Why Many Family Businesses In Cameroon Do, Not Survive Their Founders (Part 2)

Different Models Of Family Business  Across The World

The Model Common In Cameroon And Other African Countries, Is Family Lineage  

 A baking expert in Cameroon, Olivier Djaba, says there are a number of models of succession in Family Businesses in different parts of the world.  However he says the model that is common in Africa, is that of family lineage. That is, the Founder of a Family Business is succeeded in the management of the business by his son, daughter, nephew, niece, or better still, by a close family member.

But the big problem facing this model of Family Businesses in Cameroon and many other African countries is that the Founders of the businesses or enterprise do not draw a line between their successors in the management of the businesses, and their successors as Family Heads (Next – of – Kin).  The Founders generally mixed up these two successions that are supposed to be separate, even if the two have to go to one person.

And so it often happens that most Founders of Family Businesses in Cameroon do not train their successors or persons that will eventually take over the management of the businesses from them, leaving everything for their next –of – kin manage.  As a result, many next – of – kin inherit Family Businesses they are expected to manage, but that they have little or no knowledge about. And what eventually happens is that the Family Businesses crumble because of poor management.  In other words, the Family Businesses do not survive their Founders.

 Models Of Succession In Family Businesses In Europe And Asia 

Meanwhile as for Europe and Asia, the banking expert, Olivier Djaba ,says the model of succession in Family Businesses that is common over there,  is that whereby  when a  Founder of a Family Business wants to retire, workers of the enterprise that are interested in the business,  are asked to form a group, raise money and buy the enterprise or part of the shares of the enterprise.  However, the original name of the business remains intact. This means that the new proprietors or co – proprietors, cannot change the original name of the business that was adopted by the Founder of the business, even if the family no longer has any shares or capital in the business.

  Another Model Of Succession In Family Businesses

Still in Europe and some parts of the world, there is another model of succession in Family Businesses, whereby the Founders at one point, look for successors outside the enterprises. They bring in some credible investors, to ensure the survival or sustainability of the businesses, when they are no longer active or when they do pass away.

THE MENTOR knows a good example of this model of Family Business in Cameroon (name withheld).  It is located in the nation’s capital, Douala, and it is in fact one of the biggest family businesses in Cameroon. From all indications,  the said Family Business which at some point was like crumbling, has in  the last  couple of years been doing quite well,  thanks to the injection of new capital and good technical  know –how by a giant investor  from  neighbouring  Nigerian . Many people have been surprise to see that in the last couple of years, successive General Managers of this big Family Business in Cameroon have been Nigerians. This is in line with the agreement that was reached at the beginning of the partnership, by the Cameroonian born Founder of the Family business, and his Nigerian partner.