Greetings to the WBC/Micah Seton Hall Family!
This month John Fontana introduces Andrew Keyt, the former Director of the Family Business Center at Loyola Chicago, and currently Clinical Professor in Family Business at the same school. Professor Keyt's article ("What a Family Business Can Learn from the Chicago Cubs") presents insights on family business via case study.
Keyt's insights are wise and applicable to any sized business. He emphasizes the importance of developing a long term vision and culture, the need to build the right team, the necessity of embracing the customer, and a willingness to experience short term pain for long term gain.
The writer links the Cubs' success to ownership change. The sale of the franchise by a publicly traded company (with a responsibility for predictable shareholder returns) to a family is the starting point of the club's evolution. The new owners are less concerned about quarterly results and more committed to a new vision that builds a team which consistently competes for championships.
This is a terrific story. But, it begs the question, how do leaders of publicly traded companies create a great vision and culture that also delivers consistent short term results?
Last week I read that Kraft Heinz made an unsolicited attempt to purchase Unilever; this morning I read that the bid was pulled back. Kraft has had sluggish growth and, at demands from key investors, resorted to cost cutting as a strategy to reach financial targets. The bid was withdrawn because Unilever felt that cost reductions might undermine the reputation of their brands, and affect the company's strategy to grow profitability, i.e., slowly building the higher margin personal care segment of their business.
While reviewing this month's material, I thought that Kraft Heinz might be illustrative of the short term approach while Unilever's management convinced shareholders of the importance of a longer term strategy. Perhaps Unilever is the model for a public company; they seem to be applying many of the insights for family business presented by Keyt.
Enjoy the reading.