FAMILY BUSINESS MANAGEMENT:
Nine Elements of Family Business Success
FBM-CASE STUDY: The Binghams & The Louisville Courier-Journal
Teacher: Dr Ben Odejar
Raheel Waheed I.D. No. 7574
FBM-CASE STUDY: The Bingham’s & The Louisville Courier-Journal
I. Identification of the problem:
* VISION AND GOALS that is very unclear for the business and the family. Rather than focusing what the founder has visioned there is a personal animosity amongst the family siblings * While the vision was being created a SUCCESSION PLAN should have also been initiated but instead it wasn’t therefore causing a confusion of who is better suited to run the business. Because in family business you can’t have favoritism against fairness. * SIBLING RIVALRY due to selfish motives. * Concern for personal interest instead of business interest which is a selfish trait * There is a GAP IN COMMUNICATION. The actual cause of the gap would be from the top that is from the founder who is Barry Sr. and resulting in miscommunications amongst the children. Another reason being that the age factor amongst them is vast therefore they didn’t even have a personal communication also, so having a business communication was far from the case. * Due to gap of communication there is lack of unity amongst the family members. For example Barry Jrs. Mom went against him too.
II. Summarize the facts of the case:-
Barry Bingham, Sr. decided sell his family business that had stood running in the family for nearly 70years. The reason for selling being that his children had gone into a sibling rivalry in the business which was indirectly ruining the business relationship plus the personal relationship in the family. As Barry Sr.’s children returned to the business, the sibling conflicts started to rise. Constant questioning about each other’s acts was being raised. It reached a boiling point where the whole world knew the family was seen “rife with conflict”. Hence, it greatly affected the business and the demand for Louisville Times started declining. When the son Barry Jr. took a stance, one sister decided to leave and the other demanded to sell her share. But with all negotiations nothing was being accepted and agreed upon. Therefore Barry Sr. announced he would sell the business if no agreement was found, since he still controlled 95percent of the stock through voting trust, so the decision to sell was clearly his to make. Company was sold to Gannett Company hence bring the end of an era… That is the family business came to an end.
III. Analysis-Formulate 3 alternative solutions:- * Family meetings and forums:
With family meetings they would solve all their ongoing problems face to face rather than putting it up on notice boards and etc and ruining each other’s image. Barry Sr. being the in charge could shed some kind of advice to all the board members so that harmony is achieved. * Mediator: In other words get someone outside of the business who represents no link with the family or with the business. He/she could sort out the conflicts and provide them with a solution that is suitable for all. * Succession Plan: Barry Sr. should make a succession plan which allows all the family members that include Barry Jr, Eleanor, Sallie and the mother Mary know how the business is going to proceed. This way it would give a clear view of each individual’s role in the business.
IV. Recommendation:
The best solution I would select is a succession plan. By choosing this solution everyone would know their role clearly in the business and no one would argue since the founder has set this plan and he’s the ultimate decider in the business. V. Action Plan:
Barry Sr. should call in the lawyers to draw up the plan, whilst drawing up the plan include the children with the decision and take in their aspirations into consideration to show them that there are also part of the decision that is made in the family business.
REFERENCES:
http://en.wikipedia.org/wiki/Bob_Barry,_Sr.
http://www.courier-journal.com/ 