Family businesses are one of the driving forces of the Polish economy. They constitute 36% of entrepreneurship, generating a total revenue of PLN 322 billion annually and a whopping 18% of GDP! Over the next five years, about 57% of family businesses will pass into the hands of the next generation, but only slightly over 8% of successors declare their willingness to lead them.
Our research has shown that 70% of companies suffer from problems (growth barriers) related to imperfect management development models. Polish family businesses participating in the study achieved lower results on average than other (non-family) companies, and were also rated lower on individual levels of organizational development (according to the Organizational Development Pyramid® model).
Main Challenges Facing Family Business in Poland
- Low awareness of the importance of organizational efficiency
- Lack of a distinctive offer
- Insufficient managerial skills and a lack of openness to acquiring knowledge and talents from outside
- Excessive caution in financing business development
Out of 309 family businesses that participated in the study, 155 firms (slightly over 50%), including 29 medium and large firms (over 35% of medium and large family businesses participating in the study) did not have a strategy in written form. The business foundations of these companies can therefore be described as uncertain. For non-family businesses, the parameters were clearly better.
The conclusions from research in Poland and the USA, as well as more than a decade of consulting work by Prof. Flamholtz with family businesses, were presented in the book published under Polish title “Champions of Business. Strategies for the Lasting Success of Family Businesses” published in cooperation between Inventity Foundation and Stanford University.
In this particular position, we bring a significant conceptual contribution to the way of thinking about a family business, introducing such concepts as: “functionality and dysfunctionality of a family business”, “foundation of a family business”, “balance of a family business”. We introduce framework principles, including 6 factors that need to be managed to achieve a high degree of functionality in a family business, and we point out symptoms of a dysfunctional family business.
We also provide assessment tools that can be used to improve a family business. We introduce surveys for conducting an independent assessment of two key aspects of a family business’s “recipe for success”: (1) organizational development and (2) the degree of family functionality.
We invite you to read and cooperate! oraz współpracy!