FAMILY BUSINESS
Syllabus
Aggiornato A.A. 2021-2022
<p align="center">
<strong> </strong>
</p>
<p align="center">
<strong>FAMILY BUSINESS</strong>
</p>
<p align="center">
<strong> </strong>
</p>
<p align="center">
<strong>(Prof. Luca Gnan)</strong>
</p>
<p>
<strong> </strong>
</p>
<p>
<strong> </strong>
</p>
<p>
<strong><u>Teaching Staff responsible for the course:</u></strong>
</p>
<p>
Prof. Luca Gnan
</p>
<p>
E-mail: <a href="mailto:luca.gnan@uniroma2.it">luca.gnan@uniroma2.it</a>
</p>
<p>
Availability: Contact via e-mail
</p>
<p>
Prof.ssa Giulia Flamini
</p>
<p>
E-mail: <a href="mailto:giulia.flamini@uniroma2.it">giulia.flamini@uniroma2.it</a>
</p>
<p>
Availability: Contact via e-mail
</p>
<p>
We are committed to making this course a valuable learning experience for
you. After the first month, we will spend part of a class session
evaluating our progress, and we will make any necessary changes to keep us
on track. However, we welcome your feedback at any time in the semester. It
is easiest to reach us by e-mail or during office hours, but we are always
happy to set up an appointment. Additionally, if you have a disability that
requires unique accommodation, please let us know ASAP so that we can be
helpful to you.
</p>
<p>
<strong>E-mails, Office Hours & Feedback on Assignments</strong>
</p>
<p>
We endeavor to answer e-mails within one day. If you have not heard from us
within that time, please resend the e-mail. Grades & comments will be
posted online in the materials section of the course website. We will be
happy to give feedback and discuss assignments after all grading is
complete for a specific task. Office hours are scheduled by e-mail request.
</p>
<p>
We may answer questions of assignment clarification in class and via
e-mails to benefit the entire class. We may also give extra grades (see
below Team Project) during the course that, while generally designed to
support learning in the course, will also help your participation grade.
These are pass/fail and do not include comments.
</p>
<p>
<strong><u>Pre-requisites for the Course:</u></strong>
</p>
<p>
None
</p>
<p>
<strong><u>Course Description and Learning Objectives</u></strong>
</p>
<p>
Family businesses show distinct core competencies that can result in unique
competitive advantages. They take a long-run view of the business—across
generations, rather than publicly traded quarterly reports. Their capital
can be very patient. Owners will sacrifice their salaries to make payroll.
They are an integral part of their communities, unlike publicly traded
counterparts that might abandon a community at the blink of a budget. They
can engender a great deal of loyalty on the part of employees, and the
existence of family may reduce agency problems.
</p>
<p>
Family Businesses also face challenges that threaten their continuity. The
challenges are primarily the result of issues presented by the interaction
of family, management, and ownership—particularly where the family wishes
to perpetuate its influence and/or control from generation to generation.
Family firms seem to be as agile in one generation as they are fragile
across generations.
</p>
<p>
Family businesses start with an owner-managed first generation (usually an
entrepreneur). The next generation—G2—is the sibling generation, and G3 is
the cousin era. The probability of passing the company to the next
generation diminishes significantly, with fewer than half making it to G2
and only about less than 15% making it to G3. So, despite the benefits of
family, there can be some significant issues.
</p>
<p>
The course explores and analyzes the continuity challenges of a family
business and its best management practices. This course focuses on
pragmatic, action-oriented management, governance, finance, and
family/business leadership skills.
</p>
<p>
Attention is devoted to evaluating family firms and their growth options to
provide a roadmap for analyzing how family ownership, control, and
management affect performances and how family firms can create and ensure
more value through generations.
</p>
<p>
The course presents seven different sections:
</p>
<p>
· SECTION 1: Family firms: prevalence and relevance
</p>
<p>
· SECTION 2: Governance in the family firm
</p>
<p>
· SECTION 3: Strategic management in the family firm
</p>
<p>
· SECTION 4: Succession in the family firm
</p>
<p>
· SECTION 5: Change and transgenerational value creation
</p>
<p>
· SECTION 6: Interpersonal relationships and conflict in the family firm
</p>
<p>
· SECTION 7: Financial management in the family firm
</p>
<p>
The course addresses the governance, management, and finance of established
family businesses. It examines succession, values, life cycles, business
and marketing strategies, conflict resolution, communications, legal, and
financial aspects, estate planning, management, philanthropy, and other
topics that uniquely touch family business governance, management, and
finance. It will convey the characteristics that differentiate family
businesses from other businesses.
</p>
<p>
One of the features, which make this course unique and particularly modern,
is a part of Section 7: Financial management in the family firm dedicated
to the mysterious and fascinating world of the family office. This is the
little-known but key professional practice of advising entire
families-in-business, frequently large, diversified, and with wide
ramifications, about the complete spectrum of activities necessary to
ensure that wealth is created, preserved, transmitted, and spread across
the enlarged family community. These services range from asset allocation
to risk management, education, efficient tax structuring, corporate
finance, corporate governance, intra-, and inter-generational transmission,
philanthropy, etc. Given the enormous amount of wealth and power concerned,
this phenomenon is increasingly important and starts to attract some focus,
particularly on the best graduate students and professional talents.
</p>
<p>
Upon completion of this course, students should understand:
</p>
<ol start="1" type="1">
<li>
The unique assets and vulnerabilities of family enterprises.
</li>
<li>
The role of the CEO in governance, management, and the transfer of
power.
</li>
<li>
The relationship between the role of the board, the family council, and
top management in providing effective governance for family business
continuity.
</li>
<li>
Key family dynamics.
</li>
<li>
The relevance for families to manage collectively wealth created in
professional ways,
</li>
</ol>
<p>
and be able to:
</p>
<ol start="1" type="1">
<li>
Identify the various stakeholders and the role of trust among family
members and their impact on succession and continuity.
</li>
<li>
Discuss the developmental needs and challenges of next-generation
leaders.
</li>
<li>
Analyze the effect of estate taxes on ownership transfer across
generations of family business owners and the implications of ownership
structures on the competitive advantages of family businesses.
</li>
<li>
Explain the importance of strategic planning to family business
continuity.
</li>
<li>
Explore the critical role and challenges that nonfamily managers play
in family-owned operations.
</li>
<li>
Analyze the impact of family culture, communication, conflict, and
unity and explore their interaction effects on the family business.
</li>
<li>
Assess whether they want to seek employment in family businesses as key
employees/managers or in a professional advisory role.
</li>
</ol>
<p>
<strong><u>Teaching methods</u></strong>
</p>
<p>
Lessons will be characterized by the transfer of knowledge and the strong
interaction within the classroom; there are analyses of situations,
problems, and business cases to facilitate participants in learning.
</p>
<p>
<strong>
Regular attending students are strongly recommended to participate in
all the lectures, preparations, and presentations of the business
cases.
</strong>
</p>
<p>
This course uses readings, lectures, exercises, cases, individual and team
assignments, and class discussions to meet its goals. Case assignments
provide an important foundation for class discussion and must be completed
before each class session. The due dates for all cases and other
assignments are listed in the class schedule at the end of the syllabus.
Lectures will highlight key points from the readings and provide additional
information to supplement the readings. Cases will allow you to apply what
you have learned to real-world issues and scenarios. Because each of you
brings unique perspectives and experiences to the class, participation in
class discussions and activities is essential to your learning and that of
other class members. To further enrich your learning, you will also be
matched with an MScBA Teaching Assistant.
</p>
<p>
<strong><u>Textbook</u></strong>
</p>
<p>
Zellweger, T. Managing the Family Business: Theory and Practice, Edward
Elgar Publishing, 2017: ISBN: 9781783470709
</p>
<p>
<strong><u>Cases</u></strong>
</p>
<p>
During the course, we will discuss 10 cases:
</p>
<p>
1. More than a move to Mexico (Chapter 4: Zellweger, pages: 43-45)
</p>
<p>
2. Beretti Holdings—More than a retirement decision (Chapter 5: Zellweger,
pages: 109-112)
</p>
<p>
3. Henkel’s Genthin plant (Chapter 6: Zellweger, page: 125)
</p>
<p>
4. Branding and CSR at HiPP (Chapter 6: Zellweger, pages: 165-166)
</p>
<p>
5. Managing paradoxes (Chapter 6: Zellweger, pages: 193-194)
</p>
<p>
6. Bernet's choice—Valuation, emotional value, family discount and fair
distribution of assets within the family (Chapter 7: Zellweger, pages:
306-307)
</p>
<p>
7. Transgenerational value creation at Ahlstrom (Finland) (Chapter 8:
Zellweger, pages: 361-363)
</p>
<p>
8. Conflict in the Solomon family (Chapter 10: Zellweger, pages: 488-491)
</p>
<p>
9. Tom's world (Chapter 9: Zellweger, pages: 422-424)
</p>
<p>
(the following case from Harvard Business School Publishing. You need to
register to download the cases at the following link: https://hbr.org, then
download the case at the indicated link)
</p>
<p>
10. Medco Energi Internasional
</p>
<p>
<strong><u>Additional References</u></strong>
</p>
<p>
- Poza, E. J., "Family Business", First Edition. Mason, OH: Thomson
South-Western, 2004.
</p>
<p>
- Gnan, L. and Montemerlo, D., (2006), "Family-firm relationship in Italian
SMEs: ownership and governance issues in a double-fold theoretical
perspective", in P. Z. Poutziouris P., Smyrnios, K. X., and Klein, S. B.,
"Handbook of research on family business", Edward Elgar Publishing.
</p>
<p>
- Zattoni, A., Gnan, L., Huse, M., (2012) , "Does Family Involvement
Influence Firm Performance? Exploring the Mediating Effects of Board
Processes and Tasks", Journal Of Management, ISSN: 0149-2063, DOI:
10.1177/0149206312463936
</p>
<p>
- Gnan, L. and Songini, L., (2015), "Family involvement and agency cost
control mechanisms in family small and medium-sized enterprises", Journal
Of Small Business Management, vol. 53, p. 748-779, ISSN: 0047-2778, DOI:
10.1111/jsbm.12085
</p>
<p>
- Gnan, L., Montemerlo, D., Huse, M. (2015), "Governance systems in family
SMEs: the substitution effects between family councils and corporate
governance mechanisms", Journal of Small Business Management, p. 1-27,
ISSN: 1540-627X, DOI: 10.1111/jsbm.12070
</p>
<p>
- Gnan, L., Montemerlo, D., Schulze, W., Corbetta, G., (2008), “Governance
Structures in Italian Family SMEs” In: (a cura di): Comacchio A. and
Pontiggia A., “L'organizzazione fa la differenza”, Roma: Carocci Editore,
ISBN: 9788843045587
</p>
<p>
- Gnan, L. and Montemerlo, D., (2007), "Family-firm relationship in Italian
SMEs: ownership and governance issues in a double-fold theoretical
perspective" In: "Handbook of research on family business", Elgar, ISBN:
978-1845424107
</p>
<p>
- Songini, L., Gnan, L., Morelli, C., Vola, P., (2015), "The why and how of
managerialization of family businesses: evidences from Italy", Piccola
Impresa / Small Business, vol 1, DOI: 10.14596/pisb.179, pp 85-117
</p>
<p>
- Songini, L., Gnan, L., Malmi, T (2013), "The role and impact of
accounting in family business", Journal of Family Business Strategy, vol.
4, p. 71-83, ISSN: 1877-8585, DOI: 10.1016/j.jfbs.2013.04.002
</p>
<p>
- Gnan, L., Songini, L., (2014), "The glass ceiling in SMEs and its impact
on firm managerialisation: a comparison between family and nonfamily SMEs",
International Journal of Business Governance And Ethics, vol. 9, ISSN:
1477-9048
</p>
<p>
- de Pedys, V. and Antonelli, A,. (2008) "Family office for family
business", Oxford management Publishing, ISBN 978-1-906728-01-4
</p>
<p>
- Poutziouris, P., (2001) "Understanding family firms", in (Ed.) Adam, J.,
Institute of Directors, "The Growing Business Handbook", London: Kogan
Page, Chapter 6.3: pp. 9-15, 4th edition, ISBN 074943600X
</p>
<p>
- Levin, R. and Travis, V., (1987), "Small company finance: what the books
don't say", Harvard Business Review, nov-dec: 87608
</p>
<p>
- Villalonga, B. and Amit, R., (2005), "How do family ownership, control
and management affect firm value", Journal of financial economics, 80:
385-417
</p>
<p>
- Wilson, R., (2013), "The family office Report", FamilyOfficesGroup.com
</p>
<p>
- Amit, R. and Perl, R., (2012) "2012 Family Governance Report", Wharton
Global family Alliance, Wharton School, University of Pennsylvania
</p>
<p>
- Amit, R. and Lichtenstein, H., (2010), "Benchmarking the Single Family
Office" Wharton Global Family Alliance, Wharton School, University of
Pennsylvania
</p>
<p>
<strong><u>Suggested videos </u></strong>
</p>
<p>
1. Introductory video: 4 Lessons from the Best Family Businesses
</p>
<p>
<a
href="https://hbr.org/video/4660653966001/4-lessons-from-the-best-family-businesses"
>
https://hbr.org/video/4660653966001/4-lessons-from-the-best-family-businesses
</a>
</p>
<p>
2. Three circle model: importance of governance, setting goals, holistic
leadership and caring for the interests of the family
</p>
<p>
<a href="https://www.youtube.com/watch?v=D85pqiL1tNM">
https://www.youtube.com/watch?v=D85pqiL1tNM
</a>
</p>
<p>
3. The unique strengths and weaknesses of family businesses today,
contrasting it with the humble mom-and-pop store the term usually brings to
mind
</p>
<p>
<a href="https://www.youtube.com/watch?v=suL-HkP-2Ts">
https://www.youtube.com/watch?v=suL-HkP-2Ts
</a>
</p>
<p>
4. The topic of Building a Family Business That Lasts and provides viewers
with four key points to walk away with
</p>
<p>
<a href="https://www.youtube.com/watch?v=vZ52w3wBP1U">
https://www.youtube.com/watch?v=vZ52w3wBP1U
</a>
</p>
<p>
5. The key attention points and delicacies involved in preparing and
transferring a business to the next generation
</p>
<p>
<a href="https://www.youtube.com/watch?v=Io9aWtuSEh4">
https://www.youtube.com/watch?v=Io9aWtuSEh4
</a>
</p>
<p>
6. Family Business Governance: Family Constitution
</p>
<p>
<a href="https://www.youtube.com/watch?v=i5psd_84euA">
https://www.youtube.com/watch?v=i5psd_84euA
</a>
</p>
<p>
7. Family-owned companies need to be run with emotional, as well as
professional leadership
</p>
<p>
<a href="https://www.youtube.com/watch?v=2bYo2Ph48_E">
https://www.youtube.com/watch?v=2bYo2Ph48_E
</a>
</p>
<p>
8. Toward a theory of how some family firms nurture transgenerational
entrepreneurship
</p>
<p>
<a href="https://www.youtube.com/watch?v=AzFginXvSrM">
https://www.youtube.com/watch?v=AzFginXvSrM
</a>
</p>
<p>
9. Family Business Longevity
</p>
<p>
<a href="https://www.youtube.com/watch?v=uoHRNLuoYHM">
https://www.youtube.com/watch?v=uoHRNLuoYHM
</a>
</p>
<p>
10. 5 Ways For Private Equity Firms to Raise Capital From Family Offices
</p>
<p>
<a href="https://www.youtube.com/watch?v=EX8TnQmOFyc">
https://www.youtube.com/watch?v=EX8TnQmOFyc
</a>
</p>
<p>
11. Address the challenges faced by family businesses
</p>
<p>
<a href="https://www.youtube.com/watch?v=mItel08kE-Q">
https://www.youtube.com/watch?v=mItel08kE-Q
</a>
</p>
<p>
12. Conflict in the Family Business
</p>
<p>
<a href="https://www.youtube.com/watch?v=CVILBwkMVxc">
https://www.youtube.com/watch?v=CVILBwkMVxc
</a>
</p>
<p>
13. Stories of Wasteful Conflict in Family Businesses
</p>
<p>
<a href="https://www.youtube.com/watch?v=elzfKRYw1yA">
https://www.youtube.com/watch?v=elzfKRYw1yA
</a>
</p>
<p>
<strong><u>Case Discussions </u></strong>
</p>
<p>
Regular attending students are expected to be fully engaged in the entire
learning process. Regular attending students are expected to:
</p>
<p>
1) prepare the assigned readings of the cases before each class.
</p>
<p>
2) prepare as a group work a PowerPoint presentation on the case, based on
the specific assignment.
</p>
<p>
3) come to class ready to participate and discuss to enhance the
individual's learning and the class.
</p>
<p>
<strong>
On the website of the course, students find for each case the relative
assignment. Please carefully read the questions before the session and
use them for preparing the PowerPoint presentation.
</strong>
</p>
<p>
Each student will be involved in the class discussion on the cases and tie
the assigned reading for the session. The objective is to bring all class
members into the debate. The cases are designed to integrate the concepts
from the case into the context of the course.
<strong>
The preparation and the discussion of the cases do not exclude the
study of the theoretical concepts useful for the discussion of the
cases themselves and the passing of the course exam.
</strong>
</p>
<p>
With the cases' discussions in the <strong>CLASSROOM</strong>, each student
will develop:
</p>
<p>
1. The ability to set the parameters for the problem (key concepts from the
case).
</p>
<p>
2. A depth of knowledge about the case subject (understanding of material,
excellent response to the observations of others).
</p>
<p>
3. The ability to tie in the case with other course concepts.
</p>
<p>
4. The ability to get others involved in the discussion.
</p>
<p>
To adequately discuss the cases, students do:
</p>
<p>
· Be prepared with facts and specific quotes from the case.
</p>
<p>
· Be prepared to comment, ask a question, or develop ideas about the case.
</p>
<p>
During the discussion, students do:
</p>
<p>
· Take a position on a question or a point.
</p>
<ul>
<li>
Ask clarifying questions.
</li>
</ul>
<p>
· Help keep the discussion moving and on track.
</p>
<p>
· Help draw others into the discussion.
</p>
<p>
· Integrate theories and content from other cases.
</p>
<p>
During the discussion, students do not:
</p>
<p>
· Be unprepared and show your lack of knowledge.
</p>
<ul>
<li>
Monopolize the discussion.
</li>
<li>
Make irrelevant comments.
</li>
</ul>
<p>
· Be insensitive to other's desire to speak or to their opinions.
</p>
<p>
All the regular attending students are kindly invited to build up <strong>workgroups (MINIMUM 3 PERSONS – MAXIMUM 5 PERSONS)</strong>. Each
workgroup should prepare a PowerPoint presentation for each case. Into the
first slide, the names of the students belonging to the group should be
reported.
</p>
<p>
The <strong>structure of the presentation</strong> should follow the
following outline:
</p>
<ol start="1" type="1">
<li>
One or more introductory slides aimed at describing/reporting the
story, the characters, and all the necessary elements to define the
context and boundaries of the case clearly.
</li>
<li>
One slide mentioning the questions of the assignment and underlining
the learning goals of the case.
</li>
<li>
One or more slides reporting the answers to each question of the
assignment.
</li>
<li>
One or more slides reporting the final remarks on the case.
</li>
<li>
One closing slide about the lessons learned after the group discussion
of the case.
</li>
</ol>
<p>
<strong>How to prepare the PowerPoint presentation of the case?</strong>
</p>
<p>
<strong> </strong>
</p>
<p>
<strong>Introduction</strong>
– short presentation of the case, brief description of the problems and
situations that should be coped with the discussion.
</p>
<p>
<strong>Diagnosis</strong>
– Problem setting of the context and the situation. Description of the
mains facts and elements connected with the concepts and models of Family
Business. What went wrong, and which actions/situations, instead, were
right? Which elements could be considered for the diagnosis?
</p>
<p>
<strong>Solution</strong>
– Students should provide a possible answer to questions/problems related
to the case and a possible and clear indication of how to approach the
situation and how to solve it. The entire proposal should represent a
consistent action plan in terms of behaviors and expected results.
</p>
<p>
<strong>Conclusions</strong>
– Conclusions should not be longer than 300-500 words and should describe
how the situation and the problem characterized the case, how Family
Business schemata might help solve the case, and what the proposed solution
might generate in terms of organizational consequences.
</p>
<p>
<strong>Lessons learned</strong>
– At the end of the presentation elements/suggestions/advice that we
"take-home" from the case discussion should be identified and reported.
</p>
<p>
<strong>NOTE: </strong>
During the case discussion, students should explicitly address the context
and the different situations with concepts related to Family Business and
with models and theories of this course.
</p>
<p>
<strong>Case Discussions' Class Participation</strong>
</p>
<p>
The best way to learn, especially about FB, is to participate in your
education actively. In this class, "participation" is defined as quality
contributions to class discussion and exercises. There are four
pre-requisites for successful participation:
</p>
<ol start="1" type="1">
<li>
<strong>Be here on time and prepared.</strong>
If you are not here, you cannot contribute much to class discussion. <strong>If you need to miss class for a predictable reason</strong>
(e.g., job interview, athletic competition),
<strong>
please notify us at least 24 hours in advance so that we can make
arrangements for any in-class exercises and so that you can obtain
the materials distributed during the class.
</strong>
Of course, we realize that in some cases, unforeseeable emergencies
arise. Although we will not directly penalize you for non-attendance,
be aware that multiple absences will indirectly hurt you by preventing
you from participating in class, thereby lowering your participation
grade. To contribute to class discussion, you must come to class having
carefully prepared all assignments (i.e., readings, cases, exercises).
</li>
<li>
<strong>Be brave.</strong>
Everyone in this class is smart, engaging, and has unique life
experiences to share. You will get the most out of this course if you
ask questions, voice opinions, and express your thoughts to one
another. If you feel uncomfortable talking in class, please send me an
e-mail or set up an appointment to talk with me early in the semester.
We will do everything we can to accommodate your circumstances, but we
can only do so if they are brought to our attention.
</li>
<li>
<strong>Be courteous.</strong>
Successful participation includes treating your classmates respectfully
and professionally. Listen carefully to the comments and questions that
your classmates voice. You may learn something new from their
perspectives, and you will be able to avoid merely repeating something
that another classmate has said earlier in the discussion. Also, it is
perfectly acceptable for you to voice disagreement with an opinion
provided by another student. The open debate often leads to the most
thoughtful and informative class discussions. However, please express
your argument in a kind and considerate manner.
</li>
<li>
<strong>Be engaged.</strong>
This class is "unplugged."
<strong>
Once class starts, all electronics (e.g., computers, cell phones,
tablets, etc.) should be turned off and put away.
</strong>
If you need to use a device because of a language or disability issue,
you need to secure permission at the beginning of the class. The misuse
of an electronic device (e.g., surfing the web or texting) will
adversely affect your grade.
</li>
</ol>
<p>
<strong>
To facilitate the visioning of its PowerPoint presentation in the
classroom, each workgroup should take a personal computer with
PowerPoint installed and an available VGA connection.
</strong>
</p>
<p>
<strong> </strong>
</p>
<p>
<strong>
By 8 pm of the day before the case discussion, all regular attending
students should send to the Course's Instructors, attaching the case
presentation prepared. ONLY STUDENTS WHO HAD HANDED OVER ALL THE CASE
PRESENTATIONS WILL BE ADMITTED TO THE 1<sup>st</sup> EXAM AFTER THE
COURSE.
</strong>
</p>
<p>
<strong> </strong>
</p>
<p>
<strong>Policy for Late Assignments</strong>
</p>
<p>
As in the business world, work must be received on time to receive full
credit. If you are late on an assignment, your access to the 1<sup>st</sup>
exam after the course will be compromised. You are always welcome to hand
in an assignment before its due date if you know that you will be busy as
the due date approaches. If you think that you will not complete an
assignment by the stated due date, please speak with us in advance to make
alternative arrangements. Our policy on late assignments will depend on the
specific circumstances surrounding the problem and thus may differ from
student to student. Providing advance notice about a late assignment will
minimize the penalty you receive on that assignment but does not guarantee
that there will be no penalty for turning the assignment in late.
</p>
<p>
<strong><u>Other learning sources</u></strong>
</p>
<p>
Slides and other materials will be available on the course website.
</p>
<p>
<strong>
THE SLIDES DO NOT REPRESENT A SUPPORT FOR AN EFFECTIVE AND SUCCESSFUL
PREPARATION FOR THE EXAM OF THE COURSE. THEY REPRESENT ONLY A HELP TO
FACILITATE THE TRANSFER OF THE KNOWLEDGE TO STUDENTS DURING THE
LECTURES.
</strong>
</p>
<p>
<strong><u>Attendance</u></strong>
</p>
<p>
Because of the concentrated nature of the MScBA program, attendance in
class is crucial.
</p>
<p>
<strong>
Not regular attending students will be required to prepare for the exam
</strong>
<strong><u>ALL</u></strong>
<strong>
the chapters of the textbook Zellweger, T. Managing the Family
Business: Theory and Practice, Edward Elgar Publishing, 2017: ISBN:
9781783470709 and <u>ALL</u> the cases discussed in the classroom.
</strong>
</p>
<p>
<strong>NOTE: </strong>
Attendance to the first class session is mandatory. Important information
about the course and the instructor's expectations are given during the
first session. If you know that you will have to be absent for one session,
please contact your instructor to ensure that absence from a session is
acceptable.
</p>
<p>
<strong><u>Exam</u></strong>
</p>
<p>
The 1<sup>st</sup> exam after the course is a written exam (the 1st), while
all the other exams will be oral.
</p>
<p>
In the case of a written exam, the duration is about 3-4 hours, and it
includes:
</p>
<p>
a) <strong>Case discussion</strong> - You may be given a case study to
which some questions may pertain to lead the discussion. As you respond to
the questions, please use specific content and theories (use names to
identify theories and models) as the basis of your analysis. You will not
receive credit for your personal opinions unless backed by theory, lecture,
and/or text material. Also, describe how you see the content/theory
applying to the situation. Your answers will be evaluated based upon both
quantity and quality. Answers that are more complete and demonstrate a
higher level of understanding and analysis will receive more points.
