The Succession Process of Ricardo Garza Limón

In April 2024, Ricardo Garza Limón, the founder of Grupo Garza Limón in Mexico, was reflecting on the succession process he had embarked on in 2016. Despite making progress, Ricardo regretted not having achieved his main goal: seeing one of his two sons take on the role of chief executive officer (CEO) in the family firm. The company had a solid nonfamily CEO in place but needed to strengthen its board of directors and formalize a trust to align future generations with corporate governance principles. Ricardo also recognized the serious challenges facing the succession process. Not only were his sons unprepared for leadership and lacking key competencies, but there were ongoing conflicts between family members and struggles to balance family dynamics with business needs. With all these considerations in mind, Ricardo wondered whether his chosen succession plan had been the right one. If not, did he need to do something else to ensure the continuity and success of his business legacy?

This case is designed for undergraduate and graduate courses and can best be used in an introductory class on family business. By working through the case and assignment questions, students will have the opportunity to do the following:<ul><li>Explore the unique challenges and dynamics inherent in family businesses, including succession planning, familial relationships, and the intersection of family and business roles.</li><li>Analyze the importance of leadership development and succession planning ensuring the long-term sustainability of a business, particularly in the context of family-owned enterprises.</li><li>Examine the role of corporate governance in family businesses, including the composition and function of the board of directors, and its impact on strategic decision-making and organizational performance.</li><li>Evaluate strategies for resolving conflicts within family businesses, improving communication among family members and stakeholders, as well as fostering collaboration toward shared business goals.</li><li>Discuss the implications of strategic decisions, such as appointment of CEOs, composition of boards of directors, and development of ownership structures, on the overall direction and success of a company.</li></ul>

• succession, family firms, latin america