PIZZA FRANCOContentssExecutive Summary’Health of the Family Business ‘ Consultant ReportAnalysisDecisionRecommendationsMentions

Executive Summary

Pizza Franco is a household concern that operates a pizza concatenation and has been in the concern for decennaries. The company has flourished when it comes to spread outing its ironss but the concern lacks behind in footings of holding a vision and proper organisational schemes. Pizza Franco has a strong incorporate household that is running the concern with strong communicating amongst them. But the company does non hold a proper organisational scheme, strategic program, sequence programs and stockholder direction programs. Pizza Franco does non hold a board of managers and has really few external members as portion of their employees. These factors lead to the concern non being able to develop decently and efficaciously and missing behind when it comes to innovation or variegation.

Pizza Franco should set up a proper board of managers that is able to pass on with stockholders on a regular footing, they should detect the concern and supply guidelines and recommendations on how to better the concern. The board of managers will assist give the concern a way and hence aid in its development. Another of import measure that should be taken by the concern is to guarantee that there is coherence and coordination among household members, more non-family members should be brought in to make full in managerial places in order to increase variegation among the house if they have more experience than bing household members. Furthermore, the concern should develop a proper sequence program so that struggles can be avoided when make fulling out of import places such as CEO, CFO and the experient individual is selected for the place.

‘Health of the Family Business ‘ Consultant Report

Pizza Franco is a household run pizza concatenation that has been working for decennaries and has expanded their operations in a major manner. The proprietor of the company is Don Franco and his boies have been appointed at assorted managerial places within the company.

The concern has been runing for a long clip but still it lacks a proper concern scheme that is required for a household concern. A household concern is a synthesis of: ownership control ( 15 % + ) by two or more members of a household or a partnership of households, strategic influence by household members on the direction of the house, concern for household relationships and the dream ( possibility ) of continuity across coevalss. By definition, Pizza Franco is a household concern.


The cardinal standard of a successful concern is that there should be a common apprehension and mutuality between all the groups present in a concern.

These groups include household proprietor, household members, and non-family members/employees. A proper household concern realizes the fact that household kineticss play a really of import and influential function in concern and household influences the concern and frailty versa. Furthermore, ownership besides plays an of import function in act uponing the concern and the household. So all these groups are related and are independent every bit good as dependant on each other. If one system is non working decently, it will hold a bad consequence on the other system.

Pizza Franco has established itself as a household concern but it is non cognizant of the relation and influence of these groups on each other. Pizza Franco lacks a proper structured household council that is necessary for discoursing and deciding jobs before they turn into large issues, educating the household about the duties that they have when they are portion of the ownership and the direction and helps in easing a proper communicating procedure that enables the household to make a proper household program. Pizza Franco besides lacks of a proper direction squad which should include both household and non-family members.

When the CFO of Pizza Franco, the eldest boy of the proprietor, died, the household was in a struggle as to who to name as the new CFO ; Alexander, who was the boy of the proprietor and had no experience at all, or an external director. The household favored Alexander over an external director. Having less or no non-family directors reduces the efficiency of the direction. The direction squad is responsible for coming up with concern programs, strategic programs and eventuality programs and experient people are needed for this. The most of import factor that Pizza Franco deficiencies in is of an absence of a proper board of managers. A board of managers is of import for a company because it adds onto the position of the proprietor, makes efficient and effectual concern programs, every bit good as proctors the company’s public presentation, makes of import determinations sing investings and dividends and maintain household members informed about the public presentation of the concern.A house should hold a proper organisational scheme so that it can work expeditiously.

Businesss should be good cognizant of what their organisational hierarchy is, what type of accomplishments do people at each station should possess and who is responsible for each section in the concern. A proper organisational construction should be able to do certain that the organisation is decentralized or centralized. The functions of household members and non-family employees should be carefully defined and the extent of the engagement of household members in the direction should besides be set decently. Pizza Franco lacked a proper organisational scheme. The concern had no proper set guidelines for household members and it lacked a sense of way. It can be evident from the fact that when the proprietor was looking for a replacing for the CFO, he had to confer with assorted people before coming to a decision. But despite this, the communicating scheme of the concern is efficient. In the procedure of coming to a determination to choose the CFO, the male parent decided to confer with all stockholders involved and do a corporate determination.

