Three Entrepreneurial
Clans in Asia Case Study by Crissy Cruz
The Case Study of the
Three Entrepreneurial Clans in Asia featured 3 Family conglomerates from
different Southeast Asian countries.
First there was the
Raiva Siblings and Spouses of Thailand who had a restaurant and bakery empire.
The Raiva’s S&P mainly focused on food related enterprises that would
support their core business of managing their restaurants and bakeries. For
example they ventured into developing the technology of making and distributing
frozen food products in order to reduce wastage and extend the shelf life of
their food products. S&P had a They also partnered and operated with well-known
international food chains and brands such as Pizza Hut, Swensen’s in Thailand
and Haage-Dazs Ice Cream.
The Second Family
featured is Tunku Abdullah and his Royal Brood from Malaysia. Tunku Abdullah
enjoyed the advantages of being a royal and had lots of connections that
enabled his family to establish Melewar Corporation as one of the biggest
conglomerates in Malaysia. Melewar Corporation has diverse interests that range
from property development and construction, tourism, transportation,
advertising, marketing and public relations, and TV broadcasting.
Finally, the Third
family is Indonesia’s Ibu Mutiara Djokosoetono and the rest of his clan. Ibu
Mutiara Djokosoetono established the Blue Bird group which initially featured
transportation services and later expanded to non-transport services like
manufacturing of engines and spare parts of their fleet vehicles in order to
stretch their supply chain and resorts that are considered as passenger
destinations therefore boosting their transport services business.
The Case Study
rationalized the actions of these three conglomerates and discussed them
according to theories of Multiplication, Subtraction and Division process in managing
their businesses.
All conglomerates
practiced addition and multiplying their business ventures in various manners.
The Raivas have done it in a more focused and concentrated manner that supports
their core business of restaurant and bakery operations. The Melewar group had
a “shotgun approach” and grabbed every opportunity that seems viable. They
classified their businesses into industry groups, Travel and Tourism,
Insurance, Manufacturing, Shipping, Security, Property Development, and TV
broadcasting. For the Blue Bird group of
Ibu Mutiara Djokosoetono, it can be noted that their businesses don’t really
have market focus but instead just a common denominator. All enterprises are
related to various modes of transportation and anything that supports its
operations and possible expansion.
Out of the three
conglomerates, the S&P group didn’t had to prune much of their collection
of enterprises since they have been very conservative in their expansion
activities and only choosing to add companies that would be beneficial to their
original core business. However, the Melewar group’s shotgun approach had le
them to encounter some failed ventures in computer manufacturing and
agriculture. These two businesses required heavy R&D and complicated
production process, In order to recover losses the Melewar group decided to let
go of these businesses and further sell their TV broadcasting company. The Blue Bird group also weeded out their
agribusiness which is a far-fetched business concept from their transportation
related businesses. This only goes to show the importance of venturing into
enterprises that are outside of the organization’s core competencies and other
strengths.
As a conglomerate ran by
families, the different companies had their own styles of management that
involved immediate family members. Expanding the business was done not only to
ensure further income and growth for the company but also to make sure there is
enough to divide among family members. It provides opportunities for everyone
to participate, pass on the legacy and perform specific areas of
responsibility.
With all these in mind, which
among the three families has exercised the best strategies in expanding their
businesses. I admire the Raiva’s S&P group in sticking to what they do best
and building the foundation of their business empire based on the requirements
or what compliments their bakery and restaurant business. This shows an example
of good personal mastery. The Melewar and the Blue Bird group took a different
route and expanded their business with investments in fields not part of the
same market. Not all the risks they took paid off and some enterprises had to
be cut. Those failures do not merit a conclusion that Raiva’s S&P group
made better management decisions. I believe that entrepreneurship is about
taking risks. Melewar and the Blue Bird Group grabbed opportunities and made
the most out of them. The failures that
they encountered were just bumps on the road and what’s important was they knew
how to let go of the things that operated below their expectations. Again, this
is another example of self-mastery. We learn by knowing ourselves and by the
mistakes that we have done.
In the Philippines, it
is evident among the big conglomerates made up by the Sy’s, Gokongwei’s and the
Tan’s that their interests are all diverse but in a way related to one another.
It is not imperative for conglomerate to just stick to one core business as
long as they are able to manage well their enterprises and are adding to the
over all profitability of the group. Diversification can also protect the
company in losing a lot of resources once one of the industries collapses. A
diversified conglomerate would give them power and control over more markets.
In return, these interests will pay off by opening new doors and opportunities
for them to grown as a conglomerate and be one step ahead of competition.