</p>
<p>
b) <strong>Some questions directly connected to the course textbook</strong> –
The questions could be open, closed (multiple choice), or a combination of
both. You may be asked to discuss the models and the theories presented
during the course. You will be asked to interpret some real incidents and
focus your attention on specific theoretical issues.
</p>
<p>
<strong>
<u>
1<sup>st</sup> exam after the course participation and exam grades
registering on the booklet
</u>
</strong>
</p>
<p>
<strong><u> </u></strong>
</p>
<p>
<strong>
Only regular attending students that have delivered the hard copies of
ALL the cases to the Instructors can take the 1<sup>st</sup> exam after
the course with a format explicitly dedicated to them.
</strong>
</p>
<p>
<strong> </strong>
</p>
<p>
<strong>
Only regular registered students on the DELPHI System will be allowed
to register their grades.
</strong>
</p>
<p>
<strong> </strong>
</p>
<p>
<strong>
The 1<sup>st</sup> exam grades will be registered after the official
exam date; Teachers will communicate that date. It is compulsory to
come on that exam date to record the grade on the Delphi and the
booklet.
</strong>
</p>
<p>
<strong><u>Team Project</u></strong>
</p>
<p>
<strong><u> </u></strong>
</p>
<p>
The purpose of the project is to allow your team to apply what has been
learned in the course (through course lectures, readings, and case
discussions) to problems in a family firm of your team's choice.
</p>
<p>
<strong>
Class members, regular attending students, will work in teams of four
(4) people.
</strong>
</p>
<p>
<strong> </strong>
</p>
<p>
<strong>
To the Team Project, regular attending students will be allowed to
achieve a -3/+3 extra points to the final grade of the 1<sup>st</sup>
exam after the course. Only regular attending students taking the 1 <sup>st</sup> exam after the course will be accepted for the Team
Project.
</strong>
</p>
<p>
Your team should identify a family firm to study (Please, no student
groups).
</p>
<p>
Your team is to gather information from people in the family firm through
direct contact. You may supplement this information with data from the
media, the organization's literature, and other secondary sources. You
should identify a relatively recent problem to analyze (i.e., this should
not be a historical account of a problem and the company's solution). You
should focus your analysis by applying the concepts from the course. While
it is acceptable to incorporate several concepts from the course, please
aim for depth rather than breadth regarding course concepts. Your goal is
to diagnose the mechanisms causing the problem or issue of concern in the
organization. Initially, you may notice many symptoms (for instance, a
crisis after the succession, seemingly an unhealthy family culture, low
family members' commitment and involvement, governance issues, etc.), but
your task is to get to the underlying reason for these symptoms. And
beware, sometimes the initial symptoms we think we see are not what they
appear to be.
</p>
<p>
There are three broad goals for this assignment:
</p>
<p>
1. One goal of this assignment is obviously to take the initiative to make
a positive contribution to a family firm.
</p>
<p>
2. Another primary goal is to provide an opportunity for you to learn more
about family businesses firsthand and use your critical thinking and
reflection skills to link your experience with this family firm to your
learning concerning family business theories.
</p>
<p>
3. The final goal is to provide a forum for you to hone your team member
and leader skills and reflect on the learning gained from this team
experience. Each team will make a presentation and write a paper that
describes what you did for the family firm, what you learned about the
family business, and what you learned about working on a team.
</p>
<p>
To meet these broad goals, your team should answer the following questions
in the assignments detailed below.
</p>
<p>
a) What are the issues or problems facing the family firm?
</p>
<p>
b) What can Course concepts be applied to understand why this problem is
occurring?
</p>
<p>
c) What recommendations can you offer to help improve the family business
functioning?
</p>
<p>
<strong>Deliverables of the Team Project:</strong>
</p>
<p>
<strong>
1. The project proposal is due to Instructors by the 9<sup>th</sup>
session of the course by 5 pm. It should include:
</strong>
</p>
<p>
a) the names of your group members
</p>
<p>
b) your team name
</p>
<p>
c) the name of the organization
</p>
<p>
d) the name, contact information, and level of your contact person
</p>
<p>
e) the method you will use to gain access to the organization
</p>
<p>
f) a brief description (one paragraph) of the problem facing the
organization.
</p>
<p>
<strong>
2. Your written project is due to Instructors by the 18th session of
the course by 5 pm
</strong>
.
</p>
<p>
It should contain a maximum of 15 double-spaced pages (1 cm margins, 12
point font). You will be penalized significantly for exceeding this limit.
The limit does not include appendices, which you are free to use to provide
charts, figures, or other background material not necessary in the main
body of your analysis. However, appendices that are not directly referenced
in the main text will not be read. <strong>LATE PROJECT WRITE-UPS WILL NOT BE ACCEPTED</strong>.
</p>
<p>
This written project should summarize what you did for/within the
organization, what you have learned about organizational behavior, and what
you have learned about working on a team.
</p>
<p>
<strong>Grading of the Team Project:</strong>
</p>
<p>
Your group project will be evaluated on the following criteria:
</p>
<p>
a. Problem definition: How well (i.e., thoroughly and concisely) describe
the organizational context, the relevant parties, and the factors that are
important to the problem?
</p>
<p>
b. Accurate and thorough use of course concepts.
</p>
<p>
c. Integration of course concepts with information about the company and
problem, i.e., how well do you integrate course concepts with details about
the problem to illuminate the problem in a way that leads to solutions?
</p>
<p>
d. The extent to which recommendations are consistent with analysis.
</p>
<p>
e. Quality of written analysis.
</p>
<br clear="all"/>
<p>
<strong><u>Analytical Syllabus </u></strong>
</p>
<div align="center">
<table border="1" cellspacing="0" cellpadding="0" width="105%">
<tbody>
<tr>
<td width="6%">
<p align="center">
<strong>#</strong>
</p>
</td>
<td width="69%">
<p align="center">
<strong>Agenda</strong>
</p>
</td>
<td width="14%">
<p align="center">
<strong>Lecture/</strong>
</p>
<p align="center">
<strong>Case</strong>
</p>
<p align="center">
<strong>discussion</strong>
</p>
</td>
<td width="10%">
<p align="center">
<strong>Lecturer</strong>
</p>
</td>
</tr>
<tr>
<td width="100%" colspan="4">
<p align="center">
<strong>SECTION 1:</strong>
<strong></strong>
</p>
<p align="center">
<strong>Family firms: prevalence and relevance</strong>
<strong></strong>
</p>
</td>
</tr>
<tr>
<td width="6%">
<p align="center">
1
</p>
</td>
<td width="69%">
<p>
<strong>Introduction of the Course</strong>
</p>
<p>
<strong>(Chapter 1: Zellweger, pages: 1-3)</strong>
</p>
<p>
1. Thematic focus
</p>
<p>
2. Intended audience
</p>
<p>
3. Structure and pedagogical tools
</p>
<p>
<strong>Defining the family business</strong>
</p>
<p>
<strong>(Chapter 2: Zellweger, pages: 4-22)</strong>
</p>
<p>
1. The distinction between family and nonfamily firms
</p>
<p>
2. Defining family business by type of family
involvement
</p>
<p>
3. Circle models of family influence
</p>
<p>
4. Family firm identity
</p>
<p>
5. Family business definition
</p>
</td>
<td width="14%">
<p align="center">
<strong>Lecture</strong>
</p>
</td>
<td width="10%">
<p align="center">
GNAN
</p>
</td>
</tr>
<tr>
<td width="6%">
<p align="center">
2
</p>
</td>
<td width="69%">
<p>
<strong>
Prevalence and economic contribution of family
firms around the globe
</strong>
</p>
<p>
<strong>(Chapter 3: Zellweger, pages: 24-33)</strong>
</p>
<p>
Aggiornato A.A. 2021-2022
<p align="center">
<strong> </strong>
</p>
<p align="center">
<strong>FAMILY BUSINESS</strong>
</p>
<p align="center">
<strong> </strong>
</p>
<p align="center">
<strong>(Prof. Luca Gnan)</strong>
</p>
<p>
<strong> </strong>
</p>
<p>
<strong> </strong>
</p>
<p>
<strong><u>Teaching Staff responsible for the course:</u></strong>
</p>
<p>
Prof. Luca Gnan
</p>
<p>
E-mail: <a href="mailto:luca.gnan@uniroma2.it">luca.gnan@uniroma2.it</a>
</p>
<p>
Availability: Contact via e-mail
</p>
<p>
Prof.ssa Giulia Flamini
</p>
<p>
E-mail: <a href="mailto:giulia.flamini@uniroma2.it">giulia.flamini@uniroma2.it</a>
</p>
<p>
Availability: Contact via e-mail
</p>
<p>
We are committed to making this course a valuable learning experience for
you. After the first month, we will spend part of a class session
evaluating our progress, and we will make any necessary changes to keep us
on track. However, we welcome your feedback at any time in the semester. It
is easiest to reach us by e-mail or during office hours, but we are always
happy to set up an appointment. Additionally, if you have a disability that
requires unique accommodation, please let us know ASAP so that we can be
helpful to you.
</p>
<p>
<strong>E-mails, Office Hours & Feedback on Assignments</strong>
</p>
<p>
We endeavor to answer e-mails within one day. If you have not heard from us
within that time, please resend the e-mail. Grades & comments will be
posted online in the materials section of the course website. We will be
happy to give feedback and discuss assignments after all grading is
complete for a specific task. Office hours are scheduled by e-mail request.
</p>
<p>
We may answer questions of assignment clarification in class and via
e-mails to benefit the entire class. We may also give extra grades (see
below Team Project) during the course that, while generally designed to
support learning in the course, will also help your participation grade.
These are pass/fail and do not include comments.
</p>
<p>
<strong><u>Pre-requisites for the Course:</u></strong>
</p>
<p>
None
</p>
<p>
<strong><u>Course Description and Learning Objectives</u></strong>
</p>
<p>
Family businesses show distinct core competencies that can result in unique
competitive advantages. They take a long-run view of the business—across
generations, rather than publicly traded quarterly reports. Their capital
can be very patient. Owners will sacrifice their salaries to make payroll.
They are an integral part of their communities, unlike publicly traded
counterparts that might abandon a community at the blink of a budget. They
can engender a great deal of loyalty on the part of employees, and the
existence of family may reduce agency problems.
</p>
<p>
Family Businesses also face challenges that threaten their continuity. The
challenges are primarily the result of issues presented by the interaction
of family, management, and ownership—particularly where the family wishes
to perpetuate its influence and/or control from generation to generation.
Family firms seem to be as agile in one generation as they are fragile
across generations.
</p>
<p>
Family businesses start with an owner-managed first generation (usually an
entrepreneur). The next generation—G2—is the sibling generation, and G3 is
the cousin era. The probability of passing the company to the next
generation diminishes significantly, with fewer than half making it to G2
and only about less than 15% making it to G3. So, despite the benefits of
family, there can be some significant issues.
</p>
<p>
The course explores and analyzes the continuity challenges of a family
business and its best management practices. This course focuses on
pragmatic, action-oriented management, governance, finance, and
family/business leadership skills.
</p>
<p>
Attention is devoted to evaluating family firms and their growth options to
provide a roadmap for analyzing how family ownership, control, and
management affect performances and how family firms can create and ensure
more value through generations.
</p>
<p>
The course presents seven different sections:
</p>
<p>
· SECTION 1: Family firms: prevalence and relevance
</p>
<p>
· SECTION 2: Governance in the family firm
</p>
<p>
· SECTION 3: Strategic management in the family firm
</p>
<p>
· SECTION 4: Succession in the family firm
</p>
<p>
· SECTION 5: Change and transgenerational value creation
</p>
<p>
· SECTION 6: Interpersonal relationships and conflict in the family firm
</p>
<p>
· SECTION 7: Financial management in the family firm
</p>
<p>
The course addresses the governance, management, and finance of established
family businesses. It examines succession, values, life cycles, business
and marketing strategies, conflict resolution, communications, legal, and
financial aspects, estate planning, management, philanthropy, and other
topics that uniquely touch family business governance, management, and
finance. It will convey the characteristics that differentiate family
businesses from other businesses.
</p>
<p>
One of the features, which make this course unique and particularly modern,
is a part of Section 7: Financial management in the family firm dedicated
to the mysterious and fascinating world of the family office. This is the
little-known but key professional practice of advising entire
families-in-business, frequently large, diversified, and with wide
ramifications, about the complete spectrum of activities necessary to
ensure that wealth is created, preserved, transmitted, and spread across
the enlarged family community. These services range from asset allocation
to risk management, education, efficient tax structuring, corporate
finance, corporate governance, intra-, and inter-generational transmission,
philanthropy, etc. Given the enormous amount of wealth and power concerned,
this phenomenon is increasingly important and starts to attract some focus,
particularly on the best graduate students and professional talents.
</p>
<p>
Upon completion of this course, students should understand:
</p>
<ol start="1" type="1">
<li>
The unique assets and vulnerabilities of family enterprises.
</li>
<li>
The role of the CEO in governance, management, and the transfer of
power.
</li>
<li>
The relationship between the role of the board, the family council, and
top management in providing effective governance for family business
continuity.
</li>
<li>
Key family dynamics.
</li>
<li>
The relevance for families to manage collectively wealth created in
professional ways,
</li>
</ol>
<p>
and be able to:
</p>
<ol start="1" type="1">
<li>
Identify the various stakeholders and the role of trust among family
members and their impact on succession and continuity.
</li>
<li>
Discuss the developmental needs and challenges of next-generation
leaders.
</li>
<li>
Analyze the effect of estate taxes on ownership transfer across
generations of family business owners and the implications of ownership
structures on the competitive advantages of family businesses.
</li>
<li>
Explain the importance of strategic planning to family business
continuity.
</li>
<li>
Explore the critical role and challenges that nonfamily managers play
in family-owned operations.
</li>
<li>
Analyze the impact of family culture, communication, conflict, and
unity and explore their interaction effects on the family business.
</li>
<li>
Assess whether they want to seek employment in family businesses as key
employees/managers or in a professional advisory role.
</li>
</ol>
<p>
<strong><u>Teaching methods</u></strong>
</p>
<p>
Lessons will be characterized by the transfer of knowledge and the strong
interaction within the classroom; there are analyses of situations,
problems, and business cases to facilitate participants in learning.
</p>
<p>
<strong>
Regular attending students are strongly recommended to participate in
all the lectures, preparations, and presentations of the business
cases.
</strong>
</p>
<p>
This course uses readings, lectures, exercises, cases, individual and team
assignments, and class discussions to meet its goals. Case assignments
provide an important foundation for class discussion and must be completed
before each class session. The due dates for all cases and other
assignments are listed in the class schedule at the end of the syllabus.
Lectures will highlight key points from the readings and provide additional
information to supplement the readings. Cases will allow you to apply what
you have learned to real-world issues and scenarios. Because each of you
brings unique perspectives and experiences to the class, participation in
class discussions and activities is essential to your learning and that of
other class members. To further enrich your learning, you will also be
matched with an MScBA Teaching Assistant.
</p>
<p>
<strong><u>Textbook</u></strong>
</p>
<p>
Zellweger, T. Managing the Family Business: Theory and Practice, Edward
Elgar Publishing, 2017: ISBN: 9781783470709
</p>
<p>
<strong><u>Cases</u></strong>
</p>
<p>
During the course, we will discuss 10 cases:
</p>
<p>
1. More than a move to Mexico (Chapter 4: Zellweger, pages: 43-45)
</p>
<p>
2. Beretti Holdings—More than a retirement decision (Chapter 5: Zellweger,
pages: 109-112)
</p>
<p>
3. Henkel’s Genthin plant (Chapter 6: Zellweger, page: 125)
</p>
<p>
4. Branding and CSR at HiPP (Chapter 6: Zellweger, pages: 165-166)
</p>
<p>
5. Managing paradoxes (Chapter 6: Zellweger, pages: 193-194)
</p>
<p>
6. Bernet's choice—Valuation, emotional value, family discount and fair
distribution of assets within the family (Chapter 7: Zellweger, pages:
306-307)
</p>
<p>
7. Transgenerational value creation at Ahlstrom (Finland) (Chapter 8:
Zellweger, pages: 361-363)
</p>
<p>
8. Conflict in the Solomon family (Chapter 10: Zellweger, pages: 488-491)
</p>
<p>
9. Tom's world (Chapter 9: Zellweger, pages: 422-424)
</p>
<p>
(the following case from Harvard Business School Publishing. You need to
register to download the cases at the following link: https://hbr.org, then
download the case at the indicated link)
</p>
<p>
10. Medco Energi Internasional
</p>
<p>
<strong><u>Additional References</u></strong>
</p>
<p>
- Poza, E. J., "Family Business", First Edition. Mason, OH: Thomson
South-Western, 2004.
</p>
<p>
- Gnan, L. and Montemerlo, D., (2006), "Family-firm relationship in Italian
SMEs: ownership and governance issues in a double-fold theoretical
perspective", in P. Z. Poutziouris P., Smyrnios, K. X., and Klein, S. B.,
"Handbook of research on family business", Edward Elgar Publishing.
</p>
<p>
- Zattoni, A., Gnan, L., Huse, M., (2012) , "Does Family Involvement
Influence Firm Performance? Exploring the Mediating Effects of Board
Processes and Tasks", Journal Of Management, ISSN: 0149-2063, DOI:
10.1177/0149206312463936
</p>
<p>
- Gnan, L. and Songini, L., (2015), "Family involvement and agency cost
control mechanisms in family small and medium-sized enterprises", Journal
Of Small Business Management, vol. 53, p. 748-779, ISSN: 0047-2778, DOI:
10.1111/jsbm.12085
</p>
<p>
- Gnan, L., Montemerlo, D., Huse, M. (2015), "Governance systems in family
SMEs: the substitution effects between family councils and corporate
governance mechanisms", Journal of Small Business Management, p. 1-27,
ISSN: 1540-627X, DOI: 10.1111/jsbm.12070
</p>
<p>
- Gnan, L., Montemerlo, D., Schulze, W., Corbetta, G., (2008), “Governance
Structures in Italian Family SMEs” In: (a cura di): Comacchio A. and
Pontiggia A., “L'organizzazione fa la differenza”, Roma: Carocci Editore,
ISBN: 9788843045587
</p>
<p>
- Gnan, L. and Montemerlo, D., (2007), "Family-firm relationship in Italian
SMEs: ownership and governance issues in a double-fold theoretical
perspective" In: "Handbook of research on family business", Elgar, ISBN:
978-1845424107
</p>
<p>
- Songini, L., Gnan, L., Morelli, C., Vola, P., (2015), "The why and how of
managerialization of family businesses: evidences from Italy", Piccola
Impresa / Small Business, vol 1, DOI: 10.14596/pisb.179, pp 85-117
</p>
<p>
- Songini, L., Gnan, L., Malmi, T (2013), "The role and impact of
accounting in family business", Journal of Family Business Strategy, vol.
4, p. 71-83, ISSN: 1877-8585, DOI: 10.1016/j.jfbs.2013.04.002
</p>
<p>
- Gnan, L., Songini, L., (2014), "The glass ceiling in SMEs and its impact
on firm managerialisation: a comparison between family and nonfamily SMEs",
International Journal of Business Governance And Ethics, vol. 9, ISSN:
1477-9048
</p>
<p>
- de Pedys, V. and Antonelli, A,. (2008) "Family office for family
business", Oxford management Publishing, ISBN 978-1-906728-01-4
</p>
<p>
- Poutziouris, P., (2001) "Understanding family firms", in (Ed.) Adam, J.,
Institute of Directors, "The Growing Business Handbook", London: Kogan
Page, Chapter 6.3: pp. 9-15, 4th edition, ISBN 074943600X
</p>
<p>
- Levin, R. and Travis, V., (1987), "Small company finance: what the books
don't say", Harvard Business Review, nov-dec: 87608
</p>
<p>
- Villalonga, B. and Amit, R., (2005), "How do family ownership, control
and management affect firm value", Journal of financial economics, 80:
385-417
</p>
<p>
- Wilson, R., (2013), "The family office Report", FamilyOfficesGroup.com
</p>
<p>
- Amit, R. and Perl, R., (2012) "2012 Family Governance Report", Wharton
Global family Alliance, Wharton School, University of Pennsylvania
</p>
<p>
- Amit, R. and Lichtenstein, H., (2010), "Benchmarking the Single Family
Office" Wharton Global Family Alliance, Wharton School, University of
Pennsylvania
</p>
<p>
<strong><u>Suggested videos </u></strong>
</p>
<p>
1. Introductory video: 4 Lessons from the Best Family Businesses
</p>
<p>
<a
href="https://hbr.org/video/4660653966001/4-lessons-from-the-best-family-businesses"
>
https://hbr.org/video/4660653966001/4-lessons-from-the-best-family-businesses
</a>
</p>
<p>
2. Three circle model: importance of governance, setting goals, holistic
leadership and caring for the interests of the family
</p>
<p>
<a href="https://www.youtube.com/watch?v=D85pqiL1tNM">
https://www.youtube.com/watch?v=D85pqiL1tNM
</a>
</p>
<p>
3. The unique strengths and weaknesses of family businesses today,
contrasting it with the humble mom-and-pop store the term usually brings to
mind
</p>
<p>
<a href="https://www.youtube.com/watch?v=suL-HkP-2Ts">
https://www.youtube.com/watch?v=suL-HkP-2Ts
</a>
</p>
<p>
4. The topic of Building a Family Business That Lasts and provides viewers
with four key points to walk away with
</p>
<p>
<a href="https://www.youtube.com/watch?v=vZ52w3wBP1U">
https://www.youtube.com/watch?v=vZ52w3wBP1U
</a>
</p>
<p>
5. The key attention points and delicacies involved in preparing and
transferring a business to the next generation
</p>
<p>
<a href="https://www.youtube.com/watch?v=Io9aWtuSEh4">
https://www.youtube.com/watch?v=Io9aWtuSEh4
</a>
</p>
<p>
6. Family Business Governance: Family Constitution
</p>
<p>
<a href="https://www.youtube.com/watch?v=i5psd_84euA">
https://www.youtube.com/watch?v=i5psd_84euA
</a>
</p>
<p>
7. Family-owned companies need to be run with emotional, as well as
professional leadership
</p>
<p>
<a href="https://www.youtube.com/watch?v=2bYo2Ph48_E">
https://www.youtube.com/watch?v=2bYo2Ph48_E
</a>
</p>
<p>
8. Toward a theory of how some family firms nurture transgenerational
entrepreneurship
</p>
<p>
<a href="https://www.youtube.com/watch?v=AzFginXvSrM">
https://www.youtube.com/watch?v=AzFginXvSrM
</a>
</p>
<p>
9. Family Business Longevity
</p>
<p>
<a href="https://www.youtube.com/watch?v=uoHRNLuoYHM">
https://www.youtube.com/watch?v=uoHRNLuoYHM
</a>
</p>
<p>
10. 5 Ways For Private Equity Firms to Raise Capital From Family Offices
</p>
<p>
<a href="https://www.youtube.com/watch?v=EX8TnQmOFyc">
https://www.youtube.com/watch?v=EX8TnQmOFyc
</a>
</p>
<p>
11. Address the challenges faced by family businesses
</p>
<p>
<a href="https://www.youtube.com/watch?v=mItel08kE-Q">
https://www.youtube.com/watch?v=mItel08kE-Q
</a>
</p>
<p>
12. Conflict in the Family Business
</p>
<p>
<a href="https://www.youtube.com/watch?v=CVILBwkMVxc">
https://www.youtube.com/watch?v=CVILBwkMVxc
</a>
</p>
<p>
13. Stories of Wasteful Conflict in Family Businesses
</p>
<p>
<a href="https://www.youtube.com/watch?v=elzfKRYw1yA">
https://www.youtube.com/watch?v=elzfKRYw1yA
</a>
</p>
<p>
<strong><u>Case Discussions </u></strong>
</p>
<p>
Regular attending students are expected to be fully engaged in the entire
learning process. Regular attending students are expected to:
</p>
<p>
1) prepare the assigned readings of the cases before each class.
</p>
<p>
2) prepare as a group work a PowerPoint presentation on the case, based on
the specific assignment.
</p>
<p>
3) come to class ready to participate and discuss to enhance the
individual's learning and the class.
</p>
<p>
<strong>
On the website of the course, students find for each case the relative
assignment. Please carefully read the questions before the session and
use them for preparing the PowerPoint presentation.
</strong>
</p>
<p>
Each student will be involved in the class discussion on the cases and tie
the assigned reading for the session. The objective is to bring all class
members into the debate. The cases are designed to integrate the concepts
from the case into the context of the course.
<strong>
The preparation and the discussion of the cases do not exclude the
study of the theoretical concepts useful for the discussion of the
cases themselves and the passing of the course exam.
</strong>
</p>
<p>
With the cases' discussions in the <strong>CLASSROOM</strong>, each student
will develop:
</p>
<p>
1. The ability to set the parameters for the problem (key concepts from the
case).
</p>
<p>
2. A depth of knowledge about the case subject (understanding of material,
excellent response to the observations of others).
</p>
<p>
3. The ability to tie in the case with other course concepts.
</p>
<p>
4. The ability to get others involved in the discussion.
</p>
<p>
To adequately discuss the cases, students do:
</p>
<p>
· Be prepared with facts and specific quotes from the case.
</p>
<p>
· Be prepared to comment, ask a question, or develop ideas about the case.
</p>
<p>
During the discussion, students do:
</p>
<p>
· Take a position on a question or a point.
</p>
<ul>
<li>
Ask clarifying questions.
</li>
</ul>
<p>
· Help keep the discussion moving and on track.
</p>
<p>
· Help draw others into the discussion.
</p>
<p>
· Integrate theories and content from other cases.
</p>
<p>
During the discussion, students do not:
</p>
<p>
· Be unprepared and show your lack of knowledge.
</p>
<ul>
<li>
Monopolize the discussion.
</li>
<li>
Make irrelevant comments.
</li>
</ul>
<p>
· Be insensitive to other's desire to speak or to their opinions.
</p>
<p>
All the regular attending students are kindly invited to build up <strong>workgroups (MINIMUM 3 PERSONS – MAXIMUM 5 PERSONS)</strong>. Each
workgroup should prepare a PowerPoint presentation for each case. Into the
first slide, the names of the students belonging to the group should be
reported.
