The majority of businesses in the world are family owned. As businesses become successful and acquire scale and scope, more often than not, they go pubic and perhaps the family or the founder relinquishes control. General Electric was founded by Thomas Edison. It is a legendary company in every way, but many generations removed from the founder, and not a family business by any means. But certainly, Edison and the light bulb (and many other inventions), changed the world.
I was wondering, if there were businesses that changed the world, but are still in the family. So I put forth two criteria to see if an interesting list could be generated.
Criteria 1. A business that changed the world. If that criteria is a bit too restrictive, since every business cannot aspire to Thomas Edison's stature, perhaps a business with significant impact.
Criteria 2. A business still controlled or managed by the family but at least 3 or 4 generations into management.
The first criteria of course eliminates most of the businesses from consideration. And the second criteria filters out the more recent names. Google, Amazon, Facebook - all these are not in the mix since they are pretty recent. Similarly Boeing, Xerox and other such big names don't make the list since they are no longer with the original family. Anheuser Busch was a contender since it made both criteria, but just a few years ago, the family sold off the entire business.
The question becomes, what is the list of interesting companies that had a big impact on the world, that through successive generations still are with the family that founded it?
A more thorough research might yield a much better list that the one below. But this is a weekend warrior's work - so please consider it in that light! But I do hope you enjoy it!
Ford - Great story! Henry Ford introduced through his model-T a way for the common man to own a car. 'Any color so long as it is black'. Five generations into it, the Ford family is still very active at the company. A quirky story with this family worth mentioning. Henry Ford has a huge 'melting pot' - an actual melting pot. European immigrants who joined his company, had to stand in line, take a dip in the pot, come out on the other side in new clothes and 'Americanized' - the actual original melting pot!
Berreta - The world's oldest gun manufacturer founded in 1526 and is in its 15th generation of managing the business. Through the centuries, in the telling of their story, the family has guided the company in the transition from specialist gun-barrel makers to, in Napoleonic times, creator of sporting firearms, later adding military and law-enforcement arms and importing arms by Colt, Remington, S&W, and Winchester, still later developing one of the first international industrial enterprises.
There is an interesting story regarding their logo. The encircled arrows represent the three shots fired by a battleship that engages a potential enemy: the arrow on the left reprents the first warning shot, fired at the ship's stern; the arrow on the right represents the second warning shot, fired at the ship's bow. The central arrow is the last round fired, when the ship doesn't yield: this one is aimed at the ship itself. The logo was dubbed "Dare In Brocca" or "hit the target."
Bechtel - In its fourth generation of family management, this company is the largest construction and engineering company in the United States. Warren Bechtel, who founded the company in the wake of the San Francisco earthquake 100 years ago. Bechtel participated in the building of Hoover Dam in the 1930s. It has also had involvement in a number of other projects including the Channel Tunnel, King Fahd International Airport in Dammam (the largest Airport in the world by land area), Hong Kong International Airport and the Boston Big Dig.
The Boston Big Dig is in our own backyard. We Bostonians find it very convenient. However, this massive project was mired in political controversy, massive cost over runs and delays for years on end. The Big Dig was the most expensive highway project in the U.S. and was plagued by escalating costs, scheduling overruns, leaks, design flaws, charges of poor execution and use of substandard materials and criminal arrests.
But hey, I can get to the airport in 15 minutes flat!
Mars - This chocolate maker is in their fourth generation of management. Fully owned by the family. They manufacture tons of stuff that contributes to diabetes (!), but none more enticing than a bag of M&Ms.
There was some storm in a tea cup in the 90s I think, when the company asked the public to vote for a new color M&M because they were retiring the tan color M&M. 10 million votes were cast! And the color blue was selected.
I like blue M&Ms!
Sotheby's - Sotheby’s is the world’s fourth oldest auction house and of course a rival of Christie's (reminds me of Coke vs Pepsi or FedEx vs UPS).
I love visiting auctions. I have been to wine and car auctions and of course many silent auctions at charitable events. We have also more recently bought art through web auctions after visiting a gallery. However, visiting an actual live art auction like Cary Grant, Eva Maria Saint and James Mason continues to be a bucket list item.
http://www.youtube.com/watch?v=dl0JcK4-Dx0
Kongo Gumi - I cannot vouch for the world impact of this business. But this family run construction business in Osaka, Japan was founded in 578 AD and is in its 40th generation of management. Really?!
