...governance in family businesses. In a study by Professor Panikkos Poutziouris of the Cyprus Institute of Management of 42 companies on the London Stock Exchange, listed family firms outperformed their listed non-family rivals by 40 percent from 1999 to 2005. But the study also shows that the outperformance of the Family Business63 Index only applies when the interests of shareholders and management are aligned. Credit Suisse64 research also showed that family-owned companies perform better: over the long term, such firms tend to achieve superior returns and higher profitability than companies with a fragmented shareholder structure. Credit Suisse analysts compared the stock performance of European companies with a significant family influence to firms with a broad shareholder base. The study incovered several factors that contribute to the success of familyowned firms: ff Longer-term strategic focus of the controlling shareholders and management, instead of operational focus on trying to surpass quarterly results in Better alignment of management The main challenge in family business governance relates to the existence of an additional layer of relationship that the owning/controlling family brings to the business.‑ For shareholders this complexity includes understanding the various interconnections among the owning/controlling family members. These roles include: ff Family member/owners ff Family member/directors ff Family member/managers ff Family member/employees ...
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...From Swords to Ploughshares From Swords to Ploughshares: The Family Conflicts, Transition, and Connection Brenda Hawkins Strayer University Dr. Dwight Heaster Business Administration Abstract This paper describes how successful Meritex Enterprises, Inc. has been at recognizing and satisfying stakeholder interests; the mechanisms available in managing relationships with stakeholders to influence the strategic direction and performance of the company; why the board of directors for Space Center Enterprises was or was not successful in fulfilling its governance role and in meeting the challenges it faced; and why Harry “Paddy” McNeely III, was or was not, qualified to fill in his father’s footsteps as CEO of the newly-merged Meritex organization, based on strategic leadership roles. Meritex Enterprises Inc. was successful recognizing and satisfying stakeholders (2010) interests in the company by diversifying into three core businesses involving warehousing, third-party logistics, and facilities modernization. The mechanisms available to senior leadership were the diversification strategies to expand business. The newly elected CEO and Chairman, Paddy McNeely’s implementation of the related diversification strategy enabled him to restructure the company, by negotiating buyout of the management company, Space Center Enterprises. Space Center Enterprises was success in fulfilling its governance role by electing Harry “Paddy” McNeely III, to the most important position...
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...From Swords to Ploughshares: The Family Conflicts, Transition, and Connection Brenda Hawkins Strayer University Dr. Dwight Heaster Business Administration Abstract This paper describes how successful Meritex Enterprises, Inc. has been at recognizing and satisfying stakeholder interests; the mechanisms available in managing relationships with stakeholders to influence the strategic direction and performance of the company; why the board of directors for Space Center Enterprises was or was not successful in fulfilling its governance role and in meeting the challenges it faced; and why Harry “Paddy” McNeely III, was or was not, qualified to fill in his father’s footsteps as CEO of the newly-merged Meritex organization, based on strategic leadership roles. Meritex Enterprises Inc. was successful recognizing and satisfying stakeholders (2010) interests in the company by diversifying into three core businesses involving warehousing, third-party logistics, and facilities modernization. The mechanisms available to senior leadership were the diversification strategies to expand business. The newly elected CEO and Chairman, Paddy McNeely’s implementation of the related diversification strategy enabled him to restructure the company, by negotiating buyout of the management company, Space Center Enterprises. Space Center Enterprises was success in fulfilling its governance role by electing Harry “Paddy” McNeely III, to the most important position in the company, the Chief...
