Minding your own business

Entrepreneurs and owners of family-run business houses now have a course that is specially tailored for them

Move over IMD (International Institute for Management Development, Switzerland) and Harvard Business School, India's very own home-grown b-schools are here to give their students a course in Family Managed Business. After ISB Hyderabad, SP Jain Institute of Management and Research and Narsee Monjee Institute of Management and Higher Studies (NMIMS), L N Welingkar Institute of Management and Research is the latest to start a programme in Family Managed Business (FMB).

Moreover, toward the end of this year, IIM Bangalore's N S Raghavan Centre for Entrepreneurial Learning (NSRCEL) is expected to start a PG certificate programme in Entrepreneurship and Family Enterprise in association with Universitas 21 Global (U21 Global). The programme is targeted at entrepreneurs and owners of family-run business houses and will have both online sections and face-to-face classes and will be conducted through a part-time course.

"FMB is a growing area which has been neglected for years. Of late, many colleges are in the process of developing this programme," says Rattan Sharma, director, centre for family managed business, S P Jain Institute of Management and Research (SPJIMR). A majority of the students enrolling for the programme at these institutes are second-generation entrepreneurs from small and medium enterprises (SMEs) who join the programme with an aim to add value to their existing businesses. SPJIMR charges 4.5 lakh for the programme.

But how different is an FMB programme from a standard MBA? FMB, though a two-year post graduate programme like an MBA, differs in its approach. An important criteria for admission in this course is to have experience in handling one's family business for more than two years.

Another important aspect of the programme are the practical sessions of the course where the student gets a chance to apply what he learns. For instance, at SPJIMR, each month has a one-week classroom session followed by three-week practical session wherein the students return to their businesses to apply what they have learned. At Welingkar, 10 days of classroom sessions are followed by 20-day application project on-location at one's family business. Also, "the focus of MBAs is to find a job, whereas students in Family Managed Business are trained to be leaders," says Sharma. Welingkar charges Rs 3.5 lakh for this course.

At ISB, however, the admission criteria is different. Students have to be senior executives managing their family businesses. Also, ISB unlike other management institutes, conducts the programme only for four days every year for a cost of 1.5 lakh. The programme is held by a professor from the Kellogg School of Management in association with ISB's faculty member.

Says Deepak Chandra, assistant dean of the Centre for Executive Education (CEE), ISB, "The world over, family managed businesses account for over 50 per cent of GDP, more so in India. Family businesses may have the entrepreneurial drive and capacity to scale the bar from small to medium size without losing steam, but there are issues always involved and research needs to be done in these areas."

And how valid choice is an FMB over an MBA course? Says Sandesh Mistry who studied at SPJIMR and later floated his own FMB consultancy, "Though I have an automobile component business, with my other family members in to it, I did not find myself adding much value to it and therefore thought of starting my own venture. The course has been of great help in this regard as it teaches us not to be employees but entrepreneurs."

At SPJIMR, the college is planning to initiate research on the issues of succession planning, best and worst practices, corporate governance and global competitiveness of the FMB programme.

The Welingkar institute however, plans are afoot to change the mindset of the business community. Says Vanita Patel, head-FMB programme, Welingkar institute, "More and more business families send their students for an MBA programme. The mindset of people has yet to change. There is a huge market in the FMB sector which needs to be tapped. Welingkar is approaching the SMEs association, conducting focussed interviews and programmes to create awareness."