Author: Koch Center for Family Business

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About Koch Center for Family Business

The Family Business Program aims to engage the next generation of family business leaders and connect them to resources they need to succeed.


Three members of a family-owned business looking at the camera. The apparent patriarch is at the front with his arms crossed, while apparent son and daughter are behind him over his shoulder.

Peter Boumgarden, Koch Center’s director and Olin’s Koch Professor of Practice of Family Enterprise, wrote this for the Olin Blog.

Actionable thought leadership and research into the dynamics of the family enterprise. Forums to come together as family enterprise leaders to shape strategy through a mix of data and opportunities to design. Takeaways from events we stage at the Koch Center for Family Business. These are some of the features in store for readers as we introduce our new monthly newsletter, “The Family Enterprise.”

Today, I want to take a moment to share our plans for the newsletter and, I hope, entice you to subscribe to receive regular updates on what we know—and what we are learning—about the family enterprise. Our newsletter will also include insights from the field as we listen to leaders who are living this reality, snapshots of family organizations in the news, and upcoming ways to engage with the Koch Center, virtually or in person.

As a research center based within one of the world’s preeminent universities, we believe accurate insight and actionable frameworks can add significant value for family enterprise leaders. You will see this vision manifest in our upcoming event, “Data+Design: Striking the Balance Between Continuity and Change,” coming October 29. I hope you will consider joining us.

Unlike a traditional symposium, which is often high on inspiration but lower on concrete takeaways, this session will dynamically help you look inward while simultaneously leaving you with research-informed insights to guide your day-to-day strategic decisions. With this event and others to follow, we aim to generate a cascading impact on private and family enterprises within the region and, by extension, the broader national and international economy.

Starting with some sobering research insights

In our debut newsletter, however, I’d like to share my thoughts on how a university can uniquely add value within this space.

Research on Family Firm Professionalism. Source: Family Firms Needs Professional ManagementHarvard Business Review

For those of you who don’t know me, you will quickly learn that I seek to be an academic entrepreneur—one whose primary value lies in bridging the academy and the “real world.” But today, I am going to put my academic hat on and start with the raw data.

One of the better, albeit somewhat depressing pieces of research done on family organizations comes from Nicholas Bloom, Raffaella Sadun and John Van Reenen. Unlike some of the research that addresses performance through self-reporting (“how professional do you think your firm is?”), these authors trained individuals to objectively assess companies across sectors specific to their general professionalism.

Pulling from a sample of 8,000-plus manufacturing firms and just under 700 retailers around the globe, the researchers wanted to know how family-owned and family-led organizations perform compared to the publically traded firm or groups run by private equity, for example.

As they summarize in a Harvard Business Review piece entitled “Family Firms Need Professional Management,” one of their key insights is that family-owned and family-led organizations sit near the bottom of that list.

What do we do with that?

Now, other than the fact that you might work in or lead an organization like this, why should you care about this data point? As I have discovered since assuming leadership for the Koch Center in early 2021, one compelling reason is that family business is everywhere. While the data is tricky to nail down given different definitions of family ownership, some have suggested that as many as 90% of all businesses in the US are family-controlled (Colli, 2003).

Looking beyond the small business that accounts for some of this finding, consider that founding families also have substantial stakes in about a third of the largest US companies (Shieifer and Vishny, 1986). This means family business includes everything from Walmart and Ford Motor Company to your mom-and-pop operation.

Understanding how to expand the professionalism of these operations is one piece of our goal to drive economic efficiency and extend impact throughout the broader economy.

Now, let’s consider how a research university such as ours might contribute uniquely in this space by returning to the conclusions from Bloom and colleagues. The first bit of good news is that data is not destiny. Just because the category of family-owned firms scored lower on professionalism does not mean that it must be the case moving forward for any particular firm. After all, even within this data, there is a good bit of variance. Put another way, of all family-owned firms in the data, some still scored near the top of the scale and thus on par or above with their public counterparts.

Other patterns within the research provide lessons for families who own organizations. For example, the team found that professionally-managed family-owned firms tended to perform better, on average, than family or founder-led firms.

Another perspective, a brighter picture?

Beyond looking at the professionalism index alone, other research is more optimistic on the ability of family organizations to deliver strong financial performance. Consider the 2016 study, “Fine-tuning family businesses for a new era,” from global consultancy McKinsey & Company:

Overall, family businesses deliver returns on assets that are comparable to or even higher than those of state-owned or widely held companies. But what’s noteworthy about their performance is asset productivity and brand value: their asset turnover, or ratio of revenues to invested capital, is roughly twice that of other companies, and they account for 80 percent of the brand value of the world’s most valuable labels.

Take this all together and you start to realize that how you lead a family organization makes a significant difference in how the organization performs.