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...of the Study.....…………………………………………..2 3. Method of Study ..…………………………………………………………………..2 4. Chapter wise summary and critical analysis...……………………………………3 5. Theoretical framework & Relating to practical aspects..………………………..5 6. Learning and Conclusion ...............……………………….……………………….7 7. Group Working and Team Roles…………………………………………………..8 8. References...................................................................................................................12 Page 1 INTRODUCTION AND SUMMARY The Godfather, written in 1969, by a renowned Italian-American author, Mario Puzo, is based on the organized crimes that New York witnessed post World War II. The book opens with the wedding of Connie Corleone, daughter of Don Vito 'The Godfather' Corleone, head of the most powerful of the five great Mafia clans or 'families' of New York. He is a paradigmatic mafia don. Don Corleone is shot at by a new contender for power in the city, Virgil 'the Turk' Sollozzo, who plans to obtain power by the lure of vast profits in the drug trafficking trade. In Don Vito’s absence, his elder son Santino Corleone assumes the responsibility of the don to manage the family business. Hearing of his father’s news Michael returns home and during his hospital visit saves his father’s life from yet another murder attempt. These incidences filled Michael with vengeance and he plans to kill Sollozzo and Captain McCluskey and convinces Santino and Tom (family’s consigiliere) for the same. After the...
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...5 Tangible Benefits Governance challenges For Family-owned businesses Implementing Tangible Benefits Motivation Implementing Purpose Alignment Family Business Challenges Planning What To Do Family Business Challenges What To Do KEY MESSAGES To an extent, family control yields benefits. Academic research and experience from many companies and investors all show that a certain degree of family ownership/control provides positive benefits to the family business and its shareholders. Family-owned firms face unique challenges. However, many failures of family-owned companies indicate that such firms also face a multitude of challenges which risk destroying shareholder value or even the business itself. Corporate governance measures lead to long-term success and keep peace in the family. Corporate governance measures at the family and business levels provide good solutions to family ownership challenges and often are indispensable to the long-term success of the family business nd peace in the controlling family, especially with succeeding generations. —a “…We have two options; there is no right or wrong decision, nor one that is better than the other. But whatever is to be done, will be definitive. There is no turning back. We can continue being a family business, like in my grandfather’s and father’s days, or become a professional company with a strong and clear capital market strategy.” —David Feffer, Suzano, Chairman of...
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...central challenges facing Al Blanchard, Grandview Industries, and the Blanchard family? * Finding a successor that will fulfill the needs of the company and satisfy the family. The process of finding a successor does not come over night and requires diligent thinking and planning. * For Grandview Industries the future is bright. It is growing steadily and tripling in sales, so the real challenge Grandview faces is finding a president and committee that will continue to develop the business and satisfy the hundreds of employees * For the Blanchard family, they all need to come together and come up with a solution that is best for Grandview. The Blanchard’s is a pretty big family so not everyone is going to be satisfied with the decision. As a family though, they must be behind the next business leader 100% and choose it carefully. 2. What would you recommend Al Blanchard do, in his leadership capacity, on behalf of Grandview Industries and its shareholders? * I would recommend Al to stay as president for another 2 years or so. Currently he is the only viable option for this position at this time until the family works out the transition. Stepping down while Grandview is performing at a high level would be the wrong decision for Al to make. He has done an excellent job delivering dividends to family members, which have been keeping them happy. * In addition, as the business is developing and the number of shareholders is growing, any successor would have...
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...Family Assessment Casey Schuler Bemidji State University Family Description The family discussed in this paper is a blended family. Included is a stepfather (SK), age 50, a mother (LS), age 48, and three children (TS, MS, LS), whose ages are 26, 21 and 18 respectively. The mother is the biological parent of all three children from a previous marriage which ended in divorce from alcoholism in her spouse. The spouse and biological father (GS) has a distant relationship with the children and does not live close. The stepfather also has a child from a previous marriage who was adopted by his uncle and aunt. SK’s previous wife (PK) and youngest child (JK) from that marriage are deceased after an automobile accident. The K family combined 8 years ago when SK and LS had met on an online dating site and fell in love. The step father SK is a business owner who runs an automotive repair shop. He is the primary breadwinner for the family. The mother LK is retired from her previous job due to disability, but works part time for the public school system preparing food for the lunch programs at various schools. She also helps at the automotive shop doing customer service work when needed. The children are all about 4 years apart and have only loose bonds due to the age differences. The oldest son TS no longer lives at home and works construction and is not married. The youngest has also moved away from the home due to indifferences with the step father. Her relationship with the family...
