Challenges in taking a family business forward

by Surekha Galagoda

At present family business and wealth management are among the hot topics discussed by management gurus as well as students since they are the businesses which started single handedly and grown to be the giants in Asia or Europe.

Chairman, Sri Krishna Corporation and Group Director Carsons Cumberbatch and Company Mano Selvanathan expressing his views as a panellist on the theme "Building Entrepreneurial Organisations Across Generations" said that Walmart, Tata and Dell were all started by individuals.

He said that initially organisations were started by a single member, then relations joined and expanded. There comes a time when the children join the family business after university and try to change the business strategies by which the progress of the business is jeopardised. This also happens when the family emotions are spread to the business since the business is based on competency and achievement.

There are many challenges in taking a family business forward, therefore a family must agree to stay together, achieve a balance between the family system and the business and most importantly there should be a mission statement for a family.

The most important point is to discuss issues while the business is strong. Vice Chairman University Grants commission Prof. Gunapala Nanayakkara said that though the economy of Sri Lanka was opened 29 years ago the sector of education is still closed.

Therefore there will be clear opportunities for education in Sri Lanka in the future. He said that education is an investment, a product that need not be subsidised and it should be a foundation for business. Business and social ethics is the key to success.

Prof. Nanayakkara said that if a child has to make a choice between education and joining the family business he will select the path of joining the business as against education.

Our society has failed to educate people to compete and we are always inward looking.

The competition has to be proactive for strategy because all compete for customers and market share.

But in our society we avoid taking decisions and are dependent. Therefore positivism is something we need very badly at least to capitalise on the future opportunities as we have missed many opportunities in the past.

Co-founder and Advisor Virtusa Corporation Tushara Canekeratne warned against bringing friends and family into the business and added that if a person is doing so to apply the same rules to everybody.

She said that when it is a family business you have to make personal sacrifices as there is a big responsibility as many people depend on you, be it your customers or your staff. Smaller the business the more you have to watch as there is little margin for error.

Don't go after every opportunity, focus on the core opportunities and keep your eyes and ears open, said Ms Canekeratne.

The presentation was organised by the Indian School of Business (ISB), established five years ago with a mission to be an internationally top ranked research driven independent management institution that grooms future leaders for India and the world.

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