Sunday, October 21, 2007

Inheriting a successful business successfully

In an earlier post we discussed the challenges faced by someone entering a family business. We explore this further by talking about how to inherit a business successfully.

Family businesses are not new to India. Indeed, our earliest business conglomerates were built and continue to be managed by family members. When a new generation steps into the older one’s shoes, it is very likely to create ripples within the organisation.

For the business to run successfully, it is important that that none of the good stuff is disturbed when new management comes in. Unfortunately, when a young family member is brought in to head the business, some turbulence is likely – in the form of older, key executives moving out or widespread changes being made just to stamp the authority of the new boss. Some of these changes could be counter-productive.

If you are about to take over the reins of your family, how do you make the transition as smooth as possible?

Spend considerable time absorbing the company’s culture and values. If you’ve worked your way up the ladder, then you are already part of it. You may want to change a few things here and there; that is only expected. However, it is more important to know beforehand what you must not change.

Include people in your plans. Your biggest challenge will be to integrate your staff into new ways. The old guard will be more difficult to contend with, and you can expect to be under some severe scrutiny. Since our Indian culture is non-confrontational and teaches us to show respect to elders, you will have to handle any difference of opinion with great tact.

Also, remember that humility is a great virtue. Don’t be embarrassed to seek advice from your more experience colleagues. Keep them in the loop when you have big ideas.

Once you’ve established your credentials, gradually begin the process of change. Having gained the confidence of your employees, you can expect it to go down more smoothly.

Finally, be prepared that some people will never accept you as the boss. Don’t waste too much time and energy on trying to change that perception. On the flip side, steer equally clear of the sycophants and yes men.

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