Good administration is besides of import for any concern to boom. Governance needs to be efficient and for a household concern to accomplish that, they need to do certain that they have a proper construction ( with regulations and guidelines ) and promote emotional intelligence among their employees ( both household and non-family members ) . Like any other concern, a household concern should besides hold a clear scheme refering their mission, vision, sequence Torahs, portions and much more.

Pizza Franco lacks in this country every bit good. Despite spread outing their concern to such an extent, they still do non hold a formal scheme to transport out their concern. While their communicating scheme is strong and effectual, they need to be clear about what their long-run and short-run ends are and how their concern should be able to run. Family houses need aid in regulating the family–owner–management relationship. The coveted result is rational economic and household public assistance determinations unencumbered by traditional household kineticss.

Administration can be provided for through ownership construction, different categories of vote and nonvoting stock, buy-sell understandings, a household fundamental law. Pizza Franco besides lacks of a proper board that is indispensable for houses to run efficaciously. Board composing in family-controlled houses in the S & A ; P 500 found that companies, in which independent managers balanced the influence of establishing households on the board, performed better and created greater stockholder value. Firms in which establishing household ownership remained ( and comparatively few independent managers served on the board ) performed significantly worse than nonfamily houses.Shareholder direction in the house is besides really of import as stockholders are the 1s who own the house or the concern and are responsible for its wellbeing and development. The stockholders in Pizza Franco are all household members and therefore a proper program for their direction does non be.

Shareholder wealth direction and stewardship is of import as these factors make certain that the house is on its manner to development and is maximising its net incomes. With a proper stockholder wealth direction program in topographic point, the stockholders of the house will be motivated to maximise the wealth of the house, increase its stock monetary values, increase the overall value of the house and in bend addition the net worth of the person who is keeping the stock. Stewardship, on the other manus, involves the construct that the proprietor of the house or any stockholder that is involved in the concern is non in it entirely for the fiscal additions but wants to lend something to the community and the workers, they want the concern to maintain on turning and wining long after they are gone and are fundamentally looking for long-run alternatively of short-run addition because of the desire to hold future coevalss take over the business.Pizza Franco encourages stewardships among its stakeholders as they are spread outing their concern, are settling in for the long-run and are affecting future coevalss in its operations. But the company, so once more, lacks a clear scheme for the concern and it needs to specify its long-run and short-run aims. Shareholder meetings are besides really of import as these represent one of the best chances to educate proprietors about their duties and what the company and its direction expect of stockholders and let for fiscal, concern, and competitory information-sharing and communicating on other issues critical to a household house in a disciplined and proactive mode. Family stockholders anticipating to carry through their duty of alining direction involvements with stockholder precedences and keeping direction accountable demand to hold a thorough apprehension of fiscal statements.

They need to be able to do sense of what the Numberss say about the house and its competitory status.In order for a household concern to maintain on operating expeditiously for a long clip, sequence policies need to be defined clearly and expeditiously. A proper sequence standard should be set for each station ( chiefly the of import stations such as the CEO ) and successor ends should be identified. Without proper replacements taking over the concern, the household concern would fall apart and would neglect in a really bad manner. A household concern besides needs to guarantee that replacements besides fit the profile of successful replacements. For illustration they can be people that know the concern well or even love the nature of the concern, they are guided responsibly by the old coevals, by advisers, and by a board of outside managers, they have good relationships and the ability to suit others, particularly if portion of a replacement squad, they can number on competent nonfamily directors in the top direction squad to complement their ain accomplishments or they have commanding ownership or can take, through Alliess. Pizza Franco did non hold clear sequence policies. They lacked behind this country.

The illustration of puting up a new CFO when the owner’s boy died is a clear illustration of how of import it is for the concern to hold a clear sequence policy. Despite holding a deficiency of experience, Alexander ( younger boy of the proprietor ) was acute and inexorable to take his brother’s topographic point as the new CFO of the organisations. The household could non make a consensus on this determination and advisers had to be bought in to lend to this determination. The meeting ended with a common understanding of naming an interim CFO for a period between 6 months up to a twelvemonth until Alexander additions the necessary experience needed to win. The purpose of the advisers was to make a determination that would fulfill all the household members and avoid a household struggle. Therefore it is clear that Pizza Franco needs to hold a proper sequence scheme in order to avoid such struggles and determination devising processes in the hereafter and be clear about what the organisation wants.


