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Entrepreneurial Family Business Success Factors

A recent study of 15 family businesses by Israeli consultants Orenia Yanai, Ph.D. and Tamar Milo, Ph.D. revealed ten key success factors for the entrepreneurial family businesses that is family businesses where entrepreneurship is modeled and supported. In the entrepreneurial family business, they found, the concept of a family core business is replaced by the concept of partnership in the creation and management of assets and family relations. In the firms studied, succession success factors primarily involved sons.

  1. The son is raised on stories of father's entrepreneurship, and the pride associated with it
  2. The son's involvement starts early, around the age of 8-10.
  3. The son and father share a strong emotional bond. The father invests time in their relationship.
  4. The father and son have the ability to talk, disagree, or argue with mothers' active and noticeable approval. There is an atmosphere of partnership in the family dialogue.
  5. The family business team consists of at least father-mother-son. In some families, other offspring are included in the process.
  6. There is an ability to ask and receive help. The father asks for real help. The son has complementary abilities, enabling him to help the father in a meaningful way. The son perceives father as helping him as well.
  7. The son is judged/evaluated by objective non-family individuals (engineers, venture capital investors, etc.)
  8. The existing business is viewed as the means to ends, not the end in itself.
  9. While the father provides boundaries and targets for the son, much latitude is left to the son's discretion.
  10. The son's abilities are recognized and seen as something to build on rather than to suppress.
 

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