Business and Financial Watch

Posts Tagged ‘small business’

Although its role in private sector business activity is very large but most family businesses do not last long because it failed in leadership succession and not able to handle internal conflicts as well.

In a conference on family businesses in Jakarta, Thursday, Director of the Jakarta Consulting Group AB Susanto of Indonesia explained that family businesses can survive until the third generation and only 24 percent until the fourth generation which is only five percent.

Recent survey by the Jakarta Consulting Group also showed that only three percent of the family company that was built in 1932-1943 who survived until now.

While the family business that was built in 1944-1955 and only two percent of family business that began in 1956-1967 only 10 percent survive.

Family company that was built in 1968-1979 and in 1980-1991 who survived until now each one as much as 24 percent.

Susanto explains the main problems faced by family businesses in maintaining business continuity is a conflict between family members, succession of leadership failures and problems in locating family members in business.

All three, he said, is a recurrent problem in the family business in addition to problems of management structure, distribution of compensation, competence, and the misalignment between the interests of families and businesses.

Have you worked hard toil, making money here and there, but the results are not yet satisfactory?

Whether the remaining time you have too little for the family only because it is tied with an exhausting routine of work and boring? Your daily stress, depressed because your boss intimidation, went to work in the morning and returned home full of feeling tired in the evening … and tomorrow you will repeat this routine.

Is this your life?

If your answer is “YES”, then keep reading!

I’ll show you how to change the conditions
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begins with a small capital to run it,

only by working two hours a day, no need for long,

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and businesses run automatically!

Not fun if we could achieve all this?
So, read on!

Introducing, my name is Joko Susilo, M/33 th. If you think I’m the IT (Information Technology) … absolutely not! Basic education is my ARCHITECTURE, just to S1.

Below is a photo of me with the children and his beloved wife. Just like you, they are the greatest motivation we so willing to work hard day and night. Really not?

You can also see some photos of some of the results I have achieved from the internet business. You know, honestly … I could almost impossible to achieve all these achievements without the help of a unique business system that we will discuss here.

There is perception in the public that the family owned company will unfairly treat the non members of family in the company. This perception is supported by a survey conducted in Surabaya, Indonesia. The respondents of the survey are young job seeker and the goal of the survey is to get their opinion about family business. The survey came with the result that 80% of the respondents believe that there is an unfair treatment between family members and non family members in the company owned and managed by family.

Is that really happened?

That survey only indicated about the perception of the job seekers, and another survey conducted by the Jakarta Consulting Group which the target respondents are the family owned companies and to know how the organization manage their career path of the employee especially the family members. The result showed that 36.8% of the respondents (the family owned companies), the family members directly got the strategic position in the company, 20.7% family members got the special treatment, 16.1% the family members have to follow the regular career management, but with the special policy with the shorter period to follow. And only 26.4% of the respondents have no special treatments to family members regarding the career management.

This survey gave the indication that there is an unequal treatment in the family owned company (family business) between family and non family members and also became a proof of the perception in public about unfair treatment in the family business. This is an important issue for the family owned companies, because the unfair or unequal treatment between family and non family members has showed that the organization have tendency to operated and managed not in professional way.

But balancing competing interests often become difficult in three situations. The first situation is when the founder wants to change the nature of their involvement in the business. Usually the founder begins this transition by involving others to manage the business. Involving someone else to manage the company requires the founder to be more conscious and formal in balancing personal interests with the interests of the business because they can no longer do this alignment automatically—someone else is involved.

The second situation is when more than one person owns the business and no single person has the power and support of the other owners to determine collective interests. For example, if a founder intends to transfer ownership in the family business to their four children, two of whom work in the business, how do they balance these unequal differences? The four siblings need a system to do this themselves when the founder is no longer involved.

The third situation is when there are multiple owners and some or all of the owners are not in management. Given the situation above, there is a higher chance that the interests of the two sons not employed in the family business may be different than the interests of the two sons who are employed in the business. Their potential for differences does not mean that the interests cannot be aligned, it just means that there is a greater need for the four owners to have a system in place that differences can be identified and balanced.

There are some theories and literatures say that the most crucial and important issues in family business is succession. Succession is one of important issues in business organization, especially for the family owned companies, but it may not be the most crucial and important issue in the family owned companies.

Succession will become issue when the founder of the company have plan to retired or pass the company to his/her successors or the next generation. Usually this will happen after the company has stabled, and the next generation will only need to maintain the growth of the company and some development. Before came to that level, the business organization itself as the family owned organization, has some challenges because of the family culture in the organization.

These challenges have to be faced by the management of the company, sometimes the family culture can become the disadvantage for the company. Some issues regarding the family culture in the business organization are: the unequal and unfair treatment between family member and non family member in the business organization, internal communication within organization among the family members, etc

Succession is an issue that came after several others issues in family owned organization/company, because the succession problems will only exist after the plan of retirement of the founder.

