Insights

A family business in Kerala had been thriving for two generations. Founded by the patriarch and later handed over to his son, it employed several family members and dozens of loyal employees. For years, decisions rested with the head of the family, and the system worked. But as the organisation grew, cracks began to appear. Family disagreements over business decisions escalated, and senior managers from outside the family left within months, frustrated by the nepotism and informal structures within the organisation. What had once been a thriving business was trapped in inefficiency, high attrition, lost clients, and reputational damage. The market was booming, but this company was slowly slipping into decline.

This scenario isn’t unusual. One of the biggest challenges family businesses face globally, and especially in India, is professionalisation. At GatewaysGlobal, we have studied this problem for years. Through our work with family businesses across Asia, we have identified four critical layers where professionalization must take place – Self, Family, Business, and Society. Together, these form the foundation of what we call the Four-Layer Model of Professionalising Family Business.

What is Professionalisation?

From a practical standpoint, professionalization means introducing systems and processes that ensure sustainable results. In the early stages of a business, the patriarch or founding members handle decisions directly. Systems may be informal, yet they function smoothly because control rests with one or two individuals. However, as businesses expand and the number of stakeholders increases, confusion and ambiguity arise.

Professionalization should ideally begin before these confusions set in. It’s far more effective and beneficial to start when operations are running smoothly than to wait until conflicts and inefficiencies emerge.

Where Does Professionalisation Begin?

This is often a “chicken or egg” question for families – should professionalisation begin with the business or with the family? Most families attempt to professionalize their business first. They hire senior professionals from MNCs or adopt new structures. However, these efforts often fail due to unclear authority, culture clashes, or conflicts with family management. Others try to professionalise their image through CSR or philanthropic activities to project an impression of professionalism. While well-intentioned, these efforts are rarely sustainable if not backed by deeper structural changes.

Through our research and experience, we have identified that the most impactful and sustainable starting point is not the business but with the SELF. When the leaders themselves professionalise, the rest of the organisation will naturally align and follow.

Professionalising the Self

The “self” refers to the individuals who lead the business – the patriarch, matriarch, or next generation leaders. Professionalising the self requires shifting from the mindset of founder-owner to founder-CEO.

This transformation rests on three aspects:

1. Behaviour – Shifting from owner-centric to business-centric actions. For example, valuing time as a CEO does by structuring schedules, giving appointments, and respecting others’ time, etc.

2. Systems and Processes – adhering to consistent systems, rather than decisions based on personal whims.

3. Relationships – nurturing relationships with employees, vendors, and partners as long-term collaborators rather than personal dependents.

Such a shift does not happen automatically. It requires conscious effort, exposure, and personal willingness to change. Habits built over decades, such as walking into the office late or setting informal work norms, take time to unlearn. But when leaders demonstrate discipline and professionalism, it sends a strong message to their team and lays the foundation for a more professional culture in their organisation.

Executive Coaching

A key enabler in the journey of Professionalising the Self is Executive Coaching. Leaders often say they are “lonely at the top” because they are hesitant to share doubts or struggles with family or employees due to fear of judgment. An Executive Coach acts as a thought partner, providing a confidential, non-judgmental space where leaders can reflect and arrive at their own solutions.

In family businesses, where multiple members may hold senior roles, coaching can also help navigate complex dynamics. It is increasingly common for both current and next-generation leaders to seek coaching, not just as a sounding board, but also to build leadership authenticity, refine their image, and strengthen executive presence.

Mentoring

Unlike Coaching, which is more facilitative, mentoring draws on lived experiences. A mentor who has successfully navigated professionalization in a family business can guide a leader through challenges and provide practical wisdom.

Psychometric Assessments

Self-awareness is a necessity for the Professionalisation of Self. Tools like CTPI-R from Central Test, which we use at GatewaysGlobal, help leaders identify their behavioral tendencies. For example, if a leader realizes they make decisions based on emotion, they can consciously develop a more rational, balanced approach. Such assessments strengthen competencies and provide a path for self-improvement.

Exposure and Learning

Another dimension of Professionalising the Self is exposure to global best practices. Many next-generation leaders participate in family business programs at leading institutions, which give them valuable networking opportunities and insights into how other businesses have successfully professionalized.

Conclusion

Professionalising the Self is the most challenging but also the most rewarding step in a family business’s journey of professional transformation. It is not about force- fitting behaviours. It is about evolving naturally and authentically. It requires consistency and the courage to question long-standing habits. When leaders begin to shift owner-driven decisions to business-driven decisions, the effect is profound. At GatewaysGlobal, we have seen how this shift in leaders is greatly supported with a thought partner by their side. This is why Executive Coaching has become such a valuable part of our work with family businesses.

To conclude, professionalization is not a one-time exercise. It is a 360-degree transformation involving mindset shifts, behavioural changes, skill development, and support systems. In the next edition of this magazine, we will take this series forward by exploring the second layer of our model: Professionalising the Family.

Family businesses are shaped by two intertwined perspectives. On one hand, they focus on products, markets, strategies, and revenue. On the other hand, they carry the weight of relationships, traditions, and unspoken expectations. Their true measure of success lies not only in the growth of the balance sheet but in the legacy they preserve and pass on across generations.

A family business is any business where ownership and decision-making are influenced by members of the same family. They may begin modestly with a store, a workshop, or a fish stall and evolve into a retail chain, a multinational manufacturing company, or a seafood exporter with market dominance.

What begins as a livelihood transforms into a legacy, carried forward through generations. In India, family business forms the bedrock of the economy. Several studies indicate that family-owned businesses account for a major part of our great nation’s GDP, underlining their scale and impact.

While it is true that family businesses are engines of growth, they are also vulnerable to unique challenges. Where legacy and emotions intersect with money and management, conflict is often close by. The success of a family business depends less on markets and capital and more on how effectively the family manages its own complexities.

Lack of governance and transparency is one of the most common issues in family business. In the absence of clear systems, personal disagreements have a way of seeping into boardroom decisions, blurring the line between what is best for the business and what is best for an individual. The blurring also extends to wealth. The thin line between family wealth and business wealth often becomes contested ground, giving rise to bitter disputes.

Another delicate issue is succession. When the question of “who will take over after the founder” is left unanswered or handled poorly, rivalries and resentment begin to surface.

Equally complex is the balance between professionalisation and control. While bringing in external managers can strengthen governance and sharpen strategy, families often hesitate to relinquish their influence, creating a push-and-pull between tradition and modern management.

Generational differences add another layer of tension. Older members may cling to stability and preservation, while younger ones press for innovation and change, creating friction that is both ideological and personal.

Above all, emotions run deep in every decision. Unlike in other businesses, a family cannot easily separate the father from the Chairman, or the daughter or son from the Director. Personal histories and unresolved dynamics inevitably spill into the boardroom deliberation, making choices as much about relationships as about strategy.

