Family Business: Challanges and Opportunities

2671 WordsOct 26, 200811 Pages
1. INTRODUCTION A family business is an enterprise owned, managed, and operated by members of one or several families. Many companies, which were established as family businesses, are now publicly held. Numerous family businesses have non-family members as workforce, but, predominantly in smaller companies, the top positions are frequently allocated to family members. Family partaking in a business can reinforce the business because family members are very reliable and devoted to the family enterprise. On the other hand managing a family business, and especially succession planning, can cause some unique problems. Frequently family interests clash with business interests, for instance hiring a family member who is less skilled than a…show more content…
There are some private family companies that have turned to outside managers in the past years. Since last January, Missoni has a new director-general, Massimo Gasparini. Gasparini replaced Umberto Monti, who had been in the job for more than 40 years - long enough to make him, if not exactly a member of the family whose name is on the door, pretty close to it. Gasparini, by contrast, is a relative stranger. A well respected, qualified, industry-insider stranger, but a stranger however. Besides Missoni, other companies that followed this action are: Furla, which hired Paolo Fontanelli, ex-Giorgio Armani chief financial officer, last July; Ferragamo, which brought in Michele Norsa in late 2006 as its first non-family chief executive; and Versace, which signed up Giancarlo Di Risio as chief executive in 2004. For the first time in the history of the industry, there are currently more family companies run by non-family members than the other way round. "The model of the Italian family-run company belongs to the past," says Furla's Paolo Fontanelli. "They now have to compete worldwide with companies that are much better structured and more organized than they are. It's happening all over the country." Angela Missoni thinks that in a large family, sometimes relationships get in the way. "Maybe someone won't accept you have certain knowledge or you don't listen because the person who's talking is
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