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Volume 35 Winter 2015
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Volume 33 Winter 2013 Spring 2013 Summer 2013 Fall 2013
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Volume 31 Winter 2011 Spring 2011 Summer 2011 Fall 2011
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Family Business
The Woodville Republican: Family Firm or Community Asset?
May 13, 2013
Accepted in Volume: 33 Issue: 2 (Spring 2013)
William A. A. Chisholm first published a newspaper in Woodville, Mississippi in December 1823, calling it The Woodville Republican after the Democratic-Republican political party of Thomas Jefferson. The paper passed through several publishers until Captain John South Lewis purchased it in 1879. More than 130 years later, The Woodville Republican, the oldest newspaper in Mississippi, was still owned and operated by his descendants. Andy Lewis, the fourth-generation editor and publisher, faced the challenges of operating a family-owned enterprise in a weakening industry and of a fifth generation that was believed to be uninterested in carrying on the business. In The Woodville Republican, he also controlled an asset of great value to the community. Andy faced the disheartening possibility that his family’s ownership of the newspaper and the newspaper itself could both come to an end with him.
 
Ruma's Fruit and Gift Basket World: Will Dad Ever Talk to Me?
May 30, 2013
Accepted in Volume: 33 Issue: 2 (Spring 2013)
The case is about a fourth generation member of a family business who is having difficulty committing to working for the company. Andrea Ruma has worked for three years at Ruma’s Fruit and Gift Basket (Ruma’s), a 112- year- old family business in Massachusetts. Andrea is trying to decide whether she will stay in the business or leave to go back to teaching. The problem for Andrea is that her father, Jim Ruma, will not share any information on the company strategy, finances, estate planning, or succession planning, nor provide her with any feedback on whether she is doing a good job. Andrea is also very loyal to her family. Her brother Mark has been involved in the business since he was in high school. He, however, has had persistent health problems and is not seen by his family as being able to take over the business. He, in fact, looks to Andrea as a manager with their father. Her mother also works full time in the business as a bookkeeper, so Andrea worries that her mother and brother will have no financial support when her father leaves the business. There are several complications that make the decision hard for Andrea. First, she and her husband live in Los Angeles, California while the business is in greater Boston, Massachusetts. She was a middle school teacher; and after she had been laid off, her parents invited her to work in the business. They allowed her to stay in LA and commute to Boston during the busy seasons, which she has been doing. But she also realizes that the door for her to get back into teaching is probably going to close soon so she needs to make a decision. Although Jim is 72 years old, he is an active and opportunistic businessman. In the last twenty years, he has gotten out of the wholesale fruit business and has entered five new business areas, all without any planning. Although the company is profitable and provides good income to four family members, Andrea has doubts as to whether she should commit to the company with the idea of possibly taking over the business as the only viable fourth generation family member, or whether she should quit. Andrea has been trying for over a year to get her father to discuss the business with her, but he refuses. The stress of trying to sort out what she should do has been building in Andrea, as she often starts to cry when discussing with others the business and what she should do.
 
Aurum Furniture and In-Law Management
Jun 5, 2013
Accepted in Volume: 33 Issue: 2 (Spring 2013)
One of the most complex challenges for a family business is when an in-law joins the firm. In-laws are part of the family through marriage; but they form a group of unique stakeholders in the family firm as marriage can be severed but blood cannot be changed. Consequently, in-laws are not always viewed as full-fledged family members. While the firm’s founder and family members face challenges as they consider integrating in-laws into the family firm, the in-laws face many challenges in joining a family firm as well (Santiago, 2011). This case illustrates these tensions by tracing John Malone’s involvement working as an in-law for Aurum Furniture, a small family business located in a large Midwestern city in the U.S. Prior to joining Aurum, John was a successful CFO at a midsized newspaper company. Although he had been invited verbally by Patrick, his father-in-law, to join the family firm many times before, Patrick was nevertheless dumbfounded when John finally accepted and it took two years of discussion before John actually joined the firm. Indeed, John experienced a number of challenges throughout his tenure. Issues that would have been straightforward in a non-family firm were anything but that in the non-professionalized family firm. For example, his role in the firm was never defined by the family, who left it up to him to figure out what the company needed and where he could best contribute. This lack of a clear role in the firm created an identity crisis for John. As another example, when John joined the firm his mother-in-law did not know of the compensation package that he and his father-in-law had agreed upon. So, instead of paying him, she gave him an allowance until the issues with his pay could be sorted out. In effect, John had to walk a line between family member and non-family employee. Initially, family members had trouble accepting John as a full-fledged member of the family, often treating him more as an “out-law” when it came to family meetings or business decision making (cf. Aronoff & Ward, 1993). On the other hand, non-family employees saw John as a family member with special privileges and status, not to mention an office between his two brothers-in-law. In spite of these obstacles, over his four-year tenure with Aurum, John was able to carve a niche for himself in the organization and became so valuable that he was even invited to join the board. At the end of August 2006 however, he received a financially tempting offer to work in the television news industry and had to decide whether he would accept the position or stay at Aurum.
 
