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Culture and Professionalisation at Hilti  [#permalink]

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New post 18 Dec 2017, 00:00
FROM ISB Admissions Blog: Culture and Professionalisation at Hilti
Hilti Corporation is a global company that has been consistently rated as one of the best for people practices, by Fortune and the Sunday Times. Professor Kavil Ramachandran, Executive Director of the Thomas Schmidheiny Centre for Family Enterprise, Indian School of Business, in a freewheeling discussion with Prof Dr Pius Baschera of the Hilti Corporation talks about the unique approach to inculcating corporate culture and values at Hilti.

Hilti is known for its excellent culture, innovative practices, customer orientation and a clear strategy, all of which have led to its growth. Dr. Baschera says that Hilti has clearly identified strategic pillars and what the key issues are to implement the strategy; this is developed and communicated across the whole organisation, to all the 26,000 people around the world. It starts from the top, from the board of directors and the executive board.

Hilti started about 30 years ago to define the values that are important to them. The values are: Team, Commitment, Integrity and Courage. Baschera says that culture building at Hilti is a two-year long cycle that gets repeated. The cycle starts with the executive board and the board of directors spending 2-3 days together, reflecting and discussing the culture, values, and business challenges for the subsequent 3-4 years. There they decide as to what to include and what to exclude in these cultural trainings. They then roll out these team camps across the organisation. Each of them in turn is involved with the next level of executives in small groups of 10-12 people, and this continues through the organisational hierarchy, across the world, covering all the 26,000 employees. There are about 75 cultural trainers at any time, who become facilitators for a period of time. They are selected carefully for this important assignment, from various functions. They ensure that these cultural sessions are adapted to local country culture. They spend about 10 million euros every year on this important activity.

At these sessions, the four Hilti values are discussed in detail and are always linked with concrete business issues. These can be strategy issues, operational issues, cost issues, people issues and so on.

The key challenge to implement such a massive exercise is the time needed. If you have to start with five or ten people, it is easy but if you have presence in 120 countries, ten plants around the world, 4-5 research departments and a big headquarters, then it would take decades, not 2-3 years to develop it. And the challenge is that you are not deviating from it, says Baschera.

There is a huge level of stewardship as a value built in, in Hilti. Organisational goals more important than personal goals. When the founder of Hilti, Martin Hilti stepped down, his son Michael Hilti, 46 then, told his father that he did not want to be both the CEO and chairman at the same time; he wanted to split these roles. So he decided to be the chairman and offered Baschera the CEO position of the company. So it is not the role, nor the position or the ego that is important at Hilti, but it is the company first and then they do whatever is best for the company.

Source: ISBInsight, Volume 4, Issue 4, pp58-64

http://isbinsight.isb.edu/culture-and-p ... -at-hilti/

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Like Father, Like Son—Ziad Salloum on Succession in the United Arab Em  [#permalink]

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New post 22 Dec 2017, 05:00
FROM ISB Admissions Blog: Like Father, Like Son—Ziad Salloum on Succession in the United Arab Emirates
Ziad Salloum and his father Samir are both lawyers with expertise ranging from “day to day stuff” as Salloum Jr puts it (acquisitions, contracts, sales), to managing a business handover from one generation to next—a process arguably more about personalities than professionalism.

Established in 1980 by Samir, Salloum & Partners LLC (formerly the Law Offices of Samir A Salloum) assists between 20 and 30 UAE family businesses including realtors, car dealers, insurance brokers, and shipping companies.

Before entering his father’s firm, Salloum started his career as a banker, meaning when he wanted to come back into the family fold, a good legal grounding was the first matter of business. “So for 10 years, there was an incredible amount of pressure to get to learn extremely quickly, to acquire the benefit of [my father’s] experience together with the legal expertise.”

Families of wealth worldwide struggle with the big handover, with research showing not enough preparation is being put in to handling the often-fraught process. The stakes are high. In the next 10 years, more than $1 trillion of family businesses will pass to a new generation of owners, according to Badr Jafar, founder of the Pearl Initiative—a not-for-profit Sharjah-based institution.

Nonetheless, Salloum says his clients come to him with a raft of succession issues. “Part of it is a concern about loss of control…It can also be because [the principal] has sunk their entire life into it and does not have any other interests. So they are worried that if they exit the business, what do they do now?”

Another common spanner in the works with Middle Eastern succession came when children were sent to Western universities, returning with large egos and different cultural norms to their parents. This is where the unique double-team approach Ziad and Samir can implement, comes in handy.

Salloum says it all starts with relationships: “You can put the most beautiful plans in place, governance plans and all that, but if you do not work first on the strength of the relationship between the family members, then all the rest of it is not really worth the paper it is going to be printed on. So the way my father would put it is ‘You’ve got to start with love’.”

Salloum says no two successful successions were alike, with some families taking a very structured approach by mapping out rules around the necessary qualifications, work experience, and attributes a family member needs before joining the family business.

Others preferred to bring in children organically over time: Families allowed their children to be around business activities from a very young age, to get them used to be around high-powered people.

Source: Beech, James and Newlove, Alexandra, CampdenFB, Issue 71, December 19, 2017, http://www.campdenfb.com/article/father-son-ziad-salloum-succession-united-arab-emirates
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Corporate Governance in the context of family controlled businesses  [#permalink]

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New post 22 Dec 2017, 05:00
FROM ISB Admissions Blog: Corporate Governance in the context of family controlled businesses
The 120 years old Godrej Group has emerged as an icon among family businesses in India, not only for its economic achievements but also for its relentless focus on achieving excellence in corporate governance. In an interview with Sougata Ray, Professor of Strategy, Indian Institute of Management Calcutta, and Visiting Scholar, Thomas Schmidheiny Centre for Family Enterprise, ISB, Mr. Adi Godrej, the chairman of the conglomerate shares his thoughts on corporate governance in family businesses.

What does governance mean for a family enterprise?

In my opinion, corporate governance should be defined as efficient supervision which encourages ‘doing everything better’, and protects the interest of the Company while conforming to all established laws and ethics.

You said “Corporate governance should promote the long-term good of the company and not necessarily particular stakeholders”. Could you please explain this further?

