A family-owned company is born from the dreams of one person. Have you thought about how to continue with that dream for generations to come? One of the main obligations to achieve the continuance of the family-owned company is the union and commitment of all the members of the family to work as a team, under shared rules and values, to achieve relevant and long-lasting results. 90% of the companies in Mexico are family-owned. Family-owned companies prefer family members on key positions on the company; 56% of the companies hired up to four family members, and 26% of the companies recruit between six and ten family members. Only three of every ten family-owned companies continue to the second generation. The majority of the family-owned companies that do not survive the transition process to the next generation had a lack of professional management and corporate structure (Source UDEM).
It is very important to take into account the following topics to achieve the continuance of a family-owned company:
- Effective communication, and clear rules and policies within the family, are indispensable to solve conflicts and to reach agreements.
- Have a structure to lead the family and the company in the fulfillment, control, and follow up of the agreements.
- Accomplish common ideas and values among the members of the family.
- Established strategic rules and institutional bodies to deal with family matters, property issues, and company-related topics, make the family-owned company more effective in the transition to the next generation.
The landscape could not be better. Family entrepreneurship has a bond of passion and love that arouses the desire of the next generation to continue with the family legacy. Family entrepreneurship promotes the country’s development, moreover, in a society where the culture is the lack of effort.
In Mexico, 83% of companies are family-owned. In its vast majority, are small or medium companies, companies that create 67% of the jobs in the country. Therefore, their importance on the country’s economy. Notwithstanding, the foregoing there is a lack of studies about the difficulties and challenges faced by the family-owned companies, their administrative structure, or its governance.
The transition is an extremely important element in the evolution of a family-owned company, and it can be the most relevant.
Have you established within your company, how do you want the dream to be continued?
Oscar Brieño Garza
Gloria Ponce de León & Hernández