How exactly does the GMR group hope to avoid bitter succession battles? Rao quotes from an internal presentation, which says that there is only a 2 per cent chance of today’s founder driven family business remaining intact for 100 years when it is in its fourth generation. Rao firmly believes this. He also believes that no succession planning can be complete without involving the women in the family and setting up specific structures to resolve their differences. All business families know this for a fact, but rarely address it directly.

After several meetings, deliberations and presentations from top management consultants, the group draws up a clearly articulated set of rules and governance practices for dealing with every issue or dispute that may crop up within the family and create a mechanism to deal with it. These address issues such as management succession, ownership succession, control and power sharing.

P M Kumar a family advisor collated all these issues and Peter Leach, a London based family business advisor was asked to draft the Family Constitution, which each family member has reviewed and agreed to adhere to.

The starting point was a Family Business Board that worked upon a three-year strategic plan, which identified businesses the group should remain in, and which to exit. The entire family has committed to certain core values and a willingness to manage differences. It has also laid down policies on all family and business matters including consensus in decision making, media policy, code of conduct and the process of inducting family members into the business as well as providing for those who do not want to enter the business.

... contd.