A good management should be looking into the interests of all stakeholders. But the ultimate interest that should be protected is the company’s. All these other things come as part of the company’s interests and not as primary interest.

This makes perfect sense. Yet, why do you think there is so much emphasis on protection of minority shareholders’ interest in the context of family enterprises?

I think we get confused because we automatically assume that people will sacrifice minority shareholder’s interest for promoter interest and, therefore, we should go out of our way to protect it. I think we should go out of our way to promote corporate governance, to protect the company’s interests and ensure that the company’s interests include the interests of various stakeholders.

Does the short term focus in terms of quarterly performance or annual performance affect corporate governance in some ways or the other?

A good board will not over-emphasise the quarterly results at the cost of the company’s long term interests. The company’s long term interest is what is important. One advantage family businesses have is that they don’t need to chase quarterly numbers.

What is your general advice to leaders of family enterprises to improve corporate governance?

I believe it is important that corporate governance be principle-based rather than rule-based. This is essential since principles are harder to ‘get around’ compared to rules. In trying times the temptation to seek loopholes in the rules remains large. However, with principle-based corporate governance the quality of governance is as robust as the principles.

Are there special issues related to corporate governance in family enterprises as compared to firms promoted by other forms of ownership?

There are certain unique characteristics of family managed businesses that necessitate good corporate governance principles as an essential element, to ensure their successful survival. Sound corporate governance addresses risks inherent in the characteristics of family managed businesses systematically and sustainably.

How does one ensure sound corporate governance in a family owned enterprise?

Good corporate governance must include the framework of a strong performance orientation. Conformation to good governance is a hygiene factor – performance is important. Good governance needs to incorporate leadership and management imperatives that can lead to strong financial and strategic performance. Corporate governance and performance are not mutually exclusive – on the contrary, companies with sustained sterling performance are usually the paragons of governance too.

Source: ISBInsight, Volume 4, Issue 4, pp50-57

http://isbinsight.isb.edu/corporate-governance-in-the-context-of-family-controlled-businesses/

 

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Yesterday by Aniruddha Dey  [#permalink]

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New post 27 Dec 2017, 23:00
FROM ISB Admissions Blog: Yesterday by Aniruddha Dey
It seems like it was yesterday when I walked in,

Through these hallowed gates, with hopes and dreams.

A new chapter of my life was about to begin

And the road ahead looked inviting, glistening in the sunbeams

It seems like it was yesterday when I met my quad-mates –

Divergent paths united by the blind hands of chance.

Maybe it was the banter we shared over the food we ate,

That brought us together in harmonious balance.

It seems like it was yesterday that my study group was assigned –

A team of five assembled to scale the perilous peaks of assignments.

We went through days bright and nights sleepless and unkind

And bonded over unshared history and shared moments.

It seems like it was yesterday, that classes had just begun,

With professors of repute sharing insights old and new.

The claw of academic rigour gnawed at tree of mirth and fun

But in the end, we persevered through it albeit with scars few.

It seems like it was yesterday, that placement season was here,

Ushering in a sense of fear and awakening an unnerving inner voice.

After a month of effort and a stroke of luck, I had reasons to cheer

For I successfully navigated through this maze of chance and choice.

It was yesterday that I paused and looked back without haste

At the milestones that I have crossed and the people that I have met.

Life at ISB has been a race against time and competition with the best

But the memories made will forever be etched in stone and set.



Aniruddha Dey, Class of 2018
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Yesterday by Aniruddha Dey  [#permalink]

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New post 27 Dec 2017, 23:01
1
FROM ISB PGP Admissions Director Blog: Yesterday by Aniruddha Dey
It seems like it was yesterday when I walked in,

Through these hallowed gates, with hopes and dreams.

A new chapter of my life was about to begin

And the road ahead looked inviting, glistening in the sunbeams

It seems like it was yesterday when I met my quad-mates –

Divergent paths united by the blind hands of chance.

Maybe it was the banter we shared over the food we ate,

That brought us together in harmonious balance.

It seems like it was yesterday that my study group was assigned –

A team of five assembled to scale the perilous peaks of assignments.

We went through days bright and nights sleepless and unkind

And bonded over unshared history and shared moments.

It seems like it was yesterday, that classes had just begun,

With professors of repute sharing insights old and new.

The claw of academic rigour gnawed at tree of mirth and fun

But in the end, we persevered through it albeit with scars few.

It seems like it was yesterday, that placement season was here,

Ushering in a sense of fear and awakening an unnerving inner voice.

After a month of effort and a stroke of luck, I had reasons to cheer

For I successfully navigated through this maze of chance and choice.

It was yesterday that I paused and looked back without haste

At the milestones that I have crossed and the people that I have met.

Life at ISB has been a race against time and competition with the best

But the memories made will forever be etched in stone and set.



Aniruddha Dey, Class of 2018
ForumBlogs - GMAT Club’s latest feature blends timely Blog entries with forum discussions. Now GMAT Club Forums incorporate all relevant information from Student, Admissions blogs, Twitter, and other sources in one place. You no longer have to check and follow dozens of blogs, just subscribe to the relevant topics and forums on GMAT club or follow the posters and you will get email notifications when something new is posted. Add your blog to the list! and be featured to over 300,000 unique monthly visitors
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How the Generation Gap Affects Chinese Business Succession  [#permalink]

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New post 29 Dec 2017, 01:00
FROM ISB Admissions Blog: How the Generation Gap Affects Chinese Business Succession
A 2011 report estimated that around 80 percent of China’s private companies were family-run. If we define family enterprises as any enterprise where the founder or their family holds more than 50 percent of the shares, then they probably number in the millions.

In the early days of the reform and opening-up era, a shortage of freely flowing skilled labor meant that most entrepreneurs chose to involve their family in their businesses. Today, the vast majority of Chinese family enterprises are still run by the generation that founded them, with their children gradually becoming more involved in their operations.

Many members of the second generation were either born or reached adolescence when their parents started their companies. This meant that at the time when children needed their parents the most, the latter were preoccupied with getting their businesses off the ground and couldn’t afford to spend time with the kids.

