WHY SHOULD AFRICAN BUSINESSES COLLAPSE AFTER THE DEMISE OF THE FOUNDERS?

 I want to bring to your attention the important topic that is of concern to governments and family members of business empires that were big and after the demise of the founder the empire collapses. The impact of this include family wrangles and loss of jobs. We need to appreciate the role that family businesses play in the economic development of nations Some of the leading corporations around the world that span centuries were started by family business members and have employed millions of people around the world and contributed to taxes that have built roads and hospitals.

With the above, it is evident enough that we should do all it takes to ensure that family businesses are run successfully and can run for generations. I am not saying that there are no African enterprises that have spanned generations. What I am trying to articulate is that many African businesses tend to collapse after the demise of the founder compared to businesses in the developed countries and Asia. 

When the Aga khan leader passed on I was curious to know how succession of such a large empire would be handled and it was handled smoothly. It should be noted that the Aga khan business empire spans so many sectors and countries and imagine what can happen when such an empire is not handled carefully. I believe as Africans we have a lesson to learn from such examples about succession planning. We should build our businesses with longevity in mind. The businesses that we start are not ours but they are a gift to the world. Imagine starting a hospital and it collapses after the death of the founder. Imagine a university that produces countless leaders collapsing after the demise of its founder.

The critical thing is that when we are still alive we should learn about the best practices of building sustainable businesses that will span generations. The tendency of each member minding their own business is a disservice to the African continent. Businesses are the lifeblood of any economy and the collapse of any entity should concern every citizen.

There was a story of a prominent Ugandan entrepreneur who mentored her son and took him to the best universities to learn about business. This entrepreneur passed on during Covid 19 and today the son is successfully running the business enterprise. Perhaps this is a lesson to parents that we should involve children in businesses so that they appreciate them at a young age. I once saw an Indian take their children to bank money. This is practical mentorship and it should be encouraged among the African families. The tendency of learning about money at an old age is very dangerous because by then it is not easy to change habits. Money and business issues can be discussed at the dining table because they have the potential to divide families.


HOW TO AVOID COLLASPE OF FAMILY BUSINESSES

1.The founder should run the business with systems

2.The family members should be trained about running successful businesses

3.Need to use professionals in running the business.

4.Regular discussions about how the business is run is very vital

5. Family members should be introduced into the business at an early stage.

6.The use of lawyers in setting up systems for family businesses is key.

7. Family members should be trained about conflict resolution at an early stage. 

8. The founder and family members should think globally. This will enable them to appreciate the value that the family business plays in enabling them to earn an income and acquire skills for future job creation.


For individual and corporate financial literacy trainings contact:

Coach Phillip Kiryowa 

Personal Finance Coach(CPC)

Certified Master Trainer, Bank of Uganda 

Founder, Advanced Empowerment Link

0752615916

For Financial Freedom and Sustainable Enterprises 

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