Case Report - The Heraeus Group
Company key assets analysis
The most important overriding issue currently facing the Heraeus company is the question of succession and a lack of a formal corporate governance framework to address future ownership and management issues. The Heraeus company is one of Germany’s oldest and most successful family-owned companies. Dr. Jurgen Heraeus is the head of the family and has the most control and involvement in the company. He has just turned 70 and is contemplating the future of the company. Currently there are 180 family member owners, but only one family member other than Jurgen holds any significant management position, the other family members act in a capacity more like shareholders of publicly held companies.
The key assets of the Heraeus Company evolve from its extensive history, the long-term horizon of the family shareholders, the unwillingness to raise capital from outside of the company and a set of common core values of the family. One key asset is the innovative nature of the company. Since the company relies only on internal capital to fund its operations it focuses more on constant innovation rather than capital intensive endeavors with 22% of revenue coming from products that are less than 3 years old. The company is highly technology driven, owning the intellectual property of the process of melting platinum and process of obtaining high-purity quartz glass. Moreover, professionalism is also a company asset since subsidiaries under Heraeus Company are all professional companies with ownership of patents.
Entrepreneurship is the origin of the Heraeus business. Wilhelm’s father created the family business and also helped the family retrieve and develop the business after World War II. From 1851 to 2006, the family created 6 companies in different business areas.
From the above information, it is fair to