Throughout the history of humanity almost all commercial, and manufacturing activity was performed by families. Having created their business ventures, individuals supported, developed and left these projects to their descendants to guarantee succession and the further evolution. Today, regardless of drastic alterations in the world of business and global marketplace, family business remains one of the most important spheres and play a central role in the development of the economy. However, this position could be shattered by the emergence of new ways to organize business, increased rivalry, and innovations that affect the global market. Under these conditions, the future of the family business is now doubted.
The fact is that the appearance of new realities significantly impacts all family organized firms and introduce alterations in their functioning. For instance, the rapid development of technologies and innovative manufacturing processes shorten the product lifecycle and endanger long-term plans peculiar to the majority of companies of this sort (Nason, n.d). Additionally, the tendency towards the further growth of economic inequality also threatens the development of family businesses as giant corporations hold leading positions and leave no chances for small companies to enter the market and generate revenue.
Moreover, there is one more factor that might have a pernicious impact on the development of family business and preservation of its significant role in the economy. Today, we could observe radical shifts in the family structure and peoples mentalities. Many young people representing a new generation prefer not to follow in the footsteps of their parents and choose other ways for self-actualization and development. There are also drastic changes in nuclear families as they are no longer the norm (Nason, n.d). It means that many family-run ventures might be sold to acquire instant payment and engage in another activity.
However, despite all these threatening facts, family business will likely to remain central to the economy as there are several aspects critical for the further evolution of the market. First, it is focused on the long-term perspective to avoid instability and create the basis for the future rise. Second, family firms create value by hiring employees and providing workplaces for people living in the area. For instance, in Argentina, 70% of the private workforce is employed by family-run companies (Nason, n.d.). In India, 129 million people work on this sort of firms (Nason, n.d). It is a fundamental aspect of any economy as it contributes to the decrease in unemployment level and improves the quality of peoples lives. Moreover, these enterprises are the leading manufacturers of diverse food products characterized by the high quality and affordable price.
In such a way, family business will remain one of the most important aspects of the global economy. Despite drastic changes in methods and approaches to running a business, this sort of firms remains topical and provide jobs for millions of people globally and generate significant income. They only need to follow the recent alterations in the marketplace and focus on the implementation of innovations to remain beneficial and evolve.
Reference
Nason, R. (n.d.). The future of family business. Web.