</p>
<p>
The <strong>structure of the presentation</strong> should follow the
following outline:
</p>
<ol start="1" type="1">
<li>
One or more introductory slides aimed at describing/reporting the
story, the characters, and all the necessary elements to define the
context and boundaries of the case clearly.
</li>
<li>
One slide mentioning the questions of the assignment and underlining
the learning goals of the case.
</li>
<li>
One or more slides reporting the answers to each question of the
assignment.
</li>
<li>
One or more slides reporting the final remarks on the case.
</li>
<li>
One closing slide about the lessons learned after the group discussion
of the case.
</li>
</ol>
<p>
<strong>How to prepare the PowerPoint presentation of the case?</strong>
</p>
<p>
<strong> </strong>
</p>
<p>
<strong>Introduction</strong>
– short presentation of the case, brief description of the problems and
situations that should be coped with the discussion.
</p>
<p>
<strong>Diagnosis</strong>
– Problem setting of the context and the situation. Description of the
mains facts and elements connected with the concepts and models of Family
Business. What went wrong, and which actions/situations, instead, were
right? Which elements could be considered for the diagnosis?
</p>
<p>
<strong>Solution</strong>
– Students should provide a possible answer to questions/problems related
to the case and a possible and clear indication of how to approach the
situation and how to solve it. The entire proposal should represent a
consistent action plan in terms of behaviors and expected results.
</p>
<p>
<strong>Conclusions</strong>
– Conclusions should not be longer than 300-500 words and should describe
how the situation and the problem characterized the case, how Family
Business schemata might help solve the case, and what the proposed solution
might generate in terms of organizational consequences.
</p>
<p>
<strong>Lessons learned</strong>
– At the end of the presentation elements/suggestions/advice that we
"take-home" from the case discussion should be identified and reported.
</p>
<p>
<strong>NOTE: </strong>
During the case discussion, students should explicitly address the context
and the different situations with concepts related to Family Business and
with models and theories of this course.
</p>
<p>
<strong>Case Discussions' Class Participation</strong>
</p>
<p>
The best way to learn, especially about FB, is to participate in your
education actively. In this class, "participation" is defined as quality
contributions to class discussion and exercises. There are four
pre-requisites for successful participation:
</p>
<ol start="1" type="1">
<li>
<strong>Be here on time and prepared.</strong>
If you are not here, you cannot contribute much to class discussion. <strong>If you need to miss class for a predictable reason</strong>
(e.g., job interview, athletic competition),
<strong>
please notify us at least 24 hours in advance so that we can make
arrangements for any in-class exercises and so that you can obtain
the materials distributed during the class.
</strong>
Of course, we realize that in some cases, unforeseeable emergencies
arise. Although we will not directly penalize you for non-attendance,
be aware that multiple absences will indirectly hurt you by preventing
you from participating in class, thereby lowering your participation
grade. To contribute to class discussion, you must come to class having
carefully prepared all assignments (i.e., readings, cases, exercises).
</li>
<li>
<strong>Be brave.</strong>
Everyone in this class is smart, engaging, and has unique life
experiences to share. You will get the most out of this course if you
ask questions, voice opinions, and express your thoughts to one
another. If you feel uncomfortable talking in class, please send me an
e-mail or set up an appointment to talk with me early in the semester.
We will do everything we can to accommodate your circumstances, but we
can only do so if they are brought to our attention.
</li>
<li>
<strong>Be courteous.</strong>
Successful participation includes treating your classmates respectfully
and professionally. Listen carefully to the comments and questions that
your classmates voice. You may learn something new from their
perspectives, and you will be able to avoid merely repeating something
that another classmate has said earlier in the discussion. Also, it is
perfectly acceptable for you to voice disagreement with an opinion
provided by another student. The open debate often leads to the most
thoughtful and informative class discussions. However, please express
your argument in a kind and considerate manner.
</li>
<li>
<strong>Be engaged.</strong>
This class is "unplugged."
<strong>
Once class starts, all electronics (e.g., computers, cell phones,
tablets, etc.) should be turned off and put away.
</strong>
If you need to use a device because of a language or disability issue,
you need to secure permission at the beginning of the class. The misuse
of an electronic device (e.g., surfing the web or texting) will
adversely affect your grade.
</li>
</ol>
<p>
<strong>
To facilitate the visioning of its PowerPoint presentation in the
classroom, each workgroup should take a personal computer with
PowerPoint installed and an available VGA connection.
</strong>
</p>
<p>
<strong> </strong>
</p>
<p>
<strong>
By 8 pm of the day before the case discussion, all regular attending
students should send to the Course's Instructors, attaching the case
presentation prepared. ONLY STUDENTS WHO HAD HANDED OVER ALL THE CASE
PRESENTATIONS WILL BE ADMITTED TO THE 1<sup>st</sup> EXAM AFTER THE
COURSE.
</strong>
</p>
<p>
<strong> </strong>
</p>
<p>
<strong>Policy for Late Assignments</strong>
</p>
<p>
As in the business world, work must be received on time to receive full
credit. If you are late on an assignment, your access to the 1<sup>st</sup>
exam after the course will be compromised. You are always welcome to hand
in an assignment before its due date if you know that you will be busy as
the due date approaches. If you think that you will not complete an
assignment by the stated due date, please speak with us in advance to make
alternative arrangements. Our policy on late assignments will depend on the
specific circumstances surrounding the problem and thus may differ from
student to student. Providing advance notice about a late assignment will
minimize the penalty you receive on that assignment but does not guarantee
that there will be no penalty for turning the assignment in late.
</p>
<p>
<strong><u>Other learning sources</u></strong>
</p>
<p>
Slides and other materials will be available on the course website.
</p>
<p>
<strong>
THE SLIDES DO NOT REPRESENT A SUPPORT FOR AN EFFECTIVE AND SUCCESSFUL
PREPARATION FOR THE EXAM OF THE COURSE. THEY REPRESENT ONLY A HELP TO
FACILITATE THE TRANSFER OF THE KNOWLEDGE TO STUDENTS DURING THE
LECTURES.
</strong>
</p>
<p>
<strong><u>Attendance</u></strong>
</p>
<p>
Because of the concentrated nature of the MScBA program, attendance in
class is crucial.
</p>
<p>
<strong>
Not regular attending students will be required to prepare for the exam
</strong>
<strong><u>ALL</u></strong>
<strong>
the chapters of the textbook Zellweger, T. Managing the Family
Business: Theory and Practice, Edward Elgar Publishing, 2017: ISBN:
9781783470709 and <u>ALL</u> the cases discussed in the classroom.
</strong>
</p>
<p>
<strong>NOTE: </strong>
Attendance to the first class session is mandatory. Important information
about the course and the instructor's expectations are given during the
first session. If you know that you will have to be absent for one session,
please contact your instructor to ensure that absence from a session is
acceptable.
</p>
<p>
<strong><u>Exam</u></strong>
</p>
<p>
The 1<sup>st</sup> exam after the course is a written exam (the 1st), while
all the other exams will be oral.
</p>
<p>
In the case of a written exam, the duration is about 3-4 hours, and it
includes:
</p>
<p>
a) <strong>Case discussion</strong> - You may be given a case study to
which some questions may pertain to lead the discussion. As you respond to
the questions, please use specific content and theories (use names to
identify theories and models) as the basis of your analysis. You will not
receive credit for your personal opinions unless backed by theory, lecture,
and/or text material. Also, describe how you see the content/theory
applying to the situation. Your answers will be evaluated based upon both
quantity and quality. Answers that are more complete and demonstrate a
higher level of understanding and analysis will receive more points.
</p>
<p>
b) <strong>Some questions directly connected to the course textbook</strong> –
The questions could be open, closed (multiple choice), or a combination of
both. You may be asked to discuss the models and the theories presented
during the course. You will be asked to interpret some real incidents and
focus your attention on specific theoretical issues.
</p>
<p>
<strong>
<u>
1<sup>st</sup> exam after the course participation and exam grades
registering on the booklet
</u>
</strong>
</p>
<p>
<strong><u> </u></strong>
</p>
<p>
<strong>
Only regular attending students that have delivered the hard copies of
ALL the cases to the Instructors can take the 1<sup>st</sup> exam after
the course with a format explicitly dedicated to them.
</strong>
</p>
<p>
<strong> </strong>
</p>
<p>
<strong>
Only regular registered students on the DELPHI System will be allowed
to register their grades.
</strong>
</p>
<p>
<strong> </strong>
</p>
<p>
<strong>
The 1<sup>st</sup> exam grades will be registered after the official
exam date; Teachers will communicate that date. It is compulsory to
come on that exam date to record the grade on the Delphi and the
booklet.
</strong>
</p>
<p>
<strong><u>Team Project</u></strong>
</p>
<p>
<strong><u> </u></strong>
</p>
<p>
The purpose of the project is to allow your team to apply what has been
learned in the course (through course lectures, readings, and case
discussions) to problems in a family firm of your team's choice.
</p>
<p>
<strong>
Class members, regular attending students, will work in teams of four
(4) people.
</strong>
</p>
<p>
<strong> </strong>
</p>
<p>
<strong>
To the Team Project, regular attending students will be allowed to
achieve a -3/+3 extra points to the final grade of the 1<sup>st</sup>
exam after the course. Only regular attending students taking the 1 <sup>st</sup> exam after the course will be accepted for the Team
Project.
</strong>
</p>
<p>
Your team should identify a family firm to study (Please, no student
groups).
</p>
<p>
Your team is to gather information from people in the family firm through
direct contact. You may supplement this information with data from the
media, the organization's literature, and other secondary sources. You
should identify a relatively recent problem to analyze (i.e., this should
not be a historical account of a problem and the company's solution). You
should focus your analysis by applying the concepts from the course. While
it is acceptable to incorporate several concepts from the course, please
aim for depth rather than breadth regarding course concepts. Your goal is
to diagnose the mechanisms causing the problem or issue of concern in the
organization. Initially, you may notice many symptoms (for instance, a
crisis after the succession, seemingly an unhealthy family culture, low
family members' commitment and involvement, governance issues, etc.), but
your task is to get to the underlying reason for these symptoms. And
beware, sometimes the initial symptoms we think we see are not what they
appear to be.
</p>
<p>
There are three broad goals for this assignment:
</p>
<p>
1. One goal of this assignment is obviously to take the initiative to make
a positive contribution to a family firm.
</p>
<p>
2. Another primary goal is to provide an opportunity for you to learn more
about family businesses firsthand and use your critical thinking and
reflection skills to link your experience with this family firm to your
learning concerning family business theories.
</p>
<p>
3. The final goal is to provide a forum for you to hone your team member
and leader skills and reflect on the learning gained from this team
experience. Each team will make a presentation and write a paper that
describes what you did for the family firm, what you learned about the
family business, and what you learned about working on a team.
</p>
<p>
To meet these broad goals, your team should answer the following questions
in the assignments detailed below.
</p>
<p>
a) What are the issues or problems facing the family firm?
</p>
<p>
b) What can Course concepts be applied to understand why this problem is
occurring?
</p>
<p>
c) What recommendations can you offer to help improve the family business
functioning?
</p>
<p>
<strong>Deliverables of the Team Project:</strong>
</p>
<p>
<strong>
1. The project proposal is due to Instructors by the 9<sup>th</sup>
session of the course by 5 pm. It should include:
</strong>
</p>
<p>
a) the names of your group members
</p>
<p>
b) your team name
</p>
<p>
c) the name of the organization
</p>
<p>
d) the name, contact information, and level of your contact person
</p>
<p>
e) the method you will use to gain access to the organization
</p>
<p>
f) a brief description (one paragraph) of the problem facing the
organization.
</p>
<p>
<strong>
2. Your written project is due to Instructors by the 18th session of
the course by 5 pm
</strong>
.
</p>
<p>
It should contain a maximum of 15 double-spaced pages (1 cm margins, 12
point font). You will be penalized significantly for exceeding this limit.
The limit does not include appendices, which you are free to use to provide
charts, figures, or other background material not necessary in the main
body of your analysis. However, appendices that are not directly referenced
in the main text will not be read. <strong>LATE PROJECT WRITE-UPS WILL NOT BE ACCEPTED</strong>.
</p>
<p>
This written project should summarize what you did for/within the
organization, what you have learned about organizational behavior, and what
you have learned about working on a team.
</p>
<p>
<strong>Grading of the Team Project:</strong>
</p>
<p>
Your group project will be evaluated on the following criteria:
</p>
<p>
a. Problem definition: How well (i.e., thoroughly and concisely) describe
the organizational context, the relevant parties, and the factors that are
important to the problem?
</p>
<p>
b. Accurate and thorough use of course concepts.
</p>
<p>
c. Integration of course concepts with information about the company and
problem, i.e., how well do you integrate course concepts with details about
the problem to illuminate the problem in a way that leads to solutions?
</p>
<p>
d. The extent to which recommendations are consistent with analysis.
</p>
<p>
e. Quality of written analysis.
</p>
<br clear="all"/>
<p>
<strong><u>Analytical Syllabus </u></strong>
</p>
<div align="center">
<table border="1" cellspacing="0" cellpadding="0" width="105%">
<tbody>
<tr>
<td width="6%">
<p align="center">
<strong>#</strong>
</p>
</td>
<td width="69%">
<p align="center">
<strong>Agenda</strong>
</p>
</td>
<td width="14%">
<p align="center">
<strong>Lecture/</strong>
</p>
<p align="center">
<strong>Case</strong>
</p>
<p align="center">
<strong>discussion</strong>
</p>
</td>
<td width="10%">
<p align="center">
<strong>Lecturer</strong>
</p>
</td>
</tr>
<tr>
<td width="100%" colspan="4">
<p align="center">
<strong>SECTION 1:</strong>
<strong></strong>
</p>
<p align="center">
<strong>Family firms: prevalence and relevance</strong>
<strong></strong>
</p>
</td>
</tr>
<tr>
<td width="6%">
<p align="center">
1
</p>
</td>
<td width="69%">
<p>
<strong>Introduction of the Course</strong>
</p>
<p>
<strong>(Chapter 1: Zellweger, pages: 1-3)</strong>
</p>
<p>
1. Thematic focus
</p>
<p>
2. Intended audience
</p>
<p>
3. Structure and pedagogical tools
</p>
<p>
<strong>Defining the family business</strong>
</p>
<p>
<strong>(Chapter 2: Zellweger, pages: 4-22)</strong>
</p>
<p>
1. The distinction between family and nonfamily firms
</p>
<p>
2. Defining family business by type of family
involvement
</p>
<p>
3. Circle models of family influence
</p>
<p>
4. Family firm identity
</p>
<p>
5. Family business definition
</p>
</td>
<td width="14%">
<p align="center">
<strong>Lecture</strong>
</p>
</td>
<td width="10%">
<p align="center">
GNAN
</p>
</td>
</tr>
<tr>
<td width="6%">
<p align="center">
2
</p>
</td>
<td width="69%">
<p>
<strong>
Prevalence and economic contribution of family
firms around the globe
</strong>
</p>
<p>
<strong>(Chapter 3: Zellweger, pages: 24-33)</strong>
</p>
<p>
Aggiornato A.A. 2020-2021
Aggiornato A.A. 2018-2019
FAMILY BUSINESS
(Prof. Luca Gnan)
Teaching Staff responsible for the Course:
Prof. Luca Gnan
Email: luca.gnan@uniroma2.it
Availability: Contact via email
Prof.ssa Giulia Flamini
E-mail: giulia.flamini@uniroma2.it
Availability: Contact via email
We are committed to making this course a valuable learning experience for you. After the first month, we will spend part of a class session evaluating our progress, and we will make any necessary changes to keep us on track. However, we welcome your feedback at any time in the semester. It is easiest to reach us by email or during office hours, but we are always happy to set up an appointment. Additionally, if you have a disability that requires special accommodation, please let us know ASAP so that we can be helpful to you.
Emails, Office Hours & Feedback on Assignments
We endeavor to answer emails within 1 day. If you have not heard from us within that time, please resend the email. We will post grades & comments online in the materials section of the course website. We will be happy to give feedback and discuss assignments after all grading is complete for a certain assignment. We schedule office hours by email request.
We may answer questions of assignment clarification in class and via emails to benefit the entire class. We may also give extra grades (see below Team Project) during the course that, while generally designed to support learning in the course, will also help your participation grade. These are pass/fail and do not include comments.
Pre-requisites for the Course:
None
Course description and Learning Objectives
Family businesses shows distinct core competencies that can result in unique competitive advantages. They take a long run view of the business—across generations, rather than publicly traded quarterly reports. Their capital can be very patient, owners will sacrifice their salaries in order to make payroll, and they are an integral part of their communities, unlike publicly traded counterparts that might abandon a community at the blink of a budget. They can engender a great deal of loyalty on the part of employees, and the existence of family may reduce agency problems.
Family Businesses also face challenges that threaten their continuity. The challenges are primarily the result of issues presented by the interaction of family, management, and ownership—particularly where the family wishes to perpetuate its influence and/or control from generation to generation. Family firms seem to be as agile in one generation as they are fragile across generations.
Family businesses start with an owner-managed first generation (usually an entrepreneur). The next generation—G2—is the sibling generation, and G3 is the cousin era. The probability of passing the company to the next generation diminishes significantly, with fewer than half making it to G2 and only about less than 15% making it to G3. So, despite the benefits of family, there can be some significant issues.
The course explores and analyzes continuity challenges of family business and their best management practices. The focus of this course is on pragmatic, action-oriented, management, governance, finance, and family/business leadership skills.
Attention is devoted to evaluating family firms and their growth options to provide a roadmap for analyzing how family ownership, control, and management affect performances and how family firms can create and ensure more value through generations.
The course presents seven different sections:
· SECTION 1: Family firms: prevalence and relevance
· SECTION 2: Governance in the family firm
· SECTION 3: Strategic management in the family firm
· SECTION 4: Succession in the family firm
· SECTION 5: Change and transgenerational value creation
· SECTION 6: Interpersonal relationships and conflict in the family firm
· SECTION 7: Financial management in the family firm
The course addresses the governance, the management, and the finance of established family businesses. It examines succession, values, life cycles, business and marketing strategies, conflict resolution, communications, legal, and financial aspects, estate planning, management, philanthropy and other topics that uniquely touch family business governance, management and finance. It will convey the characteristics that differentiate family businesses from other businesses.
One of the features, which make this course unique and particularly modern, is a part of the Section 7: Financial management in the family firm dedicated to the mysterious and fascinating world of the family office. This is the little-known, but key professional practice of advising entire families-in-business, frequently large, diversified and with wide ramifications, about the complete spectrum of activities necessary to ensure that wealth is created, preserved, transmitted and spread across the enlarged family community. These services range from asset allocation to risk management, to education, efficient tax structuring, corporate finance and corporate governance, intra- and inter- generational transmission, philanthropy, etc. Given the enormous amount of wealth and power concerned, this phenomenon shows increasingly importance and starts to attract some focus, particularly by the best graduate students and professional talents.
Upon completion of this course, students should understand:
- The unique assets and vulnerabilities of family enterprises.
- The role of the CEO in governance, management, and the transfer of power.
- The relationship between the role of the board, the family council, and top management in providing effective governance for family business continuity.
- Key family dynamics.
- The relevance for families to manage collectively wealth created in professional ways,
and be able to:
- Identify the various stakeholders and the role of trust among family members and their impact on succession and continuity.
- Discuss the developmental needs and challenges of next generation leaders.
- Analyze the effect of estate taxes on ownership transfer across generations of family business owners and the implications of ownership structures on the competitive advantages of family businesses.
- Explain the importance of strategic planning to family business continuity.
- Explore the critical role and challenges that non-family managers play in family-owned operations.
- Analyze the impact of family culture, family communication, family conflict, and family unity and explore their interaction effects on the family business.
- Assess whether they want to seek employment in family businesses both as key employees/managers or in a professional advisory role.
Teaching methods
Lessons will focus on transferring knowledge and on a strong interaction within the classroom; there are analysis of situations problems and business cases in order to facilitate participants in learning.
Regular attending students (in order to be a regular attending student, a participant should achieve at least an 85% of presence to lectures and case discussions) are strongly recommended to participate to all the lectures and to all the preparations and presentations of the business cases.
To meet its goals, this course uses readings, lectures, exercises, cases, individual and team assignments, and class discussion. Case assignments provide an important foundation for class discussion and must completed prior to each class session. The analytical syllabus (at the end of this document) shows due dates for all cases and other assignments in the class schedule. Lectures will highlight key points from the readings and provide additional information to supplement the readings. Cases will provide you with the opportunity to apply what you have learned to real world issues and scenarios. Because each of you brings unique perspectives and experiences to the class, participation in class discussions and activities is essential to your own learning as well as that of other class members. To enrich further your learning, an MScBA Teaching Assistant will also match you.
Textbook
Zellweger, T. Managing the Family Business: Theory and Practice, Edward Elgar Publishing, 2017: ISBN: 9781783470709
Cases
During the course, we will discuss 10 cases:
1. More than a move to Mexico (Chapter 4: Zellweger, pages: 43-45)
2. Beretti Holdings—More than a retirement decision (Chapter 5: Zellweger, pages: 109-112)
3. Henkel’s Genthin plant (Chapter 6: Zellweger, page: 125)
4. Branding and CSR at HiPP (Chapter 6: Zellweger, pages: 165-166)
5. Managing paradoxes (Chapter 6: Zellweger, pages: 193-194)
6. Bernet’s choice—Valuation, emotional value, family discount and fair distribution of assets within the family (Chapter 7: Zellweger, pages: 306-307)
7. Transgenerational value creation at Ahlstrom (Finland) (Chapter 8: Zellweger, pages: 361-363)
8. Conflict in the Solomon family (Chapter 10: Zellweger, pages: 488-491)
9. Tom’s world (Chapter 9: Zellweger, pages: 422-424)
(the following case from Harvard Business School Publishing. You need to register to download the cases at the following link: https://hbr.org, then download the case at the indicated link)
10. Medco Energi Internasional
Additional References
- Poza, E. J., “Family Business”, First Edition. Mason, OH: Thomson South-Western, 2004.
- Gnan, L. and Montemerlo, D., (2006), “Family-firm relationship in Italian SMEs: ownership and governance issues in a double-fold theoretical perspective”, in P. Z. Poutziouris P., Smyrnios, K. X., and Klein, S. B., “Handbook of research on family business”, Edward Elgar Publishing.
- Zattoni, A., Gnan, L., Huse, M., (2012) ,“Does Family Involvement Influence Firm Performance? Exploring the Mediating Effects of Board Processes and Tasks”, Journal Of Management, ISSN: 0149-2063, DOI: 10.1177/0149206312463936
- Gnan, L. and Songini, L., (2015), “Family involvement and agency cost control mechanisms in family small and medium-sized enterprises”, Journal Of Small Business Management, vol. 53, p. 748-779, ISSN: 0047-2778, DOI: 10.1111/jsbm.12085
- Gnan, L., Montemerlo, D., Huse, M. (2015), “Governance systems in family SMEs: the substitution effects between family councils and corporate governance mechanisms”, Journal of Small Business Management, p. 1-27, ISSN: 1540-627X, DOI: 10.1111/jsbm.12070
- Gnan, L., Montemerlo, D., Schulze, W., Corbetta, G., (2008), “Governance Structures in Italian Family SMEs” In: (a cura di): Comacchio A. and Pontiggia A., “L'organizzazione fa la differenza”, Roma: Carocci Editore, ISBN: 9788843045587
- Gnan, L. and Montemerlo, D., (2007), “Family-firm relationship in Italian SMEs: ownership and governance issues in a double-fold theoretical perspective” In: “Handbook of research on family business”, Elgar, ISBN: 978-1845424107
- Songini, L., Gnan, L., Morelli, C., Vola, P., (2015), “The why and how of managerialization of family businesses: evidences from Italy”, Piccola Impresa / Small Business, vol 1, DOI: 10.14596/pisb.179, pp 85-117
- Songini, L., Gnan, L., Malmi, T (2013), “The role and impact of accounting in family business”, Journal of Family Business Strategy, vol. 4, p. 71-83, ISSN: 1877-8585, DOI: 10.1016/j.jfbs.2013.04.002
- Gnan, L., Songini, L., (2014), “The glass ceiling in SMEs and its impact on firm managerialisation: a comparison between family and non-family SMEs”, International Journal of Business Governance And Ethics, vol. 9, ISSN: 1477-9048
- de Pedys, V. and Antonelli, A,. (2008) “Family office for family business”, Oxford management Publishing, ISBN 978-1-906728-01-4
- Poutziouris, P., (2001) “Understanding family firms”, in (Ed.) Adam, J., Institute of Directors, “The Growing Business Handbook”, London: Kogan Page, Chapter 6.3: pp. 9-15, 4th edition, ISBN 074943600X
- Levin, R. and Travis, V., (1987), “Small company finance: what the books don’t say”, Harvard Business Review, nov-dec: 87608
- Villalonga, B. and Amit, R., (2005), “How do family ownership, control and management affect firm value”, Journal of financial economics, 80: 385-417
- Wilson, R., (2013), “The family office Report”, FamilyOfficesGroup.com
- Amit, R. and Perl, R., (2012) “2012 Family Governance Report”, Wharton Global family Alliance, Wharton School, University of Pennsylvania
- Amit, R. and Lichtenstein, H., (2010), “Benchmarking the Single Family Office” Wharton Global Family Alliance, Wharton School, University of Pennsylvania
Suggested videos
1. Introductory video: 4 Lessons from the Best Family Businesses
https://hbr.org/video/4660653966001/4-lessons-from-the-best-family-businesses
2. Three circle model: importance of governance, setting goals, holistic leadership and caring for the interests of the family
https://www.youtube.com/watch?v=D85pqiL1tNM
3. The unique strengths and weaknesses of family businesses today, contrasting it with the humble mom-and-pop store the term usually brings to mind
https://www.youtube.com/watch?v=suL-HkP-2Ts
4. The topic of Building a Family Business That Lasts and provides viewers with four key points to walk away with
https://www.youtube.com/watch?v=vZ52w3wBP1U
5. The key attention points and delicacies involved in preparing and transferring a business to the next generation
https://www.youtube.com/watch?v=Io9aWtuSEh4
6. Family Business Governance: Family Constitution
https://www.youtube.com/watch?v=i5psd_84euA
7. Family-owned companies need to be run with emotional, as well as professional leadership
https://www.youtube.com/watch?v=2bYo2Ph48_E
8. Toward a theory of how some family firms nurture transgenerational entrepreneurship
https://www.youtube.com/watch?v=AzFginXvSrM
9. Family Business Longevity
https://www.youtube.com/watch?v=uoHRNLuoYHM
10. 5 Ways For Private Equity Firms to Raise Capital From Family Offices
https://www.youtube.com/watch?v=EX8TnQmOFyc
11. Address the challenges faced by family businesses
https://www.youtube.com/watch?v=mItel08kE-Q
12. Conflict in the Family Business
https://www.youtube.com/watch?v=CVILBwkMVxc
13. Stories of Wasteful Conflict in Family Businesses
https://www.youtube.com/watch?v=elzfKRYw1yA
Case Discussions
We expect that regular attending students are fully engaged in the entire learning process. This means that we expect regular attending students to:
1) prepare the assigned readings of the cases prior to each class;
2) prepare as a group work a PowerPoint presentation on the case, based on the specific assignment;
3) come to class prepared to participate and to discuss in order to enhance the learning of the individual and the class.