In order to compensate for their absence, parents not only tried to meet their children’s every material need, but also spent vast sums on their children’s education, sending them to the best overseas schools and universities. Yet this emphasis on their children’s futures only further estranged the two generations. It also led the younger generation to have almost no understanding of, or attachment to, the family business.

It is not uncommon for the first generation to attach strong emotions to the success of their businesses. But their children tend to view them as just another piece of property, with a market value like any other. In such instances, it’s easy for conflicts to brew between the two generations. Only around 15 percent of family enterprises have founders willing to hand over the business and the younger generation who are willing to inherit.

The problem is compounded by the fact that many low-end manufacturing businesses, established early in the reform and opening-up era, are no longer viable cash cows. Instead, the younger generation tends to view them as sunset industries and look instead toward the internet, financial, fashion, and creative industries. Rather than rejecting their families’ money, they use it as a kind of angel investment when they start their own businesses in more trendy sectors.

There are still many in the younger generation who are willing to take charge of their parents’ companies. Yet in such cases, acceptance generally comes with a stipulation that their parents will endorse and support such changes to the business that their children deem necessary. In practice, as the first generation grows older, the power dynamic between them and their heirs will gradually start to tilt in favor of the latter.

Source: Hao, Wang., December 28, 2017; http://www.sixthtone.com/news/1001469/how-the-generation-gap-affects-chinese-business-succession
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How to keep a family business running after 200 years  [#permalink]

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New post 29 Dec 2017, 02:00
FROM ISB Admissions Blog: How to keep a family business running after 200 years
The rumours that swirled around the American east coast city of Baltimore in 1895 were grossly inaccurate. The word on the street was that the Loane family business had shut. So Javez Loane, who at the time ran the business that made sails, window awnings, tents, flags and wagon covers, distributed a flyer to set the record straight.

The family business was instead thriving back then, and is still in fine fettle today, now known as Loane Bros. It’s not a bad achievement for an enterprise that started by making ships’ sails in 1815, and over the next 202 years moved to its current focus on party tents, equipment and window awnings.

With a Loane at the helm, the business has survived six generations of family ownership. The word “survive” can be appropriate for any such business, given the added burdens that working with relatives can bring, such as exactly which nephew should inherit the hot seat.

The company has about 85 employees and a yearly income of about $5m (£3.7m). In addition to hiring out tents for everything from wedding receptions to conferences, it hires a host of other things required for a big bash, from tables and chairs, to wine glasses, plate sets and even a dance floor.

“We are still always learning to improve on what we do and how we do it,” says Bryan, who initially went to college to study teaching. When he was about 24 and teaching in Spain, Bryan got a call from his father Morgan who announced he was thinking of selling the business. Within weeks, Bryan came back and started work under his father. About 20 years ago, Morgan retired and Bryan took over.

“It’s sad to say, but I enjoyed it a lot more after he left,” says Bryan. Bryan says it gave him a chance to put his own stamp on the family business, just like his father had done when he became boss. Morgan still helps out occasionally by sitting in on a sales call, or driving his son to meetings in nearby Washington DC, so that Bryan can get work done in the passenger seat.

Whether Loane Bros will continue with family ownership over the next generation is uncertain. Bryan’s two children have interests elsewhere, and he is careful not to put pressure on them to come into the firm. “I would be amazed if my son or daughter came into the business,” he says. “We will cross that bridge later, but I’m not planning on it.”

Loane Bros is constantly approached by investors wanting to purchase it. but Bryan says he has seen other family businesses go down that road and it isn’t good. “The whole company just vanishes after a while,” he says. “They say they will keep all the people on, but they don’t.”

Many employees at Loane Bros have worked there for decades. They might be the ones Bryan chooses to sell the business to, so it becomes employee-owned. If no one in the family wants to take it over, Bryan sees selling it to its staff as the best way to preserve the legacy Joseph Loane started all those years ago.

Source: Solomon, Serena., December 27, 2017; http://www.bbc.com/news/business-42135812
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Hire professional managers to grow family business  [#permalink]

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New post 05 Jan 2018, 00:00
FROM ISB Admissions Blog: Hire professional managers to grow family business
Family businesses are a vital part of the Kenyan economy, and their continuity and success often depend on the transition from one generation to the next. In the Kenyan economy, it has been found that less than one-third of family businesses survive the transition from the first to the second generation, and half of these do not make it to the third generation.

The values, the foundation of the venture fade away in the dynamics of business environment. The priorities change with the leadership, which sometimes become the missing link in the texture. Typically, there comes a time when the desires and demands of the family members clash with the company objective and goals which they wish to achieve, and this is where having professional managers becomes necessary.

The professional managers bring a wealth of knowledge and experience to a family business that complements the positive aspects of the culture established by its owners. More specifically, professional managers from outside the family can bring into the business, better systems and processes, greater flexibility, transparency, accountability, faster decision making and more effectively align stakeholders with the business’ objectives.

Heightened competition is also another factor in recruiting professional managers. Not every family can produce a chief executive officer or chief financial officer, capable of running a business in an ultra-competitive marketplace, thus forcing them to look outside its circle for unique talent that will propel the business forward.

These professional managers can better handle the competition, and build on an already successful venture, by looking at other avenues of growth, for instance expansion into new markets/avenues/products that will shore up revenue and profitability.

Fortunately, more and more Kenyan family-owned businesses are waking up to the need of integrating professional management in running their operations. It is, however, imperative to be conscious of empowerment and acceptance of the change management approach and to create a well defined reporting structure to avoid overlapping of roles and creating confusion in the working environment.

With robust succession plans in place, Kenyan family business will be more likely to professionalise their management faster. Only then can we hope to see more family run businesses outgrow the second and third generations and grow into truly large businesses.

Source: Ramamurthy, Thiagarajan, January 1, 2018, https://www.businessdailyafrica.com/Hire-professional-managers-to-grow-family-business/539444-4248028-u08hly/
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Dynamics and disruptions: co-investments between venture capital and f  [#permalink]

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New post 05 Jan 2018, 00:00
FROM ISB Admissions Blog: Dynamics and disruptions: co-investments between venture capital and family business
Venture Capital firms (VCs) and family-owned business groups are not natural partners. VCs want strong minority rights, an ability to change management if the company underperforms, and do not mind dilution in shareholdings and control if the company’s valuation grows.

