Chapter 33

Resilience: Lessons from Family Businesses

Nicolas Kachaner, George Stalk, Jr., and Alain Bloch

Abridged and reprinted with permission. Copyright © 2012 by Harvard Business Publishing; all rights reserved.

Title Page

To many, the phrase family business connotes a small or midsize company with a local focus and a familiar set of problems, such as squabbles over succession. Although plenty of mom-and-pop firms certainly fit that description, it doesn't reflect the powerful role that family-controlled enterprises play in the world economy. Not only do they include sprawling corporations such as Walmart, Samsung, Tata Group, and Porsche, but they account for more than 30 percent of all companies with sales in excess of $1 billion at the time of writing (2012).

Conventional wisdom holds that the unique ownership structure of family businesses gives them a long-term orientation that traditional public firms often lack. But beyond that, little is known about exactly what makes family businesses different. Some studies suggest that, on average, they outperform other businesses over the long term—but other studies prove the opposite.

To settle that question, we and Sophie Mignon, an associate researcher at the Center for Management and Economic Research at École Polytechnique, compiled a list of 149 publicly traded, family-controlled businesses with revenues of more than $1 billion. They ...

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