These challenges are not theoretical. They have played out dramatically in the stories of two iconic Indian companies – VIP Industries and Raymond.

The Gap in VIP’s Legacy – Succession Planning

In 1980, Dilip Piramal took over the reins of VIP Industries – one of Asia’s luggage giants. However, its deepest challenge didn’t come from competitors. It came from within. Like many family businesses, VIP never built a strong succession plan. The next generation had little interest in carrying the legacy forward, and without a clear plan, the baton eventually had nowhere to go. Piramal’s recent plans of exit from the company weren’t just about market struggles. It was also about the leadership void that formed when no successor was prepared or interested in taking charge.

VIP’s story is a reminder that building an empire is only half the journey. Ensuring it survives beyond the founder requires foresight, difficult conversations, and most importantly, succession planning.

The Raymond Dispute – The Cost of Poor Governance

If VIP shows the friction of succession, Raymond shows the fallout of poor governance and lack of transparency. Founded in 1925, it thrived under Vijaypat Singhania, who later handed control to his son, Gautam. What should have been a smooth transition became one of India’s most public family feuds.

In the absence of clear governance structures and transparent systems, disputes over authority and wealth quickly spilled into headlines. Vijaypat Singhania, who later handed control to his son, Gautam. What should have been a smooth transition became one of India’s most public family feuds.

In the absence of clear governance structures and transparent systems, disputes over authority and wealth quickly spilled into headlines. Vijaypat accused Gautam of sidelining him. Investors panicked not because of weak business fundamentals, but because personal disputes rarely stay personal. They ripple across shareholders, employees, and society.

The 5 C’s – The Pillars that Safeguard Family Businesses

To prevent ambiguity, enable perpetuity, and resolve these conflicts that erupt in family businesses, every family business should align itself with the Five Cs:

Culture – the shared values and traditions that bind the family and guide the business. The family should define its values and philosophy and ensure every family member religiously adheres to it all the time.

Consensus – the ability of family members to agree on business vision, process, and key decisions. “My way or the Highway” attitude will not work. Each family member’s voice matters.

Commitment – dedication to collective decisions, with every family member walking the walk and honouring what has been agreed upon.

Capability – building skills, leadership, and systems required to grow and adapt. The next generation should be given opportunities to learn, practice, and align their capabilities with the business’s growth and culture before taking on responsibility.

Continuity – ensuring smooth succession and sustainability across generations and creating an environment of perpetuity. Perpetuity is built through an environment of trust and small, meaningful actions that shape legacy.

When the 5C’s are aligned, family businesses thrive for generations. Every family member has the responsibility to understand and adhere to the proves set to implement the 5C’s in their family.

The stories of Raymond and VIP illustrate a truth: family businesses cannot always solve their challenges internally. The very bonds that make them strong also make honest conversations difficult. That is where advisors like GatewaysGlobal LPP play a crucial role.

Family businesses are powerful because they combine vision with values and resilience with relationships. But these very qualities also create fragility when emotions override structure. Success is not guaranteed by growth in the bottom line alone. It must be safeguarded by governance and professionalism.

With the guidance of skilled advisors, families can navigate these complexities, turning conflicts into clarity and succession into opportunity. The challenge of managing a family business is great, but so too is the reward of seeing a legacy endure.

(In the interest of confidentiality, all client particulars have been changed)
Client: Wonderweaves Limited

Challenge: Wonderweaves Limited, a prominent player in the textile industry, harbored a formidable vision of achieving 500 crores in revenue by 2024. Propelled by this goal, all the employees were fully geared up and worked smart to get there. Despite the best efforts put in by all the departments, the top management sensed that something was amiss. Individually each one was doing his/her best. Collectively, however, the organization was making only incremental progress and not reaching anywhere. Multiple rounds of discussions with HODs to understand the gap did not yield anything substantial.

Discussion: Recognizing the urgency and significance of addressing the problem, the top management of Wonderweaves Limited, after a careful market study and necessary due diligence, sought the expertise of People and Strategy Consultants, Gateways Global Human Capital Solutions to help figure out the missing piece.

Approach: After doing a thorough organizational diagnosis with our indigenously designed flagship diagnostic tool called OrgEfficience, Gateways Global understood that the company faced a critical challenge in leadership. The leadership team comprised a blend of homegrown talent and laterally hired executives. Demographically, the mix was good but functionally it led to a disparity in perspectives and viewpoints. The lack of synchronization between the two impeded the company's progress and threatened the realization of its ambitious goals.

After internal discussions, deliberations, and putting the team’s collective wisdom to work, Gateways Global curated a carefully crafted three-phase program. The objective of the first phase was to identify the current level of leadership capability. The second was to design and implement interventions based on the outcome of stage one. The third phase was to test the effectiveness of the interventions using specific tools.

Following our unique ICI approach, we did the following:

360-Degree Assessment: To get an idea of where the leadership team stands currently in terms of competencies, we suggested a 360-degree assessment. Also known as a full cycle assessment, this is an evaluation tool designed to gather feedback from various sources such as self, peers, supervisors, subordinates, and clients or customers. This comprehensive feedback provides a holistic view of an individual’s strengths, weaknesses, and areas for development, offering insights into their effectiveness in the workplace from multiple perspectives. To serve the purpose of the assessment, these stakeholders were meticulously chosen to mitigate the risks of familiarity, bias, resistance, fear, confidentiality, and limited engagement.

Theme Identification: Feedback responses from the various stakeholders were aggregated and compiled into individual reports containing both qualitative and quantitative inputs. These reports were analyzed to identify recurring patterns and trends in stakeholder perceptions. They also served to throw light on how the gap between the assessment outcomes was meticulously consolidated into a perception matrix that visually represented each leader’s self-perception vis-a-vis stakeholder perception. A gap analysis was done to identify areas of alignment and divergence.

Feedback: Each participant was given detailed one-on-one feedback in a supportive and constructive manner which helped clear blind spots and correct self-perception in relation to others’ perceptions. It also gave them insights into their own strengths and areas for improvement. This equipped them to prepare an individual development plan.

Color Coding & Relationship Mapping: For easy understanding of the Management, we created a color-coded framework that facilitated a clear understanding of the leadership landscape, highlighting areas for improvement and alignment. Each participant was color-coded as red, green, or blue depending on his/her competency score.

Once each participant was color-coded, we created a comprehensive relationship map, mapping each Head of Department with his/her respective teams. This mapping exercise enhanced clarity and provided valuable context for interpreting stakeholder perceptions, shedding light on the underlying dynamics and influences. Towards the end of the discussion, the hands on-CEO was even able to cite specific instances as to why certain stakeholders would have rated the participants in a certain way.

