Competing in a Hyper-Competitive Global Market

1. Type header copy here. Competing in a Hyper-Competitive Global Market

2. Membership Value Proposition • Ownership-level Strategic Plan: Defining your shareholder agenda • Ideas that Impact: World class education • Next Generation Entrepreneurship: Skill assessment and professional development path • Peer based learning and benchmarking: Affinity groups and networking • On-line learning: Monthly Webinars • Implementation Support: Ownership, Board, Management levels • Resources: Morgan Stanley, Price Waterhouse Coopers, Saul Ewing, Creative Financial, AUA Capital, SJU

3. The Scariest Three Words for North American Business Leaders The China Price

5. EXERCISE: Ownership Strategic Thinking What is your family’s long term wealth creation strategy? Harvest Strategy Growth Strategy Q. Does your ownership group want to be in harvest mode or growth mode? Discuss both scenarios. Q. Are you intentionally building new assets and value streams or are you milking old assets? Is this good or bad? Q. What are the issues and criteria for deciding if you are in a harvest mode…or a growth mode? Key Concept: “It is fine to be in harvest or growth mode as long as it is an intentional strategy and everyone understands the ramifications of your choices.” • Institute for Family Enterprising

6. Today News Headline: Supporting Points: Ten Years News Headline: Supporting Points: EXERCISE: Your Future Vision Where are you … Where do you want to be? A vision for the future: Write a news headline and give four or five points that would be made in the article for Today and what you would like it to be Ten Years from now. • Institute for Family Enterprising

7. Family Enterprising Domain Family Enterprising Domain:The family as the unit of analysis The enterprising challenge is to get family groups to think like strategic investors and act like entrepreneurs. This means family members must move beyond their generational and preservation thinking and adopt the strategies of transgenerational entrepreneurship to accelerate their wealth creation opportunities. Our goal is to enhance long-run family enterprising. Acceleration Financial Ownership Mindset Generational Transgenerational Operational Preservation Managerial Entrepreneurial Strategic Methods • Institute for Family Enterprising

8. Actions Firm Outcomes Actions Individual Outcomes Capabilities Capabilities Capabilities f f f Actions Family Outcomes Resource Resource Resource f f f Strategic Performance Model For Family-Influenced Firms Familiness • Institute for Family Enterprising

9. DEFINING FAMILINESS “Familiness” is the unique bundle of resources a particular firm has because of the interaction of the family, its individual family members, and the business with one another. • Institute for Family Enterprising

10. Resource Capital Decision Making Reputation Alliances Leadership f f f f Sum of “f” = Familiness IDENTIFYING THE “f” FACTOR f f • Institute for Family Enterprising

11. MANAGING YOUR FAMILINESS Competitive Disadvantage Competitive Advantage + - Constrictive Familiness Distinctive Familiness Question: Where is your family on this advantage / constraint continuum? • Institute for Family Enterprising

12. Advantage Leadership Communication Lower costs Alliances Manage and Invest in Resources Strategies Resources Tangible Intangible • Institute for Family Enterprising

13. Exercise: A Test for the Fainthearted Do you have what it takes to lead beyond today’s reality? Reality Vision • What is your vision for tomorrow? • Ownership • Markets • Revenues • Profits • Operational efficiency • Human Resources • What is reality in the • marketplace? • Macro-economic • Competitive • Financial • Operational / Processes • Human Resources Key Concept: “Will today’s reality define your vision…or will your vision define tomorrow’s reality?”

14. Michael Cardone III Cardone Industries Robert Healey Jr Viking Group Succeeding in a Hyper-Competitive Global Market Robert Santiago III Para-Plus

15. Membership Value Proposition • Ownership-level Strategic Plan: Defining your shareholder agenda • Ideas that Impact: World class education • Next Generation Entrepreneurship: Skill assessment and professional development path • Peer based learning and benchmarking: Affinity groups and networking • On-line learning: Monthly Webinars • Implementation Support: Ownership, Board, Management levels • Resources: Morgan Stanley, Price Waterhouse Coopers, Saul Ewing, Creative Financial, AUA Capital, SJU

16. Next time: June 4: Jeffersonian Dinner with Chris Lowney Heroic Leadership: Best Practices from a 450-Year Old Company that Changed the World

17. Board of Directors Oversight: Values-Driven Leadership: Your first responsibility • Religion • Philadelphia • Factory Family • Meritocracy Shareholder Group Commitment: • Managerial Values, Vision, Mission • Geographic constraints • Union relationships • Accountability and professionalization Management Implementation: • Shift opens with 10 minute prayer • Chaplains oversee 15 ethnic groups • 50% less turnover • 25% greater efficiency • Institute for Family Enterprising

18. Board of Directors Accountability: Values-Driven Leadership: Your first responsibility Shareholder Group Values: • Our Values: • Our People • Our Work • Our Word • Our Witness • Our Corporate Objectives • Honor God in all we do • Help People Develop • Pursue Excellence • Grow Profitably • Leadership accountability • Profitability / Planning • Shareholder value Management Implementation:

19. Making it Real • A living wage w/ health care • A soccer field on premises for lunch-time games • Shift opens with 10 minute prayer • Executive Learning and Bible study at lunch • Chaplains support culture within15 ethnic groups • 40% of corporate giving directed by employees- 782 different recipients throughout region • Case: • Paula from Guatemala • Peter from Albania Management Implementation:

20. The Bottom Line • 50% lower turnover rate: • 50 fewer per month @ $5,000 cost to hire and train = $250,000 / month savings • ROI on Chaplains: $2,000,000 savings on $500,000 investment annually • Higher Productivity ( revenue per employee) • Higher Morale • Commitment to Continuous Improvement • Breaking the cycle of poverty • Never had a strike of their UAW workers!

21. Large Auto-Parts Firms Faring Badly vs. China Philadelphia Inquirer Some auto-parts companies have it worse than Cardone Industries Inc. Delphi Corp., the giant parts maker spun off from General Motors Corp., is in bankruptcy protection, and on Wednesday announced a massive employee buyout plan. Another big one, Dana Corp., filed for bankruptcy protection March 3. Cardone's biggest competitor, American Remanufacturers Inc. of Anaheim, Calif., was liquidated last November, putting its 1,650 employees out of work. Cardone picked up Published on 2006-03-26, Page A15, Philadelphia Inquirer, The (PA)