Secrets of Success in Long-Lasting Family Firms (Frescobaldi, Takanashi, Miele)
Why a few family firms thrive for centuries: 25 principles, four categories and three living examples.
- Sector
- Wine and hospitality; food and beverage distribution; household appliances
- Source
- Week 3 tutorial resource (IMD Perspectives for Managers, No. 2-17)
The case in brief
Denise Kenyon-Rouvinez, director of IMD’s Global Family Business Center, argues that almost all long-lasting firms are owned and managed by a family, and that their lessons apply to all businesses. Research with high-achieving families produced 25 principles, clustered into four categories, that form the Family Business Secrets of Success model.
Three short cases illustrate it. Frescobaldi has made wine in Tuscany for about 700 years and 30 generations and keeps innovating. Takanashi, part of the Kikkoman soy-sauce family business, has centuries-old moral values and built a bottling and distribution business. Miele has done “everything wrong” by orthodox management standards — specialising, refusing to outsource, investing in staff — and still thrives.
Key facts
- Model
- 25 principles in four categories; the most effective firms excel at 80% or more at any time
- Company lifespans
- Fortune 500 tenure: over 60 years in 1958, 18 years by 2012
- Frescobaldi
- About 700 years and 30 generations in wine; supplies more than 60 countries; entered tourism in 2014
- Takanashi
- Part of Kikkoman (formed by merging seven family firms in 1917); in soy-sauce-related industries since 1661; Marujin Corporation founded 1956 and won the Coca-Cola distribution contract in Japan
- Miele
- 117 years old at the time of writing; USD 4 billion revenue; exports to 47 countries
Analysis through module theory
Family Business Secrets of Success model
All three firms show strength across the four categories. Miele is described as exhibiting all or most principles most of the time: visionary leadership, entrepreneurial flair, pride in unchanging values, high equity concentration and closeness of the family to the firm.
Stewardship (Le Breton-Miller & Miller, 2009)
Frescobaldi’s early commitment to sustainable agriculture and Miele’s refusal to trade its ethos for short-term gains show owner-managers acting as guardians of assets for future generations.
Resource-based view (Chrisman et al., 2005)
The advantages are internal and hard to copy: Takanashi’s bottling and distribution expertise and moral code, Miele’s loyal and highly trained workforce, Frescobaldi’s estates and name.
Innovation in family firms
The article’s paradox — respecting tradition helps innovation — is visible at Frescobaldi, which widened ownership and leadership to a sibling group and then diversified into restaurants, wine bars and tourism on its own estates.
Discussion questions
- 1.Which of the four categories is each firm strongest in, and where is the evidence?
- 2.How did Frescobaldi’s change of succession rule support innovation and international growth?
- 3.Why might Miele’s choices look wrong to a non-family, shareholder-driven firm?
Takeaways
- Longevity comes from balancing family and business over time, not from profit maximisation.
- Values — especially moral values — can be a durable competitive resource.
- Tradition and innovation are not opposites; long horizons make renewal possible.