This exercise also helped the management to focus on teams where strategic realignment was needed to enhance trust, collaboration and mutual value creation.

Coaching: Tailoring our approach to individual competencies and areas of improvement, we designed customized coaching programs. The participants for the coaching program and were carefully selected based on a scientific coachability index. The Coaching team was put through a series of sessions. There was the first round of Team Coaching sessions to bring in team cohesiveness and focus on core development areas based on the 360 feedback. Then they were allotted business-linked projects to enhance collaboration and business focus. This gave them a shared goal to achieve while boosting productivity through synergy. It enhanced problem-solving and creativity. Next came One-On-One Coaching to focus on behavioral changes to enhance potential in the identified areas. This was followed up by the Second Team Coaching session to throw light on how to work around and manage biases. Project Assessment was done next to evaluate the status of the project by analyzing the contribution of self and team. The Second round of One-On-One Coaching sessions followed, and this served to further enhance potential in the identified areas. The third and final team coaching was aimed at establishing a Signature presence.

Effectiveness Evaluation: We used the 180-degree evaluation to test the effectiveness of the training sessions, cross-functional projects, and coaching programs periodically, assessing the impact on the individual’s performance and behavior with stakeholders, and monitoring the individual’s progress toward his goals. Wherever midcourse corrections were felt necessary, we made them, to ensure continuous growth and development.

Outcome: Through our strategic interventions, Wonderweaves Limited witnessed a remarkable transformation in its leadership dynamics. The once disjointed leadership team evolved into a synchronized force, equipped with the necessary skills and insights to drive the company towards its ambitious vision. Specifically, the following areas showed remarkable improvement.

Employee Engagement scores increased from 55% to 78%, indicating a 42% improvement in the overall organizational culture as perceived by the employees.

People’s capability increased in terms of leadership effectiveness scores from an average rating of 6.5 to 8 on a scale of 10, reflecting a 23% improvement in leadership capability. In terms of skill enhancement, the percentage of employees exceeding skill development targets rose from 60 % to 85%, showing a 42% enhancement.

Collaboration- Survey feedback indicated a 40% improvement, measured by the increase in positive responses regarding the ease and effectiveness of working across teams.

Revenue Growth-Prior to the intervention, annual revenue growth was trending at 10%. Post-intervention data showed an increase to 15%, representing a 50% increase in growth rate. As a result of our collaborative efforts, Wonderweaves Limited not only surpassed its revenue target of 500 crores ahead of schedule but also fortified its position as an industry leader.

Conclusion: The case of Wonderweaves Limited exemplifies the pivotal role of effective leadership in navigating internal challenges and achieving organizational goals. Our signature Coaching style of empowerment through insight enables everyone to unlock their full potential through a deeper understanding of their own behaviors and motivations. Hence, it’s a personalized path to success tailored to the unique needs and aspirations of each individual. We strictly adhere to the ICF credentials with its commitment to integrity, understanding, and mastery of coaching skills. These credentials are globally recognized and respected for their high standards of education and ethical practices. By partnering with our consulting firm and embracing a holistic approach to leadership development, Wonderweaves Limited not only overcame its crisis of leadership but also emerged stronger and more resilient in the face of future challenges. As organizations continue to evolve in an increasingly complex and volatile world, investing in leadership development is no longer a matter of choice but an imperative for sustained growth and success.

Many family businesses in India have a tradition of business established for problem-solving and community service rather than just profit. These businesses, grounded in tradition and family, have thrived, endured and grown over generations. But this legacy has not sustained a lot of family-owned businesses in recent years. Now, Venture-capital funded Startups and multinationals (MNCs) have become new challengers for family businesses. These newcomers have shaken up conventional industries and lured talent from family owned business with modern organization and practices.

If family businesses do not change their modes of operating, they will lose market share to MNCs and startups. Working on your family business helping to gain competitive advantage and survivability is the million dollar question today.

Family businesses are recognized for their cohesive, distinctive culture that is largely influenced by the founder’s objectives, approach and philosophy. The result of this culture is harmony between personnel workers, creating stability and dedication to the organization. However, in a turbulent business environment characterized by constant change, family businesses need to ask whether the cultural underpinning behind the family firm is still geared towards productivity.

While in an everchanging business environment where transformations and business model disruptions are a fact of life, every family-owned business must ask itself whether its culture is fit for purpose. The silver lining is that what most affects a company’s culture, health and potential can be measured, so executives can seize new opportunities. As business leaders, we help identify the gaps, and our OrgEfficience tool helps analyse those gaps to arrive at better solutions.

Based on GatewaysGlobal’s experience supporting family businesses, we have regularly observed that successful family businesses particularly flourish because they embody a cohesive, unique culture, which is strongly shaped by the founder’s purpose, approach and philosophy and embraced by the employees. Such cultures unite employees around a shared mission, creating dedicated and stable workforces.

 Purpose and Philosophy

In the early stages of a family business, leaders usually verbally express their purpose to employees. This purpose as guided by the founder philosophy, is a strategic business driving force. This mirrors the underlying core values and decision-making mechanisms that guide daily operations. This strategy may work for smaller businesses, but the need to formalize these elements increases with organizational growth.

Such philosophy should be established, documented, and communicated in writing to ensure that the organization’s philosophy that composes vision, mission, and core values are enforced causing people to change how they behave and think. By having a decisive vision and mission, with significant values, the focus of the organization can be directed towards a specific effort leading to an engaged labor force.

People Management Systems

Family businesses are often resistant to putting in people in strategic roles, such as finance or human resources, who come from outside the family amongst anyone else. Such outdated practice can obstruct building up strong people management systems. Becoming an “employee friendly” organisation is made possible by formal people management systems. Get people management system right, and it can help you hire the right talent, allow meritocracy, make compensation attractive and help in fair system of managing people.

Translating to a modern people management system can help family businesses attract and retain talent, which has always been a challenge. A well-structured people management system not only helps the business assemble a talented team, but also gives the existing family leaders a system to identify and prepare the next generation, ensuring a seamless transition while developing the next generation for leadership roles.

Succession Planning

One of the biggest challenges encountered by family business is succession planning. Many family businesses are eventually passed down, handed down to the next generation. However, while some transitions go smoothly, in the majority of cases, the transition can be fraught with problems if we do not manage the transition process properly. At GatewaysGlobal, we have heard many stories about how succession planning has led to disappointment among senior leaders, who often feel overlooked and pushed to the side.

Succession planning is much more than simply filling leadership roles with family members. What it really needs is a holistic plan designed to accommodate the unique needs of a specific family business advisory and to help ensure a seamless succession, as well as to ready the next generation to take over the reins. Family businesses need a succession plan, striking the right balance between the interests of the present-day leaders and those of the next generation.

