Overview:

Family businesses dominate the economies of most countries. According to research by McKinsey, businesses owned by families account for more than 70% of global GDP and 60% of global employment. They range in size from the corner store to the conglomerate, and include industry leaders in many sectors. Most family businesses begin as decisions made by founders to continue the legacy of what they have built by passing ownership down to their children. For those embarking on an entrepreneurial journey, it may turn into a family business at some point.

Leading a family business is a unique opportunity and challenge. It requires a mix of skills, many of which you have already learned at HBS but need to be tailored or adapted to a different environment. Through this course you will build those skills, learning from the experiences of those who have successfully navigated the risks and rewards of being a family business leader.

Career Focus:

The course will be relevant if you plan to:

• Work for a business that is owned by your family
• Be an owner of a family business, even if you don’t intend to work there
• Serve as a board member of a family business
• Explore the option of being the non-family leader of a family business
• Plan to start a business that you may decide to keep rather than sell

While the emphasis of the course will be on operating companies, there will be relevant takeaways for those planning to take a leadership role in a family office or family foundation.

Educational Objectives:

The objective of the course is to prepare you for the unique challenges and opportunities that accompany running a family business. It will address the following core questions:

• What is unique about family businesses compared to other kinds of companies? Are they more vulnerable to failure?
• What are the main types of family businesses and how does leadership vary across them?
• What kind of governance (family, corporate, etc.) is required to make effective decisions in a family business?
• How do you define success in a family business that goes beyond maximizing shareholder returns?
• How do you build and sustain competitive advantage?
• How do you plan for effective succession and transition of leadership?
• What are the key strategies for managing conflict?
• How do you create a career path as a family member or non-family member?
• How do you expand a family business beyond its original core?
• How do you turn around a once-successful family business that is struggling?
• When is the right time to sell the family business? How do you navigate that process?
• What are the danger zones and warning signs that leaders need to pay attention to?

Course Content and Organization:

The course will be divided into two main modules. The first module will focus on building the core leadership toolkit across topics such as strategy, governance, and succession. The second module will emphasize specific opportunities and challenges that leaders will likely encounter, such as how to navigate the career progression or turnaround a family business that has fallen on challenging circumstances.

Each session will involve a case discussion. Some of the cases will be of the standard variety and some will be “live cases” where the leaders from family businesses will be integrated throughout the session. Most cases will include a guest speaker who will share their leadership experiences and answer questions. Cases, subject to change/addition, include:

• 99 Ranch – Alice Chen, CEO, 2^nd generation family member
• Ayala Corporation (speaker TBD)
• Carvajal S.A. (speaker TBD)
• COFRA/C&A – Jens Brenninkmeyer, Managing Director at Bregal Investments, 6^th generation family member, HBS grad
• J.M. Huber – Molly Heaney, Board Director, 5^th generation family member
• Market Basket (speaker TBD)
• Milo’s Tea – Tricia Wallwork, CEO, 3^rd generation family member
• Pentland Brands – Andy Rubin, Chairman, 3^rd generation family member, HBS grad
• White Castle – Lisa Ingram, CEO, 4^th generation family member

The core text for the course will be Harvard Business Review’s Family Business Handbook, written by Josh Baron and Rob Lachenauer.

Grading / Course Administration:

Students will be graded on a mixture of engagement in class and a final paper. For the final paper, you will draw on your learnings from the course to develop a leadership plan. That plan will synthesize your views on what makes leadership of a family business similar and different from a non-family business, what type of leadership roles you might explore in a family business, a personal assessment on what skills you need to develop to succeed in that role(s), and an action plan to build those skills.

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