Wednesday, November 8, 2017

Is There Still a Need for Family Business Education?

Business education is focused on larger and bigger things but sometimes skips over the needs to educate on small family business affairs. While global business is the name of the game today there is still a need to provide curriculum for small business. Most people in developing countries run family businesses but may not be maximizing their applied learning if curriculum isn't focused on their needs as well.

It should be remembered that the beginning of all business education was through family and apprentice training. Apprenticeships existed for hundreds, if not thousands, of years without the need for formal education. However, as business became more complex family business eventually needed to move to formal education and business schools were launched. 

While many schools have changed their core missions much of the world is still family business oriented. Many American small businesses were killed off by large corporations and poor legislation. The rest of world functions off of family business economics. The education is still as valuable today as it was 100 years ago. 

The family system is based on family orientation: tradition, stability, loyalty, trust, and interdependency (Lumpkin et al., 2008). These values are different than what would  be experienced from the perspective of someone expecting to work in a corporation. The perspective changes how they view business and its essential function. 

Let us look at a quick example. A family business ultimate goal is to maintain the family and has the need to produce wealth and opportunity for that family. One might hire relatives, make business deals based on family connections, and mix up their personal assets. A corporation seeks to make money for hedge fund investors, business deals are subject to a bid process, and personal assets are almost never mixed. 

This fundamental difference is important and it is argued that a family business curriculum should be created that focuses beyond systems (Burch, et. al., 2015). The authors suggest that while hard skills are needed additional soft skills need to be created to deal with the complexity of family-business socio-economic structures. 

It isn't likely feasible for every university to develop programs directly related to family business in the U.S.. Such family-business degrees are likely to have a greater impact in Europe and Asia. However, it would be wise to offer a specialization in such programs at the undergraduate level. There are still enough demand that the specialization will be helpful for small business entrepreneurs. 

Burch, et. al. (2015). Rethinking family business education.  Journal of Family Business Management, 5, (2), pp.277-293. Retrived

Lumpkin, G., Martin, W. & Vaughn, M. (2008). Family orientation: Individual-level influences on family firm outcomes. Family Business Review, 21 (2), pp. 127-138.

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