In a family business, one or more members within the management team are drawn from the owning family. Family businesses can have owners who are not family members. Family businesses may also be managed by individuals who are not members of the family. However, family members are often involved in the operations of their family business in some capacity and, in smaller companies, usually one or more family members are the senior officers and managers. Many businesses that are now public companies were family businesses.

Family participation as managers and/or owners of a business can strengthen the company because family members are often loyal and dedicated to the family enterprise. However, family participation as managers and/or owners of a business can present unique problems because the dynamics of the family system and the dynamics of the business systems are often not in balance.
The interests of a family member may not be aligned with the interest of the business. For example, if a family member wants to be president but is not as competent as a non-family member, the personal interest of the family member and the well being of the business may be in conflict.

Or, the interests of the entire family may not be balanced with the interests of their business. For example, if a family needs its business to distribute funds for living expenses and retirement but the business requires those to stay competitive, the interests of the entire family and the business are not aligned.

Finally, the interest of one family member may not be aligned with another family member. For example, a family member who is an owner may want to sell the business to maximize their return, but a family member who is an owner and also a manager may want to keep the company because it represents their career and they want their children to have the opportunity to work in the business.

Many of our customers have been afraid to start using a channel of communication with your contacts (newsletter, blog, facebook, etc..) Because they believe they have nothing to say. FALSE. All companies have something to contribute, even when we are SMEs. The most important: helping customers with tips and helpful information to make the most of their services and products. Go here for a list of 25 other possibilities, courtesy of the site for small business trends, which we recommend.

1. Write ten ways in which your area may change this year.

2. Aim legal reforms and new laws that directly affect your niche market.

3. Create a list of the best online resources available to your industry.

4. Explains why things in your industry will get better (or worse) than ten years ago.

5. Attend events, fairs and conferences and write a brief summary of the main conclusions.

6. Discuss what are the marketing ideas that tend to work in the industry to which you belong.

7. Describes how your sector seems “dangerous” or “comical” to your favorite TV show or a book that has delighted.

8. Shows from time to time that the inconvenient truth that nobody wants to talk.

According to the Family Business Institute estimated that in Spain there are more than two million family businesses accounting for 75% of private employment, and for 59% of exports and its turnover is 70% of GDP.

With the aim of raising awareness, support and guidance to family businesses in overcoming obstacles to a swift and smooth generational change, the Madrid Chamber of Commerce, together with the Council of Chambers of Commerce and the European Social Fund, has decided to organize interactive workshops 8-hour launch aimed at those responsible for small family businesses in methodologies, instruments and tools that contribute to improving and facilitating family-business relations, the succession process and its management and leadership.

The camera itself looks for companies preferably with a number of workers at or below 50 and of any sector, discharged from the IAE (section 1) and the current payment against the Treasury and Social Security, where the family is involved in the political control and economic development of the company or where a family member involved in the administration bodies and has a clear vocation for continuity within the family.

A prerequisite to be eligible for these courses is that the company is attached to the Community of Madrid and the person attending the workshop is the founder, owner or manager involved in the management of the company.

Promote a strong and lasting growth and create more jobs and better quality can be achieved only based on two fundamental points: creating a favorable environment for small and medium enterprises and foster a culture based more on entrepreneurship. Entrepreneurship is risky and requires self-confidence and autonomy as well as a willingness to risk taking. The creation of an enterprise, its success and failure are inherent to the reality of the market economy. As part of the general lack of recognition and understanding that exists in society towards entrepreneurship, the problems of the company or business failure are not yet understood as a normal. In fact should always be seen as an opportunity for a fresh start. Assume the failure of a company without losing the entrepreneurial spirit is essential to avoid stagnation of the economy. Assuming that these problems can arise is inevitable that the entrepreneur should understand from the outset.

The facts are clear: 50% of businesses do not survive the first five years of life. Therefore, a low survival rate of firms is not a cause for concern and the creation of new organizations is one way that employers are reacting to market realities.

A recent OECD study shows that the business survival rate over a period of four years are lower in U.S. than in Europe. This shows that the loss of business can be compatible with economic dynamism.

View the bankruptcy as an opportunity and take advantage of second chances is a must for any entrepreneur who wants to survive in the business world.

Entrepreneurship or Entrepreneurship (more literal translation Entrepreneurship) is the act of being an entrepreneur . Entrepreneur comes from the French and, in general terms, refers to “any person who identifies an opportunity and organizes the necessary resources to implement it.” This can result in the creation of new organizations or may be part of revitalizing mature organizations in response to potential opportunities. The best known form of entrepreneurship is that by creating additional business, but lately, the term has been extended to include activities that make the social and political.
Entrepreneurial activities are quite different, depending on the type of organization that is created. Entrepreneurship ranges from individual projects (even those who the entrepreneur is not engaged exclusively) to multiple major initiatives that create employment opportunities.