By contrast, family-owned business often choose continuity in ownership over a high-risk/high-return strategy, and do not allow outsiders into a business easily. While some of the largest family offices have invested in VC funds as a passive investor, broader links and collaboration between family-owned business groups and VCs were the exception rather than the rule. This is now starting to change.

In the past few years we have seen an increasing degree of pragmatism from both VCs and family owners, which is seeing them co-invest on interesting deals, and even VCs invest in spin-outs from family business groups, sometimes led by a dynamic family member. Of particular interest seems to be venture opportunities in Artificial Intelligence (AI) and robotics, perhaps due to the general purpose of these technologies. Robotics and AI have the potential to transform, or undermine, family businesses across sectors, whether in retail, real estate, building industry, light manufacturing or agriculture.

Family groups and family office principals have different motives for investing in VC deals. It may be they are looking for investment return from a high-growth area, as a passive investor. But where they get actively engaged, we have seen a mixture of motives. Family offices are often attracted to the sectors where there is a synergistic relationship with the core business. For instance, if the family business is in commercial real estate, then there are a lot of smart city/smart building technologies that are highly relevant; if they have a logistics business, they are likely to be interested in warehouse or transportation-related robotics.

Family offices are also learning to identify the right VCs they can work with, which are pragmatic and adaptable to the specific needs of family-backed investors. As a final note, it’s important to remember that—robots and AI notwithstanding—people still do business with people. The most important starting point between VCs and family groups is trust, and so it is really important for the family group investors and VC to understand their respective investment drivers and expectations, and how they will work together.

For a VC, doing business with a family group is a lot more relationship intensive than with an institutional investor. For family businesses, VCs may sometimes seem pedantic and not pragmatic. However, the time spent to build a relationship can be really beneficial for both parties in the long-run, and for their respective joint investments.

Source: Iliev, Ilian, January 03, 2018, http://www.campdenfb.com/article/dynami ... y-business
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Keeping those billions in the family vault  [#permalink]

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New post 16 Jan 2018, 03:00
FROM ISB Admissions Blog: Keeping those billions in the family vault
What to do if you’re a 95-year-old billionaire and you live in a country with inheritance taxes as high as 65 per cent? That’s the challenge facing the family of coffee baron Kim Jae-myeong, honorary chairman of Dongsuh group. It’s a common story in South Korea, which rose to become a global industrial powerhouse dominated by family-run entities known as chaebol. Now those groups are under increasing scrutiny for business practices that have kept the families in power for decades. Failure to plan the transfer of wealth to the next generation risks losing both a big chunk of that fortune and the family’s control of the company that created it.

As a result, the nation’s wealthy dynasties have developed circuitous ways to pass down money, such as directing lucrative deals from family businesses to affiliates controlled by heirs. But with the chaebol deeply unpopular after a series of bribery and corruption scandals, the government is working to close some of the biggest loopholes, potentially encouraging capital flight as families fight to preserve wealth.

The FTC’s regulations for abusing intra-group business deals apply only to companies with more than 5 trillion won in assets and when owner families’ stakes in affiliates exceed 30 per cent. “There are many companies who have gotten away with regulations by adjusting the ownership stake at 29.9 per cent to avoid the threshold of 30 per cent,” FTC Chairman Kim Sang-jo said at a parliamentary hearing in June.

The Kims own 66.1 per cent of Dongsuh Cos. A series of family transfers that began in 2006 left his two sons with 38.3 per cent of the business and his eldest grandson with 11.2 per cent, the third-largest stake. The ownership structure caused controversy when a closely held Dongsuh affiliate came under scrutiny for gaining almost all of its revenue — 93.5 per cent — from other Dongsuh units. The dividend payout ratio reached 88.9 per cent in 2013, when the grandsons owned more than 50 per cent of the business. They have since transferred their stakes to the listed holding company.

The government is clamping down. Even if the commission manages to shut down the inter-group transfer route, families still have other ways to avoid paying inheritance taxes. One is to move money, usually in the form of stakes held by family members in their business empires, to charitable foundations. Another is to combine business units, as Samsung did with its 2015 merger of Samsung C & T and Cheil Industries.

“There are cases in which owner families have no choice but to sell their companies to pay high tax bills,” said Lee Tae-kyu, a research fellow at the Korea Economic Research Institute in Seoul. “We might end up with a lack of companies with a long history and expertise as inheritance tax burdens could force them, especially those small and medium-size companies, to give up on succession planning.”

Source: Lee, Yoojung, January 15, 2018 Gulf News, http://gulfnews.com/business/sectors/features/keeping-those-billions-in-the-family-vault-1.2157120
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Mediterra, a Family Business Built on Bread  [#permalink]

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New post 16 Jan 2018, 03:00
FROM ISB Admissions Blog: Mediterra, a Family Business Built on Bread
Mediterra Bakehouse in Pittsburg is owned by Nick Ambeliotis, a gentle Grecian giant. Ambeliotis might live and work in Pittsburgh, but he still considers Cleveland home. He grew up in Warren, Ohio, attended John Carroll University, and maintains season tickets to the Browns. For nearly a decade, he worked for Euro USA, a Cleveland-based importer and distributor of gourmet food products. As buyer, it was Ambeliotis’ job to scour Europe for the world’s finest cheeses, olive oils, pastas and charcuterie.

“During all my travels I would see all these artisans and I thought, I really want to do something like that,” he explains. “I wanted to do cheese, but it’s very complicated. I thought, bread is something I can do.”

Never mind that he knew nothing at all about baking. Today, following 15 years of relentless growth, the bakery has gobbled up 20,000 square feet and maintains a payroll approaching 100-staffers long. “We’ve just grown organically, one customer at a time,” Ambeliotis modestly says. “Every time we made a little money we bought a piece of equipment. But I don’t think we’re still really well known because we’re wholesale.”

