In The Name Of The Father

When it comes to strategy formulation there will be a relationship between the type of enterprise and the people involved in the formulation process. The process depends partly on the type of enterprise.

In SMEs strategy as well as ownership and control is in the hands of the owner. Partnerships and private companies will be dominated by interpersonal relationships usually partners, old partners or family members, public companies with a separation of ownership and management traditionally call on professional managers to formulate strategy, but increasingly shareholders are becoming involved as a result of the corporate governance movement. Members all have a democratic say in co-operatives and commonwealths but there is an increasing trend toward the building society and mutual company model with professional managers and elected management boards. In state controlled, public sector and not-for-profit enterprises, the strategy formulation and decision-making is highly politicised, and is carried out by elected representatives, appointed officers, management boards, government, employee or stakeholder representatives, professsional managers or administrators (Morden, 1999).

The founder or family members may have considerable influence on the strategy formulation process. The founder shapes the initial perspective. As Goldsmith and Clutterbuck (1985) argued family members provide continuity. They grow up in the business and know it intimately and want to maintain the value of the family's most prized asset. They take a longer view. In Mediterranean Europe, they can develop into long lasting dynasties. They can make the enterprise look more attractive and able to offer a wider range of benefits and development opportunities to prospective employees (Morden, 1999).

Family business do tend to suffer from a number of disadvantages. There is no guarantee that family members will be qualified or competent business people. The Chinese Family Business describe it as 'from shirtsleeves back to shirtsleeves' in three generations. The search for a successor may reveal a lack of interest among members of the family and a lack of motivation. There may also be rivalry and infighting for control. Separating business from the dynamics of the family stew may become problematic. A concentration of power and unchecked authority could lead to serious mistakes being made. Some of these features of family businesses suggest that occasionally professional managers should be brought in from outside to make the necessary changes. The process of professionalisation could involve a lengthy period of accomodation and uncertainty (Morden, 1996, 1999).

The main idea behind bringing in professionals and a change management process is the continued existence and success of the enterprise. Anyone who can bring continued success to a business should be made welcome.