Manoj Joshi

Family business in transition: a case of PAL

Purpose – The case aims to deal with multi generation entrepreneurship. Families are about people and businesses are about money, therefore, conflict between the two is inevitable. Family-owned businesses develop competitive edges when they align values, vision, strategy, investment and governance to make both family and business activities more professional and mutually supportive. It is a belief that “treating the business like a family”, driven by values and concern for human needs, creates an organization with motivated people working together to create long-term value. Jitesh Ghai is the MD of Panchamrit Asbestos Ltd (PAL), which stands for PAL. Jitesh has an “experiential learning” with the cement sheet business and has understood the nuances of the business. It is supposedly required that PAL ought to professionalize owing to market infeasibility. Shashwat, his son has diversified interests and therefore desires to spin-off to “Big Apple”. Design/methodology/approach – The case is based on research...

Challenges and Barriers

The extraordinary effort to liaison between the market and the firm is the ability to learn faster than the competitors. The small and the medium firms are the backbones of the economic life and whether it involves subcontracting or direct operations, it ends up in contributing tangibly to the local economy as well the national and globally. Challenges are umpteen as each makes a distinctive impact on the environment in which all types of innovative companies operate. Entrepreneurs after the Second World War have implicitly and explicitly advocated the need for constant innovations for the growth phenomenon and underwent what I term it as ‘innovation pandemonium’. Hitte et all (1993) said that ‘The importance of innovation for the competitiveness of firms and as an engine of growth at a regional or country level is widely recognised.’ The barriers provide an exhaustive outlook and comprehensible account of how it can be detrimental for either participating or not in the process of innovating. It is a complex phenomenon and requires multilevel of analysis.

Creativity and Innovation

Scholars engaged in research on innovation have studied creativity in organisation, as it relates to the working environment (Amabile, 1996), on the characteristics of low vs. high (Delbecq, 1985) and what motivates creativity, both intrinsically and extrinsically (Amabile, 1997). However, there are still few questions unanswered, as to how some firms have been very successful in fuelling innovation via creativity, while the others could not. What are the drivers to these successful innovations? The paper investigates aspects and need in a dynamic volatility, uncertainty, complexity and ambiguity (VUCA) context.

I have a dream: Ayuvayur Pharmaceuticals

Title – I have a dream: Ayuvayur Pharmaceuticals.Subject area – Start‐ups, entrepreneurship, innovation and innovative practices, risks, uncertainties, differentiation, internationalization, competition, business models, operationalizing and implementing strategy.Study level/applicability – The case is suitable for MBA students.Case overview – Vinay moved to the capital city of a Northern Indian state, which also happened to be a commercial hub, after his family business failed. The family succumbed to living in a room without electricity and doors. Vinay had dreamt of establishing his own business empire by being a successful entrepreneur. Steered by this intent, he established a pharmaceutical company with the name of Ayuvayur Pharmaceuticals. The challenge was to establish an innovative Ayurveda‐based pharmaceutical products‐based firm and to build a leading business empire with a customer focus. Progress was not smooth and the challenges ahead multiplied. Despite his ability to cope with barriers, ris...

Conflicts in a Closely Held Family Business: Durga and Company:

The purpose of this case is to investigate the nature of conflicts that arise in a closely held family business (CHFB) and to identify variables that ensure successful transition from one generation to the next. This case necessitates that in order to decide on the inheritance, a three-step process, prevention, management and resolution of conflict, is essential. It also highlights the gender bias in succession planning, ignoring the capabilities and competence of women in the family. Unstructured interviews around multiple stakeholders in the family business (FB) were taken identifying the core issues leading to conflicts. Triangulating with multiple sources or incumbents has reduced biases. It is observed that conflicts are inevitable within CHFBs. However, it is widely accepted that conflicts are paramount to forward progression both for the family and for the business, when it is constructive in nature. The case reflects the importance of understanding the critical issues around family and business. The outcome is useful in relaying better understanding on dimensions of conflicts that plague family-controlled business. Family businesses must relay importance of managing conflicts and bringing in earlier resolutions before they become extinct. The aftermath of not resolving such conflicts can be as catastrophic of destroying the FB and its wealth in the longer run.

