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Past Issue • Jan-Mar 2014

Ensuring Family and Business Continuity at India’s GMR Group

In an engaging tale about the Indian family business behemoth, the GMR Group, Professor Kavil Ramachandran, Professor John L Ward, Rachna Jha and Sachin Waikar, look at the multifarious issues that underpin family businesses. The GMR Group had reached great heights of success, but disagreements and confl icts among family members threatened to hamper its progress. To counter this, GM Rao, group founder and Chairman, spearheaded the creation of governance structures and a family constitution that would serve the purpose of an organisational blueprint for current and future generations.

By 2010, GMR Group, a multi-billion rupee diversified family business, had achieved spectacular success. With soaring net assets, leaping profits and international markets beckoning, the business was happily situated. Its executive team consisted of GM Rao (59), founder and Chairman, his two sons, Raju and Kiran, both in their 30s, and son-in-law Srinivas Bommidala (SB), who was in his mid-40s. Rao knew that the executive team had to work like a well-oiled machine for future growth. He invited external consultants and globally reputed family business experts to work closely with the family to develop a family constitution that would act as the blueprint for organisational governance. Building the constitution was in itself an arduous task that spanned hundreds of hours over several years, but ultimately, implementing it would be the real test: dependence on external expertise was to be gradually reduced and family executives were expected to become selfreliant in resolving conflicts.

ABOUT THE AUTHORS

  • Kavil-feb7

    Kavil Ramachandran

    Executive Director, Thomas Schmidheiny Centre for Family Enterprise, ISB
  • Professor John Ward,Center for Family Enterprise, Kellogg Gr

    John L Ward

    Clinical Professor of Family Enterprise and Director of the Centre for Family Enterprises at the Kellogg School of Management, Chicago (US).
  • Rachna

    Rachna Jha

    Formerly a research assistant at the Indian School of Business (ISB).
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