Module 1 of Demystifying Families in Business focuses on the Family. The Family unit forms the bedrock of the organizations that comprise the collective Family organization, specifically, the virtues that define the Family members' rules of engagement, and the Family governance structure necessary to support it. In this module note, we provide a framework for Legacy Governance, and introduce the Three Virtues of Family Business, (1) Clarity, (2) Fairness, and (3) Motivation, as requisite shared values for all Families in Business.
The start-up BlueVine Capital Inc. (BlueVine) used data and technology to help finance small businesses via factoring and lines of credit. The case explains the small business financing market in mid-2010s, how CEO Eyal Lifshitz identified the opportunity for BlueVine, and how he built the company through its first five years of operations. Through the case, Lifshitz and his team discover insights about their small business customers that inspire them to change their product portfolio. In December 2018, Lifshitz must decide which new products to launch next.
In June 2019, Best Buy appointed Corie Barry as new CEO. Her predecessor, CEO Hubert Joly, had successfully tackled BBY's two main problems-declining comps and margins-and engineered a financial turnaround within his first five years on the job. Despite its surviving as a retailer, Best Buy and Corie Barry confront multiple challenges. Best Buy is still a predominantly bricks-and-mortar store with an online presence (just 20.9 percent of sales are generated online in 2018 compared to 17 percent in 2015). Additionally, the United States is no longer the world's largest consumer retail market, and Best Buy has retreated to North America after failing to expand to China and Europe. Further, consumer electronics are caught within trade disputes between China and the United States. Under Joly, Best Buy balanced providing differentiated service with trained staff at competitive prices involves. However, Corie Barry needs to consider whether that balance can be maintained going forward, or whether Best Buy needs to further adapt.
In 2019, Chinese smartphone maker and telecommunications empire Huawei was preparing to launch its new flagship smartphone series, the Mate 30. After years of explosive growth, the previous 18 months had been a challenge for the company. In early 2018, Huawei's planned smartphone launch in the U.S. had failed due to pressure from regulators who cited concerns about the company facilitating Chinese spying. Over the following months, a trade war between the U.S. and China had broken out, with Huawei at its epicenter. By mid-2019, after months of U.S. pressure and restrictions, Huawei found its supply chain for computer parts and software under siege and several governments around the world threatened to ban its 5G network equipment from their countries. In this unpredictable climate, Huawei founder Ren Zhengfei and his management team had to figure out not only how to successfully launch Mate 30 phones in the upcoming fall, but how to ensure the company's long term viability.
Ace Company (Ace) was a Chinese start-up developing software for the Internet of Things (IoT). The company was founded in February 2015 by three colleagues for the initial purpose of providing an unprecedented universal IoT operating system, the absence of which was severely crippling developing development in IoT. By mid-2017, having proven the technical viability and market acceptability of its offering, the company was ready to scale up. However, the co-founders disagreed on the choice of growth strategy. One founder advocated extending Ace’s business to as many industrial scenarios and companies as possible, while the other founder was in favour of Ace focusing on and penetrating deeply into a few industries. The third founder was stuck in the middle and wanted to know which path they should choose.
The chief executive officer (CEO) of the government-owned Hong Kong Science and Technology Parks Corporation (HKSTP) is setting the marketing policy for the incubation program at HKSTP, Hong Kong’s leading incubator of high-technology companies. Seeing marketing as a driving force to convey the strategy of HKSTP, the CEO must analyze the key services through which HKSTP can increase an incubatee’s chances of success; analyze the advantages and disadvantages that HKSTP presents for a start-up’s location; analyze how HKSTP positions itself in the competitive market for incubation services; discern how successful it is; and determine what marketing ideas HKSTP should use to convey its competitive advantages. The task is complicated by the global nature of the incubatee servicing market, the position of Hong Kong within the Greater Bay Area of the People’s Republic of China, and the CEO’s belief that a company has to be on its own, not relying on government programs. Not only did the CEO have to give HKSTP’s incubatees the resources to help them survive and prosper, but he also had to attract the best tech start-ups to join the program.
Between 2010 and 2015, Opera Philadelphia experienced a steep decline in household subscribers and single-ticket buyers, coupled with severe revenue fluctuations. At that time, market behaviours had changed along with growth in more sophisticated use of digital media for entertainment and social interaction.<br><br>The general director’s critical objective for the Opera was to develop a fresh strategy that specifically targeted evolving tastes for opera performance in Philadelphia and the surrounding area. The Opera had to determine whether it needed to revise its segmentation and positioning strategy, as well as make adjustments to its product. This new strategy also had to provide protection for and prevent further loss of the Opera’s existing subscription audience, many of whom were loyal donors.
