What Makes Family Businesses Different
This article challenges the traditional misperceptions about family businesses – that they are just small or medium sized, or owner-managed, that they are inefficient, badly run and therefore they can not be expected to endure.
People who applying these assumptions are denying a different reality. Nearly twenty years of academic research has shown that the world is full of family businesses of all shapes, sizes and governance structures. They generally outnumber proportionally non-family businesses (on average 70:30 in western economies) and they have been shown to out-perform their publicly-quoted counterparts in more than four countries so far. Most of all, they last longer than non-family firms, which is good news for the employees and their dependents, for the shareholders, for the economy and for society in general.
So we need to think again about family businesses. They are not “bad” (of course, some can be). It’s more meaningful to think about them, as being “different” – in form, structure, goals and actions. Read More…