High growth rates: an mixed blessing for family businesses

IE Focus Newsletter November 2008November 2008 | By Cristina Cruz, Professor at IE Business School

Peru is seeing an increase in wealth that brings many opportunities for family businesses, provided that they put their house in order. The Peruvian economyâ??s sustained growth at rates of over 6% in recent years constitutes a scenario of huge opportunities for the country´s family businesses, which make up more than 85% of the countryâ??s business fabric; however, it also involves numerous challenges.

In such a dynamic environment, competitive advantages evolve rapidly, the economic cycles of enterprises are reduced, and corporate success requires a management model based on two fundamental pillars: willingness to change, in order to capture new ways in which value can be created; and continuous training in order to adapt the company to changing market requirements. Why is this particularly difficult for a family business?

The problem facing many family businesses is that the traditions and resources that were once a source of competitive edge occasionally create inertia and prevent the development of new strategies required to play on markets that are becoming more and more competitive. By the same token, the obsession for maintaining control in the family means that shares used to finance growth, such as mergers, the sale of part of the capital or being floated on the stock exchange, may be considered as a sign of failure instead of a step towards the creation of wealth.


China – Enabling a New Era of Changes《中国开创变革新纪元》

正如中国企业峰会(亚洲经济论坛)上对中国经济现状的总结时所说的:“中国正经历着有史以来最令人瞩目的发展”。以此为契机,中国的本土人民和文化,外来商业和政府职能,交织在一起组成了一个史无前例,独一无二又繁华眩目的独特群体。《中国开创变革新纪元》一书对此进行了深刻的阐述(出版社:John Wiley, 纽约、新加坡 2003版(New York and Singapore 2003);合编:Pamela C.M. Mar(世界经济论坛))。 这本书是对当代中国经济演化的发人深省的深刻注解,也是一本帮助你把握中国发展脉动的万能手册。这本书还预测了中国经济在今后十年的发展趋势,同时也指出了中国如何才能利用和增强发展所带来的积极因素从而抵制负面效应的影响。 作者从一个别具一格的,却颇具深意的视角给出了中国经济的最优,最劣前景展望。 A uniquely diverse group of Chinese and foreign business and government leaders was brought together on the occasion of the China Business Summit (World Economic Forum) to address and comment on China’s most significant growth challenges. • Hank M. Paulson, Chairman and CEO,…