The chief executive officer (CEO) of the government-owned Hong Kong Science and Technology Parks Corporation (HKSTP) is setting the marketing policy for the incubation program at HKSTP, Hong Kong's leading incubator of high-technology companies. Seeing marketing as a driving force to convey the strategy of HKSTP, the CEO must analyze the key services through which HKSTP can increase an incubatee's chances of success; analyze the advantages and disadvantages that HKSTP presents for a start-up's location; analyze how HKSTP positions itself in the competitive market for incubation services; discern how successful it is; and determine what marketing ideas HKSTP should use to convey its competitive advantages. The task is complicated by the global nature of the incubatee servicing market, the position of Hong Kong within the Greater Bay Area of the People's Republic of China, and the CEO's belief that a company has to be on its own, not relying on government programs. Not only did the CEO have to give HKSTP's incubatees the resources to help them survive and prosper, but he also had to attract the best tech start-ups to join the program.
Between 2010 and 2015, Opera Philadelphia experienced a steep decline in household subscribers and single-ticket buyers, coupled with severe revenue fluctuations. At that time, market behaviours had changed along with growth in more sophisticated use of digital media for entertainment and social interaction. The general director's critical objective for the Opera was to develop a fresh strategy that specifically targeted evolving tastes for opera performance in Philadelphia and the surrounding area. The Opera had to determine whether it needed to revise its segmentation and positioning strategy, as well as make adjustments to its product. This new strategy also had to provide protection for and prevent further loss of the Opera's existing subscription audience, many of whom were loyal donors.
Ace Company (Ace) was a Chinese start-up developing software for the Internet of Things (IoT). The company was founded in February 2015 by three colleagues for the initial purpose of providing an unprecedented universal IoT operating system, the absence of which was severely crippling developing development in IoT. By mid-2017, having proven the technical viability and market acceptability of its offering, the company was ready to scale up. However, the co-founders disagreed on the choice of growth strategy. One founder advocated extending Ace's business to as many industrial scenarios and companies as possible, while the other founder was in favour of Ace focusing on and penetrating deeply into a few industries. The third founder was stuck in the middle and wanted to know which path they should choose.
In 2013, Bikes & Co. Ltd., a business unit belonging to a multi-divisional organization in Nagpur, India, was rooted in the past and out of touch with the contemporary environment. A new chief executive officer had been charged with implementing strategic changes that would turn the unit around across the organization, in every function and department. These changes aimed to align the company with consumer expectations and behaviour, which was reflected in retail outlets or points of purchase. The organization had to avoid concentrating only on the consumer's end decision point and focus instead on the entire consumer decision journey. The new chief executive officer had been given 12 months to accomplish a business transformation that would address issues related to human resources, the supply chain, marketing and branding, vendor management, sourcing, sales, customer service, enterprise resource management, product design, engineering, and retail outlets.
In 2013, Bikes & Co. Ltd., a business unit belonging to a multi-divisional organization in Nagpur, India, was rooted in the past and out of touch with the contemporary environment. A new chief executive officer had been charged with implementing strategic changes that would turn the unit around across the organization, in every function and department. These changes aimed to align the company with consumer expectations and behaviour, which was reflected in retail outlets or points of purchase. The organization had to avoid concentrating only on the consumer’s end decision point and focus instead on the entire consumer decision journey. The new chief executive officer had been given 12 months to accomplish a business transformation that would address issues related to human resources, the supply chain, marketing and branding, vendor management, sourcing, sales, customer service, enterprise resource management, product design, engineering, and retail outlets.
In December 2012, Walt Disney Company Chairman and Chief Executive Officer, Robert A. Iger announced the completion of his company's $4 billion acquisition of Lucasfilm Ltd., further expanding the company's footprint in its Studio Entertainment segment. Was Iger navigating the company on a solid strategic course or was he engaged in the same "empire building" that ultimately forced his predecessor Michael Eisner to resign?
In April 2018, Indra Nooyi, CEO and Chair of the Board of PepsiCo, was asked if the company should keep its snacks and beverages businesses together. PepsiCo was doing well in general. Its 2017 annualized dividend per share had increased by 50 percent, and it returned $38 billion to shareholders. However, the company's report for the quarter told a familiar story. Revenues for its snacks division, Frito Lay North America, grew by 3 percent, while revenues for its North American Beverages division fell by 1 percent. Were snacks and beverages actually better together, or would a separation allow each business to maximize its potential? Nooyi's response reflected the strong conviction among PepsiCo's leadership that keeping them together created synergies that made the company more valuable than the sum of its parts. Many investors, however, were just as convinced that PepsiCo would be more efficient and profitable as two pure play companies. This case provides background on the company and the snacks and beverage markets while asking students to consider Pepsico's best strategy for future growth.