Conclusion

Today’s dynamic business environment leaves family businesses management of their own. But if they devote themselves to developing a strong vision, mission and values, building robust people management systems and designing clear succession plans, these businesses can happily navigate modern market landscapes and ensure their continued success.

Using a simple but powerful framework, GatewaysGlobal helps family businesses articulate their current culture, identify elements they may want to change and track progress toward a new vision, mission and values.

Considering the uncertainties of today’s economy, family businesses are grappling with a unique challenge of balancing traditional values with the necessity of both innovation and competition. Good governance can bring that balance, as businesses can protect their culture while seizing new opportunities. Our research indicates that without governance structures, there is confusion and reduced growth. Below are some of the key reasons why a governance structure is not only beneficial for family businesses in maintaining their innovative edge, but also vital to ensure they honour the mission and vision of the founders:

Setting Up Clear Governance Structures

It all starts with a solid governance base within family businesses, in the form of a family constitution or a succession plan. These models give extrapolated structure around which to build roles, responsibilities, and decision-making processes, permitting leadership an opportunity to innovate whilst unburdened from operational challenges. Smoothly transitioning businesses to the next generation can keep companies relevant to changing marketplace conditions, and true to established principles.

Fostering Open Lines of Communication

Family businesses in which family and non-family members can talk freely with each other become places of innovation. Good communication structure makes meeting regular and feedback channels clear to avoid misunderstanding and let ideas flow freely. Alignment guides innovation, so that when you identify and slot strategy into your goals, you can bring in people and ideas to integrate with your company philosophy.

Growing While Defending Family Interests

Policy frameworks help separates matters of personal and business interest to create an environment where decisions are made based on the organization’s long-term needs as opposed to family influences. This separation frees those businesses up to focus on innovation and growth, safe in the knowledge that the company’s strategic decisions won’t be made on a whim or in pursuit of some personal gain in the short term, but with one eye on the future. The two need to be separated to allow the family to continue to function as a unit with an eye towards sustainable growth.

Championing Diversity and Inclusion

So, in a climate of well-structured governance framework, diversity and inclusion thrive which are the key drivers of innovation. Family businesses that value a range of viewpoints have a better chance at producing innovative responses and responding to shifts in the marketplace. Offering a platform for diverse perspectives adds a layer of innovation that supports the mission of the company rather than undermining it.

Embracing Modern Technology

The legacy of many family businesses lies at the intersection of tradition and innovation—one where modern technology is integrated into governance frameworks to improve decision-making and operational efficiency while staying true to core values. Leading companies combine artificial intelligence and data analytics to provide actionable insights, automate tedious tasks, and forecast market trends, enabling leadership to leverage their time for visionary thinking. Governance that encourages new technologies allows enterprises to outpace their competition without losing touch with their traditions.

Conclusion

Such trading in family businesses management is near inevitability in this hyper-competitive business landscape where a proper governance structure should be essential to keep family businesses thriving — without compromising the legacy and values that have defined them all these years. It allows these businesses to direct their energy towards innovation and growth, rather than get derailed by internal issues.

Visit GatewaysGlobal LLP to Learn More on How Governance Can Benefit Your Family Business!

The experience of working with a new client recently gave us a first-hand feel of how the achievement of Organization suffers when the employees are not aligned with the organizational goals and vision. Be it alignment of the organizational vision, employee engagement or a positive work atmosphere, effective communication is quintessential for an organization.

To understand the importance of that, we will dive into this subject with the help of a case study. Consider a case study wherein TechnoJungle Innovations, a mid-sized IT Services firm, was able to successfully implement a holistic communication channel to handle pain points around vision casting, employee engagement, morale and loyalty.

Background: TechnoJungle Innovations had a few challenges such as the disconnect between organizational vision & departmental goals, low employee engagement, declining morale, and increasing turnover. In response to those issues, the leadership team brought in GatewaysGlobal team to implement a new communication channel aimed at creating better clarity, engagement, and employee satisfaction.

Path: Developing strong communication channel that is in line with function goals, which increases employee engagement to improve morale and loyalty across the bottom line.

Methodology

My consultants used their OrgEfficience – an Assessment tool designed and used by them to understand the processes, policies, procedures and systems of the organization in 5 days. Our tool is used for assessments diagnose organizational problems like; understanding of organization goal, employee engagement, understanding of HR policies, grievance management, workflow inefficiencies, team dynamics, effectiveness of leadership, etc.

An in depth report from our Consultants after the assessment. The following is a list of known issues / concerns.

1. Some communities offer data on their organisational structure and hierarchy.

• Top-Down Communication: Communication was predominantly top-down; employees were disconnected or unaware of decisions and changes. Somehow the communication did not / l the Project Managers / Team Leads (middle management) level in the organizations
• Siloed Departments: The majority departments worked in silo’s. Lack of collaboration among department.

2. For more than five hundred thousand staff, unfortunately, our channels of communication suffer.

• Poor Tools: Most communication used to happen on emails. The organization employees were using a common ID’s for emailing which created communication gaps and created gaps within employees – some updated about the changes in the organization and some un-updated.
• No Standardization: There were no communication standards, so the grapevine communication was at its best. “It was not clear how or when employees should share information.

3. Issues in Leadership and Management

•   Bad Middle Management: The middle managers were generally not the best communicators. They were in the organization for a long time so they faced difficulty in communication in new age mode.
•   Inconsistent Messaging: The Project Managers / Team Leads were giving inconsistent or unclear messages which resulted in a lot of confusion and dissatisfaction.

4. Employee Engagement & Staff Morale

• Disengagement: Because employees had absolutely nothing that they knew about the organizational mission, expansion plans, etc., they become disengaged or dissatisfied with their roles. In the end, it resulted in them being less involved in most of the engagement processes.
•   Risk of Backlash: Employees held back their voice and did not share their opinions considering that the organization was not aware of policies. They were concerned that, if they approached them directly, there would be repercussions from the management.

Conclusions

At GatewaysGlobal, we understand that every organization is different – each organization, like humans, has a unique DNA. That is why we think outside the box and develop custom solutions for each client that we service. There were a myriad of steps we took to resolve this that included vision alignment workshops, Townhall, Newsletter, was to have a performance management system in place, running engagement programs, and getting involved with Cross Functional Teams. While these initiatives contributed towards greater employee engagement, improved morale & loyalty, the results were also visible on TechnoJungle’s bottom-line which had stagnated for 3 consecutive years.

Are your employees aligned to your organization’s vision? Avoid falling into this trap and let communication overcome the barriers. Utilizing Enneagram and other psychological tests, co-create systems and processes customized for the collective energy of the group are relatively fast to execute. Together, let’s transform your organization. Contact us today!