Ambeliotis says that he never would have gotten this far without the aid of family. His sons Anthony, Mike and Nick Jr. all hold key roles in the company, as does daughter Nicole, her husband, a daughter-in-law and two boys (now men) who the boss “informally adopted” from Guatemala. “I struggled before Mike came on because it’s hard,” Ambeliotis explains. “It’s a 24-hour-a-day operation and I’d go home and come back the next day and they don’t care, it’s just a job. And the ones who are really good, they move on.”

Breads are made the Old World way, using very little or no yeast, instead relying on natural starters called a levain. “We do a lot of volume, but everything is still done by hand,” boasts Ambeliotis. “We do 20,000 loaves a day and every one of them is perfect.”

Two enormous hearth ovens, both built onsite by a seventh-generation French company, are the true workhorses of the bakery. Each has about 35,000 pounds of refractory brick inside. Out of those ovens come some of the most seductive and satisfying loaves in the country, from light and airy paesanos and uber-tangy San Francisco sourdoughs, to the dark, dense and chewy Mt. Athos Fire bread.

A few years ago, Ambeliotis began spending more and more time in Arizona where he could escape the daily pressures of the job, he explains. But he soon grew listless and bored. “So I bought a building and started producing and now we’re the largest artisan bread baker in Phoenix,” he says. “You find something you love to do and you try to get better at it every day. That’s all you can do.”

Source: Trattner, Douglas, January 10, https://www.clevescene.com/cleveland/mediterra-a-family-business-built-on-bread/Content?oid=14153562
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PGP Application Guidelines  [#permalink]

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New post 17 Jan 2018, 07:00
FROM ISB Admissions Blog: PGP Application Guidelines
Many of you seem to  have queries regarding your application submission. Here are some quick resolutions to common questions

 

How do I submit the application?

You need to fill in all sections of the application (1 to 10). All the sections need to be complete – Once you finish and save the section the white circle will turn green with a check mark on top panel of your application.

Image

 

After you finish the terms, declaration and payment  section – Answering the questions, uploading your signature and making the payment, be sure to click on the Finish Button to submit your application

Image

Click on the Finish Button to submit your application.

 

I don’t see the the Green Circles on my application. What do I do?

If you don’t see the green circles then you must have saved the applications with the ‘Save as draft’option. Click on ‘Submit and Next’ button to move to the next page.

Image

I cannot upload my documents. What do I do?

If you are not able to upload your documents – Recheck the file sizes and formats.You should also be able to preview the documents once you upload them. You need to upload all the mandatory documents marked with *

If you still face a problem write to pgp@isb.edu with the screenshot of the issue.

 

Why cant I see the scholarship essays?

Everyone is automatically considered for Merit based scholarships which are given based on your profile and doesn’t require separate essays to be written. The need based scholarships appear only to the people with household incomes below Rs 10 Lacs. Proofs of the same need to be submitted later.

 

My Evaluator did not receive the link for evaluation. What do I do?

Ensure that you have entered the details correctly and clicked the Send recommendation Request on the Recommendation Sub-section

Image

The evaluator can submit his/her evaluation by 22 January, 2018 eod.

 

How do I know if my application has been submitted?

You will see a “Application Successfully Submitted” Message on your screen once you Finish the application.

 

Complete your application at apply.isb.edu

Incase you need any help write to pgp@isb.edu or call us on +91 40 2318 7474 /84 /94 (on Weekdays  between 9 am to 5 pm)

 

Wish you the Best!

Team Admissions
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PGP Application Guidelines  [#permalink]

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New post 17 Jan 2018, 07:02
FROM ISB PGP Admissions Director Blog: PGP Application Guidelines
Many of you seem to  have queries regarding your application submission. Here are some quick resolutions to common questions

 

How do I submit the application?

You need to fill in all sections of the application (1 to 10). All the sections need to be complete – Once you finish and save the section the white circle will turn green with a check mark on top panel of your application.

Image

 

After you finish the terms, declaration and payment  section – Answering the questions, uploading your signature and making the payment, be sure to click on the Finish Button to submit your application

Image

Click on the Finish Button to submit your application.

 

I don’t see the the Green Circles on my application. What do I do?

If you don’t see the green circles then you must have saved the applications with the ‘Save as draft’option. Click on ‘Submit and Next’ button to move to the next page.

Image

I cannot upload my documents. What do I do?

If you are not able to upload your documents – Recheck the file sizes and formats.You should also be able to preview the documents once you upload them. You need to upload all the mandatory documents marked with *

If you still face a problem write to pgp@isb.edu with the screenshot of the issue.

 

Why cant I see the scholarship essays?

Everyone is automatically considered for Merit based scholarships which are given based on your profile and doesn’t require separate essays to be written. The need based scholarships appear only to the people with household incomes below Rs 10 Lacs. Proofs of the same need to be submitted later.

 

My Evaluator did not receive the link for evaluation. What do I do?

Ensure that you have entered the details correctly and clicked the Send recommendation Request on the Recommendation Sub-section

Image

The evaluator can submit his/her evaluation by 22 January, 2018 eod.

 

How do I know if my application has been submitted?

You will see a “Application Successfully Submitted” Message on your screen once you Finish the application.

 

Complete your application at apply.isb.edu

Incase you need any help write to pgp@isb.edu or call us on +91 40 2318 7474 /84 /94 (on Weekdays  between 9 am to 5 pm)

 

Wish you the Best!

Team Admissions
ForumBlogs - GMAT Club’s latest feature blends timely Blog entries with forum discussions. Now GMAT Club Forums incorporate all relevant information from Student, Admissions blogs, Twitter, and other sources in one place. You no longer have to check and follow dozens of blogs, just subscribe to the relevant topics and forums on GMAT club or follow the posters and you will get email notifications when something new is posted. Add your blog to the list! and be featured to over 300,000 unique monthly visitors
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World of Work: Family-owned businesses need to face tough issues  [#permalink]

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New post 19 Jan 2018, 05:00
FROM ISB Admissions Blog: World of Work: Family-owned businesses need to face tough issues
Most companies have sensitive issues that nobody talks about, but avoiding touchy subjects in family firms can be catastrophic. Eric Clinton, director of the DCU Centre for Family Business, draws a distinction between the family-first family business and the business first family business.