In the company's telling of its story,
Prince Shotoku brought Kongo family members to Japan from Korea more than 1,400 years ago to build the Buddhist Shitennoji Temple, which still stands. Over the centuries, Kongo Gumi has participated in the construction of many famous buildings, including the 16th-century Osaka castle. Apparantly, 51-year-old son, Masakazu Kongo, is waiting in the wings to take over the company as the 41st generation family leader.
There are surely more examples that come to mind, but longevity and significant impact are tough criteria to get through simultaneously.
I was wondering, if there were businesses that changed the world, but are still in the family. So I put forth two criteria to see if an interesting list could be generated.
Criteria 1. A business that changed the world. If that criteria is a bit too restrictive, since every business cannot aspire to Thomas Edison's stature, perhaps a business with significant impact.
Criteria 2. A business still controlled or managed by the family but at least 3 or 4 generations into management.
The first criteria of course eliminates most of the businesses from consideration. And the second criteria filters out the more recent names. Google, Amazon, Facebook - all these are not in the mix since they are pretty recent. Similarly Boeing, Xerox and other such big names don't make the list since they are no longer with the original family. Anheuser Busch was a contender since it made both criteria, but just a few years ago, the family sold off the entire business.
The question becomes, what is the list of interesting companies that had a big impact on the world, that through successive generations still are with the family that founded it?
A more thorough research might yield a much better list that the one below. But this is a weekend warrior's work - so please consider it in that light! But I do hope you enjoy it!
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| Henry Ford's Melting Pot |
Berreta - The world's oldest gun manufacturer founded in 1526 and is in its 15th generation of managing the business. Through the centuries, in the telling of their story, the family has guided the company in the transition from specialist gun-barrel makers to, in Napoleonic times, creator of sporting firearms, later adding military and law-enforcement arms and importing arms by Colt, Remington, S&W, and Winchester, still later developing one of the first international industrial enterprises.
Bechtel - In its fourth generation of family management, this company is the largest construction and engineering company in the United States. Warren Bechtel, who founded the company in the wake of the San Francisco earthquake 100 years ago. Bechtel participated in the building of Hoover Dam in the 1930s. It has also had involvement in a number of other projects including the Channel Tunnel, King Fahd International Airport in Dammam (the largest Airport in the world by land area), Hong Kong International Airport and the Boston Big Dig.
But hey, I can get to the airport in 15 minutes flat!
Mars - This chocolate maker is in their fourth generation of management. Fully owned by the family. They manufacture tons of stuff that contributes to diabetes (!), but none more enticing than a bag of M&Ms.
I like blue M&Ms!
Sotheby's - Sotheby’s is the world’s fourth oldest auction house and of course a rival of Christie's (reminds me of Coke vs Pepsi or FedEx vs UPS).
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| North By Northwest - Auction Scene |
http://www.youtube.com/watch?v=dl0JcK4-Dx0
Kongo Gumi - I cannot vouch for the world impact of this business. But this family run construction business in Osaka, Japan was founded in 578 AD and is in its 40th generation of management. Really?!
 |
| Osaka Castle |
There are surely more examples that come to mind, but longevity and significant impact are tough criteria to get through simultaneously.
4 comments:
Interesting stuff. Particularly like the nugget about the Beretta logo. And that Ford melting pot ceremony was also featured in the PBS documentary on Ford which aired again here recently. A ‘complex’ man to be sure.
But if you ever do experience an auction at a place like Sotheby’s, please don’t make quite the same impression Cary Grant’s character did in North by Northwest!
Excellent questions, that begs one to ask if such companies are "better" than the rest - of course, "better" needs to be defined.
You will have better luck if you include India in your consideration set. Think Tatas, Birlas, and many others of the sort.
I agree with Naren Agrawal in terms of Tatas and Birlas ...
I wonder if any management scholars have already done that sort of comparison.
If there is a significant difference (e.g., in financial performance, impact - business or social, etc.), it would be great to understand why. Is there something that is lost/gained when companies are "professionally" managed (not that family owned businesses are not)? Or, is it that the presence of a family's oversight preserves values and culture?
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