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​Notable names gather at conference to discuss different cultural perspectives of family businesses in Asia​

Published on: 04-Sep-2017

​An initiative by Nanyang Business School's Centre for Business of Culture (BoC), the conference on 'Family Business Culture for Sustainability in an Era of Turbulent Change' saw more than 80 notable academics and business executives turn up for the whole-day event in July this year.

The conference, led by BoC Centre Director Professor K. Ravi Kumar, and supported by Family Business Network Asia, featured family businesses from China, India, and Japan.

The day's proceedings commenced with opening speeches by Professor Ravi Kumar and Ms Felicia Heng, Executive Director for FBN Asia.

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Professor Ravi addressing an earnest audience on a sprightly Saturday morning

Professor Ravi expressed his pleasure at convening "a meeting of great academic minds and successful family business chieftains on this important topic of culture and values that can sustain family businesses to overcome the three-generation curse". 

The conference got a kick-start by Mr Inderjit Singh, who is a former Member of Parliament, member of the NTU Board of Trustees, and Founder/CEO of Solstar International, a Singapore-based consumer electronics products company.

In his address, Mr Singh highlighted that with Asia occupying close to half the world's population, and family businesses forming the backbone of its economies, they have the potential to become global powerhouses in the near future. He shared about starting his own career in a multinational corporation two decades ago, before finally stepping into his family business seven years ago to introduce much needed knowledge on systems and structure. He believes that family businesses are far more capable of adapting to disruption in this age than their larger counterparts – an advantage which needs to be capitalised on.

NBS's Professor Guido Gianasso next shared on his decade of experience at the International Air Transport Association (IATA), which coincided with the immediate aftermath of the 9/11 tragedy in the US. Its main challenge was to change organisational culture – IATA's employees at the time were known to have a 'civil servant' mentality, ethnocentric by nature, with a long chain of command, and a narrow span of control. From 2002 to date, IATA has managed well, with support from cultural intelligence experts, in its aggressive pursuit of efficiency, effective lobbying on governments, global airline alliances, and solidifying academic partnerships with universities like NTU, Harvard, Stanford, and Geneva.  

Our headlining speaker, Professor John Davis, who has been consulted by leading families from over 70 countries to date, spoke at large about the three-generation rule that was used to map out the wealth of the Vanderbilts (US), Batistas (Brazil), and the Chearavanonts (Thailand). Family wealth, according to him, relies heavily on the management of three dials: family growth, family lifestyle, and family financial dependency. Most importantly, according to him, "family businesses need to be talent machines in churning out intrapreneurs, entrepreneurs, and portfolio managers". 

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Professor John Davis getting his points across to an earnest crowd

Japanese family businesses

Professor Yupana Wiwattanakantang from NUS Business School took to the stage for the Japanese family business segment, as she covered the Toyoda Clan, the family behind the world renowned Toyota brand. Toyota has had its hand in the textile, logistics, electronics, materials handling and automotive industries – proving that diversification is key for the long haul. Toyota's global recall between 2009 and 2011 also proved how being a family business means its management makes personal commitments to restoring the trust in customers.

Mr Norihiro Fujii from Fujii Shuzou Co. Ltd then shared his family's strong commitment to quality Japanese sake, and being shrewd enough to take advantage of the quality water in its region. Accompanying these blessings for more than a century now, are the family's adherence to tradition, innovation, and quality brewership.

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Mr Fujii answering a question from the floor after his sharp and succinct speech, with Mr Yoichi looking on. 

Mr Toyohiro Tokuoka's family is also invested in the sake business, but chose to embrace wine too, about two decades ago to contribute in the development of food culture in Japan. Wine is now more affordable in the country, thanks in large to Tokuoka Co Ltd's extensive distributaries.

Mr Yoichi Miyazawa of Kanehori Juki Co. interestingly, would have been a musician if he had his way all those years ago, but he was forced to join the family business due to his father's illness. Today, he feels proud that the work his company does contributes in immense ways to Japanese society. Kanehori Juki is regularly involved in infrastructure development, disaster restoration, clean-ups, and even tours of heavy machinery for children.

Chinese family businesses

Professor Joseph Fan from Chinese University of Hong Kong, one of the most cited researchers in finance and governance of emerging market corporations acknowledges that globalisation, the changing roles of women, legal and social welfare systems have all seriously challenged the sustainability of family businesses in China. He believes that they need to rediscover, stay rooted, and educate future generations on Chinese culture in order to ensure quality succession.

Mr Stan Shih, the man responsible for turning Taiwan into a PC-manufacturing powerhouse through the Acer Group, shared on the Wangdao ideas of altruism and balance trumping all else as the cornerstones for a sustainable business. He firmly believes that "being a learn-it-all is much better than being a know-it-all", and it has proven to help in breaking through the bottlenecks of traditional business culture. 

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The pride of Taiwan, Mr Stan Shih, taking to the stage. 

Mr Richard Eu of the popular Eu Yan Sang brand shared on the journey it took from Ipoh, Penang, KL, Seremban, Singapore, Hong Kong, and back to Mainland China – Guangzhou. He attributes the longevity of the business to retaining the cultural roots of TCM, formidable family values, and the willingness to modernise and evolve according to the globalisation of consumer behaviour.

Indian family businesses

Professor Kavil Ramachandran from the Indian School of Business, took to the stage to share on how most businesses in India are family controlled and power is inherited by the men. "In-laws are outlaws!" he quipped at one point, but was quick to point out that the management of these businesses has seen a transition towards merit-based opportunities, as opposed to one's birthright.

Mr Subbiah from the A.M.M Foundation spoke at length about how Hindu philosophies and scriptures have proven to be the bedrock of family businesses even in the face of changing times, value systems, and women entering the fold. He says that even the scriptures believe 65 years of age is the right time for one to retire, highlighting the transition of an owner becoming a trustee at that point.

Mr Gopal Srinivasan and his century-old family business, TVS Group, was built on prioritising business over personal interests, generation after generation. While the younger generation no longer expects the family business to provide career opportunities, it manages to lure them back after substantial experience is gained abroad or elsewhere – testament to a solid family.

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Mr Srinivasan gathe​​ring consensus from his fellow Indian speakers amid questions from the floor. 

Unity in diversity

It was in a 1970 Times magazine article that the economist Milton Friedman argued that the sole purpose of a business is to generate profit for its shareholders. Mr Stan Shih spoke unanimously for all the academics and family businesses from Asia present that day when he said that it "should also be about creating value for society".

The incredibly fruitful day was brought to a close by Professor Ravi Kumar, who thanked everyone present for the very engaging session:

"It fills my heart to see that not only did the participants get so much from listening and interacting with the speakers but incredibly, all the academics and family business executives stayed till the end of the conference, learning from one another and charting an educational agenda for the future."​


About BoC and FBN Asia

The mission of BoC is to impart knowledge on creating value and succeeding in different global cultures, and to produce culturally intelligent graduates who will in turn lead the next generation of successful and sustainable businesses.

FBN Asia, as supporting partner for this conference, is a leading family business community around the world – they offer a unique and conducive space for its members to share best practices and progressive ideas on growing family businesses in Asia. Based in Singapore, the network covers a total of 11 countries, 10,000 individual members, and more than 3,000 business families across five continents.

 


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