{"id":106582,"date":"2026-06-25T10:35:04","date_gmt":"2026-06-25T07:35:04","guid":{"rendered":"https:\/\/amlak.net.sa\/?p=106582"},"modified":"2026-06-25T22:58:52","modified_gmt":"2026-06-25T19:58:52","slug":"%d9%84%d9%85%d8%a7%d8%b0%d8%a7-%d8%aa%d9%81%d8%b4%d9%84-%d9%83%d8%ab%d9%8a%d8%b1-%d9%85%d9%86-%d8%a7%d9%84%d8%b4%d8%b1%d9%83%d8%a7%d8%aa-%d8%a7%d9%84%d8%b9%d8%a7%d8%a6%d9%84%d9%8a%d8%a9-%d9%81%d9%8a","status":"publish","type":"post","link":"https:\/\/amlak.net.sa\/en\/106582\/","title":{"rendered":"Why do so many family-owned businesses fail to transition to a corporate structure?"},"content":{"rendered":"<p class=\"wp-block-paragraph\"> The most common phrase that rings out in the business world is: \"We want to transform ourselves.\" <strong><a href=\"https:\/\/amlak.net.sa\/en\/102868\/\" data-type=\"post\" data-id=\"102868\">A corporate entity governed by law<\/a><\/strong>. But the reality is that the desire to transform institutions is one thing, and the ability to achieve and implement it is another. Many founders have succeeded in building large companies that achieved growth and outstanding results over many years; however, some of these companies face a real challenge when they decide to transition from the management model based on the founder to the organized institutional business model.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>A Misconception of Institutional Work<br><\/strong> The problem often lies not in a lack of capabilities or weak capacities, but in the belief that institutional transformation is limited to preparing a new organizational structure, issuing policies and procedures, or changing job titles. While institutional transformation is actually much deeper; it represents an integrated change in the way of working, decision-making mechanisms, and the management of responsibilities.<br>In many successful family businesses, the founder is the visionary, the decision-maker, the experienced leader, and the relationship builder. Over time, the company becomes more tied to its founder than to its systems, procedures, and internal departments. This situation represents the root of the problem and the danger: when the success of the business depends on the presence of a specific person, the company becomes strong with their presence and weak in their absence\u2014which is one of the biggest risks to the sustainability of companies.<br><br><strong>Relying on the system to continue and grow <br><\/strong>True institutional work is the one that can continue and grow regardless of the founder\u2019s presence or absence, because the reliance is on the system rather than on individuals. One of the main reasons for the failure of institutional transformation is that some companies want to build an integrated organization without actually abandoning the individual management style. They prepare the organizational structures, recruit talent, adopt policies and procedures, and then all decisions ultimately come down to one person. In this case, the systems become mere documents, and the organizational structures remain a form without substance, while the way of working remains the same.<br><br><strong>Confusion between ownership and management<br><\/strong>This failure in <strong><a href=\"https:\/\/muqawil.org\/ar\/training\/details\/d1VlbUpIVEZTZ0FuYkZOZGo5SCt3Zz09OjpQ4sIo3bFuBiJokXdeRy7E\">Institutional transformation<\/a><\/strong> It often comes down to a confusion between ownership and management. Ownership is an inherent right of the founder, who is the one who deserves credit\u2014after God\u2019s will\u2014for the achievements achieved, whereas institutional management is a collective and integrated work based on clear authorities, approved regulations, active supervision, and specific responsibilities.<br>One common mistake in this regard is the belief that institutional transformation can be achieved in a short period of time. The reality is that building a foundation is a long journey that requires patience, commitment, and readiness for change, accepting the natural mistakes that accompany any transitional phase, and continuously learning from them. While building systems is relatively straightforward, compliance with them is the real challenge. Writing out the powers is easy, but respecting them when making decisions is the most difficult test.<br><br>From what I have seen, companies that succeed in institutional transformation are not necessarily the largest ones; they are rather the ones that are most committed to the importance of institutional work, the most committed to governance, discipline, and clarity in roles and responsibilities, and the most willing to accept change. Moreover, the presence of an effective board of directors, qualified executive management, clear performance indicators, and oversight and accountability mechanisms all contribute to transferring the company from relying on the founder to relying on an integrated system capable of continuing and evolving.<br><br>Ultimately, the success of companies lies not only in their ability to build businesses and generate profits, but in their ability to maintain what the founders built by building founders who\u2014with God\u2019s help\u2014can continue and grow for future generations.<br>In conclusion: We do not want the success of the work to depend on the presence of a specific person; the company becomes strong with their presence and weak without them.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"> CEO of Asas Mekin Real Estate Development and Investment Company<\/p>","protected":false},"excerpt":{"rendered":"<p><span class=\"span-reading-time rt-reading-time\" style=\"display: block;\"><span class=\"rt-label rt-prefix\">Reading time: <\/span> <span class=\"rt-time\"> 2<\/span> <span class=\"rt-label rt-postfix\">Minutes<\/span><\/span>One of the most common phrases in the business world is: \"We want to become a corporate-governed organization.\" But the reality is that the desire to transform into an institutionalized company is one thing; the ability to achieve and implement it is another. Many founders have succeeded in building large companies that achieved growth and outstanding results over many years; however, some of these companies face a real challenge when they decide to\u2026 <a title=\"Why do so many family-owned businesses fail to transition to a corporate structure?\" class=\"read-more\" href=\"https:\/\/amlak.net.sa\/en\/106582\/\" aria-label=\"Read more about Why do so many family businesses fail to transition to institutional work?\">Read more<\/a><\/p>","protected":false},"author":77,"featured_media":101949,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_seopress_titles_title":"","_seopress_titles_desc":"","_seopress_robots_index":"","_seopress_robots_follow":"","_seopress_robots_imageindex":"","_seopress_robots_snippet":"","_seopress_robots_primary_cat":"","_seopress_robots_breadcrumbs":"","_seopress_robots_freeze_modified_date":"","_seopress_robots_custom_modified_date":"","_seopress_robots_canonical":"","_seopress_social_fb_title":"","_seopress_social_fb_desc":"","_seopress_social_fb_img":"","_seopress_social_fb_img_attachment_id":0,"_seopress_social_fb_img_width":0,"_seopress_social_fb_img_height":0,"_seopress_social_twitter_title":"","_seopress_social_twitter_desc":"","_seopress_social_twitter_img":"","_seopress_social_twitter_img_attachment_id":0,"_seopress_social_twitter_img_width":0,"_seopress_social_twitter_img_height":0,"_seopress_redirections_value":"","_seopress_redirections_enabled":"","_seopress_redirections_enabled_regex":"","_seopress_redirections_logged_status":"","_seopress_redirections_param":"","_seopress_redirections_type":0,"_seopress_analysis_target_kw":"","_seopress_news_disabled":"","_seopress_video_disabled":"","_seopress_video":[],"_seopress_pro_schemas_manual":[],"_seopress_pro_rich_snippets_disable_all":"","_seopress_pro_rich_snippets_disable":[],"_seopress_pro_schemas":[],"amlak_video_sent":"","footnotes":""},"categories":[114],"tags":[],"class_list":["post-106582","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-opinions-and-analyses"],"acf":{"amlak_post_excerpt":"\u0627\u0644\u0645\u0642\u0627\u0644 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