Family Groups/Conglomerates

The GCC region of the Middle East and its respective growth over the past half century has largely been driven through public sector investment and private sector trading through a number of Family Groups.   Ranging from SMEs with one or two business lines up until vast conglomerates with multiple subsidiaries to rival multinationals.

The Family Groups have been the private sector back-bone of the region’s growth providing international groups a vehicle to trade their wares in the Gulf.  From car dealerships & construction companies to bottling plants and insurance brokers, the family groups have both partnered with overseas organisations and built their own companies from the ground up.  To facilitate the growth, the Family Groups have wisely engaged the services of a number of overseas experts and managers to provide direction, leadership and introduce best practices where required.

Family Groups do however face a unique set of challenges.  Whilst keeping the business in the family has a number of practical and theoretical advantages (i.e. of trust, keeping knowledge and relationships in the group), they are after all, a family and not impervious to the disputes and spats that any relations experience.  Succession planning, investment decisions, leadership appointments and the appropriation of profits can all create potential discord that can have devasting results.  Ecap’s extensive experience and trusted relationships in the region has equipped us with the ability to help the Family Group’s navigate the potential challenges of succession, leadership and governance and provide the very best platform for long-term sustainable growth.

If succession planning is effective, it can build the ideal foundation for stable, sustainable growth whereby, there is alignment of family values, culture, strategy and the respective roles of the family members.  If not administered correctly, it can create discord, create barriers and set the leadership and operation of family groups back years. 

Therefore, getting it right is paramount and succession needs to be planned well in advance. Ecap partners engage and work with the key family stakeholders to develop a succession process to build alignment across generations.  The succession plan will often include both internal and external candidates and must ensure that the role and responsibilities are clearly expressed and understood by all.

Ecap can help the family groups draw up an organisational structure that is best suited to the sucession and growth of the group and ensure, they can develop a governance system to satisfy all. 

Where there is no obvious choice of internal candidate, ecap will work with the senior leadership of the group to develop a role profile and ensure that all stakeholders are aligned in respect of expectations, background and that (the selected candidate) must have a strong fit between his or her own, and the family culture and values.  With all of our partners having spent a minimum of 17 years in the GCC, ecap are only too aware of the criticality of blending expectations with the culture of the group.  Hiring senior executives to leadership positions in family groups can be very challenging, but by working closely with the stakeholders ecap are able to understand the culture of the group and draw up a profile of competencies, value and capabilities that are best suited to the group.

Moreover, ecap are cognizant that the first six months for the candidate (and group alike) are critical.  Failure to adopt and work with the group’s culture is the biggest single reason for the hire being unsuccessful.  We, therefore, stay very close to both candidate and client to ensure that the candidate can have the required impact and gain the vital trust required to integrate within the group.

As the family group grows, it becomes increasingly important to develop a governance framework that distinguishes ownership from the running of the business.  Whether in the form of an Advisory Board, Family or Owner Council, ecaps partners can help articulate the appropriate framework and the respective responsibilities.  Moreover, utilising our Global network of experienced Independent Non-Executive Board Directors (INED), we can help these advisory boards or councils with experts and advisors that will add value through their experience and global knowledge of best practices.

Family Groups/Conglomerates Consultants

Christopher Abreu

Senior Managing Partner

Renee Tauro

Senior Client Partner

Reem Al-Aryan

Senior Client Partner

Kevin Pangan

Associate

 

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