Dr. Barbara Ofwono, the founder of Victorious Education Services
Dr. Barbara Ofwono, the founder of Victorious Education Services and Chairperson Uganda Women Entrepreneurs Association has advised family business owners to put in place systems to manage conflict and ensure continuity of the business after the first generation.
On the other hand Ugandan businessman, and entrepreneur as well as Chairman of Simba Group of companies Dr. Patrick Bitature, has asked the MUBS Entrepreneurship Innovation and Incubation Centre to conduct research on how family businesses can survive conflict.
This was during the weekly training series held on July 8, 2021 conducted by the Centre on “Growing a family business”, under the series of how to become a better entrepreneur.
Dr. Barbara Ofwono, the founder of Victorious Education Services
It was observed that family conflicts can ruin family businesses if not properly managed.
When conflict arises in a family business, it is often impossible to separate the family ties from the business relationships. And if the family conflict is not properly managed, it can harm the economy and it can tear families apart, hence theneed to study how family business can survive conflict.
Mr. Bitature however emphasized that patience and humility help family businesses survive for a long time. He commended MUBS for the culture of sharing knowledge during the lock down at the time when entrepreneurs are hungry for business knowledge. Ugandans are waking up and joining forums searching for knowledge which is important to the country.
Meanwhile, Dr. Ofwono who was a guest speaker on July 15, 2021 addressing under the topic “Governance In a Family Business” emphasized that businesses must continue amidst the COVID-19 lock down. Sharing her experience, she loved teaching and after training as a teacher she started setting up schools. She attributes her success to her father who believed in her and identified her talent in teaching.
For 23 years, she has been building Victorious Education Services which currently has five campuses with over 4,000 students and is recognized among Uganda’s Top 100 companies. She shared her experience when she went to one of the banks, for a loan to start her first school and the bank could not give her a loan because her business was not registered.
She did not get annoyed with the bank but rather took the move to register the company where she is the main shareholder and two other shareholders. To manage the business, she has a board of seven members and half of them are not family members. She says putting systems in place ensures that she does not make all decisions alone. Emphasizing the importance of structures in running a family business.
Dr. Ofwono said where there are no proper structures family members become suspicious. Just like any other family business, we have challenges in running the business. Our children keep on saying this is my mother’s business or my father’s business.
We have started designing a board charter and we meet once a month. “I am ceasing to be a CEO, we are working to see that I exit that position and we plan continuity,” she said.
The challenge we face now is succession, how do grow the business from first generation to the next. I am the only lady, other two shareholders are my elder brothers. This puts some challenges when the brothers say I am the elder brother. We have had conflicts but solved them through meetings. We allow the board to do their work.
As founder, I have learned to listen. Management takes decisions and reports to the board. “I play my role as manager, board member and empower others. We have head teachers in the five campuses. I do not call head teachers and disorganize their work. Governance structures have enabled the institution to grow, managers have innovation and thinking space. She advises family business owners to register their business, establish structures such as boards and manage conflicts.
Meanwhile the Principal Prof. Waswa Balunywa in his key note address, noted that for a family business to grow various issues such as conflicts, governance and succession should be well managed.
Prof. Balunywa said putting in place mechanisms to prevent and resolve conflicts in the running of family businesses is crucial for their longevity. Conflicts also prevent good working relationships among family members. It is therefore important to build culture for conflict resolution.
He advised family business owners to appoint experts on their boards. The board members may not be necessarily family members. “The biggest problem in family business is trust. People should know their roles and how they benefit from the business. This can enable growth of the business. Prof. Balunywa also mentioned that good governance was equally important in the success of a family business, defining governance as how a business or company is directed and controlled. Transparency and accountability are key values for the success of businesses. “Family businesses need structures to know what to discuss, who does what, who is in the business. Family business governance is based on culture and values of a family. There is need for exclusivity of family members.
He said that there should be a family business organ such as a family council, constitution, charter to answer questions of family vision, defining what the business wants to achieve and who is participating. The majority of family businesses in Uganda are sole proprietorships, where there is one individual, some are informal in nature, hence making it difficult to make good decisions. In some companies, the wife is not involved in the family business. Some family businesses do not want boards as the man takes all the decisions. In some family businesses boards do not meet leaving the decisions to be made by the founder.
Meanwhile, Dr. Diana Ntamu, the Director MUBS Entrepreneurship Innovation and Incubation Centre explained that many family businesses have not continued overtime after the death of the owner. Therefore, there is a need for proper succession planning to help family businesses to realize their long-term family business need structures to know what to discuss, who does what, who is in the business. Family business governance is based on culture and values of a family. There is need for exclusivity of family members.
MUBS Principal Prof. Waswa Balunywa
He said that there should be a family business organ such as a family council, constitution, charter to answer questions of family vision, defining what the business wants to achieve and who is participating. The majority of family businesses in Uganda are sole proprietorships, where there is one individual, some are informal in nature, hence making it difficult to make good decisions. In some companies, the wife is not involved in the family business. Some family businesses do not want boards as the man takes all the decisions. In some family businesses boards do not meet leaving the decisions to be made by the founder.
Meanwhile, Dr. Diana Ntamu, the Director MUBS Entrepreneurship Innovation and Incubation Centre explained that many family businesses have not continued overtime after the death of the owner. Therefore, there is a need for proper succession planning to help family businesses to realize their long-term family business objectives. “Love is the glue that keeps family together and trust makes it succeed,”
She cited an example of Peacock Furniture a family business that revolved from a grocery, bakery, furniture and recently ventured into real estate and has managed to stand the test of time. Entrepreneurial families should be careful not to force children into the business but rather discover their interests or talents.
Dr. Diana Ntamu, the Director MUBS Entrepreneurship Innovation and Incubation Centre