On the web site of the course, students find for each case the relative assignment. Please read carefully the questions before the lesson and use them for preparing the PowerPoint presentation.
Each student will be involved the class discussion on the cases and tie the assigned reading for the session. The objective is to bring all class members into the discussion. The cases intend to integrate the concepts from the case into the context of the course. The preparation and the discussion of the cases do not exclude the study of the theoretical concepts useful for the discussion of the cases themselves and for the passing of the exam of the course.
With the cases’ discussions in CLASSROOM, each student will develop:
1. The ability to set the parameters for the problem (key concepts from the case).
2. A depth of knowledge about the case subject (understanding of material, good response to the observations of others).
3. The ability to tie-in case with other course concepts.
4. The ability to get others involved in the discussion.
In order to discuss effectively the cases, students do:
· Be prepared with facts and specific quotes from the case.
· Be prepared to make a comment, ask a question, or make a statement about the case.
During the discussion, students do:
· Take a position on a question or a point.
- Ask clarifying questions.
· Help keep the discussion moving and on track.
· Help draw others into the discussion.
· Integrate theories and content from other cases.
During the discussion, students do not:
· Be unprepared and show your lack of knowledge.
- Monopolize the discussion.
- Make irrelevant comments.
· Be insensitive to other’s desire to speak or to their opinions.
We kindly invite all the regular attending students to build up work groups (MINIMUM 3 PERSONS – MAXIMUM 5 PERSONS). Each work group should prepare a PowerPoint presentation for each case. Into the first slide, each work group should report the names of the students belonging to the group.
The structure of the presentation should follow the following outline:
- One or more introductory slides aimed at describing/reporting the story, the characters, all the necessary elements in order to define clearly the context and the boundaries of the case.
- One slide mentioning the questions of the assignment and underlining the learning goals of the case.
- One or more slides reporting the answers to each question of the assignment.
- One or more slides reporting the final remarks on the case.
- One closing slide about the lessons learned after the group discussion of the case.
How to prepare the PowerPoint presentation of the case?
Introduction – short presentation of case, short description of the problems and situations that should be coped with the discussion.
Diagnosis – Problem setting of the context and of the situation. Description of the mains facts and elements connected with the concepts and models of Family Business (e.g. Ownership issues, conflicts, family culture, governance issues, leadership, managing people, succession, etc.). What went wrong and which actions/situations, instead, were right? Which elements could be considered for the diagnosis?
Solution – Students should provide a possible solution to questions/problems related with the case and a viable and clear indication on how to approach the situation and how to solve it. The entire proposal should represent a consistent action plan in terms of behaviors and expected results.
Conclusions – Conclusions should not be longer than 300-500 words and should provide a description on how the situation and the problem characterized the case, on how Family Business schemata might help to solve the case, and what the proposed solution might generate in terms of family and managerial consequences.
Lessons learned – At the end of the presentation elements/suggestions/advices that we “take home” from the case discussion should be clearly identified and reported.
NOTE: During the case discussion, students should explicitly address the context and the different situations with concepts related with Family Business and with models and theories of this course.
Case Discussions’ Class Participation
We believe that the best way to learn, especially about family Business, is to actively participate in your education. In this class, “participation” is defined in terms of quality contributions to class discussion and exercises. There are four prerequisites for successful participation:
1. Be here on time and prepared. If you are not here, you cannot contribute much to class discussion. If you need to miss class for a predictable reason (e.g., job interview, athletic competition), please notify us at least 24 hours in advance so that we can arrange for any in-class exercises and so that you can obtain the materials distributed during the class. Of course, we realize that in some cases unforeseeable emergencies arise. Although we will not directly penalize you for non-attendance, be aware that multiple absences will indirectly hurt you by preventing you from participating in class, thereby lowering your participation grade. To contribute to class discussion, you must come to class having carefully prepared all assignments (i.e., readings, cases, exercises).
2. Be brave. Everyone in this class is smart, interesting, and has unique life experiences to share. You will get the most out of this course if you ask questions, voice opinions, and express your thoughts to one another. If you feel uncomfortable talking in class, please send me an email or set up an appointment to talk with me early in the semester. We will do everything we can to accommodate each of your individual circumstances, but we can only do so if they are brought to our attention.
3. Be courteous. Successful participation includes treating your classmates in a respectful and professional manner. Listen carefully to the comments and questions that your classmates voice. You may learn something new from their perspectives, and you will be able to avoid simply repeating something that another classmate has said earlier in discussion. Also, it is perfectly acceptable for you to voice disagreement with an opinion provided by another student. Open debate often leads to the most thoughtful and informative class discussions. However, please voice your disagreement in a kind and considerate manner.
4. Be engaged. This class is “unplugged.” Once class starts, all electronics (e.g., computers, cell phones, tablets, etc.) should be turned off and put away. If you need to use a device because of a language or disability issue, you need to secure permission at the beginning of the class. The misuse of an electronic device (e.g., surfing the web or texting) will adversely affect your grade.
In order to facilitate the visioning of its own PowerPoint presentation in classroom, each work group should take a personal computer with PowerPoint installed and an available VGA connection.
By the 8pm of the day before of the case discussion, all regular attending students should send an email to the course’s Instructors, attaching the case presentation prepared. They have to hand over a hard copy of the PowerPoint presentation. ONLY THE HANDING OVER OF THE HARD COPY CERTIFIES THE PREPARATION OF THE CASE FOR THE DISCUSSION. ONLY STUDENTS WHO HAD HANDED OVER ALL THE CASE PRESENTATIONS WILL BE ADMITTED TO THE PRE-EXAM.
Policy for Late Assignments
As in the business world, work must be received on time in order to receive full credit. If you are late on an assignment, your access to the Pre-Exam will be compromised. You are always welcome to hand in an assignment before its due date if you know that you will be busy as the due date approaches. If you think that you will not be able to complete an assignment by the stated due date, please speak with us in advance to make alternative arrangements. Our policy on late assignments will depend on the specific circumstances surrounding the problem, and thus may differ from student to student. Providing advance notice about a late assignment will minimize the penalty you receive on that assignment, but does not guarantee that there will be no penalty for turning the assignment in late.
Other learning sources
Slides and other material will be available on the course website.
THE SLIDES DO NOT REPRESENT A SUPPORT FOR AN EFFECTIVE AND SUCCESFUL PREPARATION TO THE EXAM OF THE COURSE. THEY REPRESENT ONLY A HELP TO FACILITATE THE TRANSFER OF THE KNOWLEDGES TO STUDENTS DURING THE LESSONS.
Attendance
Because of the concentrated nature of the MScBA programme, attendance in class is very important.
Students with less than 85% of attendance to lectures and case discussions (including arriving late or leaving early) will be required to prepare for the exam ALL the chapters of the textbook Zellweger, T. Managing the Family Business: Theory and Practice, Edward Elgar Publishing, 2017: ISBN: 9781783470709 and ALL the cases discussed in classroom.
NOTE : Attendance for the first class session is mandatory as important information regarding the course and the instructors’ expectations are given. If you know in advance that you will be absent for one session, please contact your instructor to ensure that absence from a particular session is acceptable.
Exam
The exam, depending on the number of the registered student, is a written exam or an oral exam.
In case of a written exam, the duration is about 3-4 hours and it includes:
a) Case discussion - You may be given a case study to which some questions may pertain in order to lead the discussion. As you respond to the questions, please use specific content and theories (use names to identify theories and models) as the basis of your analysis. You will not receive credit for your personal opinions unless backed by theory, lecture, and/or text material. Also, describe how you see the content/theory applying to the situation. Your answers will be evaluated based upon both quantity and quality. Answers that are more complete and demonstrate a higher level of understanding and analysis will receive more points.
b) Some questions directly connected to the course textbook – The questions could open, closed (multiple choice), or a combination of the both. You may be asked to discuss the models and the theories presented during the course. You will be asked to interpret some real incidents and to focus your attention to some specific theoretical issues.
Pre-Exam participation and exam grades registering on the booklet
Only regular attending students (85% of attendance to lectures and case discussions, including arriving late or leaving early) that have delivered the hard copies of ALL the case to the Instructors are allowed to take the pre-exam.
Only regular registered students on the DELPHI System will be allowed to register their grade.
The pre-exam grades will be registered on the first official exam date AFTER THE COURSE ENDING. It is compulsory to come on that date of the exam for registering the grade on the Delphi and on the booklet.
Team Project
The purpose of the project is to give your team an opportunity to apply what has been learned in the course (through course lectures, readings, and case discussions) to problems in a family firm of your team's choice.
Class members, regular attending students, will work in teams of four (4) people.
To the Team Project regular attending students will be allowed to achieve a -3/+3 extra points to the final grade of the Pre-Exam. Only regular attending students, taking the Pre-Exam will be accepted for the Team Project.
Your team should identify a family firm to study (Please, no student groups).
Your team is to gather information from people in the family firm through direct contact. You may supplement this information with data from the media, the organization's literature, and other secondary sources. You should identify a relatively recent problem to analyze (i.e., this should not be an historical account of a problem and the company's solution). You should focus your analysis by applying the concepts from the course. While it is acceptable to incorporate several concepts from the course, please aim for depth rather than breadth regarding the use of course concepts. Your goal is to diagnose the mechanisms that are causing the problem or issue of concern in the organization. Initially, you may notice many symptoms (for instance, a crisis after the succession, seemingly an unhealthy family culture, low family members’ commitment and involvement, governance issues, etc.), but your task is to get to the underlying reason for these symptoms. And beware, sometimes the initial symptoms we think we see are not what they appear to be.
There are three broad goals for this assignment:
1. One goal of this assignment is obviously to take the initiative to make a positive contribution to a family firm.
2. Another major goal is to provide an opportunity for you to learn more about family businesses first hand and to use your critical thinking and reflection skills to link your experience with this family firm to your learning in relation to family business theories.
3. The final goal is to provide a forum for you to hone your skills as a team member and leader and to reflect on the learning gained from this team experience. Each team will make a presentation and write a paper that describes what you did for the family firm, what you learned about family business, and what you learned about working on a team.
To meet these broad goals, your team should answer the following questions in the assignments detailed below.
a) What are the issues or problems facing the family firm?
b) What course concepts can be applied to understand why this problem is occurring?
c) What recommendations can you offer to help improve the family business functioning?
Deliverables of the Team Project:
1. The project proposal e-mail is due by email to Instructors by the date of the 9th session of the course by 5pm. It should include:
a) The names of your group members
b) Your team name
c) The name of the organization
d) The name, contact information and level of your contact person
e) The method you will use to gain access to the organization
f) A brief description (one paragraph) of the problem facing the organization.
2. Your written project is due by email to Instructors by the date of the 18th session of the course by 5pm .
It should contain a maximum of 15 double spaced pages (1 cm margins, 12 point font). You will be penalized significantly for exceeding this limit. The limit does not include appendices, which you are free to use to provide charts, figures, or other background material not necessary in the main body of your analysis. However, appendices that are not directly referenced in the main text will not be read. LATE PROJECT WRITE-UPS WILL NOT BE ACCEPTED.
This written project should summarize what you did for/within the family firm, what you have learned about family business, and what you have learned about working on a team.
Grading of the Team Project:
Your group project will be evaluated on the following criteria:
a. Problem definition: How well (i.e., thoroughly and concisely) do you describe the family business context, the relevant parties, and the factors that are important to the problem?
b. Accurate and thorough use of course concepts.
c. Integration of course concepts with information about the family firm and problem, i.e., how well do you integrate course concepts with information about the problem to illuminate the problem in a way that leads to solutions?
d. Extent to which recommendations are consistent with analysis.
e. Quality of written analysis.
Analytical Syllabus
|
# |
Agenda |
Lecture/ Case discussion |
Lecturer |
|
SECTION 1: Family firms: prevalence and relevance |
|||
|
1 |
Introduction of the course (Chapter 1: Zellweger, pages: 1-3) 1. Thematic focus 2. Intended audience 3. Structure and pedagogical tools Defining the family business (Chapter 2: Zellweger, pages: 4-22) 1. The distinction between family and nonfamily firms 2. Defining family business by type of family involvement 3. Circle models of family influence 4. Family firm identity 5. Family business definition |
Lecture |
GNAN |
|
2 |
Prevalence and economic contribution of family firms around the globe (Chapter 3: Zellweger, pages: 24-33) 1. Prevalence of family firms worldwide 2. Economic contribution of family firms 3. Institutional setting and the prevalence of family firms Strengths and weaknesses of family firms (Chapter 4: Zellweger, pages: 36-42) 1. Typical strengths of family firms 2. Typical weaknesses of family firms 3. Bivalent attributes of family firm characteristics CASE STUDY: More than a move to Mexico (Chapter 4: Zellweger, pages: 43-45) |
Lecture and Case |
GNAN |
|
SECTION 2: Governance in the family firm |
|||
|
3 |
Governance in the family firm: premises, corporate and ownership governance (Chapter 5: Zellweger, pages: 46-72) 1. Why do family firms need governance? 2. Typical governance constellations in family firms 3. Performance implications of governance constellations 4. Untangling corporate, ownership, family governance 5. Corporate governance 6. Ownership governance |
Lecture |
GNAN |
|
4 |
Governance in the family firm: family governance (Chapter 5: Zellweger, pages: 73-105) 1. Family governance 2. Governance documents: code of conduct and family charter 3. Governance bodies: family assembly and family council 4. Integrated governance in family firms CASE STUDY: Beretti Holdings—More than a retirement decision (Chapter 5: Zellweger, pages: 109-112) |
Lecture and Case |
GNAN |
|
SECTION 3: Strategic management in the family firm |
|||
|
5 |
Strategic management in the family business: competitive advantages and the agency perspective (Chapter 6: Zellweger, pages: 116-134) 1. Strategic decision making in family firms 2. Conceptualizing the competitive advantage of family firms 3. The agency perspective CASE STUDY: Henkel’s Genthin plant (Chapter 6: Zellweger, page: 125) |
Lecture and Case |
GNAN |
|
6 |
Strategic management in the family business: RBV and OI perspectives (Chapter 6: Zellweger, pages: 137-163) 1. The resource-based perspective 2. The organizational identity perspective CASE STUDY: Branding and CSR at HiPP (Chapter 6: Zellweger, pages: 165-166) |
Lecture and Case |
GNAN |
|
7 |
Strategic management in the family business: institutional and paradox perspectives (Chapter 6: Zellweger, pages: 167-194) 1. The institutional perspective 2. The paradox perspective 3. Generic strategies for family firms 4. Tools for strategic management in family firms CASE STUDY: Managing paradoxes (Chapter 6: Zellweger, pages: 193-194) |
Lecture and Case |
GNAN |
|
SECTION 4: Succession in the family firm |
|||
|
8 |
Succession in the family firm: goals and processual issues (Chapter 7: Zellweger, pages: 203-234) 1. Succession options 2. Opportunities and challenges of succession options 3. Significance of succession options 4. Declining relevance of infra-family succession 5. Sources of complexity in family business succession 6. Structuring the succession process: succession framework 7. Clarifying goals and priorities |
Lecture |
GNAN |
|
9 |
Succession in the family firm: change strategy and who is in charge of the change (Chapter 7: Zellweger, pages: 240-254) 1. Reviewing the firm's strategy 2. Planning the transition of responsibilities |
Lecture |
GNAN |
|
10 |
Succession in the family firm: value, finance, legal, and tax issues (Chapter 7: Zellweger, pages: 258-305) 1. Valuing the firm 2. Financing the succession 3. Defining the legal and tax setup CASE STUDY: Bernet’s choice—Valuation, emotional value, family discount and fair distribution of assets within the family (Chapter 7: Zellweger, pages: 306-307) |
Lecture and Case |
GNAN |
|
SECTION 5: Change and transgenerational value creation |
|||
|
11 |
Change and transgenerational value creation (Chapter 7: Zellweger, pages: 311-356) 1. Change and adaptation in family firms 2. Longevity of family firms 3. Transgenerational value creation in family firms CASE STUDY: Transgenerational value creation at Ahlstrom (Finland) (Chapter 8: Zellweger, pages: 361-363) |
Lecture and Case |
GNAN |
|
SECTION 6: Interpersonal relationships and conflict in the family firm |
|||
|
12 |
Interpersonal relationships and conflict in the family firm: social issues, family values, and perceptions (Chapter 10: Zellweger, pages: 428-466) 1. The social structure of the family 2. Trends in the social structure of the family 3. International variance in family values 4. Understanding interpersonal dynamics in the family firm: a systemic view 5. Justice perceptions |
Lecture |
GNAN |
|
13 |
Interpersonal relationships and conflict in the family firm: managing conflicts (Chapter 10: Zellweger, pages: 468-487) 1. Why family firms are fertile contexts for conflict 2. Types of conflict 3. Conflict dynamics 4. Conflict-management styles 5. Communication strategies 6. How to behave in the face of conflict CASE STUDY: Conflict in the Solomon family (Chapter 10: Zellweger, pages: 488-491) |
Lecture and Case |
GNAN |
|
SECTION 7: Financial management in the family firm |
|||
|
14 |
Financial management in the family firm: differences with no family firms (Chapter 9: Zellweger, pages: 368-379) 1. Why finance is different for family firms 2. Family equity as a distinct asset class 3. Performance of family firms: a short review of the evidence 4. Risk taking in family firms |
Lecture |
GNAN |
|
15 |
Financial management in the family firm: financial tools (Chapter 9: Zellweger, pages: 380-400) 1. Debt financing 2. Equity financing 3. Leverage 4. Value management 5. Key financial indicators 6. Dilemmas in the financial management of family firms |
Lecture |
GNAN |
|
16 |
Financial management in the family firm: financial sustainability (Chapter 9: Zellweger, pages: 402-407) 1. Principles for the sustainable financial management of family firms 2. The role of the CFO in family firms CASE STUDY: Tom’s world (Chapter 9: Zellweger, pages: 422-424) |
Lecture and Case |
GNAN |
|
17 |
Financial management in the family firm: compensations (Chapter 9: Zellweger, pages: 407-411) 1. Management compensation in family firms CASE STUDY: Medco Energi Internasional (HBS 9-207-021) |
Lecture and Case |
GNAN |
|
18 |
Financial management in the family firm: family offices (Chapter 9: Zellweger, pages: 412-417 and Chapter 5: Zellweger, pages: 83-89) 1. The responsible shareholder in the family firm 2. Wealth governance |
Lecture |
GNAN |
Aggiornato A.A. 2018-2019
FAMILY BUSINESS
(Prof. Luca Gnan)
Teaching Staff responsible for the Course:
Prof. Luca Gnan
Email: luca.gnan@uniroma2.it
Availability: Contact via email
Prof.ssa Giulia Flamini
E-mail: giulia.flamini@uniroma2.it
Availability: Contact via email
We are committed to making this course a valuable learning experience for you. After the first month, we will spend part of a class session evaluating our progress, and we will make any necessary changes to keep us on track. However, we welcome your feedback at any time in the semester. It is easiest to reach us by email or during office hours, but we are always happy to set up an appointment. Additionally, if you have a disability that requires special accommodation, please let us know ASAP so that we can be helpful to you.
Emails, Office Hours & Feedback on Assignments
We endeavor to answer emails within 1 day. If you have not heard from us within that time, please resend the email. We will post grades & comments online in the materials section of the course website. We will be happy to give feedback and discuss assignments after all grading is complete for a certain assignment. We schedule office hours by email request.
We may answer questions of assignment clarification in class and via emails to benefit the entire class. We may also give extra grades (see below Team Project) during the course that, while generally designed to support learning in the course, will also help your participation grade. These are pass/fail and do not include comments.
Pre-requisites for the Course:
None
Course description and Learning Objectives
Family businesses shows distinct core competencies that can result in unique competitive advantages. They take a long run view of the business—across generations, rather than publicly traded quarterly reports. Their capital can be very patient, owners will sacrifice their salaries in order to make payroll, and they are an integral part of their communities, unlike publicly traded counterparts that might abandon a community at the blink of a budget. They can engender a great deal of loyalty on the part of employees, and the existence of family may reduce agency problems.
Family Businesses also face challenges that threaten their continuity. The challenges are primarily the result of issues presented by the interaction of family, management, and ownership—particularly where the family wishes to perpetuate its influence and/or control from generation to generation. Family firms seem to be as agile in one generation as they are fragile across generations.
Family businesses start with an owner-managed first generation (usually an entrepreneur). The next generation—G2—is the sibling generation, and G3 is the cousin era. The probability of passing the company to the next generation diminishes significantly, with fewer than half making it to G2 and only about less than 15% making it to G3. So, despite the benefits of family, there can be some significant issues.
The course explores and analyzes continuity challenges of family business and their best management practices. The focus of this course is on pragmatic, action-oriented, management, governance, finance, and family/business leadership skills.
Attention is devoted to evaluating family firms and their growth options to provide a roadmap for analyzing how family ownership, control, and management affect performances and how family firms can create and ensure more value through generations.
The course presents seven different sections:
· SECTION 1: Family firms: prevalence and relevance
· SECTION 2: Governance in the family firm
· SECTION 3: Strategic management in the family firm
· SECTION 4: Succession in the family firm
· SECTION 5: Change and transgenerational value creation
· SECTION 6: Interpersonal relationships and conflict in the family firm
· SECTION 7: Financial management in the family firm
The course addresses the governance, the management, and the finance of established family businesses. It examines succession, values, life cycles, business and marketing strategies, conflict resolution, communications, legal, and financial aspects, estate planning, management, philanthropy and other topics that uniquely touch family business governance, management and finance. It will convey the characteristics that differentiate family businesses from other businesses.
One of the features, which make this course unique and particularly modern, is a part of the Section 7: Financial management in the family firm dedicated to the mysterious and fascinating world of the family office. This is the little-known, but key professional practice of advising entire families-in-business, frequently large, diversified and with wide ramifications, about the complete spectrum of activities necessary to ensure that wealth is created, preserved, transmitted and spread across the enlarged family community. These services range from asset allocation to risk management, to education, efficient tax structuring, corporate finance and corporate governance, intra- and inter- generational transmission, philanthropy, etc. Given the enormous amount of wealth and power concerned, this phenomenon shows increasingly importance and starts to attract some focus, particularly by the best graduate students and professional talents.
Upon completion of this course, students should understand:
- The unique assets and vulnerabilities of family enterprises.
- The role of the CEO in governance, management, and the transfer of power.
- The relationship between the role of the board, the family council, and top management in providing effective governance for family business continuity.
- Key family dynamics.
- The relevance for families to manage collectively wealth created in professional ways,
and be able to:
- Identify the various stakeholders and the role of trust among family members and their impact on succession and continuity.
- Discuss the developmental needs and challenges of next generation leaders.
- Analyze the effect of estate taxes on ownership transfer across generations of family business owners and the implications of ownership structures on the competitive advantages of family businesses.
- Explain the importance of strategic planning to family business continuity.
- Explore the critical role and challenges that non-family managers play in family-owned operations.
- Analyze the impact of family culture, family communication, family conflict, and family unity and explore their interaction effects on the family business.
- Assess whether they want to seek employment in family businesses both as key employees/managers or in a professional advisory role.
Teaching methods
Lessons will focus on transferring knowledge and on a strong interaction within the classroom; there are analysis of situations problems and business cases in order to facilitate participants in learning.
Regular attending students (in order to be a regular attending student, a participant should achieve at least an 85% of presence to lectures and case discussions) are strongly recommended to participate to all the lectures and to all the preparations and presentations of the business cases.
To meet its goals, this course uses readings, lectures, exercises, cases, individual and team assignments, and class discussion. Case assignments provide an important foundation for class discussion and must completed prior to each class session. The analytical syllabus (at the end of this document) shows due dates for all cases and other assignments in the class schedule. Lectures will highlight key points from the readings and provide additional information to supplement the readings. Cases will provide you with the opportunity to apply what you have learned to real world issues and scenarios. Because each of you brings unique perspectives and experiences to the class, participation in class discussions and activities is essential to your own learning as well as that of other class members. To enrich further your learning, an MScBA Teaching Assistant will also match you.
Textbook
Zellweger, T. Managing the Family Business: Theory and Practice, Edward Elgar Publishing, 2017: ISBN: 9781783470709
Cases
During the course, we will discuss 10 cases:
1. More than a move to Mexico (Chapter 4: Zellweger, pages: 43-45)
2. Beretti Holdings—More than a retirement decision (Chapter 5: Zellweger, pages: 109-112)
3. Henkel’s Genthin plant (Chapter 6: Zellweger, page: 125)
4. Branding and CSR at HiPP (Chapter 6: Zellweger, pages: 165-166)
5. Managing paradoxes (Chapter 6: Zellweger, pages: 193-194)
6. Bernet’s choice—Valuation, emotional value, family discount and fair distribution of assets within the family (Chapter 7: Zellweger, pages: 306-307)
7. Transgenerational value creation at Ahlstrom (Finland) (Chapter 8: Zellweger, pages: 361-363)
8. Conflict in the Solomon family (Chapter 10: Zellweger, pages: 488-491)
9. Tom’s world (Chapter 9: Zellweger, pages: 422-424)
(the following case from Harvard Business School Publishing. You need to register to download the cases at the following link: https://hbr.org, then download the case at the indicated link)
10. Medco Energi Internasional
Additional References
- Poza, E. J., “Family Business”, First Edition. Mason, OH: Thomson South-Western, 2004.
