Family Management Style as a Way of Handling Your Own Business

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The Problem and Its Setting


When you put up your own money and operate your own business, you prize your independence. It's MY business, you can tell yourself, in good times and in bad. In a family company, however, it's OUR business.

A family business is any business in which a majority of the ownership or control lies within a family, and in which two or more family members are directly involved. It is also a complex, dual system consisting of the family and the business; family members involved in the business are part of a task system (the business) and part of a family system.

The family is always of vital importance in the Philippines; not surprisingly, most business organizations are modeled on the Filipino family. The boss and subordinate often exist in a bata relationship, basically like that between parent and child (bata literally meaning "child"). As a consequence, paternalistic management styles are the norm. A paternalistic management structure implies that decision making in most organizations is done at the top.

Rights and responsibilities are different at home than at work, and it is imperative that family members keep this fact in mind. At home family relationships and goals are the prime concern. Language is personal, attitudes are subjective, roles -- husband/wife, parent/child, family/relatives/in-laws -- are traditionally defined. At work, however, the success of the business must be paramount. Language becomes more impersonal, attitudes more objective. Family members who work in the business must accept the boss/employee relationship, as they would in any other business. Their job descriptions must be clear, in writing and adhered to. Problems arising at home should be left there when the workday begins and workplace problems should not encroach on home life. Family members who accept and observe the home/business dichotomies not only avoid strained personal relationships, but also convey an important message to all employees that in the workplace business goals come first.

Statement of the Problem

The manager of a family-owned business faces the same challenges as the owner-manager of any small company. However, the job of family manager may be complicated by relatives who must be reconciled to working together in a business.

When family members work together, emotions may interfere with business decisions. Conflicts may arise as relatives see the business from different perspectives. The researcher aims to answer the following problems:

← How does family management system help in managing a family business?

← How can conflicts in a family business be avoided?

← What is the importance of communication in a family business?

← What is paternalistic management style?

← What are the issues that most family businesses face? and

← How to manage it?

Significance of the Study

This study discusses about the family management style as a way of handling its own business. Through this study, the readers will be knowledgeable on how to handle family business effectively. They will also learn and understand the importance of communication in resolving family business conflicts.

The following persons will benefit from this study:
Parents – this study will help them in dealing with their children about their business in a disciplined but right manner. Children – this study will help them in understanding their responsibilities and importance as part of the family business.

Scope and Limitation

This study limitedly deals with the paternalistic management style as a way of handling its own business. This study will not cover the other family management styles involved in managing a family business. It focuses only on paternalistic management style and its related articles.

Chapter 2
Conceptual Framework

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