In the modern competitive landscape, organisations are attempting to perform at a high level to remain ahead in the race. These can lead to inefficiencies despite their best efforts and are a barrier to growth, productivity, and profitability. This can cause wasted resources, ineffective results and low morale among your employees.

To address these issues, organisations will require a formidable solution that enables the diagnosis, analysis and optimisation of their performance. The tool is known as OrgEfficience and is indigenously built by GatewaysGlobal, which aims to assist organisations in identifying gaps; address the areas of inefficiency; align their strategy and processes to achieve peak performance.

In our experience, Various Top 4 challenges are blocking organisational efficiency of one or the other organisation – As a reliable consulting partner for numerous organisations, we have observed these 5 factors which most of the organisation is facing.

1. Poor Communication

It is misunderstanding, mistakes and delays that are often caused by better communication or poor communication channels. When teams aren’t aligned on goals or processes, they end up duplicating efforts or losing critical details. Miscommunication causes ripples throughout the organization, affecting decision-making capabilities and reducing overall efficiency. Transparent communication is the most crucial element when it comes to a team sharing information and collaborating on tasks without ambiguity.

How does OrgEfficience help: OrgEfficience assesses where people, processes, and strategies align, what gaps in communication exist between annexes, and prescribes steps that can facilitate smooth and transparent collaboration. It is thus an important step towards building an environment of collaboration and communication, both through departments and levels.

2. Lack of Employee Engagement

Lack of motivation employees can make them less productive, which negatively contributes to overall performance. Employees who see themselves as disconnected from the organization’s mission or are convinced that their work is not valued have lower engagement.

This disengagement can lead to increased turnover, decreased morale, and reduced innovation. To maintain productivity, organizations must develop an environment in which employees feel empowered and essential to the company’s success.

OrgEfficience: Reconciling People and OrganisationHow: It helps you in knowing where your employees feel disengaged, underappreciated or unsupported. This tool goes beyond the surface to provide actionable insights that, when implemented, enhance employee experience, drive motivation and create a sense of belonging by digging into the culture and leadership practices in your organization. which leads to more audience involvement. These insights enable organisations to implement targeted strategies to enhance employee engagement, retention and overall well-being, which can ultimately contribute to business success

3. Inefficient Processes

Workflow systems can be quite restrictive too—outdated practices, duplicate entering of information, or lack of clear procedures can impact efficiency greatly. Time is wasted. Tasks are done that no longer add any value. Tools and methods that are past their prime are battling the team. This results in organizations wasting time and resources, since there is no process optimization. Conduct regular reviews and updates to workflows and eliminate bottlenecks as they appear.

Our Solution: OrgEfficience is here to help, identify processes that are draining precious resources, and frustrating employees. By analysing workflows, procedures and systems, the tool highlights areas of redundancy, bottlenecks and waste, offering a clear roadmap for process optimisation. Organisations can use these insights to remove redundant/redundant steps, automate manual processes, and reimagine workflows to achieve higher efficiencies, cut costs and increase customer satisfaction.

4. No absolute objectives and guidance

If employees do not fully understand what they are working towards, or how their tasks contribute to organizational success, motivation decreases. Without clear goals, employees will feel like they are in a vacuum, not understanding the larger purpose of their work. Such misalignment results in useless expenditure of resources and energy, as people or teams may chase contradictory or irrelevant objectives. Having clear, attainable objectives to strive for can help steer efforts and keep everyone aligned.

OrgEfficience: How OrgEfficience Helped: Our tool identifies a gap between organisational strategy and objectives, and day-to-day operations, to clarify the goals and direction of organisations. It assesses the organisation’s mission, vision and values, and its goal-setting process to identify gaps and misalignments. Organisations, with this knowledge, can articulate their mission, define their outcomes in a simple and achievable way and ensure that everyone is aligned to the same strategic priorities. They have then practice by doing this they will bring clarity and allow themselves to really drive focus, productivity and ultimately better results.

5. Poor Resource Allocation

Poor resource management—be it time, money or people—can quickly create bottlenecks and block progress. Overworked, underfunded and unprepared teams fail to deliver results. Properly managing resources means that each team has what they need to accomplish their goals. Organizations should take a step back to regularly assess where their resources are going, and course correct to make sure that the people, time and money they have at their disposal are being most effectively deployed to drive performance.

How OrgEfficience Assists: This tool provides visibility to make poor resource allocation, which is a major roadblock for achieving business objectives, visible. The tool identifies inefficiencies and misallocation and waste by analysing how resources such as talent, technology and budget are being employed. Salvaging this information, organisations can redistribute resources in accordance with strategic priorities, removing waste and optimising investments made on people, processes and technology. Organisations can maximise ROI by taking informed decisions on making resource investments with an aim to improve productivity and enable sustainable growth.

All of the above pain points may feel absolutely debilitating and when they come together, you feel like you are being pulled in the opposite direction of what you want. But, imagine if you had a tool at your disposal that would allow you to overcome these issues and leverage your organisation to its fullest potential? OrgEfficience does exactly that and by utilising our propeller tool you can help to streamline processes, remove ambiguity on goals and direction, and improve engagement and productivity.

The debate about whether family-owned businesses or non-family-owned businesses perform better has been ongoing for years. While family-owned businesses are often praised for their long-term vision, unique culture, values, commitment to quality and community involvement, non-family businesses are often credited with their professional management, scalability and adaptability. The crucial question to ask is which type has the edge when it comes to performance.

Many businesses in India are Family-Owned (FO) and Family-Run (FR). Family Business Advisory consultants  operate differently from other organizations because they consist of family and business. The family’s primary concern is the care and raising of family members, while the business’ main concern is the production and marketing of goods and services. Although the family and the business are separate institutions, in principle, there is always competition between business and family.

A persistent question in management research has been: which type of business is better, the family-owned or the non-family owned? An alternative question which in this respect can also be asked, is in the light of the PERFORMANCE.  Which type of business is more likely to become and stay high performing, the family-owned or the non-family owned?

According to researchers, the way to define a high-performing organization has always remained challenging and subjective especially when there is a comparative study between  Family & Non-Family run businesses. Most of the studies give mixed results and conflicting responses.

Drawing from GatewaysGlobal’s experience, we have been able to say that the organizations which have got the ability to recognize the need to adapt to the surroundings in which it operates can be considered as High performing organization. These organizations can quickly and efficiently change their operating structure and practices to meet needs, focus on long term success while delivering on actionable short-term goals, that are flexible, customer focused and able to work highly effectively in teams. The culture and management of these organizations support teamwork, diversity and adaptability to the environment.

Organizations spend much more time on continuously improving their core capabilities and invest in their workforce, leading to increased growth and performance. High performance organizations are sometimes labelled as high commitment organizations.

