Key Takeaways from Family Run Educational...

by: MR. PETER P. LAUREL

Key Takeaways from Family Run

Educational

Institutions:

History of Private

Educational Institutions:

Growth and development of Private HEIs is really the history of the outstanding men and women together with their families that has shaped private education.

Examples abound how many schools have eased the transition from one generation to another and become successful:

JRU - Jose Rizal University

TIP - Technological Institute of the Philippines

Baliuag University

OLFU - Our Lady of Fatima University

LPU - Lyceum of the Philippines University

CEU - Centro Escolar University

MAPUA - Mapua Institute of Technology

Amidst an increasingly

anti-private intrusive government

regulation.

There has never been a more

challenging time in Philippine

Education than today:

K-12 ASEAN 2015

OUTCOMES-BASED

EDUCATION TYPOLOGY

Profile LPU Campuses in

Intramuros

Batangas (2

campuses/building a 3rd

campus, the Riverside

Campus)

Cavite (First Resort

campus)

Laguna (Forest Campus)

Makati (Makati Campus)

Total Enrolment of 35, 000

Run by both Family Members and

Great Professionals

Lyceum of the Philippines University

Profile

Lyceum of the Philippines University

Founded by my grandfather Jose P. Laurel

Developed by my father Sotero H. Laurel

Expanded by the Current Generation

My BIGGEST fears: What if constitution is

amended and allows top

universities to enter?

What will happen to us with

MOOCs?

Family business estimated to comprise 65-

90% of all businesses.

70% of Family Business fail to survive into

the 3rd generation of family ownership.

What makes certain companies and

schools better than the others?

I. Fix the Family/Improve the Business A strong family relationships foster

strong family business structure. (Barrets

2011)

Some Take-away points

Ownership

Management Family

THREE -CYCLE MODEL OF FAMILY BUSINESS

Family gatherings, weekly lunches,

dinners even among the third generation

are warm. (Baguio, etc.)

Political Unity-Business Unity

Team Building/Visioning starts with the

Family

Examples of Family Unity Weekly Dinners

Weekly Meetings

Vacations

Bonding of our children with

cousins

(Same as teambuilding in

corporate setting)

Our Barkada are our own siblings

I. Family Constitutions and Governance Issues:

1) A family controlled institution must have a

family constitution where issues on

ownership, governance and management

are clearly spelt out.

Our schools have their manuals, processes

and policies but sometimes the controlling

family does not have a family constitution or

guide.

II. Governance:

2) Importance of Family Constitution

- Best written when the founder or seniors are

around

- Or when there are no major problems in the family

- Must define key things- like compensation, rules

of engagement, retirement,(Often a difficult topic)

expansion, succession, illnesses growing the

business.

What we can learn?

1.1. No in-laws

Gokongwei Way:

Benchmarking from Industry:

What we can learn?


2. No conflict

of Interest

What we can learn?


3. No Work, No Pay

What we can learn?


4. Personal Assets should be kept separate from company assets

What we can learn?


5. Pay based on contribution to the business

What we can learn?


6. Being family is no guarantee of Employment. (Don’t force kids to work for the company)

What we can learn?


7. Avoid working directly for your parents

What we can learn?


8. There can only be one Boss

What we can learn?


9. Give the next Generation Wings

What we can learn?

In our family constitution:

Working for the family in the

next generation will be by

invitation and not by birthright.

III. Establish a Real Vision for the

Family (not just the school) and

establish your own family core

values:

1. To leave a legacy

2. Genuine desire to be excellent- not

just to push enrolment figures

(happiness? )

Deppon

Quality Assurance

My favorite is the Honda line “

“When Good is not good enough”

(Honda)

Learning from the Best

Student Achievement

Quality of Facilities

IV. Creating a strong

Corporate Culture:

Progressive schools have strong culture - Define a

leadership brand

In LPU Batangas we have defined a Leadership

Brand based on the 4Cs:

- Competence

- Commitment

- Collaboration

- Caring

Strong work Ethic of owners/Managers

Many Schools have variations on this

but we go the extra mile to foster a

‘family atmosphere’ that cultivates the

sense of ‘malasakit’

You can benchmark strategies and

plans but it is difficult to duplicate

culture.

