Human Capital Alliance

Global Perspective Thai Experience


Financial Times: Thais are still wary of joining family businesses

09 June 2005

Thais are still wary of joining family businesses. However, attitudes are beginning to change as a younger generation of owners with formal qualifications and experience elsewhere are taking the helm.

For any Thai who forgets that working in a family owned company can be tricky, the hugely popular soap operas that fill the television schedules provide a lurid reminder.

In House of a Hundred Flowers, the ambitious marketing manager is trying to kill the owner in the hope that his girlfriend, the owner’s ditzy niece, will inherit the clothing business. The evil one has to contend with an unsavoury array of relatives, rivals and lickspittles.

In The Lucky Girl, the son of a hotel owner is secretly infatuated with his father’s secretary, but dare not make his affections known because he suspects she is his father’s mistress. The byzantine manoeuvrings of his jealous siblings and the rest of the prickly staff continually obscure the truth.

Colourful as the TV soaps are, many Thais suspect that they reflect life in a family-owned business.

Thitiporn Onsawarng, an executive consultant in her late 20s, says: “I tried working in a family business and didn’t like it. You come up with a good idea and your department manager likes it, but then he goes home and the next day the idea is dead. You’re not a member of the family, so you’re always on the outside of what’s really going on. “The critical problem is trust. Because I was not a member of the family, there was always a doubt in their minds about me. Paper qualifications and experience can always be trumped by a blood relative,” she adds.

Thais are ambitious; even receptionists study for that vital resume adornment, the MBA. Thaksin Shinawatra, the prime minister, has given the electorate a lengthy reading list of entrepreneurial how-to books and demanded that everyone learn the language of modern business. Yet when they survey the job market, many Thais see a few shining examples of international glamour, and a vast flotilla of family-owned enterprises and all that might imply.

Anders Lundquist, President of Pacific 2000, an agency says: “When Thais look for a job they always say ‘but not in a family company’. Everybody wants to work in an international company.”

Of course there remains tremendous local admiration, shading into hero worship, of the moneyed business elite. That does not necessarily equate with a desire to join what a fresh MBA often perceives as the pack of sycophants who scurry after business leaders.

“When I joined a sprawling Sino-Thai conglomerate that is about to list on the stock market, I was warned never to talk casually to more than two people at a time if I didn’t want to be branded a gossip. Basically, I was supposed to be a silent factotum at the beck and call of every son, daughter or cousin of the owner. I lasted eight months,” says Kanamas Pakwiset, an accountant. “Even quite senior non-family executives weren’t trusted to make decisions. The managers never really manage, so after a few years they lose confidence and get stuck in a job they despise. It’s not ideal for anyone,” she adds.

Many young Thais dream of running their own company. Part of the reason is a distaste for being bossed around by rich junior relatives. Traditionally, business owners – very often ethnic Chinese – expected employees to pick up what skills they needed on the job. There was a reluctance it spend money on formal training for fear that it would be wasted if workers sold their new skills elsewhere.

This caricature of a stingy, micromanaging owner who trusts no one but his family is fading, as new generations of owners- many of them educated abroad enter business. Indeed, many of the people chasing experience in an “international” company expect to work in a family business later.

“I deliberately avoided going into our jewellery-making business after getting an MBA. A family business creates its own procedures and I want to test myself in the most modern companies,” says Malivan Lertchaisirikul, a junior executive in an international firm. She and others like her will not return to the family empty handed.

“There’s a huge generational change going on. The sons and daughters in their 30s and 40’s know that they have to work with the best. If an executive has great ideas, these people will listen,” says Edwin Sim , managing director of Human Capital Alliance, a consultancy.

“What happens if you work for a multinational? Ultimately, you follow the plan that comes from head office. You can be more creative in a family set up,” says Mr.Sim.

The expert consensus is that anyone thinking of working in a family-owned This company must find out as much as possible about the key personalities and precisely what decisions they will be able to make. But be warned: every outsider will have to prove themselves both competent and loyal before he or she will be fully trusted.

An editorial in the latest issue of the glossy Thai language MBA magazine proclaims a new era; “Family businesses that do not embrace modernity is doomed, but it is brainless just to ape western practices. The trick is to combine the strengths of family ownership such as long term outlook in a modern management framework.”

Ms Thitiporn still stinging from her “family” business experience, would doubtless agree with these sentiments but she is taking no chances. “Ultimately, I want to run my own company”, she says. “When I do, I’ll be fair with everyone and I’ll make it a rule not to employ a single relative.”

By William Barnes, Financial Times

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