Entrepreneurial Success, Orientation and Opportunity Recognition

There are no fixed parameters or tools that can define the path of entrepreneurial success. Successes are as predominant as failures. Until now, there are no established methodologies that fit the likes and want to those tending to become entrepreneur(s). However the conventional wisdom allows us to think that the business might be done as follows. First to identify and evaluate an opportunity, followed by to develop a business concept, assess and acquire resources, manage the venture, and then harvest and distribute value (Stevenson, 1994). The conventional wisdom also holds that a successful entrepreneur is someone who possesses certain characteristics, including: commitment, perseverance, tolerance for risk and a high level of integrity and reliability (Timmons, 1989). There may be slight or major variations but what is important is the beginning with an idea. Thus if the idea is good enough to attract and motivate oneself, then it leads to the assimilation and transformation into reality, while ending up with a successful business. At times if the idea is bad, the entrepreneur fails in transforming it into reality. Hence, the business fails and ends up with a loss, perhaps to bankruptcy. However, this “wisdom” now seeks a challenge.

Determinants of Innovation

The most important question that researchers query about is how does the history influence innovative activities and how does it point to successful innovation? What are the determinants to it? Researchers however have been able to establish that entrepreneurship, new start-ups, consolidation of businesses, interaction with other companies and financial markets create an environment that is convincing to innovations. The most important determinant of innovation is the innovative effort. This can be measured by the expenditure in R&D etc. The level of interaction with different users also plays a vital role and cannot be ignored. A conducive environment for innovation is created by large and diversified human capital and entrepreneurial spirit both in the business and academic worlds. It is interesting to study and follow innovative firms that have launched one or more product innovations onto the market. What is further interesting as to what has happened to these firms before and after the commercialisation of an innovation?

The Connection between Entrepreneurship & Innovation

It is purposeful to identify the link and understanding between entrepreneurship and innovation. These are the drivers of local development and needs to be ascertained. Entrepreneurship (new firms & growing firms) and innovation (patents, R&D and high tech industries) aid in creating an environment where growth can healthily exist. The connection of Entrepreneurship and innovation comprises of independent and corporate efforts in assembling and deploying resources in capturing the value in innovative ideas. These innovative ideas may be present for new products, services and processes. The closer the connection, it indicates the stronger indication of integration between the two towards the prosperity of the region. Those investing heavily in innovation have discovered that the entrepreneurship as the primary mechanism for the fusion of innovation into practicable domain. Therefore it becomes paramount to foster the growth of nation that innovation and entrepreneurship be encouraged in a common platform.

Drivers to Innovation by Entrepreneurs

Innovation & Entrepreneurship has been defined in many ways by the scholars. Similarly the determinants carry a wide spectrum of understanding in the form of theories and explanations (Brock and Evans, 1989; Carree, 1997; Carree, Van Stel, Thurik and Wennekers, 2002; Gavron, Cowling, Holtham and Westall, 1998). Definitely it has a direct impact on the economic development within and outside the boundaries from the centre where it emanates. The level of entrepreneurship varies substantially from one boundary to the other as time passes (Rees and Shah, 1986; Blanchflower, 2000; Blanchflower and Meyer, 1994; De Wit and Van Winden, 1989). Large firms have been subjected to waves of downsizing and restructuring and entrepreneurship has been (re)-discovered (Carree, 1997; Gavron, Cowling, Holtham and Westall, 1998; Thurik, 1999; Wennekers and Thurik, 1999). There has been a shift from the larger to smaller firms or enterprise, which have catapulted the rate of economic development. There are no established indicators that can be generally reached to consensus, in measuring the level of entrepreneurship undertaken and so be the case of the determinants that lead to this phenomenon of being entrepreneurial.

Innovation Performance, Experiences in Different Countries

Considering the incalculable value of being into innovation, most of the countries have engaged themselves into this ‘mantra’, some are in the process of adopting it into their state policy. All innovation briefings have a starting, middle and an end and so do the countries. Some economies are very successful in the deployment process than others and are deeply thinking of capitalising their scientific strengths for commercialisation, while many are still struggling to make out what really they can do. There are few experiences around the world that have been documented and as a matter of further interest and context to the research; Countries have extolled Innovation as the ultimate means to global competitiveness. It all matters how is one going to run the firm or an economy. Too many ideas are not required, but the generations are expected to build a reliable process that shall feed an idea into a replicate one, apply in products or in services. The Entrepreneur shall find it to the market. It is the innovation that needs a consistent challenge by the market and can be categorised as an explosive activity.