Pizza Franco is a household concern that has developed in footings of its locations but it still needs to travel a long manner when it comes to scheme. The concern has developed itself expeditiously in a few countries but it still needs to work in assorted other parts. Pizza Franco has a household council which lacks in construction and experience but is really effectual for corporate determination devising among household members.

Furthermore, they have a obscure stewardship scheme as the proprietor of the concern is working for the long-run and want to do certain the concern remains successful in the hereafter. The household is besides much unified when it comes to taking determinations which is an of import trait for a concern to hold. But Pizza Franco lacks assorted necessary things. They do non hold a board of managers which is of import for a concern to execute and come on expeditiously. The concern denotes the impression of unhealthy household civilization possibly rooted in the sons’ limited concern cognition and deficiency of vision particularly expressed by Alexander who is self-asserting on his determination to take on the function as the CFO at current times ) . To an extent this job lies in the construction of the concern, as the caput of the household and the concern, the male parent, has non started to incorporate the younger boies in the concern operations.

The company lacks in strategic planning, sequence planning and stockholder scheme. These schemes guarantee that struggle is minimized among household members. Furthermore, Pizza Franco besides lacks in variegations when it comes to holding more non-family members as directors. They do non hold a proper organisational civilization which is necessary for any concern to boom.


The most of import measure that should be taken by Pizza Franco in order to better their concern is to hold a board that oversees the concern and works for its advancement. The function of the board is prominent in the administration of the relationship between a household and its concern when the owner–family–business interaction is perceived as a positive-sum moral force. Pizza Franco needs to guarantee that their board is besides adaptable to any kind of alteration in the company. The board should develop or O.

K. the strategic program, take part in the direction development program, and fix the leading continuity program and the eventuality program. The board should work plants with a professional squad of advisers to fix a sequence program and should utilize a sequence planning adviser to guarantee that the board takes stairss professionally. The other measure that should be taken by them is to hold proper defined sequence policies. These policies will guarantee that struggle among household members is decreased when sequence needs to take topographic point and the procedure is done swimmingly. The concern needs to guarantee that more non-family members are placed at managerial places if they have the needed experience since it will convey more invention and variegation into the house.

A direction squad should be developed by Pizza Franco that should measure possible replacements for direction, including household and non-family members and publicity and sequence should avoid nepotism and direction should advance the most qualified campaigner. A systems attack should be adopted by the organisation in which all the household members are made cognizant of their relation to each other and their consequence on the concern. Training of possible inheritors from an early phase in their life by offering them internship or working chance at market rates should besides be given importance. Employees and members should be made cognizant about emotional intelligence and they should be able to acknowledge each other’s feelings and manage emotions efficaciously.


Anderson, R. and Reeb, D. , Board Composition: Balancing Family Influence in S & A ; P 500 Firms,Administrative Science Quarterly, 49 ( 2004 ) , pp. 209-237.

Astrachan, J. H. ( 2010 ) .

Strategy in household concern: Toward a multidimensional research docket.Journal of Family Business Strategy,1( 1 ) , 6-14.Eddleston, K. A. , & A ; Kellermanns, F.

W. ( 2007 ) . Destructive and productive household relationships: A stewardship theory position.Journal of Business Venturing,22( 4 ) , 545-565.Gersick, K. E.

, Davis, J. A. , Hampton, M. M. , & A ; Lansberg, I. ( 1997 ) .Coevals to coevals: Life rhythms of thehousehold concern. Cambridge, MA: Harvard Business School Press.

Kellermanns, F. W. , Eddleston, K. A. , Barnett, T.

, & A ; Pearson, A. ( 2008 ) . An exploratory survey of household member features and engagement: Effectss on entrepreneurial behaviour in the household house.Family Business Review,21( 1 ) , 1-14.Poza and Daugherty ( 2013 ) .Family Business.4th Edition, chapter 6 and 7.1

Written by

I'm Colleen!

Would you like to get a custom essay? How about receiving a customized one?

Check it out