Family Business in the UAE: Management and Dynamics

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Analyze in detail the different aspects of the family dynamics challenge in the Izat Raja family. Provide specific examples to illustrate the relationships between various members of the family

As well as every family that sets up a business, Izat Raja’s family had to face a series of family dynamics challenges. First of all, one might point out the problem of the family emotional intelligence that the Izat Raja experienced at a certain point. Whereas the man showed high emotional intelligence capacity in his relations with Waleed, he proved to be relatively incompetent in managing his family feelings towards his son.

Moreover, decision making became rather ineffective when Izat made up his mind to employ his old friend, Rizvi. In this case, he made critical mistakes performing the wrong evaluation of the family needs and the reinvestment for growth (Poza, 2009).

In addition, the principal challenge that Izat faced was that his entrepreneurship was not initially a family business. In the beginning, he did not have any relatives that could assist him in policy-making, which influenced his managerial manner as he got used to relying on his abilities.

Relying on the boundary theory, analyze in detail how Raja Garage Ltd. manages its family – business identities, and identify the type of family business Raja Garage Ltd is

In the framework of the boundary theory, Izat Raja’s family business can be referred to as the type with integrated family business identities. In other words, contractual governance is mainly substituted by relational governance (Poza, 2009). In the meantime, it is critical to note that the only reason why Izat Raja’s business can be called “family” resides in the fact that his nephew, Waleed works for Raja’s company.

All the other employees are not a family member, although Raja treats them as if they were. For example, he takes up the responsibility for their well-being and rejects to cut off the workforce even when the company experiences financial problems. It is evident from the case that Izat prefers to avoid official contracts when possible, which is illustrated by the situation with Rizve when their job relationships were regulated mainly on trusting terms.

Are there any mistakes that Izat Raja made throughout the years of his company existence? Justify your answer

As well as any manager, Izat has made some mistakes in the course of his running the company. His principal drawback might reside in the fact that he refuses to adjust his firm’s services to the changing market demands. As it is seen from the case, his unwillingness to implement innovations does significant harm to the company’s performance.

Another weakness of Izat’s policy is his poor management of financial issues. According to his nephew, Izat tends to be rather careless about the income and the expenses. The relevant attitude towards accounting was seen from the very beginning when it was described that Izat did not have a record book, but would write all the accounts on a piece of paper. It might be, consequently, assumed, that Izat should employ a qualified specialist that will be in charge of this business aspect.

What do you think of Kamran’s ‘bunch of fresh ideas’ concerning the future development of the family business? Do you have other ideas for saving the company?

The “fresh” ideas of Izat’s son Kamran seem to be rather reasonable and are likely to improve the general performance of the company. For example, his suggestion to reduce the number of workers, dismissing those employees that are less skilled, is rational. In the meantime, his assumption that Waleed’s service branch should be eliminated seems to be ungrounded. According to the case, Waleed’s service helps the company to gain considerable profit – getting rid of this option will mean losing a significant percentage of customers (Spraggon, Bodolica & Manoussifar, 2012). On the whole, it might be suggested that Izat should alter his managerial style.

Reference List

Poza, E.J. (2009). Family Business. Mason, Ohio: Cengage Learning.

Spraggon, M., Bodolica, V., & Manoussifar, M., (2012). Succession Management Challenges: The Case of a Family Business in UAE. Asian Journal of Management Cases, 9(2), 115-126.

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Family Business in the UAE: Management and Dynamics

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