Family businesses play a crucial part in the economic growth of a country when they move with the times. Many Indian family businesses are still stuck with the traditional ways of functioning. Here's what they need to do to break archaic chains and flourish
Family businesses in India represent 70 percent of publicly traded companies and 85 percent of private firms. Worldwide, family businesses are responsible for 79 percent of employment and hence are crucial for a country’s economic health and growth. Interestingly, family businesses in some countries are more innovative and have higher performance compared to professionally run businesses. This is because family businesses have unique strengths (if they can leverage these)—family businesses where the owners are also managers can make quick and agile decisions without layers of bureaucracy and hierarchy. In addition, they are uniquely positioned to resist short-term profitability pressures and invest in long-term innovation.
[This article has been published with permission from IIM Bangalore. www.iimb.ac.in Views expressed are personal.]