Cloverleaf Dairy Farm - Succession Valuation
Jun 24, 2013
Accepted in Volume: 33 Issue: 2 (Spring 2013)
In May 2011, John O’Callahan returned from the University of Guelph as a new graduate, engaged to be married. He excitedly told his parents that he and his fiancée, Jane Forsyth, would like to take over the family dairy farm after their wedding in the summer. His parents, Michael and Audrey, were happy to hear the news as they had always planned that their family farm would transition to the next generation. At the same time they were somewhat anxious since they did not expect the decision to come so soon, and had not made formal succession plans or discussed this issue with their children. Michael and Audrey wanted to ensure that the selling price and other arrangements would enable them to retire comfortably and that any purchase would consider all three of their children.
 
Succession at Buchanan Transport Group
Aug 21, 2013
Accepted in Volume: 33 Issue: 2 (Spring 2013)
The case relates the history of an Australian family transport firm from its foundation in 1921, through its expansion and diversification into agriculture and tourism, to a business and succession crisis in 2006. Rita Buchanan, youngest daughter of Noel Buchanan, the third generation owner, gave her father an ultimatum about the transfer of firm ownership. Noel’s response, that he would sell the firm provided Rita remained the majority shareholder, brings interlinked family and business problems into focus: the owner’s failure to plan for succession following a dispute seven years earlier with his son, who then left the firm; the discontent of his three daughters about how this lack of succession planning affects their futures; the owner’s estrangement from his wife, Cherie, over the owner’s ongoing extramarital relationship; Cherie’s resentment of Rita’s strategic role in the firm; and the firm’s falling profitability, especially after a cyclone [hurricane] destroyed its farm and left many trucks idle. The case requires a decision about whether the youngest daughter should accept her father’s offer, and what actions are needed to safeguard the interests of the other stakeholders and ensure the future of the firm. Key words: family business, succession, leadership, conflict, gender, bases of commitment
 
Breezy Plains Acres: What About Me?
Sep 11, 2013
Accepted in Volume: 33 Issue: 2 (Spring 2013)
Breezy Plains Acres began in 1927 as a small farming operation in Minnesota consisting of a section of land with a homestead. Now run by fourth and fifth generations of the Richter family, it was a five million dollar, complex agri-business that included both owned and rented cropland and pasture, five sites, several hog finishing units, and cattle. This was no simple farm with a cow in the pen, a pig in the sty, and a few acres as depicted in “Little House on the Prairie.” Chuck Richter was in his early sixties and had begun to consider transitioning away from the day-to-day operations of the farm/ranch toward retirement. He realized that with increased complexity came increased challenges in relation to how to sustain the operation within the family for future generations. He had one farming son, seven off-farm children and fifteen grandchildren. He was concerned about who would sustain the farm, and how many of the non-farming children had the interest, and, equally important, the financial resources, to buy-in to the operation. As he considered estate planning, he recalled examples of farm families torn apart and farms being sold to strangers because of the children fighting due to how the estate was divided. Being fair to his children was of central importance. As he reviewed the challenges, he thought, “What can I do to help assure that future generations of Richters will still own and manage Breezy Plains Acres?”
 
DLC Management: Securing Its Future
Sep 24, 2013
Accepted in Volume: 33 Issue: 2 (Spring 2013)
The case describes the founding and entrepreneurial growth of a commercial real estate business by a father-son partnership up to the focal decision of whether or not to pursue an IPO. Emphasis is placed on a consideration of how a change in ownership would influence factors related to socioemotional wealth.
 
Analyzing Family Business Cases: Tools and Techniques
Oct 8, 2013
Accepted in Volume: 33 Issue: 2 (Spring 2013)
This article identifies and explores 13 analytical tools and techniques to understand the unique dilemmas and paradoxes faced by family firms. They are presented here as tools to better analyse family business cases and develop effective responses to family business situations. However, they are equally useful for families in business and advisors to family businesses as they seek to deal with the complex issues created by the conflict of family and business systems in family enterprises. Tools focused on understanding the family business system as a whole are separated from family-focused and business-focused ones. The six dual systems-focused techniques aid understanding of the key stakeholders, current status, past history, and desired future of the firm. The three family-focused techniques in the tool kit aim to better understand the relationships between and the perspectives of the key stakeholders, and the overall health of the family system. The four business system-focused conceptual techniques enable understanding of the nature and extent of the family’s involvement in the business, its key directions, performance, and continuity. Careful application of appropriate tools will deepen understanding of the core issues being faced by a decision maker and assist in the development of effective and actionable recommendations.
 

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