A Family Business Focus
- By Jon Reidel
"No wise person would ever work for a salary." Those were words of warning Pramodita Sharma recalls her grandfather sharing when she told him of her decision to pursue a career in education. To her grandfather, being one's own boss and staying in their family business in northern India were the keys to a good life.
It was a life Sharma was used to. Starting in grade five, she helped with accounting at her father's automotive dealerships. At the age of 15, when her father passed away, she continued accounting work with extended family, selling "anything with wheels."
Although she left the family business to pursue a passion for education and research, family business has not left Sharma. Today, she's a leading scholar on the topic, a research spark begun in her childhood but reignited in grad school at the University of Calgary.
“I was working on a project with a million-dollar grant marked solely for family business,” recalls Sharma, who came to UVM last year from the John Molson School of Business at Concordia University in Montreal. “I was told to do a literature review, and I started reading these articles and I thought, 'They’re talking about my family.’ It was after so many years that I found the literature that actually spoke to me, that was actually more reality to me than anything else that I had studied."
It was a fledgling field at the time, but over the years Sharma has helped define it. Her book Entrepreneurial Family Firms (2010, Prentice Hall) is one of the most widely used college textbooks and has been translated into Mandarin and Greek. She’s also editor of the journal Family Business Review and serves as director for the only global applied research initiative on family business studies, Successful Trans-generational Entrepreneurship Practices at Babson College, a group with 41 partner institutions in 35 countries and more than 180 scholars. Sharma, along with three other editors, just finished the second edition of A Review and Annotated Bibliography of Family Business Studies, which annotates every article in print on family business. She’s also one of three editors working on the Handbook of Family Business Studies scheduled for release by Sage Publications in 2013.
“Dita brings a unique dimension to our group as a leading authority in the area of family enterprise,” says Amy Tomas, a senior lecturer in the School of Business Administration. “Her energy and enthusiasm for this work has been contagious. In fact, a number of us on the faculty and staff are already collaborating on exciting initiatives Dita has put forward in her first months here, including the first ever global family enterprise case competition here at UVM next January.”
The 2013 UVM Family Enterprise Case Competition is the first of its kind dedicated to family enterprise and will bring as many 15 teams to UVM from Argentina, Spain, Mexico, Thailand, Japan, Canada and England, among others. Graduate and undergraduate teams will analyze and present at least three cases to a panel of expert judges with the winning team receiving $2,500 and division winners $1,000 each. UVM recently formed its first case team as part of an initiative by business school dean Sanjay Sharma, who is married to Pramodita, that placed fourth at the HEC Sustainability Challenge at Concordia.
Other initiatives spearheaded by Pramodita Sharma include the “UVM Family Business Awards” and the “UVM Pitch Competition,” both scheduled for Homecoming Weekend on Oct. 4-6. The awards, organized by the Family Business Initiative, will recognize UVM alumni and Vermont-based businesses that have demonstrated a commitment to creating sustainable business through leadership and innovation. The Entrepreneurial Club is organizing the Pitch Competition, made possible by a $100,000 donation by David ’86 and Jessica Arnoff. The goal of the competition is to create and present an overall business plan that is comprehensive, realistic and has potential value. Five finalists will present their ideas to prominent alumni and members of the business community to compete for cash prizes toward their entrepreneurial innovation.
Sharma teaches two new classes on “Entrepreneurship Business Planning” and “Entrepreneurial Leadership” that require students to focus on “making a difference.” The result has been support for the Hope Lodge for cancer patients, finding ways to ship students needed equipment overseas, and the launching of a UVM chapter of Alpha Kappa Psi (AKP) – the oldest and largest professional business fraternity designed to provide educational, social, and networking opportunities for students, faculty and professionals.
Through the generations
Although it was not her own, the decision new generations make to join a family business is of particular interest to Sharma today. She’s finding that the commitment level and reasons why younger generations join the family business tend to fall in four categories: need (can’t find another job), greed (don’t want someone else to benefit from the family business), a desire to contribute (help family and others), and obligation (parental pressure). Sharma and a colleague from Concordia wrote an award-winning theory paper about this topic in 2005 and have collected comparative data in Canada and Switzerland. They are now focusing on whether it matters why someone joins the family business, and if performance varies among these categories.
“We’re asking if it matters why someone joins,” says Sharma, who delivered the keynote address “Governing a Family, a Firm, and a Family Enterprise: How a Family Enterprise can Achieve Sustainability” at the 2011 Asia Pacific Successful Transgenerational Entrepreneurship Practices Family Summit in Kaohsiung, Taiwan. “The first question is will they join; the second is will they stay; and the third is what their performance is like. Surprisingly, we found that the ‘obligation’ people and the ‘desire’ people tend to stay and perform, depending on their abilities and their consciousness. The ones who come for need don’t do well and tend to have no self-confidence and low efficacy. They don’t go away, nor do they perform."
As she delves into these questions about what makes family businesses thrive and fail, her own memories are never far in her mind. "I often relate my research to some of the things I remember growing up. I still find it fascinating.”