December 5, 2022

GHBellaVista

Imagination at work

What can business school teach a family firm?

It could be stated that Ramon Roqueta was born to make wine. He is the fifth technology of his household to operate Roqueta Origen, a group of wineries in Catalonia, north-east Spain. In 1898, his terrific-terrific grandfather proven the 1st of the family’s four wineries, but the business’s origins date again even even more.

Historic data show that Roqueta’s ancestors started making wine at the Masia Roqueta farmhouse, in the Bages region north of Barcelona, in 1199. Far more than 800 yrs later on, the company’s headquarters are on the identical web site.

Roqueta turned to Iese Company University in Barcelona to put together for his eventual succession. Right after coaching at wineries in France, Australia and the US, he enrolled on the Iese MBA in 2005 to sharpen his enterprise and management capabilities. “It’s not only about making wine, but offering it and making the enterprise lucrative,” he describes.

Right after graduating in 2007, Roqueta worked in consulting, then took up a management job in the household enterprise in 2009. It was about this time that he enrolled in Iese’s Alumni Learning Software, a series of free coaching periods concentrating on particular spots of enterprise. Over many yrs, he took courses on household enterprise challenges this sort of as succession arranging and handling household conflicts.

He learnt how to create a household protocol, a doc that codifies the business’s values, vision and mission, together with policies of ownership, governance and management. The procedure associated the various household associates, which strengthened unity. “This has been a competitive advantage for the firm above the generations,” states Roqueta, who took above from his father, Valentí, as chief government in 2014.

Ramon Roqueta in the family vineyard
Ramon Roqueta states his Iese MBA helped sharpen his capabilities to strengthen sales and income © Javier Luengo

Other enterprise schools are emulating Iese by launching classes that focus on the requires of household firms, which tend to just take a extensive-time period outlook on investments alternatively of chasing quarterly returns. Family members firms generally have sturdy stakeholder associations and far more loyal workforces than other businesses. They are also generally far more risk-averse and have much less debt.

“We can find out many items from household firms,” states Allan Discua Cruz, director of the Centre for Family members Company at Lancaster College Management University in north-west England. “There are so numerous ideas and dynamics that are worth comprehending, this sort of as enterprise continuity, legacy, stewardship and resilience.”

Some teachers say that just about every enterprise pupil need to find out about household business. “With the bulk of economic action and private sector work in numerous European nations around the world generated by household firms, it is hugely probable that our graduates will be working for 1 at some position,” states Marta Elvira, chair of household-owned enterprise at Iese.

She notes an growth of career options, which includes at the developing ranks of household workplaces, in addition to employment at businesses that company household firms, this sort of as banking companies and consultancies. Other, far more entrepreneurial, students are intrigued in establishing new enterprise dynasties.

Company schools in Europe are hence sharpening their focus on household enterprises, which make up 60 for each cent of the region’s businesses — from smaller firms to multinationals this sort of as Exor, the expense firm owned by Italy’s Agnelli household, and Germany’s Volkswagen, the carmaker managed by the Porsche and Piëch people.

Morten Bennedsen, educational director of the Wendel International Centre for Family members Enterprise at Insead enterprise college in France, factors out that household enterprise investigation only emerged as an educational field in the eighties. “Business schools have not historically concentrated on household firms. That is transforming as recognition grows,” he states. Numerous business owners even now do not believe that their people require a enterprise education, Bennedsen states, but adds: “As these businesses scale, there is a require to professionalise the management and governance. That is what you can not find out from the household.”

About 10 for each cent of the 1,000 MBA students who enrol at Insead every single 12 months are from household-owned businesses. Normally, they are heirs, though present-day homeowners just take part-time government classes to cope with the pressures of preserving a household legacy. Insead features a household enterprise elective in its MBA, in addition to an government programme that addresses the challenges these businesses face.

Family members firms are occasionally stated to be especially resilient through crises, but the investigation is inconclusive. Daniela Maresch and Matthias Fink at France’s Grenoble Ecole de Management identified that this sort of firms noted noticeably far more economical losses than other people through the pandemic. The initial stabilising effect of household involvement can switch into a legal responsibility as crises unfold, the professors say, as the load of responsibility ignites household conflict.

Milan’s SDA Bocconi University of Management programs to launch new government classes for household firms up coming 12 months. “There is now a more powerful focus on risk mitigation and resilience,” states Alessandro Minichilli, professor of corporate governance at the college. “The need for enterprise education in spots like succession arranging, sustainability and governance is huge.”

Rania Labaki, head of the Edhec Family members Company Centre in Lille, France, factors out that only thirty for each cent of household enterprises make it to the second technology, with the survival rate dropping precipitously with every single succession.

The largest transfer of prosperity on report is anticipated in the coming 10 years as baby boomers retire. In Europe, at the very least $3.2tn will transform arms by 2030 and, in numerous European economies, the variety of household enterprise leaders above 70 has been soaring in the past 10 years.

Labaki thinks succession is where by enterprise schools can really make a difference: “Young heirs typically face a problem of legitimacy, and they require our competencies to direct the household enterprise,” she states.