What is it?
Large family owned companies (usually with turnover >1bn EUR/USD, and/or employees >500) are typically large enterprises with operations in several countries. They are majority owned or controlled by a family. Sometimes the family is present not only in the Board but has also management roles. Examples: Mars, Cargill, Arcelor Mittal, Walmart, Exor, Berkshire Hathaway, Volkswagen, Aldi, Roche, Auchan, Tyson Foods, Oracle, L’Oreal.
Large family companies are very similar to large public companies (large Corporates) in terms of organizational structure and processes. Where they differ is in the strategic mindset which is more long term oriented than the quarterly pace of large public companies. There is strong conviction and evidence supporting a superior long term performance of family owned companies vs publicly traded corporations.
A career in a large family owned company, similarly to large Corporates, can take various avenues- the three main functions where future CEOs develop their core skills are operations, commercial and finance- and usually they also gain experience in other functions.
Working hours are usually more reasonable than in other careers such as investment banking and consulting, with the average week being between 40-60 hours. The competition for advancement is variable, compensation is reasonably high (usually higher than in equivalent roles in smaller companies), and the work is often fairly routine with (more or less) frequent project assignments. A major difference between family owned companies and large public companies is that they very rarely make stock ownership available in senior executives’ long term incentive plans (the norm instead within large public companies).
Managing teams of people is a core aspect of a large family owned career. Those aiming at the top of the enterprise ladder will need to factor in relatively frequent changes in function, role and possible assignments in foreign countries; they will need to manage increasingly large teams, budgets and P&L.
Many people are drawn to a Large family owned career for the specific family values, longer term orientation, potentially higher camaraderie and learning opportunities provided. These are mainly represented by very actionable on-the job experience. Additional magnets can be dealing with a diverse workforce if the family owning the company is progressive.
A large family owned company provides lots of opportunities to demonstrate team play, diplomacy and political skills. People appreciate the work-life balance that comes with being in a system that needs to plan on a large scale- although this is less so when getting to the top of the ladder. They also enjoy the opportunity to live abroad for a number of years.
What are the advantages?
Benefits / Advantages:
Relatively high salaries at all levels; benefits also from lower levels.
Exposure to many different roles and functions, with real responsibilities- for managing people, delivering turnover, managing budgets.
Great learning opportunities, both on the job and through formal trainings.
Exposure to many different clients.
Visibility from outside, results are easily spotted.
It is a career where if you are interested in people, business andplaying an important social role you can find your place and get the right level of satisfaction.
Individual contributor (Entry level)
Contributes to fulfil a functional task with defined responsibilities
Perform the functional tasks assigned in liaison/coordination with the other contributors according to Company organisation and processes. If senior, then often mentor/coordinate junior contributors.
First line manager (Amber level)
Manage individual contributors
Ensure that her/his team achieves the goals of the functional role, managing people that could be geographically spread. Coordinate with the other managers according to Company organization and processes. Often define and implement goals/strategy for own team inside a broader strategic frame.
Manager of managers (Bronze level)
Ensure that his/her teams achieve the goals of their functional roles or business units, managing teams that could be geographically spread and possibly encompassing more functions or business units. Coordinate with the other managers according to Company organisation and processes. Define and implement goals/strategy for own team inside a broader strategic frame.
Lead the team: plan their work, supervise work quality.
SVP or EVP (Silver level)
Manage a function or a large Business Unit for the whole company and be part of the Executive Committee
The most senior functional role in an organization (reports directly to CEO). Gives the strategic and operational functional inputs. Ensures that the department teams achieve their goals, manages teams that can be geographically spread. Coordinate with the other functional/BU SVPs. Contributes to the overall strategy and management of the Company.
CEO (Gold level)
Manage the Company
The most senior role in the organization (AKA Chief Decision Maker). Gives the strategic and operational inputs, having the ultimate responsibility for the company. Works both with the Board and/or the owner and the company organization. Ensures that the functional and BU teams do achieve their goals. Manages the Executive Committee, defines and implements the senior management policies.
What are the typical traits of someone fitting with a family owned company career?
The personality of someone suited to work in a large family owned company has a majority of the following character traits:
What are the magnets to a large family owned company career?
The large family career path attracts people who:
Like to be part of a large organization and like the structure, order and discipline that it entails.
Appreciate the greater stability of a sizable organization as well as the relative “safety net” that it typically carries compared to other business careers like Investment Banking, Management Consulting or Private Equity.
Seek multiple career paths and a variety of assignments along a multiyear career (within or outside a specific functional area/department).
Are comfortable with a relatively slower pace and lower risk/reward parameters compared to other careers.
Tend to identify themselves in the family values.
Typical large family owned roles depending on functional area/department:
An area sales manager typically manages a sales force within its defined regional territory. He/she is responsible for overseeing sales operations, meeting targets and managing the sales team in the region. Primary job responsibilities of an area sales manager would include:
The operations manager role is mainly to implement the right processes and practices across the organization. It is also to supervise, manage and ensure the delivery of goods or services, despite unexpected issues and obstacles. The specific duties of an operations manager include formulating strategy, improving performance, procuring material and securing compliance.
The role of a Corporate Finance Manager is to maximize bottom line and liquidity opportunities for a business. Corporate Finance Managers are responsible for identifying and securing M&A deals, managing and investing large monetary funds, and buying and selling financial products, as well as securing that the company has the financial means and controlling structure to deliver the expected financial results and earnings. An important aspect of the role is also to comply with all administrative tasks, issue quarterly, half year and yearly results as well as managing accounting and taxation matters.
Human resources managers plan, direct, and coordinate the administrative functions of an organization. They typically are in charge of payroll, oversee the recruiting, interviewing, and hiring of new staff, administer training, deal with employee relations and serve as a link between an organization’s management and its employees. They advise managers on organizational policies and coordinate performance management and support with staffing.
Specific sacrifices required in a large family owned career
Drawbacks / Disadvantages:
On average, a career in a large family owned company carries a better work life balance than others. Back office functions (Finance, Legal, HR, IT, R&D…) require far less travel than sales, technical service or (sometimes) operations but, even then, we are far away from the 80-100 hours/week schedule of Investment Banking or Management Consulting. Conversely, work environments tend to be less dynamic and frenzy (the extreme opposite of a startup). While more formal than startups, the large family owned company world has relaxed a bit more as of recent and dress code and etiquette are far less rigid than in the past. Off course this changes by country/location as well as family ownership, company character and culture.