In our view, this is where a university can uniquely add value. If the vision of Olin Business School is to “provide world-changing business education, research and impact,” we must participate in this by sharing material that stretches your thinking. We must create opportunities for you to craft strategies that leverage the unique structure by being family-owned.

After all, this is how you create value for owners, employees and the communities you serve. Whether you are a mom-and-pop restaurant or an iconic, global family organization—Ford, Walmart, LVMH, Cargill—for the Koch Center to have a genuine impact on practice, we have to shape you, the practitioner.

Leveraging scholarship to create service

For family organizations to thrive, we believe this is best done not merely by matching the professionalism of public firms or private, equity-controlled counterparts. Instead, we are interested in using scholarship to identify unique forms of performance not easily achievable by publicly traded firms or those with a shorter-term capital mindset. After all, taking the playbook from one type of organization and narrowly applying it to all firms would be a mistake.

Consider, for example, work by Roger Martin from the University of Toronto, writing in HBR, “It’s Time to Replace the Public Corporation.” Here, he explores ways in which private ownership enables a proper focus on the long-term. One might look no further than Warren Buffet to see an investor who realizes the potential power of family culture and legacy and how operating with an extended time horizon might be a source of unique competitive advantage.

In other words, while any episode of HBO’s “Succession” will highlight how a clash between family and business purpose can undermine the value creation of family organizations, we also believe that a creative alignment of these goals might drive a different way of operating in the marketplace. You’ll hear echoes of some of this potential in what Olin alumni and MTM CEO Alaina Macia shares in our September’s “View from the field.”

That is why we are here. This is what you are likely to see from us moving forward. We know a university is not the only player that can add value within this space. This understanding guides the mix of academics and practitioners we intend to bring to your inbox and to our events.

That said, we do think we can be unique in providing some objectivity and rigor when exploring essential questions that deserve actionable insights. Through a mix of research, thought leadership and events that allow you to explore and design strategy in real-time, we hope to aid the development of a sector that drives much of our economy.

To the extent we can assist this development—through models to drive professionalism, methods to think about capital with a longer time horizon, or approaches to balancing family and business purpose—we will consider our work a success.

We look forward to engaging in this ongoing conversation in the months ahead.




In its sixth year, the WashU Olin Family Business Symposium provided a deeper look into how the culture of family business drives performance and outcomes—and how that culture can be preserved throughout generations.

The symposium, entitled “The Importance of Culture in a Family Business,” was hosted by the Koch Center for Family Business and was held virtually across four mornings in February.

As session one panelist Mark Leeker, managing director of Harbour Group, put it, “It always comes down to the people and the ability to have a culture that is recognized and known, so that as you go through changes, you can always fall back on what it is that you do and what’s your central core.” 

Building a team at Tata Consultancy Services

Subramanian Ramadorai

On Tuesday, February 2, Subramanian Ramadorai, former MD and CEO of Tata Consultancy Services, spoke to Spencer Burke, Olin’s Eugene F. Williams, Jr. executive in residence. TCS is one of the world’s largest IT, consulting, and business solutions organizations. Ramadorai is largely responsible for its growth over the past four decades.

The keynote presentation was followed by a panel discussion with Leeker and Olin’s Seth Carnahan, associate professor of strategy, moderated by Koch Center Director Peter Boumgarden.

Eight generations and counting

Lisanne Cape Dorion

The second week of the symposium, on February 10, featured Lisanne Cape Dorion, board director, and Scott Northcutt, senior vice president of human resources, of Bacardi, Ltd. Dorion and Northcutt shared some of the strategies that Bacardi, a 150-year old family-owned beverage company with over 1,000 family members across eight generations, uses to encourage innovation while preserving the company’s long-held values. 

Following the Bacardi presentation, Gina Hoagland, chairman & principal of Collaborative Strategies, Inc. moderated a panel discussion with Joshua Hager, president and COO of Hager Companies, Kevin Maher, Jr., vice president and general manager of St. Charles Automotive, and Chris Seyer, CEO of Sayer Industries, Inc. 

Investments and banking

George H. Walker

George H. Walker, chairman and CEO of investment management firm Neuberger Berman, spoke on the structure of the employee-owned firm and how the ownership approach can inform the company’s long-term planning and innovation. With offices in 24 countries, Neuberger Berman has been named by Pensions & Investments as a Best Place to Work in Money Management, finishing first or second each of the last five years. Many of Walker’s experiences of workplace culture in a financial institution were echoed in the panel discussion with David Eichhorn, CEO and head of investment strategies at NISA Investment Advisors, and Michael Dierberg, chairman of the board at First Bank.

