Family Business Management

Rodrigo Basco is Professor and the Sheikh Saoud bin Khalid bin Khalid Al-Qassimi Chair in Family Business at the American University of Sharjah, UAE.

Contents

Preface

Part I _ Introduction to family business






Chapter 1 _ Approaching the concept of family business





Introduction



Family business definition



Type of family businesses





Family-first family firms



Business-first firms



Family business–first family firms



Immature family firms




The importance of studying family business governance and management



Additional activities and reading material





Classroom discussion questions



Additional readings



Classroom activity




Case for analysis I: Birla—An entrepreneurial family



Case for analysis II: Chick-fil-A—A family serving quality and tradition



Case study: Wal-Mart




Chapter 2 _ Family business dynamics: Individual needs, goals, expectations, and emotions





Introduction



The three-circle model





Roles



Goals



Psychological needs



Expectations




The evolutionary perspective of the three-circle model
Emotions in the family business





Emotions in family business across contexts




Additional activities and reading material





Classroom discussion questions



Additional readings



Classroom activity




Case for analysis I: Pritzker family across generations



Case for analysis II: The Henriquez Group



Case Study: Estee Lauder Companies




Chapter 3 _ Interpersonal relationships and communication in family businesses





Introduction



Interpersonal relationships in the family entity





Couple relationships and family business



Sibling relationships and family business



Parent–child relationships and family business



In-law relationships and family business




Family communication



Family genogram



Additional activities and reading material





Classroom discussion questions



Additional readings



Classroom activity












Case for analysis I: Case for analysis I: Dassler brothers
Case for analysis II: The co-preneurs Mr. & Mrs. Hartz



Case Study: British royal family

Part II _ Management in family business




Chapter 4 _ Conflict, conflict management, and communication





Introduction



Definition of conflicts in family businesses



The conflict process in family businesses



Sources of conflicts in family business





Conflict and context




Types of family business conflicts



Conflict management





Conflict-resolution techniques



Conflict-stimulation techniques




Additional activities and reading material





Classroom discussion questions



Additional readings



Classroom activity




Case for analysis I: The team is broken!



Case for analysis II: Steinberg family business



Case Study: The fate of Gucci




Chapter 5 _ Human resource management in family businesses





Introduction



Nepotism



Human resource approach





Origins of asymmetric treatment




Justice/fairness





Levels of justice




Dysfunctional behavior



Additional activities and reading material





Classroom discussion questions



Additional readings



Classroom activity




Case for analysis I: What a mistake!



Case for analysis II: Embracing nepotism



Case Study: It is just a scandal or the scandal




Chapter 6_Strategic and financial management in family businesses





Introduction



Family business goals





Family business goals as reference points



Socioemotional wealth as an endowment effect




Strategic and financial behavior



Strategic management in family business





Market domain





Internal competitive advantages



External competitive advantages




Nonmarket domain




Combination of market and nonmarket domains as a determinant of performance and survival



Additional activities and reading material





Classroom discussion questions



Additional readings



Classroom activity




Case for analysis I: ALDI and the power of family ties



Case for analysis II: Feetures case study



Case study: An upside down strategy for LEGO

Part III _ Governance in family business




Chapter 7 _ Ownership governance in family business





Introduction



Corporate governance in family businesses



Ownership structure and governance





Type of owners




Ownership assembly or shareholder meeting



Shareholder agreement





Benefits of shareholder agreements




Evolutionary approach to ownership governance



Additional activities and reading material





Classroom discussion questions



Additional readings



Classroom activity




Case for analysis I: The united family behind LEGO



Case for analysis II: H51—The mission to preserve the Hermès family identity



Case Study: "The Factory" of the human misery




Chapter 8 _ Business governance in family business





Introduction



Board of directors





Board of directors’ tasks



Types of boards of directors



Board of directors composition




The evolution of the board across the lifecycle of the family business



Board of director practicalities





Number of board members



Recruiting board members



Regulation of the board of directors




Additional activities and reading material





Classroom discussion



Additional readings



Classroom activity




Case for analysis I: Al-Wadi Group—Corporate governance



Case for analysis II: Volkswagen scandal and boardroom politics



Case study: In between the board of directors and family shareholders




Chapter 9 _ Family governance in family business





Introduction



Types of family cohesion



Family leader—Chief family officer



Family governance viewed across an evolutionary perspective





Family meetings



Family assembly



Family council



Family policies



Family wealth governance



Family chapter or constitution




Additional activities and reading material





Classroom discussion questions



Additional readings



Classroom activity




Case for analysis I: The family organization behind Al Handal International Group (HIG)



Case for analysis II: Merck—A family transcending generations



Case study: Al Saud Company and the first serious crisis

Part IV _ Succession in family business




Chapter 10 _ Ownership, governance, and management succession





Introduction



Succession of what?





Types of succession in family business



Exit strategy (from a family business to a nonfamily business)




Complexity in family business succession





Barriers to intra-family management succession




Succession process perspective



Additional activities and reading material





Classroom discussion questions



Additional readings



Classroom activity




Case for analysis I: The global pasta—Barilla



Case for analysis II: Succession to succeed in the Middle East



Case study: How far can U-Haul go from here?




Chapter 11 _ The incumbent generation in family business succession





Introduction



Senior generations across time





Founder generation



Second generation



Third and further generations




Succession strategies





Keep relying on informal mechanisms to address succession



Formalize corporate governance to address succession



Pruning the family ownership tree




Plan the succession process



Type of incumbent based on their retirement styles



Passive family members



Transgenerational value creation



Additional activities and reading material





Classroom discussion questions



Additional readings



Classroom activity




Case for analysis I: Holly in her father’s shoes



Case for analysis II: What’s next? Retirement



Case study: Can I stay a bit more with all of you? Group Olive Mendoza




Chapter 12 _ The next generation in family business succession





Introduction



The Disney effect in family business succession



Managerial succession





Successor intentions



Parent–child relationships



Successor career-path intentions



Successor commitment




Successor entry and career paths



Model of change in family business succession



Next-generation ownership succession



Next-generation governance succession



Additional activities and reading material





Classroom discussion questions



Additional readings



Classroom activity




Case for analysis I: Succession in the luxury house of Zegna



Case for analysis II: The succession race at LVMH



Case study: Al Saud Company managing changes from the second generation to the third