Dr. AbdelGadir Warsama Ghalib

In all Gulf countries, GCC, there are many family business companies and it is very evident that those family business companies play an important, active and effective role in developing the business industry, trade activities and the national economy of their countries.

Almost all around the globe, family business companies start by one single pioneer person, in the family, who initially starts the type of business he likes and keeps in maintaining, developing and guarding this business for a long and continuous time.

At a certain stage, during the process of the business , other members of the family normally join forces with this one-handed businessman or, could say, pioneer entrepreneur and give him more support and the necessary impetus to keep the business rolling, growing and expanding every day. There are many good examples to cite…

The leadership of the businessman or the pioneer entrepreneur continues even after many family members join him in “what is known” the family business and this continuation process, in fact, is due to many factors including among other things the charisma of the first starter entrepreneur.

It is almost established that almost all family business companies depend on the leadership of a single dynamic and business oriented entrepreneur perhaps with the assistance of relatives and or children when they grow-up.

However, certain problems could come to light particularly in case of siblings who together own and run the second or third generation family business. This could be, because the new comers may not follow the leadership style of the founding old parent or senior brother.

After the expansion of the family business and continuation for long years the cousins, likewise, whose families share in the ownership in a later – generation family business could face more complex challenges. This situation could take them to adopt a different kind of leadership and or management style, otherwise they may diminish.

With particular reference to family business, many studies and research had revealed that there is a remarkable noticeable difference between what is known as necessity - based entrepreneurship and opportunity - based entrepreneurial  activity.

The first type is represented in the case of the founding fathers who started business because most likely that other employment opportunities were limited or unavailable at that time. Whereas, on the other hand, the second type is represented by the new generation(s) who join the business after having the necessary educational and professional qualifications.

The education, professional qualifications and external exposure which has been obtained by the new generation focuses on a new type of leadership for the family business companies.  Anew-look for the business.

The old guards, in case they are still involved in the management, may resist or delay the new development or the change in the pipe line and this could very seriously affect or jeopardize the overall interest of the family business companies.

To overcome such difficulties or problems we advise that the company business should be institutionalized through pursuing certain rules regarding the adoption of new structure and strategy for the company. Opting for and implementing new corporate governance rules. Institutionalization of the family business and applying corporate governance principles will effectively help in the prudent management and wise leadership of the family company. Moreover, they will directly help in keeping the family business intact and more stronger

However, all such steps are in need of close understanding and cooperation among all family members. The old guards with their classical views and the new comers with their virgin new-look are to exchange, match and intermingle. Many families worked very hard to achieve this end and, fortunately, they have managed to survive by over-stepping this sensitive period. Others, are keenly advised to follow suit and to benefit from such successful experiences.. All family companies are in need of such vision to smoothly penetrate the coming future for the new generations in the family... They represent future.