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...evenings; I was the primary caregiver for our two children. That meant I had to leave work earlier than any of the other managers, and that caused a lot of friction and resentment... The tension it created for me at work was instrumental in my eventually having to leave the company. —MICHAEL KERLEY, PRESIDENT, CREATIVE DIALOGUES Chapter Overview This chapter focuses on how women (and, increasingly, men) attempt to balance the multiple competing demands on their time and energy. The authors discuss the types of conflicts that often occur as employees try to meet the needs of their spouses, children, elderly parents, community, and employers. They discuss both the positive, life- enhancing effects of participating in multiple roles, as well as the inevitable stresses and strains associated with life’s daily traumas (e.g., the baby...
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...Family Assessment Casey Schuler Bemidji State University Family Description The family discussed in this paper is a blended family. Included is a stepfather (SK), age 50, a mother (LS), age 48, and three children (TS, MS, LS), whose ages are 26, 21 and 18 respectively. The mother is the biological parent of all three children from a previous marriage which ended in divorce from alcoholism in her spouse. The spouse and biological father (GS) has a distant relationship with the children and does not live close. The stepfather also has a child from a previous marriage who was adopted by his uncle and aunt. SK’s previous wife (PK) and youngest child (JK) from that marriage are deceased after an automobile accident. The K family combined 8 years ago when SK and LS had met on an online dating site and fell in love. The step father SK is a business owner who runs an automotive repair shop. He is the primary breadwinner for the family. The mother LK is retired from her previous job due to disability, but works part time for the public school system preparing food for the lunch programs at various schools. She also helps at the automotive shop doing customer service work when needed. The children are all about 4 years apart and have only loose bonds due to the age differences. The oldest son TS no longer lives at home and works construction and is not married. The youngest has also moved away from the home due to indifferences with the step father. Her relationship with the family...
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...society. Social values refer to the general recognition in society about which acts are good and desirable on the part of people and which acts are not. In relation to business, social values of business may indicate: a. The characteristics of good business; b. Objectives which are desirable for business to follow; and c. The manner in which business activities should be conducted in the interest of society. For example, we consider it bad, if any business indulges itself in selling adulterated goods or charging higher price or polluting the environment. Thus, social values of the business form the base for social responsibilities. Business can also be guided by certain moral principles say, running the business without adopting unfair practices, being honest and truthful about quality of goods, charging fair prices, abiding to laws, paying taxes, duties and fees to the government honestly. The basic question underlying business ethics is whether business should aim at earning profit by any means, obviously not. Thus, businessmen should charge only fair price for the goods and services supplied, never sell adulterated products as pure. Indeed business ethics suggest certain principles to conduct business so as to be morally justified. Just like social values, business ethics also play a major role while fulfilling social responsibilities. Definition of Social Values Larger concept which includes social capital as well as the subjective aspect of citizens’...
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...to the successful evolution of any family business is the development of the younger generation of the family members for the leadership, commercial and general business skills demanded of the family by the business. In addition, younger generations should understand the responsibilities that success can bring, and how best to ensure their positions of commercial influence and the benefits given to them by personal affluence, are deployed in ways which will give them the best chance of fulfilled, productive and happy lives. Key challenges include: * Development of family members involved in the business and preparing them for future leadership if appropriate * Educating the next generation to be responsible owners of the business * Encouraging them to be responsible with wealth * Developing a cohesive team in the next generation which can work together to arrive at consensus, allowing continued business success and family harmony. Challenges facing the next generation The next generation often have a tough act to follow. This, coupled with the normal challenges of family life, presents a particularly demanding set of challenges, including: * Increased choices - not all will want to join the business straight from study, if at all * The pressure of living up to expectations * Sibling rivalry * Knowing how to connect with the business if they are not directly involved * Changing lifestyles - children in family Businesses are often raised in a...
