Strategiesof family business development
dr. Adrianna Lewandowska, ICV
11. Controlling conference: Controllingtool for business excellence
Grand hotel Metropol, Portorož -27.10.2011
dr Adrianna Lewandowska, MBA
Business Discovery Manager & Advisory www.bd7.pl
Internationaler Controller Verein, Managing Committee member www.icv.pl
Poznan School of Banking, Lecturer www.wsb.pl
Advisory:
Business strategies for family enterprises
Projects for strategies’implementation based on the Balances Scorecard concept
Succession programs
Expert of International Network of Strategy Advisers
Besides:
Board member, Internationaler Controller Verein,
Coordinator of Polish ICV work groups
Lecturer WSB Poznań, MBA programs
Our schedule
Do we need a strategy at all...? Chaos in the times of turbulences
The essence of strategic management in family businesses
Harmonization of values as a material for effective strategies
Key strategic choices
The process of strategy’s implementation –establishment
How many hats can have one person?
OwnerManagerFamily member
Originator
Guard of the law and order
Cf.Q.Fleming, Tajniki przetrwania firmy rodzinnej
Fire fighter
Colleague
How many hats can have one person?
Owner Manager
Originator
Fire fighter
Cf.Q.Fleming, Tajniki przetrwania firmy rodzinnej
Family member
Guard of the law and order
Do we need a strategy?
Factors causing chaos
Technical change and informaticion revolution
Decisive technologies and inventions
Emerging economies
Hypercompetition
Envirement
Growth of the power the customer has
Management in chaos
Enterprises nowadays have to develop some skills and work out systems of quick finding and predicting turbulences in their surroundings and recognizing dangers and chances brought by chaos.
After that the company has to react wisely, accurately and firmly. to accurately firmly.
The companymust buildand implement elastic and effective strategies.
Cf. P.Kotler, Chaos
The system of enterprising actions
Logos, thepathof the reason
Mythos, thepathof a myth, ritual, commonstories
PILLARS OF THE STRATEGY
Cf. K.Obłój; Pasja i dyscyplina strategii
The essence of the strategy
The essence of the effective strategy iscreating the uniqueness of the company and lettingboth the employees and the people from the company’s environment clearly distinguish the firm
from all its rivals.
You could say that the most important point of each strategy is naming the company identity, regardless of the sector, branch or the market of the enterprise.
Cf. A.Kaleta
Functions of the strategic management
Strategic management concerns activities being an answer to the changes in the environment and everything what happens in the future.
It’s about building a competitive advantage of the company, but not for the present, but for the future.
It’s about understanding that what’s competitive now, doesn’t have to be competitive tomorrow.
Surprise your competitors!
Break stereotypes and be brave in your goals!
Balanced development of the company
Money expenditure
Strategicarea
Operativearea
develop exploit
Marketing
Developing capacities
Qualitypotential
Staff competences
Partnershiprelations = possibilities + skills
Investorrelations
Potential’s inflow
Orders / contracts
Using capacities
Quality quarantee
employment
Liquidity guarantee
Partners’disposition
Money inflow
The system of enterprising actions
management (dream management)
management (finance management)
Introducing the system’s principles
Values’ management (dream management) Value management (finance management)
finding a profitable fullfilling the stakeholders
expectations vision mission
Business model
USP(being better than the rivals on every field important for the customer) way
Strategic tensions
Priority FAMILY –treating every member of the family equally, even at the cost of the company’s system and its future
Priority COMPANY –considering the rules for the best interest of the company, its employees and shareholders
COMPROMISE –constant search for balance, family’s satisfaction as a source of an economic success of the company
Strategic priorities
Priority COMPANY
When the company’s system is superior, the area of the family is neglected. It destroys the family ties, relationships and bonds.
Strategic priorities
Priority FAMILY
When the family’s system is superior, family relationships are more important, objective evaluation of the employees is missing, the decision making process is wrong. Loosing strategic possibilities
RODZINA
FIRMA
Startegic priorities
Balanced priorities
A balanced attitude to the development of both systems.
There are trust, commitment, effectiveness of the company and the harmony in the family.
FAMILY COMPANY
Strategies of family businesses
Objective of the enterprise…?
The objective of the strategy is guaranteeing the long –term existence of the company / securing the organization by accepting and
organization balancing the advantages of all groups of interests engaged in the company
Values’ harmonisation
The source of continuance and development of an organization are main values, or precisely a strong consciousness of the own main values, their invariableness to the changes in the environment and conscious managing them, meaning implementingthem in every field of the company’s activities.
Studies: J.Porras and J.Collins
Integrated development strategy of a family business
Individual strategy of the owner, Strategy of the family, Strategy of the company.
Managing a change REVISION
Power of well worked out visions
Creating the vision of the future and an image of reality causes „creative tension”.
Even if the cicumstances are unfavorable, we should build creative, far –reaching visions and develop strategic thinking.
Creative tension
Building a common vision
Saying –we have to do this, it’s our vision, realize it with enthusiasm!
Selling –we already have the best answer, now we will try to convince you to!
Testing – what in our vision excites you and what doesn’t?
Consulting –what vision –in the opinion of the organization's memberswe should accept?
Co –creating –let’s crate an image of the future we want both as individuals and as an organization!
Stakeholders’ groups
Who belongs to the stakeholders’group so far? (who do we have to interest ) and why is their interest important for us?
How can we motivate individual stakeholders’groups, so that they want to get involved in execution of our strategic topics?
For every field of our development we define an objective and an indicator
for controlling its execution
Who do we want / should work with?
Operative vs. strategic actions
Strategy vs. current actions
Development of strategic frames
Strategic projects
Cascading
In the centre there are ACTIONS
Consequence =cooperation; cross –sectional projects
Power of well worked out visions
What counts, is not what the vision is, but what it can maycause!
Creative tension
The future has many names: For the weak, it means the unattainable. For the fearful, it means the unknown. For the courageous, it means opportunity. Victor Hugo
Thank you for your attention and commitment!
Adrianna Lewandowska