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  In Search of the Secrets to Longevity  Premium

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Research contradicts two clichés regarding the size and longevity of family firms. An ambitious study of Spanish companies underscores that these businesses are neither as young nor as small as is often supposed. So, what are the secrets to their success? Do profitable, long-lasting businesses share a distinct set of values? Comparing the Spanish data with that of similar studies done in other countries, the author finds that family businesses do tend to attach greater importance to certain values over others. In particular, the author highlights values associated with integrity, which foster unity and respect; excellence, hard work, quality and profitability; entrepreneurial spirit; as well as transparency and social responsibility. To confirm the specific nature and influence of these values on the success of family firms, IESE’s Family-Owned Business Chair is in the process of conducting a new study, which will compare the top Fortune 500 companies with the leading companies as ranked by Family Business magazine. Significant differences have already been noted, although in both cases the top values are the same: integrity, respect and customer focus.

Tools and Frameworks:
> “Better With Age” shows that more than half of family businesses have been around longer than non-family ones.
> “The Oldest Family Firms” lists the five oldest companies from the world’s top 100 family businesses.
> “Three Points to Success” reveals the critical dimensions that any sustainable business must consider.
> “Values, the Bedrock for Sustainable Businesses” depicts the foundations and pillars upon which any sustainable business needs to be built and supported.

Examples Cited:
Samsung, Wal-Mart, Hyundai, Heineken, Fiat, Henkel, SC Johnson, Ford, Peugeot-Citroën, BMW, Toyota, Tata, Inditex, H&M, Ikea, El Corte Inglés, Mercadona, FCC, Ferrovial, Codorníu, Miquel Costas & Miquel, Gomà Camps, Grupo Osborne, Miguel Torres, Haniel, Bertelsmann, Santander, Ferrero, Pronovias, Jack Heuer, LVMH

Research Basis:
Studied more than 2,200 Spanish companies, each with revenues exceeding 50 million euros, later expanded to include research on Finnish family firms, as well as interviews with Italian and French firms belonging to the Henokiens Association. Also, shares early findings of ongoing research comparing the top Fortune 500 companies with the leading companies as ranked by Family Business magazine.

About the Author:
Josep Tàpies is a professor in the Department of Strategic Management and holder of the Family-Owned Business Chair at IESE.
This article is based on:  In Search of the Secrets to Longevity
Publisher:  Estudios y Ediciones IESE
Year:  2010
Language:  English