- Gnan, L. and Montemerlo, D., (2006), “Family-firm relationship in Italian SMEs: ownership and governance issues in a double-fold theoretical perspective”, in P. Z. Poutziouris P., Smyrnios, K. X., and Klein, S. B., “Handbook of research on family business”, Edward Elgar Publishing.
- Zattoni, A., Gnan, L., Huse, M., (2012) ,“Does Family Involvement Influence Firm Performance? Exploring the Mediating Effects of Board Processes and Tasks”, Journal Of Management, ISSN: 0149-2063, DOI: 10.1177/0149206312463936
- Gnan, L. and Songini, L., (2015), “Family involvement and agency cost control mechanisms in family small and medium-sized enterprises”, Journal Of Small Business Management, vol. 53, p. 748-779, ISSN: 0047-2778, DOI: 10.1111/jsbm.12085
- Gnan, L., Montemerlo, D., Huse, M. (2015), “Governance systems in family SMEs: the substitution effects between family councils and corporate governance mechanisms”, Journal of Small Business Management, p. 1-27, ISSN: 1540-627X, DOI: 10.1111/jsbm.12070
- Gnan, L., Montemerlo, D., Schulze, W., Corbetta, G., (2008), “Governance Structures in Italian Family SMEs” In: (a cura di): Comacchio A. and Pontiggia A., “L'organizzazione fa la differenza”, Roma: Carocci Editore, ISBN: 9788843045587
- Gnan, L. and Montemerlo, D., (2007), “Family-firm relationship in Italian SMEs: ownership and governance issues in a double-fold theoretical perspective” In: “Handbook of research on family business”, Elgar, ISBN: 978-1845424107
- Songini, L., Gnan, L., Morelli, C., Vola, P., (2015), “The why and how of managerialization of family businesses: evidences from Italy”, Piccola Impresa / Small Business, vol 1, DOI: 10.14596/pisb.179, pp 85-117
- Songini, L., Gnan, L., Malmi, T (2013), “The role and impact of accounting in family business”, Journal of Family Business Strategy, vol. 4, p. 71-83, ISSN: 1877-8585, DOI: 10.1016/j.jfbs.2013.04.002
- Gnan, L., Songini, L., (2014), “The glass ceiling in SMEs and its impact on firm managerialisation: a comparison between family and non-family SMEs”, International Journal of Business Governance And Ethics, vol. 9, ISSN: 1477-9048
- de Pedys, V. and Antonelli, A,. (2008) “Family office for family business”, Oxford management Publishing, ISBN 978-1-906728-01-4
- Poutziouris, P., (2001) “Understanding family firms”, in (Ed.) Adam, J., Institute of Directors, “The Growing Business Handbook”, London: Kogan Page, Chapter 6.3: pp. 9-15, 4th edition, ISBN 074943600X
- Levin, R. and Travis, V., (1987), “Small company finance: what the books don’t say”, Harvard Business Review, nov-dec: 87608
- Villalonga, B. and Amit, R., (2005), “How do family ownership, control and management affect firm value”, Journal of financial economics, 80: 385-417
- Wilson, R., (2013), “The family office Report”, FamilyOfficesGroup.com
- Amit, R. and Perl, R., (2012) “2012 Family Governance Report”, Wharton Global family Alliance, Wharton School, University of Pennsylvania
- Amit, R. and Lichtenstein, H., (2010), “Benchmarking the Single Family Office” Wharton Global Family Alliance, Wharton School, University of Pennsylvania
Suggested videos
1. Introductory video: 4 Lessons from the Best Family Businesses
https://hbr.org/video/4660653966001/4-lessons-from-the-best-family-businesses
2. Three circle model: importance of governance, setting goals, holistic leadership and caring for the interests of the family
https://www.youtube.com/watch?v=D85pqiL1tNM
3. The unique strengths and weaknesses of family businesses today, contrasting it with the humble mom-and-pop store the term usually brings to mind
https://www.youtube.com/watch?v=suL-HkP-2Ts
4. The topic of Building a Family Business That Lasts and provides viewers with four key points to walk away with
https://www.youtube.com/watch?v=vZ52w3wBP1U
5. The key attention points and delicacies involved in preparing and transferring a business to the next generation
https://www.youtube.com/watch?v=Io9aWtuSEh4
6. Family Business Governance: Family Constitution
https://www.youtube.com/watch?v=i5psd_84euA
7. Family-owned companies need to be run with emotional, as well as professional leadership
https://www.youtube.com/watch?v=2bYo2Ph48_E
8. Toward a theory of how some family firms nurture transgenerational entrepreneurship
https://www.youtube.com/watch?v=AzFginXvSrM
9. Family Business Longevity
https://www.youtube.com/watch?v=uoHRNLuoYHM
10. 5 Ways For Private Equity Firms to Raise Capital From Family Offices
https://www.youtube.com/watch?v=EX8TnQmOFyc
11. Address the challenges faced by family businesses
https://www.youtube.com/watch?v=mItel08kE-Q
12. Conflict in the Family Business
https://www.youtube.com/watch?v=CVILBwkMVxc
13. Stories of Wasteful Conflict in Family Businesses
https://www.youtube.com/watch?v=elzfKRYw1yA
Case Discussions
We expect that regular attending students are fully engaged in the entire learning process. This means that we expect regular attending students to:
1) prepare the assigned readings of the cases prior to each class;
2) prepare as a group work a PowerPoint presentation on the case, based on the specific assignment;
3) come to class prepared to participate and to discuss in order to enhance the learning of the individual and the class.
On the web site of the course, students find for each case the relative assignment. Please read carefully the questions before the lesson and use them for preparing the PowerPoint presentation.
Each student will be involved the class discussion on the cases and tie the assigned reading for the session. The objective is to bring all class members into the discussion. The cases intend to integrate the concepts from the case into the context of the course. The preparation and the discussion of the cases do not exclude the study of the theoretical concepts useful for the discussion of the cases themselves and for the passing of the exam of the course.
With the cases’ discussions in CLASSROOM, each student will develop:
1. The ability to set the parameters for the problem (key concepts from the case).
2. A depth of knowledge about the case subject (understanding of material, good response to the observations of others).
3. The ability to tie-in case with other course concepts.
4. The ability to get others involved in the discussion.
In order to discuss effectively the cases, students do:
· Be prepared with facts and specific quotes from the case.
· Be prepared to make a comment, ask a question, or make a statement about the case.
During the discussion, students do:
· Take a position on a question or a point.
- Ask clarifying questions.
· Help keep the discussion moving and on track.
· Help draw others into the discussion.
· Integrate theories and content from other cases.
During the discussion, students do not:
· Be unprepared and show your lack of knowledge.
- Monopolize the discussion.
- Make irrelevant comments.
· Be insensitive to other’s desire to speak or to their opinions.
We kindly invite all the regular attending students to build up work groups (MINIMUM 3 PERSONS – MAXIMUM 5 PERSONS). Each work group should prepare a PowerPoint presentation for each case. Into the first slide, each work group should report the names of the students belonging to the group.
The structure of the presentation should follow the following outline:
- One or more introductory slides aimed at describing/reporting the story, the characters, all the necessary elements in order to define clearly the context and the boundaries of the case.
- One slide mentioning the questions of the assignment and underlining the learning goals of the case.
- One or more slides reporting the answers to each question of the assignment.
- One or more slides reporting the final remarks on the case.
- One closing slide about the lessons learned after the group discussion of the case.
How to prepare the PowerPoint presentation of the case?
Introduction – short presentation of case, short description of the problems and situations that should be coped with the discussion.
Diagnosis – Problem setting of the context and of the situation. Description of the mains facts and elements connected with the concepts and models of Family Business (e.g. Ownership issues, conflicts, family culture, governance issues, leadership, managing people, succession, etc.). What went wrong and which actions/situations, instead, were right? Which elements could be considered for the diagnosis?
Solution – Students should provide a possible solution to questions/problems related with the case and a viable and clear indication on how to approach the situation and how to solve it. The entire proposal should represent a consistent action plan in terms of behaviors and expected results.
Conclusions – Conclusions should not be longer than 300-500 words and should provide a description on how the situation and the problem characterized the case, on how Family Business schemata might help to solve the case, and what the proposed solution might generate in terms of family and managerial consequences.
Lessons learned – At the end of the presentation elements/suggestions/advices that we “take home” from the case discussion should be clearly identified and reported.
NOTE: During the case discussion, students should explicitly address the context and the different situations with concepts related with Family Business and with models and theories of this course.
Case Discussions’ Class Participation
We believe that the best way to learn, especially about family Business, is to actively participate in your education. In this class, “participation” is defined in terms of quality contributions to class discussion and exercises. There are four prerequisites for successful participation:
1. Be here on time and prepared. If you are not here, you cannot contribute much to class discussion. If you need to miss class for a predictable reason (e.g., job interview, athletic competition), please notify us at least 24 hours in advance so that we can arrange for any in-class exercises and so that you can obtain the materials distributed during the class. Of course, we realize that in some cases unforeseeable emergencies arise. Although we will not directly penalize you for non-attendance, be aware that multiple absences will indirectly hurt you by preventing you from participating in class, thereby lowering your participation grade. To contribute to class discussion, you must come to class having carefully prepared all assignments (i.e., readings, cases, exercises).
2. Be brave. Everyone in this class is smart, interesting, and has unique life experiences to share. You will get the most out of this course if you ask questions, voice opinions, and express your thoughts to one another. If you feel uncomfortable talking in class, please send me an email or set up an appointment to talk with me early in the semester. We will do everything we can to accommodate each of your individual circumstances, but we can only do so if they are brought to our attention.
3. Be courteous. Successful participation includes treating your classmates in a respectful and professional manner. Listen carefully to the comments and questions that your classmates voice. You may learn something new from their perspectives, and you will be able to avoid simply repeating something that another classmate has said earlier in discussion. Also, it is perfectly acceptable for you to voice disagreement with an opinion provided by another student. Open debate often leads to the most thoughtful and informative class discussions. However, please voice your disagreement in a kind and considerate manner.
4. Be engaged. This class is “unplugged.” Once class starts, all electronics (e.g., computers, cell phones, tablets, etc.) should be turned off and put away. If you need to use a device because of a language or disability issue, you need to secure permission at the beginning of the class. The misuse of an electronic device (e.g., surfing the web or texting) will adversely affect your grade.
In order to facilitate the visioning of its own PowerPoint presentation in classroom, each work group should take a personal computer with PowerPoint installed and an available VGA connection.
By the 8pm of the day before of the case discussion, all regular attending students should send an email to the course’s Instructors, attaching the case presentation prepared. They have to hand over a hard copy of the PowerPoint presentation. ONLY THE HANDING OVER OF THE HARD COPY CERTIFIES THE PREPARATION OF THE CASE FOR THE DISCUSSION. ONLY STUDENTS WHO HAD HANDED OVER ALL THE CASE PRESENTATIONS WILL BE ADMITTED TO THE PRE-EXAM.
Policy for Late Assignments
As in the business world, work must be received on time in order to receive full credit. If you are late on an assignment, your access to the Pre-Exam will be compromised. You are always welcome to hand in an assignment before its due date if you know that you will be busy as the due date approaches. If you think that you will not be able to complete an assignment by the stated due date, please speak with us in advance to make alternative arrangements. Our policy on late assignments will depend on the specific circumstances surrounding the problem, and thus may differ from student to student. Providing advance notice about a late assignment will minimize the penalty you receive on that assignment, but does not guarantee that there will be no penalty for turning the assignment in late.
Other learning sources
Slides and other material will be available on the course website.
THE SLIDES DO NOT REPRESENT A SUPPORT FOR AN EFFECTIVE AND SUCCESFUL PREPARATION TO THE EXAM OF THE COURSE. THEY REPRESENT ONLY A HELP TO FACILITATE THE TRANSFER OF THE KNOWLEDGES TO STUDENTS DURING THE LESSONS.
Attendance
Because of the concentrated nature of the MScBA programme, attendance in class is very important.
Students with less than 85% of attendance to lectures and case discussions (including arriving late or leaving early) will be required to prepare for the exam ALL the chapters of the textbook Zellweger, T. Managing the Family Business: Theory and Practice, Edward Elgar Publishing, 2017: ISBN: 9781783470709 and ALL the cases discussed in classroom.
NOTE : Attendance for the first class session is mandatory as important information regarding the course and the instructors’ expectations are given. If you know in advance that you will be absent for one session, please contact your instructor to ensure that absence from a particular session is acceptable.
Exam
The exam, depending on the number of the registered student, is a written exam or an oral exam.
In case of a written exam, the duration is about 3-4 hours and it includes:
a) Case discussion - You may be given a case study to which some questions may pertain in order to lead the discussion. As you respond to the questions, please use specific content and theories (use names to identify theories and models) as the basis of your analysis. You will not receive credit for your personal opinions unless backed by theory, lecture, and/or text material. Also, describe how you see the content/theory applying to the situation. Your answers will be evaluated based upon both quantity and quality. Answers that are more complete and demonstrate a higher level of understanding and analysis will receive more points.
b) Some questions directly connected to the course textbook – The questions could open, closed (multiple choice), or a combination of the both. You may be asked to discuss the models and the theories presented during the course. You will be asked to interpret some real incidents and to focus your attention to some specific theoretical issues.
Pre-Exam participation and exam grades registering on the booklet
Only regular attending students (85% of attendance to lectures and case discussions, including arriving late or leaving early) that have delivered the hard copies of ALL the case to the Instructors are allowed to take the pre-exam.
Only regular registered students on the DELPHI System will be allowed to register their grade.
The pre-exam grades will be registered on the first official exam date AFTER THE COURSE ENDING. It is compulsory to come on that date of the exam for registering the grade on the Delphi and on the booklet.
Team Project
The purpose of the project is to give your team an opportunity to apply what has been learned in the course (through course lectures, readings, and case discussions) to problems in a family firm of your team's choice.
Class members, regular attending students, will work in teams of four (4) people.
To the Team Project regular attending students will be allowed to achieve a -3/+3 extra points to the final grade of the Pre-Exam. Only regular attending students, taking the Pre-Exam will be accepted for the Team Project.
Your team should identify a family firm to study (Please, no student groups).
Your team is to gather information from people in the family firm through direct contact. You may supplement this information with data from the media, the organization's literature, and other secondary sources. You should identify a relatively recent problem to analyze (i.e., this should not be an historical account of a problem and the company's solution). You should focus your analysis by applying the concepts from the course. While it is acceptable to incorporate several concepts from the course, please aim for depth rather than breadth regarding the use of course concepts. Your goal is to diagnose the mechanisms that are causing the problem or issue of concern in the organization. Initially, you may notice many symptoms (for instance, a crisis after the succession, seemingly an unhealthy family culture, low family members’ commitment and involvement, governance issues, etc.), but your task is to get to the underlying reason for these symptoms. And beware, sometimes the initial symptoms we think we see are not what they appear to be.
There are three broad goals for this assignment:
1. One goal of this assignment is obviously to take the initiative to make a positive contribution to a family firm.
2. Another major goal is to provide an opportunity for you to learn more about family businesses first hand and to use your critical thinking and reflection skills to link your experience with this family firm to your learning in relation to family business theories.
3. The final goal is to provide a forum for you to hone your skills as a team member and leader and to reflect on the learning gained from this team experience. Each team will make a presentation and write a paper that describes what you did for the family firm, what you learned about family business, and what you learned about working on a team.
To meet these broad goals, your team should answer the following questions in the assignments detailed below.
a) What are the issues or problems facing the family firm?
b) What course concepts can be applied to understand why this problem is occurring?
c) What recommendations can you offer to help improve the family business functioning?
Deliverables of the Team Project:
1. The project proposal e-mail is due by email to Instructors by the date of the 9th session of the course by 5pm. It should include:
a) The names of your group members
b) Your team name
c) The name of the organization
d) The name, contact information and level of your contact person
e) The method you will use to gain access to the organization
f) A brief description (one paragraph) of the problem facing the organization.
2. Your written project is due by email to Instructors by the date of the 18th session of the course by 5pm .
It should contain a maximum of 15 double spaced pages (1 cm margins, 12 point font). You will be penalized significantly for exceeding this limit. The limit does not include appendices, which you are free to use to provide charts, figures, or other background material not necessary in the main body of your analysis. However, appendices that are not directly referenced in the main text will not be read. LATE PROJECT WRITE-UPS WILL NOT BE ACCEPTED.
This written project should summarize what you did for/within the family firm, what you have learned about family business, and what you have learned about working on a team.
Grading of the Team Project:
Your group project will be evaluated on the following criteria:
a. Problem definition: How well (i.e., thoroughly and concisely) do you describe the family business context, the relevant parties, and the factors that are important to the problem?
b. Accurate and thorough use of course concepts.
c. Integration of course concepts with information about the family firm and problem, i.e., how well do you integrate course concepts with information about the problem to illuminate the problem in a way that leads to solutions?
d. Extent to which recommendations are consistent with analysis.
e. Quality of written analysis.
Analytical Syllabus
|
# |
Agenda |
Lecture/ Case discussion |
Lecturer |
|
SECTION 1: Family firms: prevalence and relevance |
|||
|
1 |
Introduction of the course (Chapter 1: Zellweger, pages: 1-3) 1. Thematic focus 2. Intended audience 3. Structure and pedagogical tools Defining the family business (Chapter 2: Zellweger, pages: 4-22) 1. The distinction between family and nonfamily firms 2. Defining family business by type of family involvement 3. Circle models of family influence 4. Family firm identity 5. Family business definition |
Lecture |
GNAN |
|
2 |
Prevalence and economic contribution of family firms around the globe (Chapter 3: Zellweger, pages: 24-33) 1. Prevalence of family firms worldwide 2. Economic contribution of family firms 3. Institutional setting and the prevalence of family firms Strengths and weaknesses of family firms (Chapter 4: Zellweger, pages: 36-42) 1. Typical strengths of family firms 2. Typical weaknesses of family firms 3. Bivalent attributes of family firm characteristics CASE STUDY: More than a move to Mexico (Chapter 4: Zellweger, pages: 43-45) |
Lecture and Case |
GNAN |
|
SECTION 2: Governance in the family firm |
|||
|
3 |
Governance in the family firm: premises, corporate and ownership governance (Chapter 5: Zellweger, pages: 46-72) 1. Why do family firms need governance? 2. Typical governance constellations in family firms 3. Performance implications of governance constellations 4. Untangling corporate, ownership, family governance 5. Corporate governance 6. Ownership governance |
Lecture |
GNAN |
|
4 |
Governance in the family firm: family governance (Chapter 5: Zellweger, pages: 73-105) 1. Family governance 2. Governance documents: code of conduct and family charter 3. Governance bodies: family assembly and family council 4. Integrated governance in family firms CASE STUDY: Beretti Holdings—More than a retirement decision (Chapter 5: Zellweger, pages: 109-112) |
Lecture and Case |
GNAN |
|
SECTION 3: Strategic management in the family firm |
|||
|
5 |
Strategic management in the family business: competitive advantages and the agency perspective (Chapter 6: Zellweger, pages: 116-134) 1. Strategic decision making in family firms 2. Conceptualizing the competitive advantage of family firms 3. The agency perspective CASE STUDY: Henkel’s Genthin plant (Chapter 6: Zellweger, page: 125) |
Lecture and Case |
GNAN |
|
6 |
Strategic management in the family business: RBV and OI perspectives (Chapter 6: Zellweger, pages: 137-163) 1. The resource-based perspective 2. The organizational identity perspective CASE STUDY: Branding and CSR at HiPP (Chapter 6: Zellweger, pages: 165-166) |
Lecture and Case |
GNAN |
|
7 |
Strategic management in the family business: institutional and paradox perspectives (Chapter 6: Zellweger, pages: 167-194) 1. The institutional perspective 2. The paradox perspective 3. Generic strategies for family firms 4. Tools for strategic management in family firms CASE STUDY: Managing paradoxes (Chapter 6: Zellweger, pages: 193-194) |
Lecture and Case |
GNAN |
|
SECTION 4: Succession in the family firm |
|||
|
8 |
Succession in the family firm: goals and processual issues (Chapter 7: Zellweger, pages: 203-234) 1. Succession options 2. Opportunities and challenges of succession options 3. Significance of succession options 4. Declining relevance of infra-family succession 5. Sources of complexity in family business succession 6. Structuring the succession process: succession framework 7. Clarifying goals and priorities |
Lecture |
GNAN |
|
9 |
Succession in the family firm: change strategy and who is in charge of the change (Chapter 7: Zellweger, pages: 240-254) 1. Reviewing the firm's strategy 2. Planning the transition of responsibilities |
Lecture |
GNAN |
|
10 |
Succession in the family firm: value, finance, legal, and tax issues (Chapter 7: Zellweger, pages: 258-305) 1. Valuing the firm 2. Financing the succession 3. Defining the legal and tax setup CASE STUDY: Bernet’s choice—Valuation, emotional value, family discount and fair distribution of assets within the family (Chapter 7: Zellweger, pages: 306-307) |
Lecture and Case |
GNAN |
|
SECTION 5: Change and transgenerational value creation |
|||
|
11 |
Change and transgenerational value creation (Chapter 7: Zellweger, pages: 311-356) 1. Change and adaptation in family firms 2. Longevity of family firms 3. Transgenerational value creation in family firms CASE STUDY: Transgenerational value creation at Ahlstrom (Finland) (Chapter 8: Zellweger, pages: 361-363) |
Lecture and Case |
GNAN |
|
SECTION 6: Interpersonal relationships and conflict in the family firm |
|||
|
12 |
Interpersonal relationships and conflict in the family firm: social issues, family values, and perceptions (Chapter 10: Zellweger, pages: 428-466) 1. The social structure of the family 2. Trends in the social structure of the family 3. International variance in family values 4. Understanding interpersonal dynamics in the family firm: a systemic view 5. Justice perceptions |
Lecture |
GNAN |
|
13 |
Interpersonal relationships and conflict in the family firm: managing conflicts (Chapter 10: Zellweger, pages: 468-487) 1. Why family firms are fertile contexts for conflict 2. Types of conflict 3. Conflict dynamics 4. Conflict-management styles 5. Communication strategies 6. How to behave in the face of conflict CASE STUDY: Conflict in the Solomon family (Chapter 10: Zellweger, pages: 488-491) |
Lecture and Case |
GNAN |
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SECTION 7: Financial management in the family firm |
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Aggiornato A.A. 2017-2018
FAMILY BUSINESS
(Prof. Luca Gnan)
Teaching Staff responsible for the Course:
Prof. Luca Gnan
Email: luca.gnan@uniroma2.it
Availability: Contact via email
Prof.ssa Giulia Flamini
E-mail: giulia.flamini@uniroma2.it
Availability: Contact via email
We are committed to making this course a valuable learning experience for you. After the first month, we will spend part of a class session evaluating our progress, and we will make any necessary changes to keep us on track. However, we welcome your feedback at any time in the semester. It is easiest to reach us by email or during office hours, but we are always happy to set up an appointment. Additionally, if you have a disability that requires special accommodation, please let us know ASAP so that we can be helpful to you.
Emails, Office Hours & Feedback on Assignments
We endeavor to answer emails within 1 day. If you have not heard from us within that time, please resend the email. We will post grades & comments online in the materials section of the course website. We will be happy to give feedback and discuss assignments after all grading is complete for a certain assignment. We schedule office hours by email request.
We may answer questions of assignment clarification in class and via emails to benefit the entire class. We may also give extra grades (see below Team Project) during the course that, while generally designed to support learning in the course, will also help your participation grade. These are pass/fail and do not include comments.
Pre-requisites for the Course:
None
Course description and Learning Objectives
Family businesses shows distinct core competencies that can result in unique competitive advantages. They take a long run view of the business—across generations, rather than publicly traded quarterly reports. Their capital can be very patient, owners will sacrifice their salaries in order to make payroll, and they are an integral part of their communities, unlike publicly traded counterparts that might abandon a community at the blink of a budget. They can engender a great deal of loyalty on the part of employees, and the existence of family may reduce agency problems.
Family Businesses also face challenges that threaten their continuity. The challenges are primarily the result of issues presented by the interaction of family, management, and ownership—particularly where the family wishes to perpetuate its influence and/or control from generation to generation. Family firms seem to be as agile in one generation as they are fragile across generations.
Family businesses start with an owner-managed first generation (usually an entrepreneur). The next generation—G2—is the sibling generation, and G3 is the cousin era. The probability of passing the company to the next generation diminishes significantly, with fewer than half making it to G2 and only about less than 15% making it to G3. So, despite the benefits of family, there can be some significant issues.
The course explores and analyzes continuity challenges of family business and their best management practices. The focus of this course is on pragmatic, action-oriented, management, governance, finance, and family/business leadership skills.
Attention is devoted to evaluating family firms and their growth options to provide a roadmap for analyzing how family ownership, control, and management affect performances and how family firms can create and ensure more value through generations.
The course presents seven different sections:
· SECTION 1: Family firms: prevalence and relevance
· SECTION 2: Governance in the family firm
· SECTION 3: Strategic management in the family firm
· SECTION 4: Succession in the family firm
· SECTION 5: Change and transgenerational value creation
· SECTION 6: Interpersonal relationships and conflict in the family firm
· SECTION 7: Financial management in the family firm
The course addresses the governance, the management, and the finance of established family businesses. It examines succession, values, life cycles, business and marketing strategies, conflict resolution, communications, legal, and financial aspects, estate planning, management, philanthropy and other topics that uniquely touch family business governance, management and finance. It will convey the characteristics that differentiate family businesses from other businesses.
One of the features, which make this course unique and particularly modern, is a part of the Section 7: Financial management in the family firm dedicated to the mysterious and fascinating world of the family office. This is the little-known, but key professional practice of advising entire families-in-business, frequently large, diversified and with wide ramifications, about the complete spectrum of activities necessary to ensure that wealth is created, preserved, transmitted and spread across the enlarged family community. These services range from asset allocation to risk management, to education, efficient tax structuring, corporate finance and corporate governance, intra- and inter- generational transmission, philanthropy, etc. Given the enormous amount of wealth and power concerned, this phenomenon shows increasingly importance and starts to attract some focus, particularly by the best graduate students and professional talents.
