Managing Business Family Dynasties
Between Family, Organisation, and the Network
This book by Prof. Dr. Tom Rüsen, Prof. Dr. Heiko Kleve und Prof. Dr. Arist von Schlippe deals with dynastic business families. Such families are characterized by a circle of owners comprising more than 50 family members, which typically face specific issues and challenges for which there has been little research knowledge and practical approaches until now.
The book presents results and findings from a special research project on “big family management” where 7 representatives of dynastic families from Germany were studied over a 3-year period. The result was the identification of six topic areas that management in these business families has to deal with. At the same time, the study observes that dynastic business families hardly follow the logic of classic families anymore, but can rather be understood as networks with common family backgrounds. The study also reveals that a large number of business families are heading for large shareholder groups due to changed inheritance practices. The contents outlined here provide an orientation framework for the growing business family.
“Four questions to Tom Rüsen”: Interview about the book
What is of primary consideration in your book “Managing Business Family Dynasties”?
In this publication, we present the results of our three-year research project about “Big Family Management”. As part of our work, we met the leading heads of seven dynastic business families.Those stand out as their circle of shareholders amounts to more than 50 family members. The participating business families intrigued six pivotal questions regarding the handling and management of their family collectives, which count between 150 and 700 associates.
To whom is the book addressed?
Every business family that is situated in their fourth generation and is or has been following an egalitarian method of inheritance can profit from the insight of this book. For as soon as principles of communication and interaction become impractical for personal contact, businesses are forced to establish particular formats and processes suited for larger groups. Essentially, this book is interesting to every business family that fails to gather their shareholder family around one large table, thus is larger than 20 to 25 people.
What motivated you and your co-authors to write this book?
Our theory models about family strategy and the management of a business family were successfully adopted in practice. However, representatives of “Big Families” more frequently reported to us during mutual discussions that our theory was not focused enough on specific issues of their concern. This caught our interest, and we then regularly came together with the family representatives.
What are the key concepts you want your readers to take away from this book?
There are multiple key concepts from which we can perhaps name one upfront: It is not sufficient to solely concentrate on the professionalism of the Family Business Governance. The firms and shareholder families that we covered are generally very professional. Yet, what is often “disregarded” or defectively managed is the handling with “familiarity”. Large families need a certain sense of belonging together or family feeling if they do not want to develop into an investment club with a common heritage. We examined this distinct form of family management, which can be compared to the management of a network, based on the initial questions and the established practices of our project participants.