Meeting of the Family Business Network

The 10th study session of the "Family Business Network," one of the networks for graduates of NUCB Business School, was held on May 20.

The theme of the study session was "Family Businesses: Dilemmas of Managing a Business in a Different Industry," and all participants discussed the problems that family businesses face when they diversify and enter a different industry. The case was about a family business that entered into a different industry. In this case, the main character is asked by his father to support a company in a different industry that is on the verge of bankruptcy. The participants discussed from various angles the pros and cons and significance of investing cash earned from the main business into another company to support, and what they should learn from the management of a company in a different industry. Opinions were exchanged from a variety of angles on such issues as the pros and cons and significance of investing cash earned in the core business into another company to support.

• Should we support this business by abrogating its financial strength?
• Will excessive support affect the motivation of the executives and employees of the core business?
• Is there a possibility that there will come a time when external factors will change and the different business we supported will support our core business in the opposite direction?
• Is there anything that can be learned by interacting with organizations of different cultures?
• Relationships with the local community to which the core business and cross-industry companies belong
• How to foster organizational culture as a group of companies, etc.

At the end of this case, the protagonist said to the employees of the different industry company he entered, "I will definitely rebuild this company. Please follow me." The case closes with the protagonist saying to the employees of the new company, "I will definitely turn this company around."

After the discussion, Mr. Shimada, the case writer, told us, "Actually, this company has recovered and is now the group's top earner." This was a case in point.

About the Family Business Network

Not only family businesses, but also alumni, current students, and faculty of NUCB Business School who are interested in various matters related to business succession, will hold a proactive study session, with everyone viewing it as their own management issue.