1. 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.

2. 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.

3. 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.

4. 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.

5. 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

6. (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?