Turkey: Business must come before family
The Sabanci group, a Fortune 500 company with a turnover of nearly $9 billion in 1997, is one of a handful in Turkey that is making a serious attempt to institutionalize a heavily family dominated structure.
At the beginning of 1995 Sabanci commissioned consultants McKinsey to prepare the blueprint of the transition. One year later the plan was put into effect. But Sakip Sabanci, the 65-year-old patriarch who has been at the helm for more than three decades, says that he had been turning the idea over for more than 15 years.
"I saw too many fortunes being broken up after the father died," he said. "It is like dividing up a large farm among brothers and sisters. Suddenly the combine harvester becomes superfluous because it is too large for the decimated farm. What was whole and economic ceases to be either."
He was shocked when he learnt that only 15% of family businesses survive beyond the third generation. "We have partnerships with many international blue-chip companies - Philip Morris, Du Pont, Toyota, Bekaert," he said. "Every time I got together with them I wanted to know: how did you survive, what did you do, what should we do?"
His question to McKinsey was, he says: "What do you propose we do so that even in the fifth generation Sabanci exists?"
The company was run by five of six Sabanci brothers (since the reorganization one brother has been murdered by terrorists and another died of cancer).