The answer to the question that has been raised earlier about Family-Run & Non-Family-Run business in becoming and staying high performing needs bit more delving into the differences in the way how a family and non-family businesses deal with the factors of high performance.

In a traditional Indian family-run business, the key bottlenecks that hinder the organization from becoming a high-performing entity can be categorized into six main areas, such as:

1. Organizational Design

Most Family Business consultants find that traditional family-run businesses operate with strict hierarchies, making it difficult for cross-functional collaboration. There are always some kinds of undefined barriers between functional units. Sharing of information across levels is constantly challenging in both bottom up and top-down processes. This is particularly evident in organizations that are dependent on multiple family stake holders handling the business.

2. Organization strategy and vision

A common understanding of the organizations strategy and direction is shared among only a set of employees at higher levels. Vision, values, and mission statements which guide their organizations are not clearly defined. Even though they are defined the statements may not be specific, strategic, and carefully crafted.  One of the bigger challenges in most of the traditional family run business is that during the growth stages the vision, and values of the organization which act as foundations on which the organization is built is not sufficiently communicated the across the organization. Reward and incentivized behaviour may not be in line with the organization’s goals. They may not be any reward programs or systems that aim to benefit employees who follow the values of the organization.

3. Family Leaders

In a traditional family run business, one can identify that leaders (family owners) closely monitor or supervise their teams. Leaders are more concerned about day-to-day administration concentrating on the short-term results and will take more hands-on approach even into small operational issues. They act more as supervisor upon their team members by instructing every aspect of the project at hand. The leaders expect their team members to adjust to their leadership style irrespective of the needs of their team members. Leaders are not consistent with the values they propagate which tends to create a reduced sense of belongingness among teams.

4. Employee Teams

Employee teams mostly depend on family managers or owners to set schedules, manage quality, and solve problems. Teams struggle to share information across levels of the organization and are continually under direct supervision of owner managers. Members of teams have limited autonomy and idea input, ultimately reflecting in less job satisfaction, and operating at lower potential. Team members who are part of such family run business show little personal commitment to growth and success of the team as well as the organization.

5. Innovative Practices

Information sharing is not streamlined via communications channels even though there may be a set up with state-of-the-art information technology. Internal communication is restricted, and open exchange of information is considered as a misconduct. There is very little focus on improving products, manufacturing processes, or services in order to gain a competitive advantage. Any improvement models or systems (Like TPM, TQM, Six Sigma, Process re-engineering) are seen from cost incurring perspective.

Even when it comes to hiring of new employees, there is very little involvement of managers or department heads in hiring of their team members. Certain family run business limit their HR systems to administration purposes and may not allow them to focus on implementing skill & ability development programs. It is typical for these kinds of organizations to have high rate of skilled employee attrition.

6. Flexibility & Adaptability

Failures in family run business are majorly due to their inability to have structures in place that allow them to quickly adjust to the environment that they operate within and the ability to reconfigure themselves to meet the demands of the marketplace is one of the biggest challenges faced by these entities. There is no structured systems or process which can survey and monitor the environment to understand the context of their business, identify trends, and seek out any competitors. Traditional family run business l have a low external orientation, less focus in meeting customer demands and developing close relationships with customers, not giving importance to understanding their customers’ values, and needs.

We GatewaysGlobal have developed a tool called ‘Orgefficience’ which can help the family run business to identify the gaps and analyse them for arriving at better specific interventions. The “ICI” approach followed by GatewaysGlobal has helped transforming many family run businesses in management quality, belief and trust in others and fair treatment of all stake holders. The initiatives introduced by us in the organizations improved open culture, long term orientation, safe & secure workplace in terms of physical and psychological aspects.  Unique strategies customised and implemented in each organization have upgraded employee quality and made the organization focus more on continuous improvement which ultimately made the organization a performance driven entity.

In India Family-owned businesses have traditionally been regarded as the engine room of the country’s economy. Our experience showed that family businesses can significantly outperform non-family-owned businesses. However, the family run business must focus more on “Keeping the business performance first” rather than “Keeping business in the family” to become a High Performing Organization.

Ultimately, the key to success lies not in whether a business is family owned or non-family owned but, in its ability, to balance competing demands, adapt to changing circumstances, and make strategic decisions that drive growth and profitability.

Blog courtesy: M Anantha Krishna, Consultant Organisational Performance.

In the bustling city of Kochi, two family businesses, Bright Ltd. and LB Ventures stood at the dawn of a new performance year (company names altered to conceal identify). Each beginning brings an opportunity to reflect on what went right and what did not. So, like most companies, both these companies too conducted their annual reviews. Both operate in the same industry, and both were founded three generations ago. However, they had contrasting approaches to business. Bright Ltd. was led by a visionary and future focused CEO Sheela Bright. LB Ventures was led by CEO Eric John who lacked a structured plan and focused on day -to -day operations.

After the annual review, both companies engaged an external consultant – Bright Ltd. engaged the consultant with the primary goal to double the turnover by the next financial year. LB Ventures engaged the consultant to find out why the company had failed to reach the financial target for the current year. Coincidentally, both companies engaged the same consultant – GatewaysGlobal Human Capital Solutions.

GatewaysGlobal took a deep dive into Bright Ltd. first and then into LB Ventures. They found that despite facing similar market conditions, the two companies exhibited different approaches to all aspects of the business, leading to divergent outcomes. The specific areas where the two companies were different in both approach and implementation were:

1. Strategy Planning at the beginning of the year provides clarity of purpose, direction, efficient resource allocation, and a guiding framework that empowers the business to capitalize on opportunities and navigate challenges in the pursuit of sustainable growth.

By staying ahead of market trends, and proactively addressing challenges, Bright Ltd. achieved sustained growth, expanded market share, and enhanced brand reputation. Employee morale and engagement were high, fostering a culture of innovation and continuous improvement.

In contrast, LB Ventures relied on historical precedents and short-term fixes, most often guided by immediate concerns rather than long-term vision.

2. Succession Planning ensures a clear roadmap for smooth transition of leadership and management responsibilities from one generation to the next. By identifying and grooming potential successors early on, the family business can maintain continuity and stability, safeguarding its legacy and reputation.

Bright Ltd. made deliberate efforts to identify and develop potential successors within the family. They were seen providing the right education, mentorship, and hands on experience to prepare their potential successors for leadership roles. LB Ventures on the other hand, was seen procrastinating on grooming successors.

3. Financial management at the beginning of the year ensures that funds are directed towards activities that support the family business’s strategic goals. By prioritizing investments and expenditures, the business can maximize its return on investment and optimize its use of capital. By reinforcing commitment to maintaining accurate financial records, adhering to accounting standards and ensuring transparency in financial reporting, the business can build trust with stakeholders and uphold its reputation.