Upon completion of this course, students should understand:
- The unique assets and vulnerabilities of family enterprises.
- The role of the CEO in governance, management, and the transfer of power.
- The relationship between the role of the board, the family council, and top management in providing effective governance for family business continuity.
- Key family dynamics.
- The relevance for families to manage collectively wealth created in professional ways,
and be able to:
- Identify the various stakeholders and the role of trust among family members and their impact on succession and continuity.
- Discuss the developmental needs and challenges of next generation leaders.
- Analyze the effect of estate taxes on ownership transfer across generations of family business owners and the implications of ownership structures on the competitive advantages of family businesses.
- Explain the importance of strategic planning to family business continuity.
- Explore the critical role and challenges that non-family managers play in family-owned operations.
- Analyze the impact of family culture, family communication, family conflict, and family unity and explore their interaction effects on the family business.
- Assess whether they want to seek employment in family businesses both as key employees/managers or in a professional advisory role.
Teaching methods
Lessons will focus on transferring knowledge and on a strong interaction within the classroom; there are analysis of situations problems and business cases in order to facilitate participants in learning.
Regular attending students (in order to be a regular attending student, a participant should achieve at least an 85% of presence to lectures and case discussions) are strongly recommended to participate to all the lectures and to all the preparations and presentations of the business cases.
To meet its goals, this course uses readings, lectures, exercises, cases, individual and team assignments, and class discussion. Case assignments provide an important foundation for class discussion and must completed prior to each class session. The analytical syllabus (at the end of this document) shows due dates for all cases and other assignments in the class schedule. Lectures will highlight key points from the readings and provide additional information to supplement the readings. Cases will provide you with the opportunity to apply what you have learned to real world issues and scenarios. Because each of you brings unique perspectives and experiences to the class, participation in class discussions and activities is essential to your own learning as well as that of other class members. To enrich further your learning, an MScBA Teaching Assistant will also match you.
Textbook
Zellweger, T. Managing the Family Business: Theory and Practice, Edward Elgar Publishing, 2017: ISBN: 9781783470709
Cases
During the course, we will discuss 10 cases:
1. More than a move to Mexico (Chapter 4: Zellweger, pages: 43-45)
2. Beretti Holdings—More than a retirement decision (Chapter 5: Zellweger, pages: 109-112)
3. Henkel’s Genthin plant (Chapter 6: Zellweger, page: 125)
4. Branding and CSR at HiPP (Chapter 6: Zellweger, pages: 165-166)
5. Managing paradoxes (Chapter 6: Zellweger, pages: 193-194)
6. Bernet’s choice—Valuation, emotional value, family discount and fair distribution of assets within the family (Chapter 7: Zellweger, pages: 306-307)
7. Transgenerational value creation at Ahlstrom (Finland) (Chapter 8: Zellweger, pages: 361-363)
8. Conflict in the Solomon family (Chapter 10: Zellweger, pages: 488-491)
9. Tom’s world (Chapter 9: Zellweger, pages: 422-424)
(the following case from Harvard Business School Publishing. You need to register to download the cases at the following link: https://hbr.org, then download the case at the indicated link)
10. Medco Energi Internasional
Additional References
- Poza, E. J., “Family Business”, First Edition. Mason, OH: Thomson South-Western, 2004.
- Gnan, L. and Montemerlo, D., (2006), “Family-firm relationship in Italian SMEs: ownership and governance issues in a double-fold theoretical perspective”, in P. Z. Poutziouris P., Smyrnios, K. X., and Klein, S. B., “Handbook of research on family business”, Edward Elgar Publishing.
- Zattoni, A., Gnan, L., Huse, M., (2012) ,“Does Family Involvement Influence Firm Performance? Exploring the Mediating Effects of Board Processes and Tasks”, Journal Of Management, ISSN: 0149-2063, DOI: 10.1177/0149206312463936
- Gnan, L. and Songini, L., (2015), “Family involvement and agency cost control mechanisms in family small and medium-sized enterprises”, Journal Of Small Business Management, vol. 53, p. 748-779, ISSN: 0047-2778, DOI: 10.1111/jsbm.12085
- Gnan, L., Montemerlo, D., Huse, M. (2015), “Governance systems in family SMEs: the substitution effects between family councils and corporate governance mechanisms”, Journal of Small Business Management, p. 1-27, ISSN: 1540-627X, DOI: 10.1111/jsbm.12070
- Gnan, L., Montemerlo, D., Schulze, W., Corbetta, G., (2008), “Governance Structures in Italian Family SMEs” In: (a cura di): Comacchio A. and Pontiggia A., “L'organizzazione fa la differenza”, Roma: Carocci Editore, ISBN: 9788843045587
- Gnan, L. and Montemerlo, D., (2007), “Family-firm relationship in Italian SMEs: ownership and governance issues in a double-fold theoretical perspective” In: “Handbook of research on family business”, Elgar, ISBN: 978-1845424107
- Songini, L., Gnan, L., Morelli, C., Vola, P., (2015), “The why and how of managerialization of family businesses: evidences from Italy”, Piccola Impresa / Small Business, vol 1, DOI: 10.14596/pisb.179, pp 85-117
- Songini, L., Gnan, L., Malmi, T (2013), “The role and impact of accounting in family business”, Journal of Family Business Strategy, vol. 4, p. 71-83, ISSN: 1877-8585, DOI: 10.1016/j.jfbs.2013.04.002
- Gnan, L., Songini, L., (2014), “The glass ceiling in SMEs and its impact on firm managerialisation: a comparison between family and non-family SMEs”, International Journal of Business Governance And Ethics, vol. 9, ISSN: 1477-9048
- de Pedys, V. and Antonelli, A,. (2008) “Family office for family business”, Oxford management Publishing, ISBN 978-1-906728-01-4
- Poutziouris, P., (2001) “Understanding family firms”, in (Ed.) Adam, J., Institute of Directors, “The Growing Business Handbook”, London: Kogan Page, Chapter 6.3: pp. 9-15, 4th edition, ISBN 074943600X
- Levin, R. and Travis, V., (1987), “Small company finance: what the books don’t say”, Harvard Business Review, nov-dec: 87608
- Villalonga, B. and Amit, R., (2005), “How do family ownership, control and management affect firm value”, Journal of financial economics, 80: 385-417
- Wilson, R., (2013), “The family office Report”, FamilyOfficesGroup.com
- Amit, R. and Perl, R., (2012) “2012 Family Governance Report”, Wharton Global family Alliance, Wharton School, University of Pennsylvania
- Amit, R. and Lichtenstein, H., (2010), “Benchmarking the Single Family Office” Wharton Global Family Alliance, Wharton School, University of Pennsylvania
Suggested videos
1. Introductory video: 4 Lessons from the Best Family Businesses
https://hbr.org/video/4660653966001/4-lessons-from-the-best-family-businesses
2. Three circle model: importance of governance, setting goals, holistic leadership and caring for the interests of the family
https://www.youtube.com/watch?v=D85pqiL1tNM
3. The unique strengths and weaknesses of family businesses today, contrasting it with the humble mom-and-pop store the term usually brings to mind
https://www.youtube.com/watch?v=suL-HkP-2Ts
4. The topic of Building a Family Business That Lasts and provides viewers with four key points to walk away with
https://www.youtube.com/watch?v=vZ52w3wBP1U
5. The key attention points and delicacies involved in preparing and transferring a business to the next generation
https://www.youtube.com/watch?v=Io9aWtuSEh4
6. Family Business Governance: Family Constitution
https://www.youtube.com/watch?v=i5psd_84euA
7. Family-owned companies need to be run with emotional, as well as professional leadership
https://www.youtube.com/watch?v=2bYo2Ph48_E
8. Toward a theory of how some family firms nurture transgenerational entrepreneurship
https://www.youtube.com/watch?v=AzFginXvSrM
9. Family Business Longevity
https://www.youtube.com/watch?v=uoHRNLuoYHM
10. 5 Ways For Private Equity Firms to Raise Capital From Family Offices
https://www.youtube.com/watch?v=EX8TnQmOFyc
11. Address the challenges faced by family businesses
https://www.youtube.com/watch?v=mItel08kE-Q
12. Conflict in the Family Business
https://www.youtube.com/watch?v=CVILBwkMVxc
13. Stories of Wasteful Conflict in Family Businesses
https://www.youtube.com/watch?v=elzfKRYw1yA
Case Discussions
We expect that regular attending students are fully engaged in the entire learning process. This means that we expect regular attending students to:
1) prepare the assigned readings of the cases prior to each class;
2) prepare as a group work a PowerPoint presentation on the case, based on the specific assignment;
3) come to class prepared to participate and to discuss in order to enhance the learning of the individual and the class.
On the web site of the course, students find for each case the relative assignment. Please read carefully the questions before the lesson and use them for preparing the PowerPoint presentation.
Each student will be involved the class discussion on the cases and tie the assigned reading for the session. The objective is to bring all class members into the discussion. The cases intend to integrate the concepts from the case into the context of the course. The preparation and the discussion of the cases do not exclude the study of the theoretical concepts useful for the discussion of the cases themselves and for the passing of the exam of the course.
With the cases’ discussions in CLASSROOM, each student will develop:
1. The ability to set the parameters for the problem (key concepts from the case).
2. A depth of knowledge about the case subject (understanding of material, good response to the observations of others).
3. The ability to tie-in case with other course concepts.
4. The ability to get others involved in the discussion.
In order to discuss effectively the cases, students do:
· Be prepared with facts and specific quotes from the case.
· Be prepared to make a comment, ask a question, or make a statement about the case.
During the discussion, students do:
· Take a position on a question or a point.
- Ask clarifying questions.
· Help keep the discussion moving and on track.
· Help draw others into the discussion.
· Integrate theories and content from other cases.
During the discussion, students do not:
· Be unprepared and show your lack of knowledge.
- Monopolize the discussion.
- Make irrelevant comments.
· Be insensitive to other’s desire to speak or to their opinions.
We kindly invite all the regular attending students to build up work groups (MINIMUM 3 PERSONS – MAXIMUM 5 PERSONS). Each work group should prepare a PowerPoint presentation for each case. Into the first slide, each work group should report the names of the students belonging to the group.
The structure of the presentation should follow the following outline:
- One or more introductory slides aimed at describing/reporting the story, the characters, all the necessary elements in order to define clearly the context and the boundaries of the case.
- One slide mentioning the questions of the assignment and underlining the learning goals of the case.
- One or more slides reporting the answers to each question of the assignment.
- One or more slides reporting the final remarks on the case.
- One closing slide about the lessons learned after the group discussion of the case.
How to prepare the PowerPoint presentation of the case?
Introduction – short presentation of case, short description of the problems and situations that should be coped with the discussion.
Diagnosis – Problem setting of the context and of the situation. Description of the mains facts and elements connected with the concepts and models of Family Business (e.g. Ownership issues, conflicts, family culture, governance issues, leadership, managing people, succession, etc.). What went wrong and which actions/situations, instead, were right? Which elements could be considered for the diagnosis?
Solution – Students should provide a possible solution to questions/problems related with the case and a viable and clear indication on how to approach the situation and how to solve it. The entire proposal should represent a consistent action plan in terms of behaviors and expected results.
Conclusions – Conclusions should not be longer than 300-500 words and should provide a description on how the situation and the problem characterized the case, on how Family Business schemata might help to solve the case, and what the proposed solution might generate in terms of family and managerial consequences.
Lessons learned – At the end of the presentation elements/suggestions/advices that we “take home” from the case discussion should be clearly identified and reported.
NOTE: During the case discussion, students should explicitly address the context and the different situations with concepts related with Family Business and with models and theories of this course.
Case Discussions’ Class Participation
We believe that the best way to learn, especially about family Business, is to actively participate in your education. In this class, “participation” is defined in terms of quality contributions to class discussion and exercises. There are four prerequisites for successful participation:
1. Be here on time and prepared. If you are not here, you cannot contribute much to class discussion. If you need to miss class for a predictable reason (e.g., job interview, athletic competition), please notify us at least 24 hours in advance so that we can arrange for any in-class exercises and so that you can obtain the materials distributed during the class. Of course, we realize that in some cases unforeseeable emergencies arise. Although we will not directly penalize you for non-attendance, be aware that multiple absences will indirectly hurt you by preventing you from participating in class, thereby lowering your participation grade. To contribute to class discussion, you must come to class having carefully prepared all assignments (i.e., readings, cases, exercises).
2. Be brave. Everyone in this class is smart, interesting, and has unique life experiences to share. You will get the most out of this course if you ask questions, voice opinions, and express your thoughts to one another. If you feel uncomfortable talking in class, please send me an email or set up an appointment to talk with me early in the semester. We will do everything we can to accommodate each of your individual circumstances, but we can only do so if they are brought to our attention.
3. Be courteous. Successful participation includes treating your classmates in a respectful and professional manner. Listen carefully to the comments and questions that your classmates voice. You may learn something new from their perspectives, and you will be able to avoid simply repeating something that another classmate has said earlier in discussion. Also, it is perfectly acceptable for you to voice disagreement with an opinion provided by another student. Open debate often leads to the most thoughtful and informative class discussions. However, please voice your disagreement in a kind and considerate manner.
4. Be engaged. This class is “unplugged.” Once class starts, all electronics (e.g., computers, cell phones, tablets, etc.) should be turned off and put away. If you need to use a device because of a language or disability issue, you need to secure permission at the beginning of the class. The misuse of an electronic device (e.g., surfing the web or texting) will adversely affect your grade.
In order to facilitate the visioning of its own PowerPoint presentation in classroom, each work group should take a personal computer with PowerPoint installed and an available VGA connection.
By the 8pm of the day before of the case discussion, all regular attending students should send an email to the course’s Instructors, attaching the case presentation prepared. They have to hand over a hard copy of the PowerPoint presentation. ONLY THE HANDING OVER OF THE HARD COPY CERTIFIES THE PREPARATION OF THE CASE FOR THE DISCUSSION. ONLY STUDENTS WHO HAD HANDED OVER ALL THE CASE PRESENTATIONS WILL BE ADMITTED TO THE PRE-EXAM.
Policy for Late Assignments
As in the business world, work must be received on time in order to receive full credit. If you are late on an assignment, your access to the Pre-Exam will be compromised. You are always welcome to hand in an assignment before its due date if you know that you will be busy as the due date approaches. If you think that you will not be able to complete an assignment by the stated due date, please speak with us in advance to make alternative arrangements. Our policy on late assignments will depend on the specific circumstances surrounding the problem, and thus may differ from student to student. Providing advance notice about a late assignment will minimize the penalty you receive on that assignment, but does not guarantee that there will be no penalty for turning the assignment in late.
Other learning sources
Slides and other material will be available on the course website.
THE SLIDES DO NOT REPRESENT A SUPPORT FOR AN EFFECTIVE AND SUCCESFUL PREPARATION TO THE EXAM OF THE COURSE. THEY REPRESENT ONLY A HELP TO FACILITATE THE TRANSFER OF THE KNOWLEDGES TO STUDENTS DURING THE LESSONS.
Attendance
Because of the concentrated nature of the MScBA programme, attendance in class is very important.
Students with less than 85% of attendance to lectures and case discussions (including arriving late or leaving early) will be required to prepare for the exam ALL the chapters of the textbook Zellweger, T. Managing the Family Business: Theory and Practice, Edward Elgar Publishing, 2017: ISBN: 9781783470709 and ALL the cases discussed in classroom.
NOTE : Attendance for the first class session is mandatory as important information regarding the course and the instructors’ expectations are given. If you know in advance that you will be absent for one session, please contact your instructor to ensure that absence from a particular session is acceptable.
Exam
The exam, depending on the number of the registered student, is a written exam or an oral exam.
In case of a written exam, the duration is about 3-4 hours and it includes:
a) Case discussion - You may be given a case study to which some questions may pertain in order to lead the discussion. As you respond to the questions, please use specific content and theories (use names to identify theories and models) as the basis of your analysis. You will not receive credit for your personal opinions unless backed by theory, lecture, and/or text material. Also, describe how you see the content/theory applying to the situation. Your answers will be evaluated based upon both quantity and quality. Answers that are more complete and demonstrate a higher level of understanding and analysis will receive more points.
b) Some questions directly connected to the course textbook – The questions could open, closed (multiple choice), or a combination of the both. You may be asked to discuss the models and the theories presented during the course. You will be asked to interpret some real incidents and to focus your attention to some specific theoretical issues.
Pre-Exam participation and exam grades registering on the booklet
Only regular attending students (85% of attendance to lectures and case discussions, including arriving late or leaving early) that have delivered the hard copies of ALL the case to the Instructors are allowed to take the pre-exam.
Only regular registered students on the DELPHI System will be allowed to register their grade.
The pre-exam grades will be registered on the first official exam date AFTER THE COURSE ENDING. It is compulsory to come on that date of the exam for registering the grade on the Delphi and on the booklet.
Team Project
The purpose of the project is to give your team an opportunity to apply what has been learned in the course (through course lectures, readings, and case discussions) to problems in a family firm of your team's choice.
Class members, regular attending students, will work in teams of four (4) people.
To the Team Project regular attending students will be allowed to achieve a -3/+3 extra points to the final grade of the Pre-Exam. Only regular attending students, taking the Pre-Exam will be accepted for the Team Project.
Your team should identify a family firm to study (Please, no student groups).
Your team is to gather information from people in the family firm through direct contact. You may supplement this information with data from the media, the organization's literature, and other secondary sources. You should identify a relatively recent problem to analyze (i.e., this should not be an historical account of a problem and the company's solution). You should focus your analysis by applying the concepts from the course. While it is acceptable to incorporate several concepts from the course, please aim for depth rather than breadth regarding the use of course concepts. Your goal is to diagnose the mechanisms that are causing the problem or issue of concern in the organization. Initially, you may notice many symptoms (for instance, a crisis after the succession, seemingly an unhealthy family culture, low family members’ commitment and involvement, governance issues, etc.), but your task is to get to the underlying reason for these symptoms. And beware, sometimes the initial symptoms we think we see are not what they appear to be.
There are three broad goals for this assignment:
1. One goal of this assignment is obviously to take the initiative to make a positive contribution to a family firm.
2. Another major goal is to provide an opportunity for you to learn more about family businesses first hand and to use your critical thinking and reflection skills to link your experience with this family firm to your learning in relation to family business theories.
3. The final goal is to provide a forum for you to hone your skills as a team member and leader and to reflect on the learning gained from this team experience. Each team will make a presentation and write a paper that describes what you did for the family firm, what you learned about family business, and what you learned about working on a team.
To meet these broad goals, your team should answer the following questions in the assignments detailed below.
a) What are the issues or problems facing the family firm?
b) What course concepts can be applied to understand why this problem is occurring?
c) What recommendations can you offer to help improve the family business functioning?
Deliverables of the Team Project:
1. The project proposal e-mail is due by email to Instructors by the date of the 9th session of the course by 5pm. It should include:
a) The names of your group members
b) Your team name
c) The name of the organization
d) The name, contact information and level of your contact person
e) The method you will use to gain access to the organization
f) A brief description (one paragraph) of the problem facing the organization.
2. Your written project is due by email to Instructors by the date of the 18th session of the course by 5pm .
It should contain a maximum of 15 double spaced pages (1 cm margins, 12 point font). You will be penalized significantly for exceeding this limit. The limit does not include appendices, which you are free to use to provide charts, figures, or other background material not necessary in the main body of your analysis. However, appendices that are not directly referenced in the main text will not be read. LATE PROJECT WRITE-UPS WILL NOT BE ACCEPTED.
This written project should summarize what you did for/within the family firm, what you have learned about family business, and what you have learned about working on a team.
Grading of the Team Project:
Your group project will be evaluated on the following criteria:
a. Problem definition: How well (i.e., thoroughly and concisely) do you describe the family business context, the relevant parties, and the factors that are important to the problem?
b. Accurate and thorough use of course concepts.
c. Integration of course concepts with information about the family firm and problem, i.e., how well do you integrate course concepts with information about the problem to illuminate the problem in a way that leads to solutions?
d. Extent to which recommendations are consistent with analysis.
e. Quality of written analysis.
Analytical Syllabus
|
# |
Agenda |
Lecture/ Case discussion |
Lecturer |
|
SECTION 1: Family firms: prevalence and relevance |
|||
|
1 |
Introduction of the course (Chapter 1: Zellweger, pages: 1-3) 1. Thematic focus 2. Intended audience 3. Structure and pedagogical tools Defining the family business (Chapter 2: Zellweger, pages: 4-22) 1. The distinction between family and nonfamily firms 2. Defining family business by type of family involvement 3. Circle models of family influence 4. Family firm identity 5. Family business definition |
Lecture |
GNAN |
|
2 |
Prevalence and economic contribution of family firms around the globe (Chapter 3: Zellweger, pages: 24-33) 1. Prevalence of family firms worldwide 2. Economic contribution of family firms 3. Institutional setting and the prevalence of family firms Strengths and weaknesses of family firms (Chapter 4: Zellweger, pages: 36-42) 1. Typical strengths of family firms 2. Typical weaknesses of family firms 3. Bivalent attributes of family firm characteristics CASE STUDY: More than a move to Mexico (Chapter 4: Zellweger, pages: 43-45) |
Lecture and Case |
GNAN |
|
SECTION 2: Governance in the family firm |
|||
|
3 |
Governance in the family firm: premises, corporate and ownership governance (Chapter 5: Zellweger, pages: 46-72) 1. Why do family firms need governance? 2. Typical governance constellations in family firms 3. Performance implications of governance constellations 4. Untangling corporate, ownership, family governance 5. Corporate governance 6. Ownership governance |
Lecture |
GNAN |
|
4 |
Governance in the family firm: family governance (Chapter 5: Zellweger, pages: 73-105) 1. Family governance 2. Governance documents: code of conduct and family charter 3. Governance bodies: family assembly and family council 4. Integrated governance in family firms CASE STUDY: Beretti Holdings—More than a retirement decision (Chapter 5: Zellweger, pages: 109-112) |
Lecture and Case |
GNAN |
|
SECTION 3: Strategic management in the family firm |
|||
|
5 |
Strategic management in the family business: competitive advantages and the agency perspective (Chapter 6: Zellweger, pages: 116-134) 1. Strategic decision making in family firms 2. Conceptualizing the competitive advantage of family firms 3. The agency perspective CASE STUDY: Henkel’s Genthin plant (Chapter 6: Zellweger, page: 125) |
Lecture and Case |
GNAN |
|
6 |
Strategic management in the family business: RBV and OI perspectives (Chapter 6: Zellweger, pages: 137-163) 1. The resource-based perspective 2. The organizational identity perspective CASE STUDY: Branding and CSR at HiPP (Chapter 6: Zellweger, pages: 165-166) |
Lecture and Case |
GNAN |
|
7 |
Strategic management in the family business: institutional and paradox perspectives (Chapter 6: Zellweger, pages: 167-194) 1. The institutional perspective 2. The paradox perspective 3. Generic strategies for family firms 4. Tools for strategic management in family firms CASE STUDY: Managing paradoxes (Chapter 6: Zellweger, pages: 193-194) |
Lecture and Case |
GNAN |
|
SECTION 4: Succession in the family firm |
|||
|
8 |
Succession in the family firm: goals and processual issues (Chapter 7: Zellweger, pages: 203-234) 1. Succession options 2. Opportunities and challenges of succession options 3. Significance of succession options 4. Declining relevance of infra-family succession 5. Sources of complexity in family business succession 6. Structuring the succession process: succession framework 7. Clarifying goals and priorities |
Lecture |
GNAN |
|
9 |
Succession in the family firm: change strategy and who is in charge of the change (Chapter 7: Zellweger, pages: 240-254) 1. Reviewing the firm's strategy 2. Planning the transition of responsibilities |
Lecture |
GNAN |
|
10 |
Succession in the family firm: value, finance, legal, and tax issues (Chapter 7: Zellweger, pages: 258-305) 1. Valuing the firm 2. Financing the succession 3. Defining the legal and tax setup CASE STUDY: Bernet’s choice—Valuation, emotional value, family discount and fair distribution of assets within the family (Chapter 7: Zellweger, pages: 306-307) |
Lecture and Case |
GNAN |
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SECTION 5: Change and transgenerational value creation |
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11 |
Change and transgenerational value creation (Chapter 7: Zellweger, pages: 311-356) 1. Change and adaptation in family firms 2. Longevity of family firms 3. Transgenerational value creation in family firms CASE STUDY: Transgenerational value creation at Ahlstrom (Finland) (Chapter 8: Zellweger, pages: 361-363) |
Lecture and Case |
GNAN |
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SECTION 6: Interpersonal relationships and conflict in the family firm |
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12 |
Interpersonal relationships and conflict in the family firm: social issues, family values, and perceptions (Chapter 10: Zellweger, pages: 428-466) 1. The social structure of the family 2. Trends in the social structure of the family 3. International variance in family values 4. Understanding interpersonal dynamics in the family firm: a systemic view 5. Justice perceptions |
Lecture |
GNAN |
|
13 |
Interpersonal relationships and conflict in the family firm: managing conflicts (Chapter 10: Zellweger, pages: 468-487) 1. Why family firms are fertile contexts for conflict 2. Types of conflict 3. Conflict dynamics 4. Conflict-management styles 5. Communication strategies 6. How to behave in the face of conflict CASE STUDY: Conflict in the Solomon family (Chapter 10: Zellweger, pages: 488-491) |
Lecture and Case |
GNAN |
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SECTION 7: Financial management in the family firm |
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14 |
Financial management in the family firm: differences with no family firms (Chapter 9: Zellweger, pages: 368-379) 1. Why finance is different for family firms 2. Family equity as a distinct asset class 3. Performance of family firms: a short review of the evidence 4. Risk taking in family firms |
Lecture |
GNAN |
|
15 |
Financial management in the family firm: financial tools (Chapter 9: Zellweger, pages: 380-400) 1. Debt financing 2. Equity financing 3. Leverage 4. Value management 5. Key financial indicators 6. Dilemmas in the financial management of family firms |
Lecture |
GNAN |
|
16 |
Financial management in the family firm: financial sustainability (Chapter 9: Zellweger, pages: 402-407) 1. Principles for the sustainable financial management of family firms 2. The role of the CFO in family firms CASE STUDY: Tom’s world (Chapter 9: Zellweger, pages: 422-424) |
Lecture and Case |
GNAN |
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17 |
Financial management in the family firm: compensations (Chapter 9: Zellweger, pages: 407-411) 1. Management compensation in family firms CASE STUDY: Medco Energi Internasional (HBS 9-207-021) |
Lecture and Case |
GNAN |
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18 |
Financial management in the family firm: family offices (Chapter 9: Zellweger, pages: 412-417 and Chapter 5: Zellweger, pages: 83-89) 1. The responsible shareholder in the family firm 2. Wealth governance |
Lecture |
GNAN |
Aggiornato A.A. 2017-2018
FAMILY BUSINESS
(Prof. Luca Gnan)
Teaching Staff responsible for the Course:
Prof. Luca Gnan
Email: luca.gnan@uniroma2.it
Availability: Contact via email
Prof.ssa Giulia Flamini
E-mail: giulia.flamini@uniroma2.it
Availability: Contact via email
We are committed to making this course a valuable learning experience for you. After the first month, we will spend part of a class session evaluating our progress, and we will make any necessary changes to keep us on track. However, we welcome your feedback at any time in the semester. It is easiest to reach us by email or during office hours, but we are always happy to set up an appointment. Additionally, if you have a disability that requires special accommodation, please let us know ASAP so that we can be helpful to you.
