Case:
Family Business Succession in Asia
Characteristics of the Wang Group
Wang Group is a family-owned business that established and operated by the Wang family. Wang Group, which has business of real estate, plantations and resources, and stocks and bonds, is influential and successful across several countries such as Singapore, China, and Japan etc. From my perspective, Wang Group is a typical Asian family firm, since its operation philosophy is consisted of traditional Asian value. For instance, Alfred Wang, who was the founder of the Wang Group, grew up and experienced some both political and economical hardships in China, so that some Chinese cultural values made him believe that a family business should lead people to build a better life and society. As a result, Alfred Wang became a spiritual and inspirational leader who contributed to satisfy people’s four basic needs — needs for clothing, food, shelter and transport. From my perspective, this kind of selfless spirit that beyond status and profit is the key for Wang Group to get success and reputation in the current competitive market (Family Business Succession in Asia, 45-52).
How did Charles Wang change the Wang Group
Furthermore, when Charles Wang, who was the second son of Alfred Wang, took over the Wang Group, the business strategy was changed. Specifically, Charles Wang emphasized the importance of doing diverse types of business. The reason was that the market demand is changing as the society develops, so it was necessary for them to follow the major trends and then satisfy the market rather then just focusing on one industry. In my opinion, Charles Wang’s idea is proper and far-sighted since it is possible for a company to lose their market share gradually if they just stick on one kind of business. Just like the Porsche case I studied few days ago: as SUV get more popularity in the world, the Porsche company, who only produced sports car before, entered the SUV industry in order to attract more customers and profits and keep its market position; and its sale profit was increased dramatically (Porsche: The Cayenne Launch, 21-44). Thus, I am sure that Charles Wang has made a correct decision for the development of his family business. What is more, just like the humanistic care that Alfred Wang advocated, Charles Wang not only focused on earning profits from his business but also promoting the new and proper value and lifestyle to shape the society to become more harmonious. Moreover, for the sake of building a more powerful and structural company that involves in different fields of business, Charles Wang pointed out the importance of changing the Wang Group to a more complex and integrated organization because this change is easier for a family business accept and then follow the current environmental trends. In addition, in order to become such professional organization, Charles Wang hired an experienced CEO outside the family to lead the Wang Group to get to the next step. It is worth mentioning that this new CEO brings a new team of people, who is professional enough and fit into the different parts of work, into the Wang Group (Family Business Succession in Asia, 45-52). To my point of view, this strategy just like the geocentric staff policy that I learned in the chapter 17 in class, in which means the company uses the best people for the specific jobs regardless of their backgrounds. This strategy can really benefit the development of the business since it can let the company make the best use of the human resources so that the operation of the business is able to become more efficient and effective (D’Amore - McKim School of Business, Global Human Resources Management PowerPoint).
Obstacles brought by leader changing
Nevertheless, the leadership changing also faced some challenges and obstacles in the Wang Group. For instance, it is difficult for the Charles Wang and the outside team to reach a consensus on many problems such as the company’s mission and business strategy. Moreover, I think it is hard for the original executives and workers in the family business to trust and corporate with the outside team sincerely because they already had a solid relationship and principles in the company; the appliance of these outside people may affect their benefit chains and authorities (Family Business Succession in Asia, 45-52).
Suggestions of further steps
From my perspectives, the Wang Group should still hire outside team, which is professional and experienced enough, to fit in the matching jobs, since he could not just attribute the falling revenue and loss to the mismanagement