Sports, family, and the community

Carolyn Kindle Betz

The final morning of the symposium, on February 25, was the most popular and likely of most interest to St. Louisans: a panel discussion between Carolyn Kindle Betz, CEO of St. Louis CITY SC, William DeWitt III, president of the St. Louis Cardinals, and Tom Stillman, chairman and governor of the St. Louis Blues. Kindle Betz, DeWitt, and Stillman spoke on balancing the need for both continuity and change in sports organizations as old as the Cardinals (140 years) and as new as the St. Louis CITY SC (announced in 2019 and expected to begin play in 2023).

Videos for all four events can be found below. Find more information about the Koch Center for Family Business and videos and audio recordings from past events here




Alex Haimann

Koch Center for Family Business Associate Director Alex Haimann was recently published in the Harvard Business Review. His article, “How to Design a Better Hiring Process,” suggests a number of innovative alternatives to the standard “What are your strengths and weaknesses?” approach to evaluating prospective hires.

Better methods, he says, might be to “immerse job candidates in unconventional scenarios to gather the most useful insights about their critical-thinking abilities, tech savviness, and interpersonal skills,” for example, testing technical skills by observing the candidate’s real-time problem-solving process.

Haimann reports success since implementing this approach in his own business, seeing significant increases in retention and quality of new hires.

In addition to his work with the Koch Center, Alex is a partner and the head of business development at Less Annoying CRM, a simple CRM built from the ground up for small businesses. More than 10,000 small businesses worldwide use LACRM to manage contacts, track leads, and stay on top of follow-ups. LACRM continues to grow by engaging customers and finding new opportunities for mutually beneficial partnerships.




Family members who are CEOs of their family business remain in the role longer and are rarely forced out. That’s one finding in a newly released research brief from the Koch Center for Family Business, “Family CEOs, Turnover, and Firm Performance.”

The brief was co-written by Koch Center Director Barton H. Hamilton, Professor Andres Hincapie (UNC), and research fellows Simone Hanna and Noah Lyman.

The brief details the following findings regarding the turnover and performance of CEOs in family businesses:

  • CEO performance has a signicant impact on the likelihood of forced turnover.
  • Family CEO successors remain CEO for longer and are almost never forced out.
  • Insiders (both family and non-family) tend to be appointed in more profitable companies than outsiders. Insider CEOs appear to outperform outsiders as a result.
  • Family insiders are younger and have more experience in the firm at time of appointment than unrelated insiders.
  • Founders are more likely to be forcibly removed from office by year two than any other CEO type.

Find more research and resources on family business and succession at the Koch Center site.




Olin Blog post by Spencer Burke, Koch Center Eugene F. Williams Jr. Executive in Residence. See more of his reviews and articles on his page at the St. Louis Trust. Burke takes another look at this 2018 book—a tutorial on the exercise of corporate control of both private and public companies—a week after Sumner Redstone’s death on August 11, 2020.

Keach Hagey’s bookThe King of Content—Sumner Redstone’s Battle for Viacom, CBS, and Everlasting Control of His Media Empire (2018), tells the story of how Sumner Redstone parlayed National Amusements, Inc., the movie theater business (initially, drive-in movie theatres) developed by his father, into a multi-billion dollar media empire controlling Viacom, Paramount and CBS.

Along the way, Redstone became known as one of the wiliest dealmakers in Hollywood and a feared adversary in the world of corporate take-overs. It is quite a tale of corporate and family intrigue and perfect for Wall Street “deal” junkies and family business owners.

The book is very well researched and contains a lot of new information and insights not covered in the previous accounts of this saga in Vanity Fair and The Wall Street Journal. Redstone was hardly “self-made” (as he often suggested), but his career trajectory is still extraordinary and entertaining to read about.

Wresting ownership from family

He spent a lifetime wresting ownership of his family’s business away from his brother and his kids, his own grandchildren, his several wives and from any other family member who exhibited weakness, including his own son, Brent.

He ignored his father’s wish that the business he built would remain a family business. In the process of accumulating 80% control of the business, he faced years of litigation to resolve accusations of self-dealing, conflicts of interest, fraud and even tax evasion.

Family business owners can learn a lot from this book about good corporate “hygiene,” i.e., the mechanisms needed to avoid loss of control of a family business from death, disability or divorce.

Sumner faced all these threats and still managed to come out on top. Along the way, you will learn about the importance of trusts, pre-nup agreements, health care powers of attorney, incapacity clauses and voting trusts to retaining control of your business. An important lesson of this book is that every control mechanism has its limits and why just owning the majority of stock in a company may not be sufficient protection from the risk of loss of control.

Outflanking Redstone’s paramours

Sumner’s ultimate weapon to maintain control of his empire was an Irrevocable Voting Trust that vested perpetual control of National Amusements in the hands of a few of his trusted business advisors in the event of his death or incapacity. 