Emails, Office Hours & Feedback on Assignments
We endeavor to answer emails within 1 day. If you have not heard from us within that time, please resend the email. We will post grades & comments online in the materials section of the course website. We will be happy to give feedback and discuss assignments after all grading is complete for a certain assignment. We schedule office hours by email request.
We may answer questions of assignment clarification in class and via emails to benefit the entire class. We may also give extra grades (see below Team Project) during the course that, while generally designed to support learning in the course, will also help your participation grade. These are pass/fail and do not include comments.
Pre-requisites for the Course:
None
Course description and Learning Objectives
Family businesses shows distinct core competencies that can result in unique competitive advantages. They take a long run view of the business—across generations, rather than publicly traded quarterly reports. Their capital can be very patient, owners will sacrifice their salaries in order to make payroll, and they are an integral part of their communities, unlike publicly traded counterparts that might abandon a community at the blink of a budget. They can engender a great deal of loyalty on the part of employees, and the existence of family may reduce agency problems.
Family Businesses also face challenges that threaten their continuity. The challenges are primarily the result of issues presented by the interaction of family, management, and ownership—particularly where the family wishes to perpetuate its influence and/or control from generation to generation. Family firms seem to be as agile in one generation as they are fragile across generations.
Family businesses start with an owner-managed first generation (usually an entrepreneur). The next generation—G2—is the sibling generation, and G3 is the cousin era. The probability of passing the company to the next generation diminishes significantly, with fewer than half making it to G2 and only about less than 15% making it to G3. So, despite the benefits of family, there can be some significant issues.
The course explores and analyzes continuity challenges of family business and their best management practices. The focus of this course is on pragmatic, action-oriented, management, governance, finance, and family/business leadership skills.
Attention is devoted to evaluating family firms and their growth options to provide a roadmap for analyzing how family ownership, control, and management affect performances and how family firms can create and ensure more value through generations.
The course presents seven different sections:
· SECTION 1: Family firms: prevalence and relevance
· SECTION 2: Governance in the family firm
· SECTION 3: Strategic management in the family firm
· SECTION 4: Succession in the family firm
· SECTION 5: Change and transgenerational value creation
· SECTION 6: Interpersonal relationships and conflict in the family firm
· SECTION 7: Financial management in the family firm
The course addresses the governance, the management, and the finance of established family businesses. It examines succession, values, life cycles, business and marketing strategies, conflict resolution, communications, legal, and financial aspects, estate planning, management, philanthropy and other topics that uniquely touch family business governance, management and finance. It will convey the characteristics that differentiate family businesses from other businesses.
One of the features, which make this course unique and particularly modern, is a part of the Section 7: Financial management in the family firm dedicated to the mysterious and fascinating world of the family office. This is the little-known, but key professional practice of advising entire families-in-business, frequently large, diversified and with wide ramifications, about the complete spectrum of activities necessary to ensure that wealth is created, preserved, transmitted and spread across the enlarged family community. These services range from asset allocation to risk management, to education, efficient tax structuring, corporate finance and corporate governance, intra- and inter- generational transmission, philanthropy, etc. Given the enormous amount of wealth and power concerned, this phenomenon shows increasingly importance and starts to attract some focus, particularly by the best graduate students and professional talents.
Upon completion of this course, students should understand:
- The unique assets and vulnerabilities of family enterprises.
- The role of the CEO in governance, management, and the transfer of power.
- The relationship between the role of the board, the family council, and top management in providing effective governance for family business continuity.
- Key family dynamics.
- The relevance for families to manage collectively wealth created in professional ways,
and be able to:
- Identify the various stakeholders and the role of trust among family members and their impact on succession and continuity.
- Discuss the developmental needs and challenges of next generation leaders.
- Analyze the effect of estate taxes on ownership transfer across generations of family business owners and the implications of ownership structures on the competitive advantages of family businesses.
- Explain the importance of strategic planning to family business continuity.
- Explore the critical role and challenges that non-family managers play in family-owned operations.
- Analyze the impact of family culture, family communication, family conflict, and family unity and explore their interaction effects on the family business.
- Assess whether they want to seek employment in family businesses both as key employees/managers or in a professional advisory role.
Teaching methods
Lessons will focus on transferring knowledge and on a strong interaction within the classroom; there are analysis of situations problems and business cases in order to facilitate participants in learning.
Regular attending students (in order to be a regular attending student, a participant should achieve at least an 85% of presence to lectures and case discussions) are strongly recommended to participate to all the lectures and to all the preparations and presentations of the business cases.
To meet its goals, this course uses readings, lectures, exercises, cases, individual and team assignments, and class discussion. Case assignments provide an important foundation for class discussion and must completed prior to each class session. The analytical syllabus (at the end of this document) shows due dates for all cases and other assignments in the class schedule. Lectures will highlight key points from the readings and provide additional information to supplement the readings. Cases will provide you with the opportunity to apply what you have learned to real world issues and scenarios. Because each of you brings unique perspectives and experiences to the class, participation in class discussions and activities is essential to your own learning as well as that of other class members. To enrich further your learning, an MScBA Teaching Assistant will also match you.
Textbook
Zellweger, T. Managing the Family Business: Theory and Practice, Edward Elgar Publishing, 2017: ISBN: 9781783470709
Cases
During the course, we will discuss 10 cases:
1. More than a move to Mexico (Chapter 4: Zellweger, pages: 43-45)
2. Beretti Holdings—More than a retirement decision (Chapter 5: Zellweger, pages: 109-112)
3. Henkel’s Genthin plant (Chapter 6: Zellweger, page: 125)
4. Branding and CSR at HiPP (Chapter 6: Zellweger, pages: 165-166)
5. Managing paradoxes (Chapter 6: Zellweger, pages: 193-194)
6. Bernet’s choice—Valuation, emotional value, family discount and fair distribution of assets within the family (Chapter 7: Zellweger, pages: 306-307)
7. Transgenerational value creation at Ahlstrom (Finland) (Chapter 8: Zellweger, pages: 361-363)
8. Conflict in the Solomon family (Chapter 10: Zellweger, pages: 488-491)
9. Tom’s world (Chapter 9: Zellweger, pages: 422-424)
(the following case from Harvard Business School Publishing. You need to register to download the cases at the following link: https://hbr.org, then download the case at the indicated link)
10. Medco Energi Internasional
Additional References
- Poza, E. J., “Family Business”, First Edition. Mason, OH: Thomson South-Western, 2004.
- Gnan, L. and Montemerlo, D., (2006), “Family-firm relationship in Italian SMEs: ownership and governance issues in a double-fold theoretical perspective”, in P. Z. Poutziouris P., Smyrnios, K. X., and Klein, S. B., “Handbook of research on family business”, Edward Elgar Publishing.
- Zattoni, A., Gnan, L., Huse, M., (2012) ,“Does Family Involvement Influence Firm Performance? Exploring the Mediating Effects of Board Processes and Tasks”, Journal Of Management, ISSN: 0149-2063, DOI: 10.1177/0149206312463936
- Gnan, L. and Songini, L., (2015), “Family involvement and agency cost control mechanisms in family small and medium-sized enterprises”, Journal Of Small Business Management, vol. 53, p. 748-779, ISSN: 0047-2778, DOI: 10.1111/jsbm.12085
- Gnan, L., Montemerlo, D., Huse, M. (2015), “Governance systems in family SMEs: the substitution effects between family councils and corporate governance mechanisms”, Journal of Small Business Management, p. 1-27, ISSN: 1540-627X, DOI: 10.1111/jsbm.12070
- Gnan, L., Montemerlo, D., Schulze, W., Corbetta, G., (2008), “Governance Structures in Italian Family SMEs” In: (a cura di): Comacchio A. and Pontiggia A., “L'organizzazione fa la differenza”, Roma: Carocci Editore, ISBN: 9788843045587
- Gnan, L. and Montemerlo, D., (2007), “Family-firm relationship in Italian SMEs: ownership and governance issues in a double-fold theoretical perspective” In: “Handbook of research on family business”, Elgar, ISBN: 978-1845424107
- Songini, L., Gnan, L., Morelli, C., Vola, P., (2015), “The why and how of managerialization of family businesses: evidences from Italy”, Piccola Impresa / Small Business, vol 1, DOI: 10.14596/pisb.179, pp 85-117
- Songini, L., Gnan, L., Malmi, T (2013), “The role and impact of accounting in family business”, Journal of Family Business Strategy, vol. 4, p. 71-83, ISSN: 1877-8585, DOI: 10.1016/j.jfbs.2013.04.002
- Gnan, L., Songini, L., (2014), “The glass ceiling in SMEs and its impact on firm managerialisation: a comparison between family and non-family SMEs”, International Journal of Business Governance And Ethics, vol. 9, ISSN: 1477-9048
- de Pedys, V. and Antonelli, A,. (2008) “Family office for family business”, Oxford management Publishing, ISBN 978-1-906728-01-4
- Poutziouris, P., (2001) “Understanding family firms”, in (Ed.) Adam, J., Institute of Directors, “The Growing Business Handbook”, London: Kogan Page, Chapter 6.3: pp. 9-15, 4th edition, ISBN 074943600X
- Levin, R. and Travis, V., (1987), “Small company finance: what the books don’t say”, Harvard Business Review, nov-dec: 87608
- Villalonga, B. and Amit, R., (2005), “How do family ownership, control and management affect firm value”, Journal of financial economics, 80: 385-417
- Wilson, R., (2013), “The family office Report”, FamilyOfficesGroup.com
- Amit, R. and Perl, R., (2012) “2012 Family Governance Report”, Wharton Global family Alliance, Wharton School, University of Pennsylvania
- Amit, R. and Lichtenstein, H., (2010), “Benchmarking the Single Family Office” Wharton Global Family Alliance, Wharton School, University of Pennsylvania
Suggested videos
1. Introductory video: 4 Lessons from the Best Family Businesses
https://hbr.org/video/4660653966001/4-lessons-from-the-best-family-businesses
2. Three circle model: importance of governance, setting goals, holistic leadership and caring for the interests of the family
https://www.youtube.com/watch?v=D85pqiL1tNM
3. The unique strengths and weaknesses of family businesses today, contrasting it with the humble mom-and-pop store the term usually brings to mind
https://www.youtube.com/watch?v=suL-HkP-2Ts
4. The topic of Building a Family Business That Lasts and provides viewers with four key points to walk away with
https://www.youtube.com/watch?v=vZ52w3wBP1U
5. The key attention points and delicacies involved in preparing and transferring a business to the next generation
https://www.youtube.com/watch?v=Io9aWtuSEh4
6. Family Business Governance: Family Constitution
https://www.youtube.com/watch?v=i5psd_84euA
7. Family-owned companies need to be run with emotional, as well as professional leadership
https://www.youtube.com/watch?v=2bYo2Ph48_E
8. Toward a theory of how some family firms nurture transgenerational entrepreneurship
https://www.youtube.com/watch?v=AzFginXvSrM
9. Family Business Longevity
https://www.youtube.com/watch?v=uoHRNLuoYHM
10. 5 Ways For Private Equity Firms to Raise Capital From Family Offices
https://www.youtube.com/watch?v=EX8TnQmOFyc
11. Address the challenges faced by family businesses
https://www.youtube.com/watch?v=mItel08kE-Q
12. Conflict in the Family Business
https://www.youtube.com/watch?v=CVILBwkMVxc
13. Stories of Wasteful Conflict in Family Businesses
https://www.youtube.com/watch?v=elzfKRYw1yA
Case Discussions
We expect that regular attending students are fully engaged in the entire learning process. This means that we expect regular attending students to:
1) prepare the assigned readings of the cases prior to each class;
2) prepare as a group work a PowerPoint presentation on the case, based on the specific assignment;
3) come to class prepared to participate and to discuss in order to enhance the learning of the individual and the class.
On the web site of the course, students find for each case the relative assignment. Please read carefully the questions before the lesson and use them for preparing the PowerPoint presentation.
Each student will be involved the class discussion on the cases and tie the assigned reading for the session. The objective is to bring all class members into the discussion. The cases intend to integrate the concepts from the case into the context of the course. The preparation and the discussion of the cases do not exclude the study of the theoretical concepts useful for the discussion of the cases themselves and for the passing of the exam of the course.
With the cases’ discussions in CLASSROOM, each student will develop:
1. The ability to set the parameters for the problem (key concepts from the case).
2. A depth of knowledge about the case subject (understanding of material, good response to the observations of others).
3. The ability to tie-in case with other course concepts.
4. The ability to get others involved in the discussion.
In order to discuss effectively the cases, students do:
· Be prepared with facts and specific quotes from the case.
· Be prepared to make a comment, ask a question, or make a statement about the case.
During the discussion, students do:
· Take a position on a question or a point.
- Ask clarifying questions.
· Help keep the discussion moving and on track.
· Help draw others into the discussion.
· Integrate theories and content from other cases.
During the discussion, students do not:
· Be unprepared and show your lack of knowledge.
- Monopolize the discussion.
- Make irrelevant comments.
· Be insensitive to other’s desire to speak or to their opinions.
We kindly invite all the regular attending students to build up work groups (MINIMUM 3 PERSONS – MAXIMUM 5 PERSONS). Each work group should prepare a PowerPoint presentation for each case. Into the first slide, each work group should report the names of the students belonging to the group.
The structure of the presentation should follow the following outline:
- One or more introductory slides aimed at describing/reporting the story, the characters, all the necessary elements in order to define clearly the context and the boundaries of the case.
- One slide mentioning the questions of the assignment and underlining the learning goals of the case.
- One or more slides reporting the answers to each question of the assignment.
- One or more slides reporting the final remarks on the case.
- One closing slide about the lessons learned after the group discussion of the case.
How to prepare the PowerPoint presentation of the case?
Introduction – short presentation of case, short description of the problems and situations that should be coped with the discussion.
Diagnosis – Problem setting of the context and of the situation. Description of the mains facts and elements connected with the concepts and models of Family Business (e.g. Ownership issues, conflicts, family culture, governance issues, leadership, managing people, succession, etc.). What went wrong and which actions/situations, instead, were right? Which elements could be considered for the diagnosis?
Solution – Students should provide a possible solution to questions/problems related with the case and a viable and clear indication on how to approach the situation and how to solve it. The entire proposal should represent a consistent action plan in terms of behaviors and expected results.
Conclusions – Conclusions should not be longer than 300-500 words and should provide a description on how the situation and the problem characterized the case, on how Family Business schemata might help to solve the case, and what the proposed solution might generate in terms of family and managerial consequences.
Lessons learned – At the end of the presentation elements/suggestions/advices that we “take home” from the case discussion should be clearly identified and reported.
NOTE: During the case discussion, students should explicitly address the context and the different situations with concepts related with Family Business and with models and theories of this course.
Case Discussions’ Class Participation
We believe that the best way to learn, especially about family Business, is to actively participate in your education. In this class, “participation” is defined in terms of quality contributions to class discussion and exercises. There are four prerequisites for successful participation:
1. Be here on time and prepared. If you are not here, you cannot contribute much to class discussion. If you need to miss class for a predictable reason (e.g., job interview, athletic competition), please notify us at least 24 hours in advance so that we can arrange for any in-class exercises and so that you can obtain the materials distributed during the class. Of course, we realize that in some cases unforeseeable emergencies arise. Although we will not directly penalize you for non-attendance, be aware that multiple absences will indirectly hurt you by preventing you from participating in class, thereby lowering your participation grade. To contribute to class discussion, you must come to class having carefully prepared all assignments (i.e., readings, cases, exercises).
2. Be brave. Everyone in this class is smart, interesting, and has unique life experiences to share. You will get the most out of this course if you ask questions, voice opinions, and express your thoughts to one another. If you feel uncomfortable talking in class, please send me an email or set up an appointment to talk with me early in the semester. We will do everything we can to accommodate each of your individual circumstances, but we can only do so if they are brought to our attention.
3. Be courteous. Successful participation includes treating your classmates in a respectful and professional manner. Listen carefully to the comments and questions that your classmates voice. You may learn something new from their perspectives, and you will be able to avoid simply repeating something that another classmate has said earlier in discussion. Also, it is perfectly acceptable for you to voice disagreement with an opinion provided by another student. Open debate often leads to the most thoughtful and informative class discussions. However, please voice your disagreement in a kind and considerate manner.
4. Be engaged. This class is “unplugged.” Once class starts, all electronics (e.g., computers, cell phones, tablets, etc.) should be turned off and put away. If you need to use a device because of a language or disability issue, you need to secure permission at the beginning of the class. The misuse of an electronic device (e.g., surfing the web or texting) will adversely affect your grade.
In order to facilitate the visioning of its own PowerPoint presentation in classroom, each work group should take a personal computer with PowerPoint installed and an available VGA connection.
By the 8pm of the day before of the case discussion, all regular attending students should send an email to the course’s Instructors, attaching the case presentation prepared. They have to hand over a hard copy of the PowerPoint presentation. ONLY THE HANDING OVER OF THE HARD COPY CERTIFIES THE PREPARATION OF THE CASE FOR THE DISCUSSION. ONLY STUDENTS WHO HAD HANDED OVER ALL THE CASE PRESENTATIONS WILL BE ADMITTED TO THE PRE-EXAM.
Policy for Late Assignments
As in the business world, work must be received on time in order to receive full credit. If you are late on an assignment, your access to the Pre-Exam will be compromised. You are always welcome to hand in an assignment before its due date if you know that you will be busy as the due date approaches. If you think that you will not be able to complete an assignment by the stated due date, please speak with us in advance to make alternative arrangements. Our policy on late assignments will depend on the specific circumstances surrounding the problem, and thus may differ from student to student. Providing advance notice about a late assignment will minimize the penalty you receive on that assignment, but does not guarantee that there will be no penalty for turning the assignment in late.
Other learning sources
Slides and other material will be available on the course website.
THE SLIDES DO NOT REPRESENT A SUPPORT FOR AN EFFECTIVE AND SUCCESFUL PREPARATION TO THE EXAM OF THE COURSE. THEY REPRESENT ONLY A HELP TO FACILITATE THE TRANSFER OF THE KNOWLEDGES TO STUDENTS DURING THE LESSONS.
Attendance
Because of the concentrated nature of the MScBA programme, attendance in class is very important.
Students with less than 85% of attendance to lectures and case discussions (including arriving late or leaving early) will be required to prepare for the exam ALL the chapters of the textbook Zellweger, T. Managing the Family Business: Theory and Practice, Edward Elgar Publishing, 2017: ISBN: 9781783470709 and ALL the cases discussed in classroom.
NOTE : Attendance for the first class session is mandatory as important information regarding the course and the instructors’ expectations are given. If you know in advance that you will be absent for one session, please contact your instructor to ensure that absence from a particular session is acceptable.
Exam
The exam, depending on the number of the registered student, is a written exam or an oral exam.
In case of a written exam, the duration is about 3-4 hours and it includes:
a) Case discussion - You may be given a case study to which some questions may pertain in order to lead the discussion. As you respond to the questions, please use specific content and theories (use names to identify theories and models) as the basis of your analysis. You will not receive credit for your personal opinions unless backed by theory, lecture, and/or text material. Also, describe how you see the content/theory applying to the situation. Your answers will be evaluated based upon both quantity and quality. Answers that are more complete and demonstrate a higher level of understanding and analysis will receive more points.
b) Some questions directly connected to the course textbook – The questions could open, closed (multiple choice), or a combination of the both. You may be asked to discuss the models and the theories presented during the course. You will be asked to interpret some real incidents and to focus your attention to some specific theoretical issues.
Pre-Exam participation and exam grades registering on the booklet
Only regular attending students (85% of attendance to lectures and case discussions, including arriving late or leaving early) that have delivered the hard copies of ALL the case to the Instructors are allowed to take the pre-exam.
Only regular registered students on the DELPHI System will be allowed to register their grade.
The pre-exam grades will be registered on the first official exam date AFTER THE COURSE ENDING. It is compulsory to come on that date of the exam for registering the grade on the Delphi and on the booklet.
Team Project
The purpose of the project is to give your team an opportunity to apply what has been learned in the course (through course lectures, readings, and case discussions) to problems in a family firm of your team's choice.
Class members, regular attending students, will work in teams of four (4) people.
To the Team Project regular attending students will be allowed to achieve a -3/+3 extra points to the final grade of the Pre-Exam. Only regular attending students, taking the Pre-Exam will be accepted for the Team Project.
Your team should identify a family firm to study (Please, no student groups).
Your team is to gather information from people in the family firm through direct contact. You may supplement this information with data from the media, the organization's literature, and other secondary sources. You should identify a relatively recent problem to analyze (i.e., this should not be an historical account of a problem and the company's solution). You should focus your analysis by applying the concepts from the course. While it is acceptable to incorporate several concepts from the course, please aim for depth rather than breadth regarding the use of course concepts. Your goal is to diagnose the mechanisms that are causing the problem or issue of concern in the organization. Initially, you may notice many symptoms (for instance, a crisis after the succession, seemingly an unhealthy family culture, low family members’ commitment and involvement, governance issues, etc.), but your task is to get to the underlying reason for these symptoms. And beware, sometimes the initial symptoms we think we see are not what they appear to be.
There are three broad goals for this assignment:
1. One goal of this assignment is obviously to take the initiative to make a positive contribution to a family firm.
2. Another major goal is to provide an opportunity for you to learn more about family businesses first hand and to use your critical thinking and reflection skills to link your experience with this family firm to your learning in relation to family business theories.
3. The final goal is to provide a forum for you to hone your skills as a team member and leader and to reflect on the learning gained from this team experience. Each team will make a presentation and write a paper that describes what you did for the family firm, what you learned about family business, and what you learned about working on a team.
To meet these broad goals, your team should answer the following questions in the assignments detailed below.
a) What are the issues or problems facing the family firm?
b) What course concepts can be applied to understand why this problem is occurring?
c) What recommendations can you offer to help improve the family business functioning?
Deliverables of the Team Project:
1. The project proposal e-mail is due by email to Instructors by the date of the 9th session of the course by 5pm. It should include:
a) The names of your group members
b) Your team name
c) The name of the organization
d) The name, contact information and level of your contact person
e) The method you will use to gain access to the organization
f) A brief description (one paragraph) of the problem facing the organization.
2. Your written project is due by email to Instructors by the date of the 18th session of the course by 5pm .
It should contain a maximum of 15 double spaced pages (1 cm margins, 12 point font). You will be penalized significantly for exceeding this limit. The limit does not include appendices, which you are free to use to provide charts, figures, or other background material not necessary in the main body of your analysis. However, appendices that are not directly referenced in the main text will not be read. LATE PROJECT WRITE-UPS WILL NOT BE ACCEPTED.
This written project should summarize what you did for/within the family firm, what you have learned about family business, and what you have learned about working on a team.
Grading of the Team Project:
Your group project will be evaluated on the following criteria:
a. Problem definition: How well (i.e., thoroughly and concisely) do you describe the family business context, the relevant parties, and the factors that are important to the problem?
b. Accurate and thorough use of course concepts.
c. Integration of course concepts with information about the family firm and problem, i.e., how well do you integrate course concepts with information about the problem to illuminate the problem in a way that leads to solutions?
d. Extent to which recommendations are consistent with analysis.
e. Quality of written analysis.