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...The Role of Life Insurance in Financial Plan Life insurance can be an integral part of financial plan for future and the futures of loved ones. Selling life insurance should always be set in that situation, where it is a very important part of a person's total financial picture. One way to sell insurance in this manner is to set it against competing products as superior to them in value over time. In many cases for the ideal life insurance client, the promise of future financial support for his or her family after death is a powerful selling point. Life insurance as a role for total coverage tool against death when there is no financial planning in place is also ideal in that, given a large enough death benefit, a person's house, bills, funeral and children's educations will be paid for in full. This is a primary motivating factor particularly for younger clients who are just married and just beginning to build a life together. Emphasis on their age and relative health being to their advantage at such an early stage in life is also a useful way of showing how life insurance is a key product to have. The major roles for life insurance to play in a proper financial plan are assets assurance, leaving a legacy, family future financial support and protecting own business. Life Insurance may able to help the insurers protect their assets. Insurers may have real and personal property that they would not want to go to ruin after they pass away. With a life insurance policy, insurer...
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...Family Firms and their Governance Creating Tomorrow’s Company from Today’s by Sir Adrian Cadbury Family Firms and their Governance Creating Tomorrow’s Company from Today’s by Sir Adrian Cadbury Family Firms and their Governance Creating Tomorrow’s Company from Today’s by Sir Adrian Cadbury Introduction Family-owned firms are one of the foundations of the world’s business community. Their creation, growth and longevity are critical to the success of the global economy. Although facing many of the same dayto-day management issues as publicly-owned companies, they must also manage many issues specific to their status. Sir Adrian Cadbury’s long and distinguished business career was built on his dual expertise in both corporate governance and family firms. A recognised authority on the former, he led the committee which laid the foundations for corporate governance in the UK. Thereafter, he played a crucial role in developing corporate governance standards in many other countries. Sir Adrian also has a first-hand understanding of family firms. His career began with his own family’s firm, the Cadbury company. Joining its board when it was still privately owned, he subsequently became its chairman. During his tenure, Cadbury was transformed into a public company and subsequently merged with Schweppes. His unique perspective of family firms and their governance is at the heart of this report. To lend a global dimension to the topic, we have also studied five other family...
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...Family Description The family discussed in this paper is a blended family. Included is a stepfather (SK), age 50, a mother (LS), age 48, and three children (TS, MS, LS), whose ages are 26, 21 and 18 respectively. The mother is the biological parent of all three children from a previous marriage which ended in divorce from alcoholism in her spouse. The spouse and biological father (GS) has a distant relationship with the children and does not live close. The stepfather also has a child from a previous marriage who was adopted by his uncle and aunt. SK’s previous wife (PK) and youngest child (JK) from that marriage are deceased after an automobile accident. The K family combined 8 years ago when SK and LS had met on an online dating site and fell in love. The step father SK is a business owner who runs an automotive repair shop. He is the primary breadwinner for the family. The mother LK is retired from her previous job due to disability, but works part time for the public school system preparing food for the lunch programs at various schools. She also helps at the automotive shop doing customer service work when needed. The children are all about 4 years apart and have only loose bonds due to the age differences. The oldest son TS no longer lives at home and works construction and is not married. The youngest has also moved away from the home due to indifferences with the step father. Her relationship with the family is somewhat strained and she does not live close by either...
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...one can either come in or wander away. The yards will be furnished with safe, educational and entertaining toys, as well as a sandbox. The houses will typically be used for rainy-day activities, naps, story-telling, the serving and preparation of meals. The houses will also contain safe educational toys, games, and books for the entertainment of the children. The roles of the stakeholders in the education and child care field range from the owners to the children. These stakeholders will shape various projects within the business, ensure resources are available to contribute to our business's success, and provide insight regarding the reaction to a project's outcome, which will create adjustments within the our company when necessary to win organizational support. Our focus is to provide a stimulating early care and educational experience, which promotes each child's social/emotional, physical and cognitive development. Our goal is to support children's desire to be life-long learners. As a the CEO and owner of Second Home Educational Child Care, I am an important stakeholder in this business as the business will affect my...
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