Systems, scale & succession: classification & prediction model for family businesses in India

Abstract

Identification and classification of family businesses is a major hurdle which one has to cross by dealing with great deal of subjectivity and reliability issues concerning the quality of descriptive data that obtained from the business. There has been great deal of research in studying elements of a family business but not much literature can be found about the interplay of those elements across categories (like how succession parameters would interact with scale or systems parameters and so on). This study was meant to dissect the various elements, mark their interlinkages and subsequently come up with a model that could take as input, any Indian family business profile with it’s easily known deterministic parameters, and give the output of assessed probabilities and possible gradation of subjective parameters. The results obtained were encouraging, for both, firm which the researchers were familiar with through friends and family, as well as firms which were not so well known to them. The model and flowchart finally obtained, can now classify and predict prospects of Indian family businesses, with fair amount of conviction due to the comprehensive coverage of deterministic variables and their wider linkages.