Executive Search

Away from the meta-national decision centers, family businesses in emerging and fringe economies need to continuously adapt their business models to the growing presence of globalization. Sometimes, this can mean they have less time or lack the necessary focus to optimize vital internal processes, such as top-level succession planning. In what follows, Egon Zehnder International consultants working on three different continents – in Argentina, Indonesia and Portugal – argue that in these special circumstances there are several aspects that must be observed if succession planning is to match up to best practices and meet with success.

We search in vain for a strictly scientific and un-equivocal definition of “emerging economies”. S&P, for instance, assigned a total of 19 countries to this category at the end of last year, while Dow Jones counted no less than 35, including Argentina and Indonesia. But even in the absence of precise definitions, experts are agreed that these economies all display strong growth and rapid industrialization. In these parts of the world the business environment often changes much faster than in mature economies.

Partly as a result, emerging markets are assumed to provide greater potential for profit, but they also harbor substantial risk factors. And in another crucial distinction, the corporate landscape is far more clearly dominated by family firms – the archetypal form of private enterprise – than in developed economies with their established industrial traditions.

Read full article "On the verge of globalization" in the new edition of THE FOCUS on Family.