Family businesses contribute significantly to economic stability and innovation, yet they often encounter challenges related to governance, succession, and professionalization. Unlike corporations with clear managerial hierarchies, family businesses operate within a framework where ownership, management, and family relationships are deeply intertwined(Ward, 2016). The Three Circle Model (Tagiuri & Davis, 1982) offers a structured approach to understanding these overlapping roles by categorizing them into three dimensions: family, ownership, and business. Successful family enterprises integrate these areas effectively, ensuring a balance between tradition and professional management (Gersick et al., 1997).
In our family business, ownership remains entirely within the family, which has helped maintain control and preserve generational values. However, the absence of external investors means that all financial risks are internally managed, limiting expansion opportunities. Management is structured as a hybrid model, combining family leadership with professional executives to bring in industry expertise. My father, the Managing Director, has aggressively expanded the business, while my uncle, the Managing Partner, has taken a more cautious approach, causing a slower transition from Generation 1 to Generation 2. This divergence in leadership styles created hesitancy in adopting new market opportunities, and as a result, the third generation—including myself and my brother—faces the challenge of modernizing operations while maintaining legacy values.
Additionally, different family members contribute in varied capacities:
• I am actively involved in management and business operations but do not yet hold ownership stakes in all divisions.
• My brother is also engaged in operations.also do not yet ownership stakes in all divisions.
• My sister, while not involved in the core business, manages non-core family-owned businesses. But completely owned by herself.
• My mother remains a shareholder but does not participate in daily management.
• My uncle has stakes in the hospital business but not very active in day to day activities.
References:
• Gersick, K. E., Davis, J. A., McCollom Hampton, M., & Lansberg, I. (1997). Generation to generation: Life cycles of the family business. Harvard Business Press.
• Tagiuri, R., & Davis, J. (1982). “Bivalent attributes of the family firm.” Family Business Review, 9(2), 199–208.
• Ward, J. L. (2016). Perpetuating the family business: 50 lessons learned from long-lasting, successful families in business. Palgrave Macmillan.
@Huzain , Thanks for sharing your story—it’s great to get that inside view of your own family business. That said, it feels a bit more like a company profile than a reflective post. I’d love to see you dig into a specific paradox or tension more critically. Also, the references are solid, but there’s little linking them to the real-world examples you mention.