Introduction
Zayed Al-Hussaini Group was established in 1940 by Zayed Al Hussaini who was the grandfather of Ahmed. Initially before starting the group, Zayed and his family worked as pearl divers. These pearls were sent to international markets via sea routes which made the family earn reasonable money. During spare time, Zayed along with his father went on to local counselors and traders regularly. However, with the passage of time the pearl industry started declining with the introduction of artificial pearls therefore; Zayed and his family were forced to look for alternate options for income.
To earn a living Zayed then started his own shipping business where he also involved his younger brother, Ali. After the independence of United Arab Emirates, the shipping business started to prosper in the Middle East and it created more opportunities to work with different regions. After becoming successful with the shipping business, they decided to diversify their operations therefore they entered a long-term contract with MNC operations in FMCG business through joint ventures by acquiring ownership of more than 51% shares of the company. Zayed Al-Hussaini Group further expanded itself by entering into the fashion industry in 1990. They even expanded into other diverse businesses as well such as automobiles, real estate, restaurants, financial services, etc.
Problem Statement
The main problem identified in the case is when Hamdan died in an accident and Ahmed, who is the grandson of Zayed Al-Hussaini; was asked to come from London in order to take over the responsibilities of the Group General Manager at Zayed Al-Hussaini Group. However, Ahmed was reluctant to take this position because he was unsure about managing business and family together; while setting priorities for each one of it.
Analysis
Strengths of the business
Hierarchy
The company is a family business where all the stakeholders are the family members. Zayed Al-Hussaini was the chairman of the company whereas his son Hamdan was appointed as the in charge of all the franchises. Whereas his daughters, Maryam and Zainab were given the positions of General Manager and Managing Director respectively. The infrastructure of the company was quite innovative yet informal.
Diverse Business
The most important feature of the family-owned business was that it involved a number of various businesses ranging from fashion industry to fast food business, financial company, etc. the company did not remain with a single business and in fact entered a number of different businesses.
Succession Planning
The succession planning at the company was quite properly planned. For example, Zayed trained his children Hamdan, Zainab and Maryam. Similarly, Maryam trained her children Fatima and Khalid to further expand and involve in the business. Zainab trained her children Majid and Jawad to come up and handle the business affairs in the future. Moreover in order to continue the string, Zayed and Maryam mutually appointed Ahmed as the General Manager for all the groups.
Environment
The environment of work was quite informal and co-operative where all the family members actually supported and helped each other with their roles and responsibilities. The major opportunity which occurred with such a system was the direction of the company which was solely aimed to grow.
Weaknesses of the business
Emotional Involvement
The biggest weakness observed in the family business was the emotional jealousy among family members. This was seen when Ahmed was asked to join as General Manager of all the groups and Majid and Fatima did not like the idea; they openly showed their discomfort and disliking towards the appointment.
Decision Making
As the case states, many times the decision made by Maryam was not in the interest of the business, but she had to take those decisions because of the family unity. Although she knew that they might fail but because one of the family members insisted to take the decisions, hence she had to say yes.
Challenges in Family Business
Undefined Roles
In a family business system, the biggest problem is the undefined roles within the company. In such a business system in spite of being incompetent for a specific responsibility; family members are appointed because they are a part of the family. Such situations happened in this case also, where Maryam had to listen to the decisions made by family members in spite of the fact that they were against the interest of the company.....................................
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