Those in the second category stand a much better chance of success, he says, because they’re commercially focused. By contrast, those putting family interests first can run into all sorts of trouble – from lazy offspring not pulling their weight to high staff turnover because employees quickly learn that being family trumps ability.

One of the biggest elephants in the room in any “Mom and Pop” business is succession. Stepping back when you have given your energy and passion to a company for maybe 50 years is difficult and not every founder knows when it’s time to bow out. Often, it would take a brave son or daughter to tell the “Monarch” (a founder who typically leaves in a box) that their reign is over.

The average tenure of a CEO in a family business is 23 years compared with just six years in a multinational. Equally, the informal structures often found in family businesses can foster an environment where disagreements are allowed to escalate and become intensely personal.  Clinton says one of the ways family firms can handle succession while also tackling interfamily scraps is by “professionalising” their businesses. “Things like reporting structures are not just for bigger companies,” he says. “Family firms will also benefit from having good processes, defined responsibilities and specific ways of doing things.”

“Professionalising” includes ensuring transparency and well-documented agreements around shareholding and ownership – a classic flashpoint in family businesses. It also means putting clear management structures in place [one person in overall charge with designated reporting lines beneath], having a succession plan and involving outsiders in the business whether at management or board level.

“Succession is not about someone walking in one day and saying, ‘I’m out of here’. It’s a process that should be worked out during regular meetings where issues such as ownership and control are openly discussed. The main concern is that people leave it too late.”

One way of easing the transition is for the founder to move from CEO to chairman or chairwoman of the company. They might also take on an ambassador-like role representing the company’s interests where desirable.

Families often grow faster than businesses and one route to ruin is to have an open door policy around employing family members. Clinton recommends laying down a set of criteria that family members should meet if they want to join the business. For example, they should have relevant formal education and a specified length of outside experience, preferably at management level and ideally in a family-owned business in a foreign market.

Source: Keogh, Olive., January 19, 2018, https://www.irishtimes.com/business/work/world-of-work-family-owned-businesses-need-to-face-tough-issues-1.3357714
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A Proud Family Business — Burgeson’s Heating and Air Conditioning, Inc  [#permalink]

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New post 19 Jan 2018, 05:00
FROM ISB Admissions Blog: A Proud Family Business — Burgeson’s Heating and Air Conditioning, Inc.
It was in 1949 when Elgar Burgeson decided that it was time to start his own company. He then put his mastery to work. That was when his daughter, Dianne Burgeson, president and CEO of the company, was three years old. Dianne has now been in the business for 51 years and is dedicated to keeping the business in the family. Burgeson’s celebrated its 69th year on Jan. 2, 2017.

Elgar began working in the sheet metal industry when Dianne was very young. When the family chose to move to California, Elgar took a job working for a company that specialized in this area, but later realized that it was not the place for him.

“He just wanted to start his own business,” Dianne expressed. “He wanted his business to be held in high regard of ethics and taking care of customers,” something, she mentioned, continues to this day.

The business has been successful in staying a part of the family – with three generations currently employed at Burgeson’s, and a fourth coming in.

“We have a great-grandchild who was working after school and summers with us but is now going to business school, with plans of getting a business degree and returning to Burgeson’s to keep the tradition going,” Dianne commented.

She went on to say that the company, and its employees, is still committed to carrying out her father’s vision for Burgeson’s. She said that they do this in order to further her father’s integrity and respect for the industry.

According to Dianne, having new generations come into the business has taken it to the next level. It now gives back to the community in sponsorships and donations to local organizations, sports and optimists.

In terms of its services, Kevin Burgeson, who is co-owner, corporate board secretary and comfort advisor, said the business has stayed true to the services that were offered when Elgar started the company.

“Although we continue to do the same, we have added more in-depth products that are more sophisticated and more energy efficient,” Kevin noted.

“The ultimate goal is to keep the Burgeson’s family tradition going and continue taking care of our clients,” Dianne concluded.

Source: Garcia, Andrea., January 18, 2018; http://www.mountain-news.com/business/a ... d2c7f.html
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Embracing ISB to Find Yourself – By Arpitta Jerath Co2018  [#permalink]

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New post 29 Jan 2018, 04:00
FROM ISB Admissions Blog: Embracing ISB to Find Yourself – By Arpitta Jerath Co2018
As clichéd as it sounds, but it seems like only yesterday that we came to the Indian School of Business, prepared (or so we thought!) to take on the biggest leap of our lives. We added ourselves to numerous WhatsApp groups, attended meet ups, ‘connected’ with alums to soak in as much as we could about what was in store for us. It will only take you an hour or so on your first day at campus to realize that no amount of preparation, no amount of networking can PRE-pare you for your life at ISB. Why, you may ask. As much as the next year is about learning from some of the best professors, finding that distant dream job and knowing your peers, it is also about finding yourself, accepting yourself for who you are and bettering yourself. And nothing can prepare you for this than ISB itself.

‘The year of transformation’. This is what the one year PGP at ISB is fondly called (soon it’ll be your favorite hashtag too). One caveat though, the transformation is slow and abstract. You’ll keep feeling that you’re the same person. More often than not, you will be the same person albeit your ability to function like a pro with just 3 hours of sleep, your ability to write a three-hour exam with a hangover along with your appetite for food (and other things) at any hour of the day.

So what changes really? The answer to that I think is not only very subjective but also very personal. Through my own experience, I think what this one year at ISB will do is that it will make you extremely comfortable in your own skin. You will start accepting yourself for who you are and that is when the magic begins to happen. My friends have always thought of me as an outgoing, extroverted person. In reality I think I am happiest when I am by my own, in the confines of my room snuggled with a nice book. But I also thought about how nice it would be if I could call people over, host them and throw a nice, cozy party. I could never get myself to do it thinking what if no one showed up. What a bummer that would be!

In the beginning of the second term, the school invited applications for various posts of GSB or the Graduate Student Board. The GSB is a student elected body, responsible for coordinating and managing all student activities and initiatives both academic and extracurricular. I decided to stand for the position of the Director of the Student Life council (SLC), a council that is primarily responsible for all student activities and engagements. SLC takes care of all occasions, events and parties both on campus and off campus. Personally, this was a major challenge as it was way beyond my comfort zone. But it was also something I always wanted to do- getting people together and ensuring they have a great time.

