[Vnbiz] Read Google stories - Ask Vietnamese entrepreneurs about enterprise culture.

[Tran Dinh Hoanh]

Dear brother Nhon & CACC,

Let me try to present this family-owned business issue in the most simple
way, by starting it with brother Nhon's issue.  But first, let me clarify
some terminology.

The technically correct term is "family-owned business," meaning the
ownership of the company (like stocks or partnership shares) are in the hand
of people of the same family (like husband, wife, brothers, sisters,
children, etc.). "Family business" is a short way to call "family-owned
business."

Even in family-owned business we have non-family employees.  And most of the
time, there are more non-family employees and family employees.  The family
members are owners, and when the company is very new and small, the
owners may be employees, usually  in management position.

I would use the term "non-family-owned company" instead of "professional
company" (as brother Nhon uses), because the use of the term "professional
company" in this context implies that family-owned company is not
professional, which is unduly prejudicial to the mind.

Now, back to the main point.  Brother Nhon said, "The problem that I have to
pay more time to look for the ideal peers that would start-up with me. This
is my problem now."  Of course, that is your problem of anyone who looks for
a business partner.  It is like looking for a marriage partner.  The
pre-wedding sweet beautiful gorgeous lady that you've been head over heel in
love with may turn out to be the ruthless slave driver after the wedding
night :-)  Too late man.  You have voluntarily signed away your freedom :-(.

Business partner is not much different from marriage partner.  It is someone
you will have to live with for life (if we are not talking about
heartbreaking divorce or partnership dissolution at this point).  So it does
take a lot of time to find the right partner.   You have the find the person
(1) with a good level of a skill that is needed in the business (2) who
loves to own a business and (3) who can "live" happily with you for years to
come.

That is not going to be easy.  Most business partnerships come from longtime
friends and family members.  If your brothers have the skills needed for the
business and want to do business with you, all you need is about two minutes
to decide yes or no, because you already know exactly whether you can live
with them or not.  And if you decide to do business with your
brothers/sisters, you will have the unity that only family members can
create and the trust that only family members can give, plus you don't have
to worry much about fighting for a dollar here and a dollar there for
"fairness" in income division among partners, or many other kinds of
conflict often seen among partners.

Of course, any rule has exception.  But generally, family unity will create
the strongest team possible under the sun.  And creating a successful
business is all about team, team and team.  Never underestimate family
unity.   Many people do not understand this point and they generally said
"Don't do business with your family members."  We Vietnamese family usually
do business with our family members.  The result is, in the US history,
among ALL immigration groups (Chinese, Hispanic, Caucasian, etc.),
Vietnamese is the most successful group timewise. The Vietnamese immigrants
in the US gain in one generation what other immigrant groups needed three
generations (I will discuss this point more some other time).

Once a family-owned company has become big, it is like any other major
corporation.  Ex:  Microsoft, although so big and owned by millions
of stockholders worldwide, is actually controlled by Bill Gates (the major
stockholder).  Actuality we can say that Microsoft is owned by Bill Gates,
one man.  Talking about flexibily and openess, a family-owned business that
has 3 or 4 owners has more hope than a company owned by one man, don't you
think?

I want to emphasize this point because some people do think that it is bad
to do business with your family members and I think that is a really serious
mistake.  Use the strength you already have, and that is your family.

Of course, all this discussion presumes that your family members have the
skills and the professional attidue for the job.  Many people get their
family members into the business without caring much about their skills and
professionalism.  That's why they fail.  This is just bad management.

Also, I don't say that non-family members are not good.  I say,
faimly-members are very good to build a business if they all have the skills
and professionalism.

Have a great day!

Hoanh



On 2/10/07, Pham Thanh Nhon <nhonpt at gmail.com> wrote:

> [ Vietnam Business Forum ]
>
>
>
> Dear bro Hoanh, bro Craig, bro Hong-Phong_Pho & CACC,
> Thanks for your interesting replies, I think family company is a good
> model to start our business. However, I recommend that a family company is
> in size, not in management because family management would lack of the
> competition with other:
>
> + Good employees are more interested to work with professional companies
> than family companies.
> + Family culture are difficult to build a diversity culture.
> + Easy to conflict between relatives & outside workers.
> + Difficult to adapt with quick change of business.
> + Problem to transfer to new model
>
> To me, I'd like to start my business in way of professional
> responsibilities than family model. The problem that I have to pay more time
> to look for the ideal peers that would start-up with me. This is my problem
> now ^___^.
>
> Best regards,
> Pham Thanh Nhon
> PR Freelance. If you like to do sth for our country, take me up:
> Phone: (+84) - 987 728 911
> YIM: companion7_18
> MSN: nhon.pt at hotmail.com
> Skype: nhonpt
>
-- 
Tran Dinh Hoanh, LLB, JD
Attorney of Law
Washington DC
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