoilt through inequitable rewards||4%|
|10||Outside shareholders do not contribute to but take payouts from the business||3%|
|11||The family is always put before the business and therefore the latter can be less efficient||3%|
|12||Past deeds are never forgotten and are brought up at inappropriate times||2%|