Chapter Twelve: 12.1 FAMILY COMPANIES INTRODUCTION THE ANGLO MODEL: ENVIRONMENT, CULTURE AND MANGEMENT THE CHINESE MODEL: ENVIRONMENT AND CULTURE THE CHINESE MODEL: MANAGEMENT CHANGES IN THE CHINESE MODEL IMPLICATIONS FOR THE MANAGER SUMMARY EXERCISE.

Chapter Twelve: 12.2 HIRING FAMILY MEMBERS IN THE US/UK FAMILY COMPANY Anglo consultants usually advise family companies NOT to employ family members. If you do, employ ONLY a family member who has appropriate work experience and qualifications If hired, the family member should be paid a fair market salary be promoted, rewarded and if necessary terminated on the basis of job performance NOT participate in the hiring of other family members NOT directly supervise other family members.

Chapter Twelve: 12.3 SUCCESSION ISSUES IN THE US/UK FAMILY COMPANY what is the status of minority family owners? what rights and obligations does the new controlling owner have to their predecessor’s management policies? what rights does the previous controlling owner, for as long as alive, have to interfere in day-to-day operations? These questions become urgent when there is more than one claimant.

Chapter Twelve: 12.4 LEARNING FROM THE WEST One Chinese manager proposed that Chinese family companies separate ownership from management in the American style. Once a Singaporean cooked in his own restaurant; now he buys a string of restaurants, hires a cook for each and supervises all institute fair systems for employee evaluation decentralize top management institute proper accounting systems hire outside professionals.

Chapter Twelve: 12.5 STAGED DEVELOPMENT OF THE CHINESE FAMILY COMPANY The East Asia Analytical Unit (1995) proposed STAGES by which the Chinese company could “Westernize:” draw in expertise from outside the family but still within the clan bring in outsider middle managers to balance control by family members raise capital from banks restructure and streamline

(12.5) list the firm on the local stock exchange and raise capital from international bond markets sell down family stock to a bare majority holding. How far can the model be applied in other cultures?