At the start of the year Bright Ltd. meticulously made a comprehensive budget outlining revenue target, expense forecasts and investment priorities. This allowed them to align their financial resources with strategic goals and anticipate potential challenges. They also implemented a strict cash flow management system. They closely monitored their receivables and payables, negotiating favorable terms with suppliers, and maintained adequate reserves. As a result, they could sail through fluctuations in cash flow without facing liquidity crises. They also conducted thorough financial analysis and feasibility studies before making any major investments. Through their prudent tax planning-leveraging tax incentives and optimizing tax structure through legal means, the company reduced its tax burden while ensuring regulatory compliance.

LB Ventures on the other hand lacked a coherent budgeting process, leading to inconsistencies in financial projections and resource allocation. They struggled to prioritize expenditures. They paid little attention to cash flow resulting in delayed payments to suppliers, missed opportunities and strained relationship with creditors. Neglecting tax planning led them to miss potential tax savings opportunities. Their lack of attention to tax compliance exposed them to penalties, further straining their financial resources.

4. Governance & Decision Making promotes transparency and accountability within the family business. Clearly defined roles and responsibilities and decision-making frameworks ensure that decisions are made by authorized people and that they are held accountable for their actions.

Bright Ltd. had established a clear governance structure that defined roles, responsibilities, and decision-making authority within the family and business. This facilitated transparency, accountability, and efficient communication. Moreover, their decision making was based on data driven insights and inputs from various stakeholders. Regular board meetings and management reviews provided for risk assessments and course corrections as needed. They also had an effective conflict resolution mechanism which minimized disruptions and maintained harmony in decision making process.

LB Ventures lacked a clear governance structure resulting in role ambiguity leading to conflicts and power struggles and hence inefficiencies within the organization. Decision making was based on impulse and emotions rather than strategic considerations. This created tension, distrust, low morale, and low productivity.

5. Communication Architecture is crucial for creating a solid foundation for businesses. Clear and consistent communication channels, both horizontal and vertical facilitate dissemination of information about business goals, core values etc. it also enables unity and shared purpose among family members besides ensuring that relevant stakeholders are consulted, informed, and involved in key decisions. It preserves family harmony and cohesion by enabling family members to address conflicts constructively. Effective communication between the management and employees is possible, the business can solicit feedback, recognize achievements, and address employee concerns leading to enhanced employee morale and productivity. Strong customer and client relationships, loyalty and retention which are the cornerstones of a successful and sustainable business require an effective communication architecture.

Bright Ltd. had created a strategic communication framework to foster transparency, alignment, and collaboration within the organization. There were both vertical and horizontal communication channels to share ideas, concerns, and feedback periodically. Regular town hall meetings, employee forums and suggestion boxes facilitated two-way communication and promoted a culture of engagement and inclusivity. Communication guidelines to ensure consistency, clarity and effectiveness in internal and external communications were laid down. Regular updates and reporting mechanisms kept stakeholders updated about the company’s performance, initiatives, and key developments. All this helped in creating transparency and hence trust among employees, customers, and investors.

LB Ventures relied on ad hoc communication practices resulting in misunderstandings. The lack of effective communication channels led to silos, miscommunication, and lack of alignment between different departments and stakeholders hindering collaboration. There were no efficient reporting mechanisms leading to confusion, uncertainty, speculation, and trust erosion.

6. Risk Management is important as substantial family wealth is locked up in the business. Addressing them proactively can sustain business and ensure continuity apart from minimizing the risk of disruptions.

Bright Ltd. had a proactive risk management strategy comprising of regular risk assessment across all functions, risk analysis of the impact of the risks so identified, risk mitigation to reduce the likelihood and impact of such risks, and risk monitoring to track and monitor key risk indicators and early warning signals. They fostered a risk aware culture throughout the organization embedding risk management into day-to-day operations. As a result, they encountered their risks efficiently safeguarding business continuity and reputation.

As for LB ventures, their approach to risk management was fragmented and ad hoc with little collaboration between departments. Rather than taking a holistic view of their risk landscape, they exhibited knee jerk reactions to immediate threats. This myopic view exposed them to systemic risks undermining their long-term viability. As a result of this, they experienced increased volatility, and uncertainty in a dynamic business environment.

7. Customer & Market Analysis helps identify and capitalize on new market opportunities like niche markets, underserved markets and areas of growth which helps in defining their marketing strategy.

Bright Ltd. crafted a customer centric approach to market analysis; they conducted a thorough customer segmentation to identify distinct customer groups with unique needs, characteristics and buying behaviors. They utilized demographic psychographic and behavioral data to tailor their marketing strategies, product offerings and customer experiences to different segments. They also invested in market research to gather insights on market trends. They used a prudent mix of qualitative and quantitative market research methods like surveys, focus groups, interviews, and data analytics for informed and data driven decision-making. They developed a compelling value proposition based on a deep understanding of customer preferences, pain points and aspirations. They positioned their products as solutions to these needs as compared to that of their competitors. They proactively took customer feedback and incorporated relevant inputs into product features. They regularly benchmarked their performance against industry peers and monitored competitors’ pricing strategies.

As a result of their customer-centric approach, they were able to build strong customer relationships and were agile enough to respond to changing market conditions without major disruptions.

LB Ventures relied on assumptions rather than data driven analysis. This resulted in generic marketing strategies that failed to resonate with target audiences. Their market research was ad hoc often resulting in superficial analysis that was of little use to drive the business. Rather than having a compelling value proposition, they sought to do product centric messaging that failed to differentiate them from their competitors, much less address their preferences or pain points. There was no customer feedback mechanism which deprived them from getting a solid understanding of their customer satisfaction levels. Such a reactive approach made them vulnerable to market disruptions, have a weak customer connect resulting in value -erosion for both the customers and the business.

8. Talent Management

Bright Ltd. was able to attract, retain and develop top talent because of its future focused approach. They conducted regular assessment of the current and future talent needs. Critical roles and skills for future success were identified and they framed strategies to fill the current gaps through recruitment of fresh talent or upskilling of existing ones. They invested in them through workshops, team, and individual coaching. Recognizing the importance of continuity in leadership, the company identified high potential employees and provided them with opportunities for leadership development. By grooming future leaders from within, they ensured a smooth transition across generations. They also ensured a culture of empowerment.

LB Ventures was observed to rely on ad hoc recruitment activities and allocate minimum resources for employee upskilling or leadership development. So, there were evident skill gaps. There was no focus on identifying and grooming future leaders from within, leading to instability during leadership transitions. Due to this lack of investment in talent development, they experienced high attrition especially at senior levels.

