MNE3704
Assignment 5 Semester 1 2026
Unique number:
Due Date: 28 April 2026
QUESTION 1
1.1 Three-Circle Model Analysis
The Three-Circle Model explains that a family business is made up of three connected parts,
which are family, ownership, and management. These parts affect each other, so a problem
in one area affects the whole business.
In the family system, Mokoena Furniture Manufacturers is facing conflict between family
members. The second generation does not agree on the future of the business. One wants
growth through technology, another wants expansion, and another wants a cautious
approach. This shows emotional tension and lack of unity. The book explains that family
relationships can affect business decisions because emotions can override logical thinking
(Poza and Daugherty, 2018).
Terms of use
By making use of this document you agree to:
Use this document as a guide for learning, comparison and reference purpose,
Terms of use
Not to duplicate, reproduce and/or misrepresent the contents of this document as your own work,
By making
Fully accept the consequences should use ofor
you plagiarise this document
misuse you agree to:
this document.
Use this document solely as a guide for learning, reference, and comparison purposes,
Ensure originality of your own work, and fully accept the consequences should you plagiarise or misuse this document.
Comply with all relevant standards, guidelines, regulations, and legislation governing academic and written work.
Disclaimer
Great care has been taken in the preparation of this document; however, the contents are provided "as is" without any express or
implied representations or warranties. The author accepts no responsibility or liability for any actions taken based on the
information contained within this document. This document is intended solely for comparison, research, and reference purposes.
, +27 81 278 3372
QUESTION 1
1.1 Three-Circle Model Analysis
The Three-Circle Model explains that a family business is made up of three
connected parts, which are family, ownership, and management. These parts affect
each other, so a problem in one area affects the whole business.
In the family system, Mokoena Furniture Manufacturers is facing conflict between
family members. The second generation does not agree on the future of the
business. One wants growth through technology, another wants expansion, and
another wants a cautious approach. This shows emotional tension and lack of unity.
The book explains that family relationships can affect business decisions because
emotions can override logical thinking (Poza and Daugherty, 2018).
In the ownership system, the founder controls 80 percent of the business and
makes most decisions alone. This creates imbalance and limits the involvement of
other shareholders. The book shows that when ownership is not shared properly, it
can lead to conflict and poor decisions because not all voices are considered (Poza
and Daugherty, 2018).
In the management system, the business is struggling with low growth and
competition. The founder still controls all major decisions, which slows down change.
The book explains that centralised control and lack of adaptation can weaken the
business and make it less competitive (Poza and Daugherty, 2018).
These three systems are not balanced at MFM. Family conflict affects ownership
decisions, and ownership control affects management performance. This shows how
the whole system is under pressure.
1.2 Risks of no succession plan and solutions
The lack of a succession plan creates serious risks for the business. The book states
that failure in succession planning is one of the main reasons why family businesses
fail (Poza and Daugherty, 2018).
Disclaimer
Great care has been taken in the preparation of this document; however, the contents are provided "as is"
without any express or implied representations or warranties. The author accepts no responsibility or
liability for any actions taken based on the information contained within this document. This document is
intended solely for comparison, research, and reference purposes. Reproduction, resale, or transmission
Assignment 5 Semester 1 2026
Unique number:
Due Date: 28 April 2026
QUESTION 1
1.1 Three-Circle Model Analysis
The Three-Circle Model explains that a family business is made up of three connected parts,
which are family, ownership, and management. These parts affect each other, so a problem
in one area affects the whole business.
In the family system, Mokoena Furniture Manufacturers is facing conflict between family
members. The second generation does not agree on the future of the business. One wants
growth through technology, another wants expansion, and another wants a cautious
approach. This shows emotional tension and lack of unity. The book explains that family
relationships can affect business decisions because emotions can override logical thinking
(Poza and Daugherty, 2018).
Terms of use
By making use of this document you agree to:
Use this document as a guide for learning, comparison and reference purpose,
Terms of use
Not to duplicate, reproduce and/or misrepresent the contents of this document as your own work,
By making
Fully accept the consequences should use ofor
you plagiarise this document
misuse you agree to:
this document.
Use this document solely as a guide for learning, reference, and comparison purposes,
Ensure originality of your own work, and fully accept the consequences should you plagiarise or misuse this document.
Comply with all relevant standards, guidelines, regulations, and legislation governing academic and written work.
Disclaimer
Great care has been taken in the preparation of this document; however, the contents are provided "as is" without any express or
implied representations or warranties. The author accepts no responsibility or liability for any actions taken based on the
information contained within this document. This document is intended solely for comparison, research, and reference purposes.
, +27 81 278 3372
QUESTION 1
1.1 Three-Circle Model Analysis
The Three-Circle Model explains that a family business is made up of three
connected parts, which are family, ownership, and management. These parts affect
each other, so a problem in one area affects the whole business.
In the family system, Mokoena Furniture Manufacturers is facing conflict between
family members. The second generation does not agree on the future of the
business. One wants growth through technology, another wants expansion, and
another wants a cautious approach. This shows emotional tension and lack of unity.
The book explains that family relationships can affect business decisions because
emotions can override logical thinking (Poza and Daugherty, 2018).
In the ownership system, the founder controls 80 percent of the business and
makes most decisions alone. This creates imbalance and limits the involvement of
other shareholders. The book shows that when ownership is not shared properly, it
can lead to conflict and poor decisions because not all voices are considered (Poza
and Daugherty, 2018).
In the management system, the business is struggling with low growth and
competition. The founder still controls all major decisions, which slows down change.
The book explains that centralised control and lack of adaptation can weaken the
business and make it less competitive (Poza and Daugherty, 2018).
These three systems are not balanced at MFM. Family conflict affects ownership
decisions, and ownership control affects management performance. This shows how
the whole system is under pressure.
1.2 Risks of no succession plan and solutions
The lack of a succession plan creates serious risks for the business. The book states
that failure in succession planning is one of the main reasons why family businesses
fail (Poza and Daugherty, 2018).
Disclaimer
Great care has been taken in the preparation of this document; however, the contents are provided "as is"
without any express or implied representations or warranties. The author accepts no responsibility or
liability for any actions taken based on the information contained within this document. This document is
intended solely for comparison, research, and reference purposes. Reproduction, resale, or transmission
