MA’s creates effective transition to its next generation
MA’s Foods has been in business for more than 25 years with 300+ staff. MA’s is a family-owned business started by Mario de Alwis and backed by his wife Suzette De Alwis. MA’s is one of the family owned organisations with notable successes in managing the transition from first generation to the next generation. Today with a strong brand image and range of quality certifications, MA’s is exporting products to the international markets and has diversified into many innovative products and services.
Development phase
At MA’s transition has been well planned and therefore it didn’t lead to any crisis. “We decided together about the changes we expected. But it was not so easy in the beginning. Delegation was not understood well in the early stage and my sons were too young to accept all the challenges,” Mr. Mario said explaining the decision-making process that took place prior to the systematic and gradual transition. “It was carefully chosen options. We had a series of discussions to come to a decision. We had two options – educate the children to enable them to work elsewhere or to have them in our business with right skills. We decided on the second and have succeeded.”
Weakness the key to success
Some entrepreneurs may not like outsiders coming in and advising but Mario looked at it differently. He believes in external knowledge and professional support. He has had a history of getting external professional and managerial support throughout the development of his company. “There are things that could be done by me. But there are many things that I myself can’t do. Perhaps my sons are better in those areas. They are smart and computer savvy. If you don’t know something you must accept it. That is the key to success,” he said.
External knowledge
At a crucial time, when the need for expansion was felt MA’s hired external consultants. The first consultancy service resulted in the first-ever business plan for MA’s in 2005. That was virtually the beginning of a better transition. The structure, roles and responsibilities were developed to suit the expansion. This has been done not only to cater the needs of the business but also to create platforms for next generation and effective delegation.
Focused education for children
Mario also prepared a plan on his sons’ education and positioning them right at the end of graduation from the universities. As a result, one son has completed agribusiness and the other has done food science. These are key competency areas for MA’s. But this did not happen overnight. The guidance on choosing the course was well focused and aligned with the needs of the business. As such the present operations are well managed by the second generation who are subject matter experts in the relevant result areas of the business.
Passion for learning
Undoubtedly learning is a key to the success of any organization. While believing in a systematic approach to business management, Mario has a habit of reading books on management. This is yet another reason why the organisation could accommodate new knowledge and fresh ideas. MA’s invested in branding and worked with international branding gurus. Branding has now become one of Mario’s pet subjects. He continues to believe that transition is also associated with taking the brand image to the next level.
Home grown culture limited
“Though there are good things in the home grown culture there are limitations,” says Mario. Traditional habits in a family business such as friendliness, being humble to people, flexibility and good relationships with staff have often largely contributed to the success of the business. But Mario’s viewpoint is different. He is an advocate for a robust corporate culture while being a custodian of a value-based business culture. “While we all have good practices, flexibilities and friendly work environments, controls are important as the organisation grows. Systems are also vital so we are now transitioning our traditional home grown business culture to a better corporate culture. This doesn’t mean we lose our inheritance but we upgrade it to match the business needs,” said Mario.
Intrusion is entrepreneurial
When talking about retirement and delegation, Mario said “transition doesn’t mean that you totally get away from the business but you have certain controls over it. This is a process that goes along with entrepreneurial attachments. It’s difficult for you to separate them”. Innovation, branding and customer care are key areas among others in which Mario has strong control. He is passionate and keen on branding and labelling. His attitude towards customer care and building relationship is traced back to his father’s teaching. But he is confident some of these will get well ingrained to the next generation. The company is now in the process of going into better equity partnerships taking it towards a corporate entity for stability, strength and sustainability.
(This is Part 1 of a 3-part series written in support of the upcoming learning event on “Transition in Management and Leadership of Family Businesses” facilitated by the International Institute of Development Training. Any comments are welcome to azeez@iidt.org)