Analytical Syllabus
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Agenda |
Lecture/ Case discussion |
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SECTION 1: Family firms: prevalence and relevance |
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Introduction of the course (Chapter 1: Zellweger, pages: 1-3) 1. Thematic focus 2. Intended audience 3. Structure and pedagogical tools Defining the family business (Chapter 2: Zellweger, pages: 4-22) 1. The distinction between family and nonfamily firms 2. Defining family business by type of family involvement 3. Circle models of family influence 4. Family firm identity 5. Family business definition |
Lecture |
GNAN |
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2 |
Prevalence and economic contribution of family firms around the globe (Chapter 3: Zellweger, pages: 24-33) 1. Prevalence of family firms worldwide 2. Economic contribution of family firms 3. Institutional setting and the prevalence of family firms Strengths and weaknesses of family firms (Chapter 4: Zellweger, pages: 36-42) 1. Typical strengths of family firms 2. Typical weaknesses of family firms 3. Bivalent attributes of family firm characteristics CASE STUDY: More than a move to Mexico (Chapter 4: Zellweger, pages: 43-45) |
Lecture and Case |
GNAN |
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SECTION 2: Governance in the family firm |
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3 |
Governance in the family firm: premises, corporate and ownership governance (Chapter 5: Zellweger, pages: 46-72) 1. Why do family firms need governance? 2. Typical governance constellations in family firms 3. Performance implications of governance constellations 4. Untangling corporate, ownership, family governance 5. Corporate governance 6. Ownership governance |
Lecture |
GNAN |
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4 |
Governance in the family firm: family governance (Chapter 5: Zellweger, pages: 73-105) 1. Family governance 2. Governance documents: code of conduct and family charter 3. Governance bodies: family assembly and family council 4. Integrated governance in family firms CASE STUDY: Beretti Holdings—More than a retirement decision (Chapter 5: Zellweger, pages: 109-112) |
Lecture and Case |
GNAN |
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SECTION 3: Strategic management in the family firm |
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5 |
Strategic management in the family business: competitive advantages and the agency perspective (Chapter 6: Zellweger, pages: 116-134) 1. Strategic decision making in family firms 2. Conceptualizing the competitive advantage of family firms 3. The agency perspective CASE STUDY: Henkel’s Genthin plant (Chapter 6: Zellweger, page: 125) |
Lecture and Case |
GNAN |
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6 |
Strategic management in the family business: RBV and OI perspectives (Chapter 6: Zellweger, pages: 137-163) 1. The resource-based perspective 2. The organizational identity perspective CASE STUDY: Branding and CSR at HiPP (Chapter 6: Zellweger, pages: 165-166) |
Lecture and Case |
GNAN |
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7 |
Strategic management in the family business: institutional and paradox perspectives (Chapter 6: Zellweger, pages: 167-194) 1. The institutional perspective 2. The paradox perspective 3. Generic strategies for family firms 4. Tools for strategic management in family firms CASE STUDY: Managing paradoxes (Chapter 6: Zellweger, pages: 193-194) |
Lecture and Case |
GNAN |
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SECTION 4: Succession in the family firm |
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8 |
Succession in the family firm: goals and processual issues (Chapter 7: Zellweger, pages: 203-234) 1. Succession options 2. Opportunities and challenges of succession options 3. Significance of succession options 4. Declining relevance of infra-family succession 5. Sources of complexity in family business succession 6. Structuring the succession process: succession framework 7. Clarifying goals and priorities |
Lecture |
GNAN |
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9 |
Succession in the family firm: change strategy and who is in charge of the change (Chapter 7: Zellweger, pages: 240-254) 1. Reviewing the firm's strategy 2. Planning the transition of responsibilities |
Lecture |
GNAN |
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10 |
Succession in the family firm: value, finance, legal, and tax issues (Chapter 7: Zellweger, pages: 258-305) 1. Valuing the firm 2. Financing the succession 3. Defining the legal and tax setup CASE STUDY: Bernet’s choice—Valuation, emotional value, family discount and fair distribution of assets within the family (Chapter 7: Zellweger, pages: 306-307) |
Lecture and Case |
GNAN |
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SECTION 5: Change and transgenerational value creation |
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11 |
Change and transgenerational value creation (Chapter 7: Zellweger, pages: 311-356) 1. Change and adaptation in family firms 2. Longevity of family firms 3. Transgenerational value creation in family firms CASE STUDY: Transgenerational value creation at Ahlstrom (Finland) (Chapter 8: Zellweger, pages: 361-363) |
Lecture and Case |
GNAN |
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SECTION 6: Interpersonal relationships and conflict in the family firm |
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12 |
Interpersonal relationships and conflict in the family firm: social issues, family values, and perceptions (Chapter 10: Zellweger, pages: 428-466) 1. The social structure of the family 2. Trends in the social structure of the family 3. International variance in family values 4. Understanding interpersonal dynamics in the family firm: a systemic view 5. Justice perceptions |
Lecture |
GNAN |
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13 |
Interpersonal relationships and conflict in the family firm: managing conflicts (Chapter 10: Zellweger, pages: 468-487) 1. Why family firms are fertile contexts for conflict 2. Types of conflict 3. Conflict dynamics 4. Conflict-management styles 5. Communication strategies 6. How to behave in the face of conflict CASE STUDY: Conflict in the Solomon family (Chapter 10: Zellweger, pages: 488-491) |
Lecture and Case |
GNAN |
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SECTION 7: Financial management in the family firm
EN
IT
Aggiornato A.A. 2016-2017
FAMILY BUSINESS
(Prof. Luca Gnan)
Teaching Staff responsible for the Course: Prof. Luca Gnan Email: luca.gnan@uniroma2.it Availability: Contact via email Prof.ssa Giulia Flamini E-mail: giulia.flamini@uniroma2.it Availability: Contact via email We are committed to making this course a valuable learning experience for you. After the first month, we will spend part of a class session evaluating our progress, and we will make any necessary changes to keep us on track. However, we welcome your feedback at any time in the semester. It is easiest to reach us by email or during office hours, but we are always happy to set up an appointment. Additionally, if you have a disability that requires special accommodation, please let us know ASAP so that we can be helpful to you. Emails, Office Hours & Feedback on Assignments We endeavor to answer emails within 1 day. If you have not heard from us within that time, please resend the email. We will post grades & comments online in the materials section of the course website. We will be happy to give feedback and discuss assignments after all grading is complete for a certain assignment. We schedule office hours by email request. We may answer questions of assignment clarification in class and via emails to benefit the entire class. We may also give extra grades (see below Team Project) during the course that, while generally designed to support learning in the course, will also help your participation grade. These are pass/fail and do not include comments. Pre-requisites for the Course: None Course description and Learning Objectives Family businesses shows distinct core competencies that can result in unique competitive advantages. They take a long run view of the business—across generations, rather than publicly traded quarterly reports. Their capital can be very patient, owners will sacrifice their salaries in order to make payroll, and they are an integral part of their communities, unlike publicly traded counterparts that might abandon a community at the blink of a budget. They can engender a great deal of loyalty on the part of employees, and the existence of family may reduce agency problems. Family Businesses also face challenges that threaten their continuity. The challenges are primarily the result of issues presented by the interaction of family, management, and ownership—particularly where the family wishes to perpetuate its influence and/or control from generation to generation. Family firms seem to be as agile in one generation as they are fragile across generations. Family businesses start with an owner-managed first generation (usually an entrepreneur). The next generation—G2—is the sibling generation, and G3 is the cousin era. The probability of passing the company to the next generation diminishes significantly, with fewer than half making it to G2 and only about less than 15% making it to G3. So, despite the benefits of family, there can be some significant issues. The course explores and analyzes continuity challenges of family business and their best management practices. The focus of this course is on pragmatic, action-oriented, management, governance, finance, and family/business leadership skills. Attention is devoted to evaluating family firms and their growth options to provide a roadmap for analyzing how family ownership, control, and management affect performances and how family firms can create and ensure more value through generations. The course presents seven different sections: · SECTION 1: Family firms: prevalence and relevance · SECTION 2: Governance in the family firm · SECTION 3: Strategic management in the family firm · SECTION 4: Succession in the family firm · SECTION 5: Change and transgenerational value creation · SECTION 6: Interpersonal relationships and conflict in the family firm · SECTION 7: Financial management in the family firm The course addresses the governance, the management, and the finance of established family businesses. It examines succession, values, life cycles, business and marketing strategies, conflict resolution, communications, legal, and financial aspects, estate planning, management, philanthropy and other topics that uniquely touch family business governance, management and finance. It will convey the characteristics that differentiate family businesses from other businesses. One of the features, which make this course unique and particularly modern, is a part of the Section 7: Financial management in the family firm dedicated to the mysterious and fascinating world of the family office. This is the little-known, but key professional practice of advising entire families-in-business, frequently large, diversified and with wide ramifications, about the complete spectrum of activities necessary to ensure that wealth is created, preserved, transmitted and spread across the enlarged family community. These services range from asset allocation to risk management, to education, efficient tax structuring, corporate finance and corporate governance, intra- and inter- generational transmission, philanthropy, etc. Given the enormous amount of wealth and power concerned, this phenomenon shows increasingly importance and starts to attract some focus, particularly by the best graduate students and professional talents. Upon completion of this course, students should understand:
and be able to:
Teaching methods Lessons will focus on transferring knowledge and on a strong interaction within the classroom; there are analysis of situations problems and business cases in order to facilitate participants in learning. Regular attending students (in order to be a regular attending student, a participant should achieve at least an 85% of presence to lectures and case discussions) are strongly recommended to participate to all the lectures and to all the preparations and presentations of the business cases. To meet its goals, this course uses readings, lectures, exercises, cases, individual and team assignments, and class discussion. Case assignments provide an important foundation for class discussion and must completed prior to each class session. The analytical syllabus (at the end of this document) shows due dates for all cases and other assignments in the class schedule. Lectures will highlight key points from the readings and provide additional information to supplement the readings. Cases will provide you with the opportunity to apply what you have learned to real world issues and scenarios. Because each of you brings unique perspectives and experiences to the class, participation in class discussions and activities is essential to your own learning as well as that of other class members. To enrich further your learning, an MScBA Teaching Assistant will also match you. Textbook Zellweger, T. Managing the Family Business: Theory and Practice, Edward Elgar Publishing, 2017: ISBN: 9781783470709 Cases During the course, we will discuss 10 cases: 1. More than a move to Mexico (Chapter 4: Zellweger, pages: 43-45) 2. Beretti Holdings—More than a retirement decision (Chapter 5: Zellweger, pages: 109-112) 3. Henkel’s Genthin plant (Chapter 6: Zellweger, page: 125) 4. Branding and CSR at HiPP (Chapter 6: Zellweger, pages: 165-166) 5. Managing paradoxes (Chapter 6: Zellweger, pages: 193-194) 6. Bernet’s choice—Valuation, emotional value, family discount and fair distribution of assets within the family (Chapter 7: Zellweger, pages: 306-307) 7. Transgenerational value creation at Ahlstrom (Finland) (Chapter 8: Zellweger, pages: 361-363) 8. Conflict in the Solomon family (Chapter 10: Zellweger, pages: 488-491) 9. Tom’s world (Chapter 9: Zellweger, pages: 422-424) (the following case from Harvard Business School Publishing. You need to register to download the cases at the following link: https://hbr.org, then download the case at the indicated link) 10. Medco Energi Internasional Additional References - Poza, E. J., “Family Business”, First Edition. Mason, OH: Thomson South-Western, 2004. - Gnan, L. and Montemerlo, D., (2006), “Family-firm relationship in Italian SMEs: ownership and governance issues in a double-fold theoretical perspective”, in P. Z. Poutziouris P., Smyrnios, K. X., and Klein, S. B., “Handbook of research on family business”, Edward Elgar Publishing. - Zattoni, A., Gnan, L., Huse, M., (2012) ,“Does Family Involvement Influence Firm Performance? Exploring the Mediating Effects of Board Processes and Tasks”, Journal Of Management, ISSN: 0149-2063, DOI: 10.1177/0149206312463936 - Gnan, L. and Songini, L., (2015), “Family involvement and agency cost control mechanisms in family small and medium-sized enterprises”, Journal Of Small Business Management, vol. 53, p. 748-779, ISSN: 0047-2778, DOI: 10.1111/jsbm.12085 - Gnan, L., Montemerlo, D., Huse, M. (2015), “Governance systems in family SMEs: the substitution effects between family councils and corporate governance mechanisms”, Journal of Small Business Management, p. 1-27, ISSN: 1540-627X, DOI: 10.1111/jsbm.12070 - Gnan, L., Montemerlo, D., Schulze, W., Corbetta, G., (2008), “Governance Structures in Italian Family SMEs” In: (a cura di): Comacchio A. and Pontiggia A., “L'organizzazione fa la differenza”, Roma: Carocci Editore, ISBN: 9788843045587 - Gnan, L. and Montemerlo, D., (2007), “Family-firm relationship in Italian SMEs: ownership and governance issues in a double-fold theoretical perspective” In: “Handbook of research on family business”, Elgar, ISBN: 978-1845424107 - Songini, L., Gnan, L., Morelli, C., Vola, P., (2015), “The why and how of managerialization of family businesses: evidences from Italy”, Piccola Impresa / Small Business, vol 1, DOI: 10.14596/pisb.179, pp 85-117 - Songini, L., Gnan, L., Malmi, T (2013), “The role and impact of accounting in family business”, Journal of Family Business Strategy, vol. 4, p. 71-83, ISSN: 1877-8585, DOI: 10.1016/j.jfbs.2013.04.002 - Gnan, L., Songini, L., (2014), “The glass ceiling in SMEs and its impact on firm managerialisation: a comparison between family and non-family SMEs”, International Journal of Business Governance And Ethics, vol. 9, ISSN: 1477-9048 - de Pedys, V. and Antonelli, A,. (2008) “Family office for family business”, Oxford management Publishing, ISBN 978-1-906728-01-4 - Poutziouris, P., (2001) “Understanding family firms”, in (Ed.) Adam, J., Institute of Directors, “The Growing Business Handbook”, London: Kogan Page, Chapter 6.3: pp. 9-15, 4th edition, ISBN 074943600X - Levin, R. and Travis, V., (1987), “Small company finance: what the books don’t say”, Harvard Business Review, nov-dec: 87608 - Villalonga, B. and Amit, R., (2005), “How do family ownership, control and management affect firm value”, Journal of financial economics, 80: 385-417 - Wilson, R., (2013), “The family office Report”, FamilyOfficesGroup.com - Amit, R. and Perl, R., (2012) “2012 Family Governance Report”, Wharton Global family Alliance, Wharton School, University of Pennsylvania - Amit, R. and Lichtenstein, H., (2010), “Benchmarking the Single Family Office” Wharton Global Family Alliance, Wharton School, University of Pennsylvania Suggested videos 1. Introductory video: 4 Lessons from the Best Family Businesses https://hbr.org/video/4660653966001/4-lessons-from-the-best-family-businesses 2. Three circle model: importance of governance, setting goals, holistic leadership and caring for the interests of the family https://www.youtube.com/watch?v=D85pqiL1tNM 3. The unique strengths and weaknesses of family businesses today, contrasting it with the humble mom-and-pop store the term usually brings to mind https://www.youtube.com/watch?v=suL-HkP-2Ts 4. The topic of Building a Family Business That Lasts and provides viewers with four key points to walk away with https://www.youtube.com/watch?v=vZ52w3wBP1U 5. The key attention points and delicacies involved in preparing and transferring a business to the next generation https://www.youtube.com/watch?v=Io9aWtuSEh4 6. Family Business Governance: Family Constitution https://www.youtube.com/watch?v=i5psd_84euA 7. Family-owned companies need to be run with emotional, as well as professional leadership https://www.youtube.com/watch?v=2bYo2Ph48_E 8. Toward a theory of how some family firms nurture transgenerational entrepreneurship https://www.youtube.com/watch?v=AzFginXvSrM 9. Family Business Longevity https://www.youtube.com/watch?v=uoHRNLuoYHM 10. 5 Ways For Private Equity Firms to Raise Capital From Family Offices https://www.youtube.com/watch?v=EX8TnQmOFyc 11. Address the challenges faced by family businesses https://www.youtube.com/watch?v=mItel08kE-Q 12. Conflict in the Family Business https://www.youtube.com/watch?v=CVILBwkMVxc 13. Stories of Wasteful Conflict in Family Businesses https://www.youtube.com/watch?v=elzfKRYw1yA Case Discussions We expect that regular attending students are fully engaged in the entire learning process. This means that we expect regular attending students to: 1) prepare the assigned readings of the cases prior to each class; 2) prepare as a group work a PowerPoint presentation on the case, based on the specific assignment; 3) come to class prepared to participate and to discuss in order to enhance the learning of the individual and the class. On the web site of the course, students find for each case the relative assignment. Please read carefully the questions before the lesson and use them for preparing the PowerPoint presentation. Each student will be involved the class discussion on the cases and tie the assigned reading for the session. The objective is to bring all class members into the discussion. The cases intend to integrate the concepts from the case into the context of the course. The preparation and the discussion of the cases do not exclude the study of the theoretical concepts useful for the discussion of the cases themselves and for the passing of the exam of the course. With the cases’ discussions in CLASSROOM, each student will develop: 1. The ability to set the parameters for the problem (key concepts from the case). 2. A depth of knowledge about the case subject (understanding of material, good response to the observations of others). 3. The ability to tie-in case with other course concepts. 4. The ability to get others involved in the discussion. In order to discuss effectively the cases, students do: · Be prepared with facts and specific quotes from the case. · Be prepared to make a comment, ask a question, or make a statement about the case. During the discussion, students do: · Take a position on a question or a point.
· Help keep the discussion moving and on track. · Help draw others into the discussion. · Integrate theories and content from other cases. During the discussion, students do not: · Be unprepared and show your lack of knowledge.
· Be insensitive to other’s desire to speak or to their opinions. We kindly invite all the regular attending students to build up work groups (MINIMUM 3 PERSONS – MAXIMUM 5 PERSONS). Each work group should prepare a PowerPoint presentation for each case. Into the first slide, each work group should report the names of the students belonging to the group. The structure of the presentation should follow the following outline:
How to prepare the PowerPoint presentation of the case?
Introduction – short presentation of case, short description of the problems and situations that should be coped with the discussion. Diagnosis – Problem setting of the context and of the situation. Description of the mains facts and elements connected with the concepts and models of Family Business (e.g. Ownership issues, conflicts, family culture, governance issues, leadership, managing people, succession, etc.). What went wrong and which actions/situations, instead, were right? Which elements could be considered for the diagnosis? Solution – Students should provide a possible solution to questions/problems related with the case and a viable and clear indication on how to approach the situation and how to solve it. The entire proposal should represent a consistent action plan in terms of behaviors and expected results. Conclusions – Conclusions should not be longer than 300-500 words and should provide a description on how the situation and the problem characterized the case, on how Family Business schemata might help to solve the case, and what the proposed solution might generate in terms of family and managerial consequences. Lessons learned – At the end of the presentation elements/suggestions/advices that we “take home” from the case discussion should be clearly identified and reported. NOTE: During the case discussion, students should explicitly address the context and the different situations with concepts related with Family Business and with models and theories of this course. Case Discussions’ Class Participation
We believe that the best way to learn, especially about family Business, is to actively participate in your education. In this class, “participation” is defined in terms of quality contributions to class discussion and exercises. There are four prerequisites for successful participation: 1. Be here on time and prepared. If you are not here, you cannot contribute much to class discussion. If you need to miss class for a predictable reason (e.g., job interview, athletic competition), please notify us at least 24 hours in advance so that we can arrange for any in-class exercises and so that you can obtain the materials distributed during the class. Of course, we realize that in some cases unforeseeable emergencies arise. Although we will not directly penalize you for non-attendance, be aware that multiple absences will indirectly hurt you by preventing you from participating in class, thereby lowering your participation grade. To contribute to class discussion, you must come to class having carefully prepared all assignments (i.e., readings, cases, exercises). 2. Be brave. Everyone in this class is smart, interesting, and has unique life experiences to share. You will get the most out of this course if you ask questions, voice opinions, and express your thoughts to one another. If you feel uncomfortable talking in class, please send me an email or set up an appointment to talk with me early in the semester. We will do everything we can to accommodate each of your individual circumstances, but we can only do so if they are brought to our attention. 3. Be courteous. Successful participation includes treating your classmates in a respectful and professional manner. Listen carefully to the comments and questions that your classmates voice. You may learn something new from their perspectives, and you will be able to avoid simply repeating something that another classmate has said earlier in discussion. Also, it is perfectly acceptable for you to voice disagreement with an opinion provided by another student. Open debate often leads to the most thoughtful and informative class discussions. However, please voice your disagreement in a kind and considerate manner. 4. Be engaged. This class is “unplugged.” Once class starts, all electronics (e.g., computers, cell phones, tablets, etc.) should be turned off and put away. If you need to use a device because of a language or disability issue, you need to secure permission at the beginning of the class. The misuse of an electronic device (e.g., surfing the web or texting) will adversely affect your grade. In order to facilitate the visioning of its own PowerPoint presentation in classroom, each work group should take a personal computer with PowerPoint installed and an available VGA connection.
By the 8pm of the day before of the case discussion, all regular attending students should send an email to the course’s Instructors, attaching the case presentation prepared. They have to hand over a hard copy of the PowerPoint presentation. ONLY THE HANDING OVER OF THE HARD COPY CERTIFIES THE PREPARATION OF THE CASE FOR THE DISCUSSION. ONLY STUDENTS WHO HAD HANDED OVER ALL THE CASE PRESENTATIONS WILL BE ADMITTED TO THE PRE-EXAM.
Policy for Late Assignments As in the business world, work must be received on time in order to receive full credit. If you are late on an assignment, your access to the Pre-Exam will be compromised. You are always welcome to hand in an assignment before its due date if you know that you will be busy as the due date approaches. If you think that you will not be able to complete an assignment by the stated due date, please speak with us in advance to make alternative arrangements. Our policy on late assignments will depend on the specific circumstances surrounding the problem, and thus may differ from student to student. Providing advance notice about a late assignment will minimize the penalty you receive on that assignment, but does not guarantee that there will be no penalty for turning the assignment in late. Other learning sources Slides and other material will be available on the course website. THE SLIDES DO NOT REPRESENT A SUPPORT FOR AN EFFECTIVE AND SUCCESFUL PREPARATION TO THE EXAM OF THE COURSE. THEY REPRESENT ONLY A HELP TO FACILITATE THE TRANSFER OF THE KNOWLEDGES TO STUDENTS DURING THE LESSONS. Attendance Because of the concentrated nature of the MScBA programme, attendance in class is very important. Students with less than 85% of attendance to lectures and case discussions (including arriving late or leaving early) will be required to prepare for the exam ALL the chapters of the textbook Zellweger, T. Managing the Family Business: Theory and Practice, Edward Elgar Publishing, 2017: ISBN: 9781783470709 and ALL the cases discussed in classroom. NOTE : Attendance for the first class session is mandatory as important information regarding the course and the instructors’ expectations are given. If you know in advance that you will be absent for one session, please contact your instructor to ensure that absence from a particular session is acceptable. Exam The exam, depending on the number of the registered student, is a written exam or an oral exam. In case of a written exam, the duration is about 3-4 hours and it includes: a) Case discussion - You may be given a case study to which some questions may pertain in order to lead the discussion. As you respond to the questions, please use specific content and theories (use names to identify theories and models) as the basis of your analysis. You will not receive credit for your personal opinions unless backed by theory, lecture, and/or text material. Also, describe how you see the content/theory applying to the situation. Your answers will be evaluated based upon both quantity and quality. Answers that are more complete and demonstrate a higher level of understanding and analysis will receive more points. b) Some questions directly connected to the course textbook – The questions could open, closed (multiple choice), or a combination of the both. You may be asked to discuss the models and the theories presented during the course. You will be asked to interpret some real incidents and to focus your attention to some specific theoretical issues. Pre-Exam participation and exam grades registering on the booklet Only regular attending students (85% of attendance to lectures and case discussions, including arriving late or leaving early) that have delivered the hard copies of ALL the case to the Instructors are allowed to take the pre-exam.
Only regular registered students on the DELPHI System will be allowed to register their grade.
The pre-exam grades will be registered on the first official exam date AFTER THE COURSE ENDING. It is compulsory to come on that date of the exam for registering the grade on the Delphi and on the booklet. Team Project
The purpose of the project is to give your team an opportunity to apply what has been learned in the course (through course lectures, readings, and case discussions) to problems in a family firm of your team's choice. Class members, regular attending students, will work in teams of four (4) people.
To the Team Project regular attending students will be allowed to achieve a -3/+3 extra points to the final grade of the Pre-Exam. Only regular attending students, taking the Pre-Exam will be accepted for the Team Project. Your team should identify a family firm to study (Please, no student groups). Your team is to gather information from people in the family firm through direct contact. You may supplement this information with data from the media, the organization's literature, and other secondary sources. You should identify a relatively recent problem to analyze (i.e., this should not be an historical account of a problem and the company's solution). You should focus your analysis by applying the concepts from the course. While it is acceptable to incorporate several concepts from the course, please aim for depth rather than breadth regarding the use of course concepts. Your goal is to diagnose the mechanisms that are causing the problem or issue of concern in the organization. Initially, you may notice many symptoms (for instance, a crisis after the succession, seemingly an unhealthy family culture, low family members’ commitment and involvement, governance issues, etc.), but your task is to get to the underlying reason for these symptoms. And beware, sometimes the initial symptoms we think we see are not what they appear to be. There are three broad goals for this assignment: 1. One goal of this assignment is obviously to take the initiative to make a positive contribution to a family firm. 2. Another major goal is to provide an opportunity for you to learn more about family businesses first hand and to use your critical thinking and reflection skills to link your experience with this family firm to your learning in relation to family business theories. 3. The final goal is to provide a forum for you to hone your skills as a team member and leader and to reflect on the learning gained from this team experience. Each team will make a presentation and write a paper that describes what you did for the family firm, what you learned about family business, and what you learned about working on a team. To meet these broad goals, your team should answer the following questions in the assignments detailed below. a) What are the issues or problems facing the family firm? b) What course concepts can be applied to understand why this problem is occurring? c) What recommendations can you offer to help improve the family business functioning? Deliverables of the Team Project: 1. The project proposal e-mail is due by email to Instructors by the date of the 9th session of the course by 5pm. It should include: a) The names of your group members b) Your team name c) The name of the organization d) The name, contact information and level of your contact person e) The method you will use to gain access to the organization f) A brief description (one paragraph) of the problem facing the organization. 2. Your written project is due by email to Instructors by the date of the 18th session of the course by 5pm . It should contain a maximum of 15 double spaced pages (1 cm margins, 12 point font). You will be penalized significantly for exceeding this limit. The limit does not include appendices, which you are free to use to provide charts, figures, or other background material not necessary in the main body of your analysis. However, appendices that are not directly referenced in the main text will not be read. LATE PROJECT WRITE-UPS WILL NOT BE ACCEPTED. This written project should summarize what you did for/within the family firm, what you have learned about family business, and what you have learned about working on a team. Grading of the Team Project: Your group project will be evaluated on the following criteria: a. Problem definition: How well (i.e., thoroughly and concisely) do you describe the family business context, the relevant parties, and the factors that are important to the problem? b. Accurate and thorough use of course concepts. c. Integration of course concepts with information about the family firm and problem, i.e., how well do you integrate course concepts with information about the problem to illuminate the problem in a way that leads to solutions? d. Extent to which recommendations are consistent with analysis. e. Quality of written analysis. Analytical Syllabus
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