9. Family Values & Culture should be the anchor that holds the family and business firmly rooted. Its very identity is bestowed by the values that it espouses. By embodying values like integrity, trust, responsibility and empathy, enduring relationships can be built enhancing goodwill and reputation the market.

Though both companies were rooted in family ownership, their approaches to endorsing and integrating family culture and values into their organizational ethos varied significantly. Bright Ltd. prioritized the preservation, promotion and integration of its family heritage and values by commemorating and honoring them at appropriate forums and family events instilling a sense of pride. They integrated their core values – integrity, respect, honesty, and trust – into decision-making at all levels of the organization- employee relations, customer interactions, strategic planning etc. They also had a family governance structure which formalized roles, promoted transparency, and formed the basis of conflict resolution and succession planning.

LB Ventures though takes pride in their family heritage and values was seen struggling to align family values with organizational practices. The inability to formalize these core values and weave them into the overall organizational fabric led to inconsistency and confusion among employees. This disconnect also resulted in a fragmented organizational culture and low employee morale. It deterred top talent from joining the organization.

In conclusion, it may be said that having a strong start is a necessity and no longer an option. The CEO of Bright Ltd. had meticulously crafted a robust plan at the beginning of the year that aligned with their long-term goals. Hence it was easy for them to review it at the end of the year and take stock of what went right and what did not. The CEO of LB ventures had a myopic view with a focus on day-to-day operations only. There was no concrete plan. Hence at the end of the year there was no clarity on what they had set out to achieve.

There could be other factors too like technology, administration, logistics and business development to mention a few. As people and strategy advisors, GatewaysGlobal observed that the above-mentioned were the fundamental areas that differentiated the two companies.

Would you like us to unlock your organization’s full potential with expert diagnosis? If so, we are just a click away. And it is not just another assessment, it is a transformative journey….

Sheela Warrier
Consultant- Organisational Performance

The collaboration between the Finance and Human Resources (HR) departments is becoming increasingly important in today’s business environment for the success of the organisation. Given the dynamic nature of the corporate environment and the increasing value of human capital, this kind of collaboration is especially important for Indian enterprises. Though finance and HR have always been seen as separate departments with different goals, their confluence has become essential for making strategic decisions, encouraging innovation, and promoting long-term success.

In the past, the departments of Finance and Human Resources have worked independently, concentrating on their specialised fields of employee relations and financial management. However, a more integrated approach is now required due to the changing corporate landscape, which is characterised by rapid technological breakthroughs, altering demography, and changing regulatory frameworks. These days, businesses understand that accomplishing organisational goals depends on the efficient administration of both people and financial resources.

Drawing from GatewaysGlobal’s experience working with family businesses over the years and through our approach ICI in consulting, in here we are narrating our observations and suggestions.

Talent acquisition and retention are two important areas where collaboration between HR and finance is showing up. Financial data and analytics are becoming more and more important to HR professionals in their efforts to draw and keep top personnel. The collaboration between HR and finance in talent acquisition and retention can be exemplified through various scenarios.

1. Budget Allocation for Recruitment Campaigns: Here, the finance department can provide insights into the available budget for such campaigns based on the company’s financial health and objectives. For instance, if the company is aiming for aggressive growth, finance might allocate a larger budget to HR for recruitment efforts.
2. Determining Compensation Packages: When HR is devising compensation packages for new hires or existing employees, they can collaborate with finance to ensure that the offers are competitive yet financially sustainable for the company.
3. Analysing ROI of Recruitment Initiatives: HR can work closely with finance to evaluate the return on investment (ROI) of various recruitment tactics. They can analyse the cost per hire, time to fill positions, and retention rates to determine which recruitment strategies are most effective in terms of both acquiring talent and minimizing financial costs.
4. Aligning Hiring Practices with Financial Goals: HR professionals can collaborate with finance to ensure that their hiring practices are aligned with the company’s financial goals.
5. Employee Benefits and Incentives: Finance can provide insights into the financial implications of different employee benefits and incentive programs. For example, when HR is designing employee benefit packages or incentive schemes, they can consult with finance to ensure that these initiatives are financially viable and contribute to the company’s overall growth objectives.

The establishment of a culture of employee engagement and growth is another area greatly aided by the coming together of finance and HR. To determine their efficacy and justify investment, HR initiatives including training programmes, career development pathways, and performance management systems need financial analysis and support. HR and finance can work together to make sure that resources are used effectively, optimising the return on investment in employee development programmes and coordinating them with the strategic goals of the business. Let’s say the HR department proposes implementing a new training program for employees to enhance their skills. Before proceeding, they need to analyse the financial implications of such a program. This could involve calculating the costs associated with hiring trainers, developing training materials, and potential lost productivity during training periods.

Compensation and benefits management is another crucial area of cooperation between HR and finance. Financial performance and employee satisfaction are highly impacted by salary structures, incentive programmes, and employee perks. Financial and HR professionals working together can create pay plans that balance affordability with market competitiveness. HR can customise pay plans to draw in and keep talent while upholding financial responsibility and guaranteeing consistency with the organization’s financial objectives by utilising financial information and insights.

Further, personnel planning and resource allocation are areas in which finance and HR collaborate. Businesses may foresee their future talent requirements and allocate resources appropriately by combining financial projections with HR analytics. Companies can effectively traverse transitions such as entering new markets, introducing new products, or reorganising their organisational structure by coordinating their efforts in finance and HR. This helps to optimise resource allocation and minimise risks.

The collaboration between finance and HR takes on even more importance in the Indian corporate environment, where talent scarcity, complex regulations, and volatile markets presents certain challenges. Businesses that operate in highly skilled talent-dependent industries like financial services, pharmaceuticals, and information technology stand to gain a great deal from a collaborative approach between these divisions. Indian businesses may strengthen their competitive edge, promote innovation, and maintain long-term growth in a market that is becoming more and more competitive by utilising their HR and financial know-how.

But good coordination alone won’t suffice to achieve finance and HR partnership; organisations must undergo a culture transformation. Establishing a culture of mutual respect, trust, and open communication among various roles is crucial for companies to promote cross-functional collaboration and knowledge sharing. Investing in technological platforms that combine HR and financial data can help departments work together more easily and make data-driven decisions.

In conclusion, for Indian businesses hoping to prosper in the dynamic economic climate of today, cooperation between finance and HR is a strategic must rather than an option. Companies may improve employee engagement, allocate resources more efficiently, and promote sustainable growth by coordinating their financial goals with their human capital plans.

The future success and resilience of organisations will also be greatly influenced by the development of synergy between departments, as their roles continue to change. We at GatewaysGlobal understands these changing needs and also that every organization needs tailor approach, we are here to help you in achieving the organizational goal.

Mr. Shehzan P P
Senior Associate Consultant