It is a values connection that inspires

creativity and excellence.

Whether it is fostering a

leadership brand, celebrating small

wins or recognizing champions in

your organization.

V. Creating culture as a distinct

competitive edge (Parker 2012)

Investors in People guide to

drive Culture and Performance

Inspiring a shared vision

Empowerment

Communication

Modelling

Succession

Professionalization:

Reliance on and respect for non-family

professional managers who are part of the

extended “family” who are loyal and are

performers.

Strong desire to lead by duplicating oneself

by empowering the team.

Strong Push for Quality Assurance (PQA, IIP,

Accreditation, ABET, ICE, etc.).

Managers moulded to think like owners and

have personal integrity.

Finding the Best Talent by developing from

within.

Ayala Family Corporation

Stewardship of a Family

Legacy

Strong work ethic

Family Unity

Patriotism and National

Commitment

Family and Professional

Governance

One of my favorite ads

You never actually

own a Patek

Philippe.

You merely take care

of it for the next

generation.

The Business of Family

HOLDING IN TRUST FOR

FUTURE GENERATIONS

RIGHT

OF

PROFESSION

Ownership VS. Stewardship

Transition to Greater

Professionalization

Schools flight to professionalization of

schools:

Accreditation/Certification

System/Processes Structures

Internationalization

People Management

VI. Professionalize motivate

your workforce

- The highest skill is still

people skills – or ability to

influence people to

achieve goals.

VII. Build a corps of dedicated

managers that form your power

team

A school or corporation that

offers its work force career

advancement and job security- in

other words strive to be a great

employer.

“Change managers

only when necessary,

promote from within if

possible and if you

can’t find inside look

for a talent with a

process track record”

VIII. Warren Buffet’s Advice

- Don’t forget core processes

especially student achievement

and instruction

- Have 2 to 3 star professors in your

defined flagship program to

elevate standards/add luster.

- One of the best quality

assurances mechanisms are the

Malcolm Baldrige Framework

and Industry based certification

and accreditation

- Do dry-runs/practices before Big

events(you will always improve).

- Appoint/Define a champion for

each area you want to

strengthen.

Be a good listener and

cheerleader

Praise small wins

Benchmark with the Best

(locally and internationally if

possible) Taylor’s University

Benchmark with industry

IX. MOOCs

assive pen n

Line ourses

X. Internationalize or Perish

Change parts of our

Vision/Mission to become a

recognized university in Asia

Pacific Region by 2022.

XI. Local Accreditation (while very good)

• Has its limitations

• Go for industry based program

• Accreditation

Being PAASCU/PACUCOA level 2,3,4

accreditated is no big deal now

• GO for ABET, ICE or AACSB.

• Go for industry based certification

XII. Internationalize

with things like the

common core or

a Semi IB

Preparing the 3rd Generation

for Leadership

The Great Sustainability

Challenge

Passing it on to the Third

Generation

Ownership Models

Break Up Model

Family A Family B Family C

Business A Business B Business C

Joint Ownership

Management Limited

to one Family

Ownership Models

Family A B C

Business B

Family B

Business A

Family A

Business C

Family C

Ownership Models

Holding

Company

Business A

• Joint Ownership

•Shared Management

Public Company

Business B

Business A

Business C

• Publicly Listed Co.

•Family & Professional Management

What makes the 3rd

Generation such a

challenge?

Starting them young

Best time for a first job

12 years old

Cousins or friends work together

Allowances

Half Day/Every other day

Completion and Perfect

Attendance Bonus

Dinner Menu

Value Formation

The Story Teller

Team Building Bonding Trips

Best time for a first job

Fueling their interest-

Exposure, Exposure, Exposure

Preparing the 3rd

Generation for

Business

In General

Preparation for Business in General

Education is a birthright

Towards Self Sufficiency

Management Involvement in the

Business is not a birthright but by

invitation

Prerequisite Work Experience

Conclusion: 1. Family

2. Governance

3. Professionalization

4. Internationalization

5. Managerial Effectiveness

6. Succession

Above all to remain United under

PACU and COCOPEA to Promote Private Higher Education within a deregulated environment!

Thank you

Key Takeaways from Family Run Educational...

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