Today, we are a team of 5 and are constantly deliberating over the next school event for the class and enjoying every bit of it. Standing for the SLC was my biggest dare to self and I am glad I took that step. Today, some of my happiest memories from ISB are because of the opportunities I got by being a part of the SLC. While you all get prepared for YOUR year of transformation, be open to making it about yourself, embrace yourself in totality and then throw yourself in challenges – unknown and daunting.

The beauty of this place is that it will never fail you. Remind yourself time and again to try on something new.

If you have the will, you WILL find your calling. Slowly and eventually!



Arpitta Jerath is a student a ISB (PGP Co-2018

She is also the Director of the Student Life Council
ForumBlogs - GMAT Club’s latest feature blends timely Blog entries with forum discussions. Now GMAT Club Forums incorporate all relevant information from Student, Admissions blogs, Twitter, and other sources in one place. You no longer have to check and follow dozens of blogs, just subscribe to the relevant topics and forums on GMAT club or follow the posters and you will get email notifications when something new is posted. Add your blog to the list! and be featured to over 300,000 unique monthly visitors

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Embracing ISB to Find Yourself – By Arpitta Jerath Co2018  [#permalink]

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New post 29 Jan 2018, 04:01
FROM ISB PGP Admissions Director Blog: Embracing ISB to Find Yourself – By Arpitta Jerath Co2018
As clichéd as it sounds, but it seems like only yesterday that we came to the Indian School of Business, prepared (or so we thought!) to take on the biggest leap of our lives. We added ourselves to numerous WhatsApp groups, attended meet ups, ‘connected’ with alums to soak in as much as we could about what was in store for us. It will only take you an hour or so on your first day at campus to realize that no amount of preparation, no amount of networking can PRE-pare you for your life at ISB. Why, you may ask. As much as the next year is about learning from some of the best professors, finding that distant dream job and knowing your peers, it is also about finding yourself, accepting yourself for who you are and bettering yourself. And nothing can prepare you for this than ISB itself.

‘The year of transformation’. This is what the one year PGP at ISB is fondly called (soon it’ll be your favorite hashtag too). One caveat though, the transformation is slow and abstract. You’ll keep feeling that you’re the same person. More often than not, you will be the same person albeit your ability to function like a pro with just 3 hours of sleep, your ability to write a three-hour exam with a hangover along with your appetite for food (and other things) at any hour of the day.

So what changes really? The answer to that I think is not only very subjective but also very personal. Through my own experience, I think what this one year at ISB will do is that it will make you extremely comfortable in your own skin. You will start accepting yourself for who you are and that is when the magic begins to happen. My friends have always thought of me as an outgoing, extroverted person. In reality I think I am happiest when I am by my own, in the confines of my room snuggled with a nice book. But I also thought about how nice it would be if I could call people over, host them and throw a nice, cozy party. I could never get myself to do it thinking what if no one showed up. What a bummer that would be!

In the beginning of the second term, the school invited applications for various posts of GSB or the Graduate Student Board. The GSB is a student elected body, responsible for coordinating and managing all student activities and initiatives both academic and extracurricular. I decided to stand for the position of the Director of the Student Life council (SLC), a council that is primarily responsible for all student activities and engagements. SLC takes care of all occasions, events and parties both on campus and off campus. Personally, this was a major challenge as it was way beyond my comfort zone. But it was also something I always wanted to do- getting people together and ensuring they have a great time.

Today, we are a team of 5 and are constantly deliberating over the next school event for the class and enjoying every bit of it. Standing for the SLC was my biggest dare to self and I am glad I took that step. Today, some of my happiest memories from ISB are because of the opportunities I got by being a part of the SLC. While you all get prepared for YOUR year of transformation, be open to making it about yourself, embrace yourself in totality and then throw yourself in challenges – unknown and daunting.

The beauty of this place is that it will never fail you. Remind yourself time and again to try on something new.

If you have the will, you WILL find your calling. Slowly and eventually!



Arpitta Jerath is a student a ISB (PGP Co-2018

She is also the Director of the Student Life Council
ForumBlogs - GMAT Club’s latest feature blends timely Blog entries with forum discussions. Now GMAT Club Forums incorporate all relevant information from Student, Admissions blogs, Twitter, and other sources in one place. You no longer have to check and follow dozens of blogs, just subscribe to the relevant topics and forums on GMAT club or follow the posters and you will get email notifications when something new is posted. Add your blog to the list! and be featured to over 300,000 unique monthly visitors
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Why Family-Business Entrepreneurs Should Embrace Private Equity Fundin  [#permalink]

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New post 03 Feb 2018, 15:00
FROM ISB Admissions Blog: Why Family-Business Entrepreneurs Should Embrace Private Equity Funding
With the passage of President Donald Trump’s tax plan, family-business entrepreneurs seem to be getting a big bump in social investment and corporate growth. Yet this tax overhaul isn’t without its problems. Especially when it comes to the private-equity space, the plans to limit deductions on debt interest can actually hurt family-business entrepreneurs who rely on this forward-focused capital in order to innovate and expand. With both possibility and uncertainty on the horizon, family-business entrepreneurs need to better understand the resources that private-equity firms offer as they prepare to forge ahead.

Historically, many firms in the private equity industry suffered from negative reputations, which were based on companies that “stripped and flipped” investments. Those firms’ emphases on short-term returns — and disregard for stakeholders — gave many in the field a bad rap and led to some misconceptions that are contrary to what most PE investors actually accomplish for entrepreneurs and family businesses.

Still, some industry insiders believe that PE firms don’t support existing management teams or cultures at the companies in which they invest, while others are skeptical of PE investors because they have reputations for overleveraging companies. While PE firms are largely constrained by strict regulations from both the government and lenders, these fears are relevant.

Private equity investments can serve as catalysts for growth and product development for family-business entrepreneurs by helping bring precision and accountability to those companies. Family-business entrepreneurs often fail to govern themselves well, and their output suffers as a result.

