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Human Capital In The Family Business: Opportunities and Challenges

Human Capital In The Family Business: Opportunities and Challenges; Human capital, which is defined generally as the knowledge, capacity and existing skills within the company and / or family business. It is one of the most successful family businesses ancient factors. However, the 100K Factory Revolution environment imposes certain challenges as they provide opportunities at the same time in the event of the establishment of a human capital a distinct competitive advantage over the long-term extension. Dr. Philip Seager of the Center for Family Businesses in St. Gallen University in Switzerland, discusses the characteristics that must be considered when analyzing the human capital in family businesses.

While there are many different aspects of human capital-with regard to family businesses, but it will be dealt with two main aspects are as follows. First, human capital provided by the family firm itself of one important factor that should be discussed is. Second, human capital from outside the family is also important to ensure long-term success. There are challenges and opportunities associated with both sides.

Human Capital
Human Capital

At first, the presence and participation of the family of a long-term dominant in the family business, may have positive and negative effects on the human capital impacts. Over time, the family business be able to collect one of the private areas can be transferred through the generations distinct knowledge. More importantly, research has shown that family businesses as well as succeed in the collection of knowledge and unique investment experience, or else the knowledge and skills on how to establish and manage the company on a long-term sense. They may be moved as well as the knowledge to the 100K Factory Revolution Scam members of the next generation. This leads to a more comprehensive view on the issue of succession: Thus, effective Caliphate does not include only the transfer of assets, but also include the transfer of mental outstanding entrepreneurial abilities and possibilities associated with it. The main challenge is in recognizing the family business for its role with regard to human capital. Accordingly, it must make a clear and systematic improvement of the human capital that exists within the family. Moreover, family businesses must always be careful not to join the family company unless they are on a high degree of commitment and qualifications. Thus, you should develop guidance and clear policies about when and how and under what circumstances the family can join the company. Important aspects is the required level of education and experience gained outside the family company and the job is initiated, including professional and tracks available within the company’s ongoing evaluation of performance. Is joining members of the family are not qualified enough to the company may spend on human capital base for the family over time.

Referring to the second main aspect of human capital in the family business, it is clear that companies are growing much faster than the families that owned pace. And therefore can not be a family company providing a sufficient number of family members eligible to fill all positions in the company to expand and grow in size with time, and thus it becomes to recruit staff from outside the family imperative.

On the positive side, family businesses can deliver a unique atmosphere for the promotion and support of knowledge, skills and abilities of staff belonging to the family. Family businesses are often characterized by a strong and very ancient cultures, which makes it even individuals not belonging to the family feel as if they were part of it. The long-term trend of family businesses and the lack of “recruitment and dispensing later” policies often contribute to creating a climate where can Alttaiwiralamnahja of human capital in the long term.

On the negative side, the family business environment might become a hindrance when it comes to attracting and keeping employees on a high degree of competence and training from outside the family. In a family business, you may be booking top positions prestigious family members; for example, a family business may decide that the person holding the post of Executive Director should be a family. This relates to the homeland of another potential weakness, namely nepotism or preference. When family members get preferential treatment with regard to salary or promotions within the company even if they were on a lesser degree of efficiency compared to employees from outside the family, this may lead to a feeling of employees from outside the family of injustice. As a result, they may wish to leave the company, which could lead to loss of human capital. And gaze on this, if known of these practices, potential employees of competence and qualifications employers were reluctant to join the family of the foundation of the company. In addition to this 100K Factory Revolution Review it is often family businesses opposed to the idea of ​​shares to employees from outside the family because they do not want to weaken their grip on the company, which is one of the basic conditions for survival as a family company. Thus, the staff is aware of outside the family that he would not have the chance to own a significant equity stakes at all as they will never practice especially dominant majority rights. As a result, these employees may be more receptive to offers made by rival companies allows them to own a significant share of stock. It is natural that seeking employees to own shares of stock, at least in the long term would be reluctant to join the family business from the ground up.

The bottom line is that it can family businesses create a unique competitive advantage by fostering human capital, both within the family or outside. Within the family, you must make a kind of systematic improvement on the knowledge and experience of individuals and enthusiastic young people interested in the company’s generation, and at the same time the rules and procedures are clear with respect to the probability of joining the family firm application. For employees from outside the family, the family businesses should try to take advantage of the features have access to human capital from outside the family as well as the preservation and development of the long-term.

Employees must be intuit from outside the family that they can fully develop their abilities within the family business, any other words that fill the posts depends on qualifications rather than kinship. Moreover, the ownership of the company’s shares for a limited circle of employees may be an idea worth considering. However, it may not achieve formal ownership alone the desired results. More important than formal ownership is that family businesses focused on creating a sense of belonging and cohesion and moral ownership among the staff. This may increase the chances of getting the workforce to a high degree of knowledge, skills and loyalty to contribute effectively to the competitive advantage of family businesses and their success in the long term.

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