Professional Outlook in the Family Run Retail Business

RAI

The panel discussion on Professional Outlook in the Family Run Retail Business had business leaders from several retail chains in south India, which have been family run discussing on dynamics of professional outlooks in such businesses.
Family Run Business - KRS - RAI

Panelists in the session included:

M. Banumathi, Head Naidu Hall, Kovai

Gnanasekar Kandaswamy, MD, Pazhamudhir Nilayam

T.Shantakumar, MD, Kirtilals

Amar Subash, GM Security, Commercial &   Retail Biz, Tyco India

Moderator: Sanjay Badhe, Deputy Director, Retail School of Excellence, Great Lakes Institute of Management



Question: Do family run businesses need professionals?

T.Shantakumar, MD, Kirtilals

“Both family members and professionals go through a period of adjustment when professionals join the business.”

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  • Businesses need professionals to scale.
  • Professionals bring in discipline, process and systems.
  • The entrepreneur, though, brings in a level of customer connect that the Professional cannot.
  • The challenge is to get the professional aligned to family culture and business values.
  • We do several informal meets, lunches with senior professionals when they join.  Our purpose is to empower each Store Manager so that they can engage and connect with the customer, the same way that the entrepreneur can.

 

Question: How do you solve conflicts?

T.Shantakumar, MD, Kirtilals

“When new family members enter the business, we are careful to mentor both them and the professionals already in the business.”

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  • Take conflicts offline – for one to one personal discussions with both, family members and the professionals.
  • Once the decision is made – then both have to align with the decision, even if they don’t agree.
  • We are clear, that professionals who cannot align with the family values and the business culture – cannot continue with us.
  • We use the period of the first 90 days on the job, to gauge that alignment.

Question: How do family businesses attract good professionals

M. Banumathi, Head Naidu Hall, Kovai

“Family owned retail stores provide high emotional connect to professionals – that’s why they stay.”

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  • You have to attract good people – not just at senior levels, but especially at the front end.
  • Family businesses provide an environment which is an ‘extension’ of the home environment.
  • For us, our sales men and saleswomen are our “Heroes”, and – like in the movies, we want them to be visible to the customers (audience) not us – the ‘directors’ and ‘producers’.
  • We recruit for attitude not qualification or experience.  We also ensure that we take on and solve their problems, so that they are free to do what they do best which is sell.  (example – savings schemes)
  • We encourage them to develop confidence, by getting them mentored by senior sales staff. Our staff calls seniors as “Amma / Appa / Akka / Anna” – a mark of the depth of relationship.

 

Question: How do family businesses attract good people?

M. Banumathi, Head Naidu Hall, Kovai

Word of mouth is the best advertisement”

  • Our sales staff help us keep our pulse on the market. They tell us what customers want – and purchase managers do regular monthly meetings to make sure that our range / merchandise reflect that local know-how.
  • We have found, that customers in different towns (from Coimbatore to Madurai )have different tastes. By formally recording customer needs via salespeople,  we find that our business is better, and inventory lower.

 

Question: How do family  businesses retain professionals?

Gnanasekar Kandaswamy, MD, Pazhamudhir Nilayam

“Make sure that you treat family members and professionals fairly and equally.”

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  • Most entrepreneurs think that professionalism is about appointing a CEO – this is not true.
  • A company is professional when it has proper systems and structures to run day to day operations without interference of the entrepreneur.
  • The entrepreneur should focus on “directionalizing”  and setting targets.
  • We do not differentiate between professionals and family members.
  • Both have to take the consequences of their decisions – good and bad.

 

Question: How do you stop yourself from not interfering with the professionals?

T.Shantakumar, MD, Kirtilals

“Empower the professional and then “walk away” – let him do his job.”

  • Once you have delegated authority to a professional – then you have to give him the space to perform.
  • If you interfere and micro-manage he will not perform.
  • At the same time, the customer needs you – so you still need to be available to the customer.
  •  Other than that – you walk away – decisions regarding the stores has to be done by the manager dedicated for that.
  • If you have to override the manager in front of the customer, then after the incident, you go back and motivate the manager so he does not lose heart (or face).

 

Question: How do you stop yourself from not interfering with the professionals?

Gnanasekar Kandaswamy, MD, Pazhamudhir Nilayam

 “Identify your core values, centralize and control only those. Leave the rest to the professionals.”

  • If you are thinking about professionalizing – do not lose the core values – essence of the brand.(in the mind of consumer)
  • We have “centralized”  the core values by a monthly review process – we focus on targets and the support needed to achieve the targets.
  • This ensures that our presence is not needed – and that gives the professional the space to perform.

Question: How do family owned business score when it comes to adopting technology?

Amar Subash, GM Security, Commercial & Retail Biz, Tyco India

“Family owned retailers are profitable. They do not therefore view technology as a cost – they see it as an investment.”

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  • The key is accessing the entrepreneur and getting enough time from him to demonstrate value.
  • Once you demonstrate value, then technology adoption and  rollout is much faster among family owned businesses than among modern retailers where decision makers span multiple levels in the hierarchy.
  • Once you have built credibility – they are also far more open in terms of looking at technology to solve strategic issues. More importantly, willingness to be transparent about the issues is much higher.

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Retailers Association of India (RAI) is the unified voice of Indian retailers. RAI is a not for profit organization (registered under section 25 of Companies Act, 1956), works with all the stakeholders for creating the right environment for the growth of the modern retail industry in India. RAI is the body that encourages, develops, facilitates and supports retailers to become modern and adopt best practices that will delight customers. RAI has a three charter aim of Retail Development, Facilitation and Propagation.