On the other hand, PE firms understand the importance of good governance and can help such companies implement strategies such as a value-added and independent board of directors, audit and compensation committees or even conduct third-party reviews of existing strategies. As a result, the company’s leadership will be better equipped to identify risks and make smart, goal-oriented decisions within their marketplace.

Moreover, family businesses can benefit from PE firms’ expertise in the areas of strategic planning, financial management and controls and shoring up companies for sustained success. Most PE firms maintain relatively small portfolios, so they can invest significant resources into engaging their companies and working with them on value creation and long-term planning. By instituting top-to-bottom incentive programs, private equity firms can drive increased productivity throughout the organization.

Taking private equity can provide a great boon to your family business, but it is a major decision. The better you know your company’s strengths, weaknesses and goals, the more likely you are to find a partner that will help you achieve your vision.

Source: Johnson, Jeff., January 29, 2018, https://www.entrepreneur.com/article/307999
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The pros and cons of IPOs in family businesses  [#permalink]

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New post 03 Feb 2018, 15:00
FROM ISB Admissions Blog: The pros and cons of IPOs in family businesses
Like many family business owners, Phil Dudderidge reached the point where he wanted to take some value out of the enterprise that he had built up over more than two decades. Mr Dudderidge, executive chairman of the company, Focusrite, describes his decision to float it on Aim, the London Stock Exchange’s junior market, in late 2014 as “de-risking, from a personal standpoint”. Focusrite makes audio equipment for both professional and bedroom musicians. Mr Dudderidge, a former audio engineer for Led Zeppelin, bought the company’s assets out of liquidation in 1989.

The IPO route does not appeal to all family business owners, however. They can be reluctant to dilute family ownership, because of the potential loss of control, and stock market investors sometimes worry that the families might be too self-interested to ensure good stock performance. Despite the misgivings on both sides, there is evidence that an IPO can be good for both the family business and for its investors.

In Mr Dudderidge’s case, the decision to pursue a listing came as he approached “what might be called a retirement age”. He began to think about how best to pass on his family wealth, adding: “I’m not planning to retire but you never know when nature might decide these things for you.”

Weighing how to reduce his family’s ownership, he decided an IPO was preferable to a takeover by a competitor, because he did not want to sell the whole company. He also wanted to avoid bringing in a private equity investor because that route would not fit with the company’s debt-free business model.

Focusrite has performed well on Aim. Its share price has more than doubled since IPO, making it a positive example for those who argue that founder-owned companies perform better as public companies. Not every IPO experience is so smooth for a family business, however.

Those running or working with family businesses argue that when pitching for external investors, it is important to be sure of the investment proposition. “If you are taking your company to market as a growth stock, you have to believe your growth story and be confident that you can demonstrate [it] for years to come,” says Mr Dudderidge. His tips for a successful listing include picking your advisers carefully, and deciding whether you are offering share price growth or income to potential investors.

When family businesses do decide to bring in a private equity investor or to place shares with chosen institutions at IPO, it is important to make sure that any major external investors are a good cultural fit, says Elizabeth Bagger, executive director at the Institute for Family Business, a UK industry group.

Differences of opinion among family members on whether to accept external investors are common. One way to resolve such disputes is to set up a kind of internal share market to buy out relations who do not want to proceed to the public market, says Ms Bagger.

Source: Smith, Ian., January 29, 2018; https://www.ft.com/content/94213c84-fb9f-11e7-9bfc-052cbba03425
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Dr Pepper Deal Signals Advantage of Family Firms’ Long Term Horizons  [#permalink]

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New post 09 Feb 2018, 03:00
FROM ISB Admissions Blog: Dr Pepper Deal Signals Advantage of Family Firms’ Long Term Horizons
JAB Holdings has cooled its coffee spending spree, striking a deal to buy its first cold drinks company, Dr Pepper Snapple, in a move which has bemused market commentators. Luxembourg-based JAB, which mainly controls the wealth of Germany’s Reimann family, has announced it will buy the US soft drink maker for $18.7 billion, and merge it with coffee pod producer Keurig Green Mountain, which JAB bought in 2015.

Some analysts consider the Dr Pepper deal odd—Barclays’ Lauren Lieberman said “many are struggling to understand the strategic rationale”—given coffee is one of the fastest-growing food and drink industries, while large soft drink companies face growing backlash from health lobbyists, and millennials develop a taste for more boutique, less sugar-laden brands.

But does the family business tradition of taking a long-term view free from shareholder interference mean JAB is less hesitant in making such surprising decisions? Almost certainly, says Chris Simpson, strategy adviser at UK-based Business Doctors. “Once you have pension funds and institutional investors expecting quarter-on-quarter results, share price growth and/or dividends that have been promised or implied, this kind of option is nigh on impossible to pursue,” Simpson said.

The Reimanns are not involved in any of the operative businesses they own or part own, which include the coffee assets already mentioned plus Bally, Coty, and their original family business, Reckitt Benckiser. They entrust their fortune to three advisers, Peter Harf, Bart Becht, and Olivier Goudet, who run JAB and sit on the boards of the subsidiaries.

Lieberman also emphasised “the long-term perspective of JAB stakeholders”, and said the deal was reminiscent of when the holding company merged Coty with P&G’s beauty business in 2015. “In both cases, it would seem JAB is aiming to create a ‘challenger’ platform and disrupt the status quo in its respective industry,” she said.

“In both cases, we expect the grand plan to become clear over time as JAB is a group with a unique vision on industry evolution and a preference for longer-term thinking.”

Keurig Green Mountain chief executive Bob Gamgort (left) said the deal came about by looking through “the lens of consumer needs, versus traditional manufacturer-defined segments”. He also emphasised distribution savings, and the combined companies’ ability to “reach virtually every consumer, everywhere”.

“It is not intuitive at first, but as people learn about it they are going to realise that this makes total sense.”

Source: Newlove, Alexandra, February 2, 2018, http://www.campdenfb.com/article/dr-pepper-deal-signals-advantage-family-firms-long-term-horizons
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Dr Pepper Deal Signals Advantage of Family Firms’ Long Term Horizons &nbs [#permalink] 09 Feb 2018, 03:00

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