How can a family business survive for generations?
Jakarta, 1 March 2023 - It is not easy to continue a business, especially a family business. Many family businesses collapse and cannot survive to the next generation. This is due to many things, especially the challenges that are usually faced by a family business.
Guru Besar Psikologi Unika Atma Jaya, Hana Panggabean.
Professor of Industrial Psychology at Atma Jaya Catholic University, Hana Panggabean said that a family business is actually the same as a business in general. However, the difference is that there is a family element. When we talk about family, Hana added, we are talking about inter-personal relationships.
"So there is a saying that the first generation builds, the second generation raises, and the third generation destroys. Actually, in the family business, the first generation always has a pattern, namely the founding generation, the second generation, and the third generation talks about failure and success," Hana said in the seminar Aneka Warna Relasi Inter Generasi Bisnis Keluarga, Monday (27/2/2023).
According to Hana, the first or second generation is the one spoken to by her siblings. Meanwhile, in the third generation, it is not necessarily their siblings who are spoken to. "Now what is often a problem is the issue of relationships, because the relationship is becoming increasingly complex and broad. That's what makes the third generation crucial," she said.
The typical challenges faced by family businesses are firstly the strong emotional element due to the relationship element found. Secondly, there is a strong culture of entitlement in family businesses. The third challenge is succession and succession should be established before a crisis occurs.
"There is research on a family business that happens to belong to a Chinese family, so the men get higher rights than the women, coincidentally their two sons and two daughters were all sent abroad. When they came home, they wanted to take care of the textile business, so they asked why they wanted to? He replied that since he was a child, his father had told him that this (business) belongs to you, and it will belong to your brother (koko), so from a young age he had been told that. So succession has been done since the beginning," she said.
The next challenge for family businesses is Good HR Practices. According to Hana, this is often a weapon in the wrong hands, as it can be used to get rid of or elevate the wrong people without seeing the right ones.
The two basic keys in a family business are trust and business commitment. "Business commitment can be built for various reasons, it can be personal, such as a message from your mother or parents. Then the most important thing is trust so that the family business is sustainable," she said.
Meanwhile, Hidayatur Rahman, who is the second generation and Chairman of the Ethics Commission of PT Jatinom Indah Agri, said that he had prepared the successor of his family business early on. Currently, PT Jatinom Indah Agri has entered its third generation.
Hidayat prepared his son Salman Al Farisi as a successor. Since elementary school, Salman has been taught to do business. Even in high school, Hidayat was once called by the counselling teacher because the turnover of his son's school canteen had decreased, this was because his son was selling at school. "But after being given understanding, the school finally understood," said Hidayat on the same occasion.
According to Hidayat, a common mistake in a family business is not preparing a successor early enough. "So far, we have only been given the money, not the business poison. After graduating from college, we can't give it, it's like bamboo that has started to get hard, we don't have enough time," said the father of three.
Apart from preparing a successor early on, Hidayat also always tries to maintain family harmony. Friction between families in business must exist, but it is never brought into the family realm. "So it's just inside the room, it's not brought out," Hidayat explained.
As Chairman of the Ethics Committee, Hidayat admitted to reducing conflict by admitting when he was wrong. Furthermore, convincing that no one is special or can do everything. "We process in the household if we look for the right thing, the household will not finish. I would rather look for the good for them (family members)," he said.
If there is a deadlock, Hidayat admitted that he does not hesitate to ask for help from a third party to mediate. The third party can be a brother, sister, or consultant. The third party is tasked with talking to make the deadlock liquid.
"In a family business, it's not necessarily that the first or second child is suitable. But choose a child whose heart is like the ocean, so if he is slandered, he accepts it, hears it, it's good to accept it. But we have a vision that the integrity of the family is one of my goals," he revealed.