His daughter, Shari, ultimately, was able to take control of (or “defang”) the voting powers in the trust and prevent the loss of control to those non-family outsiders. To do this, she also needed to outflank the two paramours of her father who had become agents on his healthcare power of attorney and reigned supreme over Sumner for several years. How Shari ultimately accomplished all this is quite a tale and the highlight of the book.

Sumner’s control of National Amusements enabled him to take enormous financial risks to stalk his “content” prey in the public markets. Viacom, Paramount and CBS were his most visible conquests but there were many others along the way. There also were some major (and costly) failures (Midway Gaming which resulted in a $500 million loss) and a few significant missed opportunities, including a failed attempt acquire Facebook in its early days.

For three decades, National Amusements has had just under 80% of the voting interest in Viacom and CBS through its ownership of most of their super-voting stock, despite “only” having an 8% or so economic interest in either company. 

‘A veritable dictator’

The control of those super voting shares by National Amusements made Sumner a veritable dictator over the governance and strategic direction of both companies. National Amusements’ roughly 8% economic interest in Viacom today has a market value of around $1.2 billion, a fraction of what it was worth at its peak.

Despite his business success, Redstone will never be anyone’s role model for best CEO or father; he is sui generis—an extremely cunning, ruthless and self-centered individual with boundless energy, grit, determination and sexual appetite. He is wickedly smart, well-educated (Harvard and Harvard law) and motivated to succeed, but what he sought most of all throughout his career was “control” of everything he touched, including family, business, mistresses and all the attendant personal relationships arising therefrom. 

The “empire” he still controlled is, contrary to all he set out to do, led by his daughter Shari and not doing particularly well (and this was the case before the COVID-19 pandemic).

Scandal emerges from fire

Redstone’s earned his reputation for grit and determination by surviving the 1979 Copley Hotel fire in Boston. There, to save himself, he climbed out of his third-floor hotel room window, held onto the window frame and sustained burns over 45% of his body before eventually being rescued by the fire department. 

It was widely reported at the time that he was sharing the same hotel room with a woman (not his wife) with whom he was having an extra-marital relationship. She also escaped from the same window and was completely nude (and suffered only minor injuries) at the time of her rescue.

As his relevance has faded with his age, Redstone may best be known today as the main character reference for Logan Roy, the dark and controlling CEO of Waystar Royco, a fictitious publicly traded media company, and patriarch of the Roy family media empire featured in HBO’s award winning TV series, Succession

Roy’s character is, in fact, an amalgam of several public personalities, including Rupert Murdoch, Robert Maxwell and Donald Trump, but the Redstone family story line dominates this popular series. If you are a fan of Succession, you will enjoy this book. 

Value destruction

My only disappointment with Hagey’s account of Redstone’s career is its failure to quantify the value destruction over the years that this man’s leadership visited on his other family members and the public shareholders of both Viacom and CBS. 

Redstone and his minions, led by his long-time lawyer pal, Philippe Dauman, the former CEO of Viacom, cost his family and the public shareholders of these companies a fortune by extracting excessive “rents” in the form of inflated executive compensation and missed opportunities for both companies in the capital markets. It is remarkable that he has not been held to account for this.

Today, Viacom and CBS, one company once again, are shadows of their former selves in terms of valuation and have lost the competitive advantages they enjoyed in the 1990s and early 2000s. Sumner may have been the “King of Content,” but he failed to exploit fully the two biggest media trends of this century—social media and the digital delivery of content.  The moral of this story is that Sumner Redstone is no Rupert Murdoc. He simply stayed at the gaming table too long and lost his edge.

Sumner’s widely proclaimed grand scheme was “to live forever” and, at all costs, prevent his daughter Shari, owner of 20% of National Amusements, from ever becoming CEO of his companies. This is how the book ends:

‘Total control’

“Unable to eat or talk, he communicates via buttons on a table loaded with recordings of his voice from stronger days—’yes,’ ‘no,’ and his favorite, ‘f**k you.’ The man who always wanted total control, who believed in his own abilities above those of anyone else, who vowed to never sell Viacom, who swore he would never die—as of this writing, this man, Sumner Redstone, still draws breath, thanks, perhaps, to a lifetime of healthy eating and, even more likely, his own iron will.

“It is he, not Shari, that owns the majority of the controlling shares in the companies, and so long as he is not declared incompetent, it will be he who must technically decide the increasingly urgent question of whether to merge or sell Viacom or CBS. Because while content may still be king, kings, it turns out, can be bought just like anybody else.” (p. 306)

We can only imagine what Sumner’s father would say today if he knew how his dream for the family business he created had turned out.

When recently asked about what being part of the Redstone family business was like, Shari responded “It’s a dream life, except when it is not a dream life.” What more can be said?