Introduction Strategic Issues in Family Business ENT 06

Introduction: Strategic Issues in Family Business ENT 06. 327. 01 Entrepreneurship

Learning Goals Gain understanding and respect for family business continuity n Understand the challenges and advantages faced by family business (especially your own !!) n Learn managerial, governance, and family practices that increase odds of family business success n 2

Largest Family Businessess Company Ran k Wal-Mart Stores 1 Ford Motor Co. 2 Samsung 3 LG Group 4 Carrefour Group 5 Fiat Group 6 Ifi Istituto Finanziario Industriale S. p. A. 7 PSA Peugeot Citroën S. A 8 Cargill Inc. 9 BMW (Bayerische Motoren Werke AG) 10 3

Columbia Sportswear n n Chairman Gert Boyle's parents — German nationals ---fled Nazi Germany in 1938. Purchased a small hat company upon their arrival in Portland named it Columbia Hat Company. Gert's husband later took over, and after he died Gert went from housewife to executive overnight. Today, son Tim Boyle is the longtime president and CEO. http: //www. columbia. com/history/About_Us_History, default, pg. html 4

An Example: n n A Dream Postponed, Aug. 26, 2004 (Patient Rancher, Lynn Godfrey) http: //www. cbsnews. com/st ories/2003/02/13/hartman/m ain 540443. shtml 5

Elements of Family Business Ownership Family Management 6

An Example: n Ditch Digger With Big Dreams Larson, A Son To Be Proud Of Jason http: //www. cbsnews. com/video/watch/? id=597086 n&tag=related; photovideo 7

What is Family Business: n A family business is a synthesis of: q q Ownership Control By Members of A Family or Consortium of Families Family Ownership Of Shares Is 15% Or Higher Family Exercises Strategic Influence In The Management Of The Firm Expectations, Dreams, Possibilities Of Business Continuity Across Generations 8

Family Businesses. . . n n Constitute 80– 98% of businesses in U. S. and other free economies Generate 49% of GDP in U. S. and more than 75% in most other countries Employ 59% of private sector U. S. workforce and more than 85% of working population overseas Family-controlled companies comprise q q n 37% of all Fortune 500 companies 60% of all publicly held companies Created about 80% of all NEW jobs in the 1980 s and 1990 s 9

Family Business Can be Explosive n n Kelly family of Iowa and their demolition business AED http: //videos. howstuffworks. com/tlc/39698 -the-imploders-meet-the-imploding-family-video. htm 10