Introduction FamilyBusiness2FamilyBusiness
The fictional Al Mamnoon Group is a successful Kuwaiti family business that is run by the second generation after its founder, Mohammed Al Mamnoon, faced sudden health issues and had to retire. With his two sons Rashid and Khalid in charge the business continues to strive. So much so that the third generation is gradually joining the family business in various different ways. This transition is challenging for the family and results in a few difficulties between Rashid and Khalid. Find out what advice Arab family business leaders give to the Al Mamnoon Group through this issue’s Tharawat magazine case study survey.
The Al Mamnoon Family and the Third Generation Challenge
T
he Al Mamnoon group was established in
Over the years, Mohammed and his two sons worked very
1967 in Kuwait by Mohammed Al Mamnoon.
hard to build a strong and diversified group of companies.
With great commitment and hard work
In the 90ies the Al Mamnoon group established activities in
Mohammed grew his small trading business
agriculture, finance and real estate, as well as a successful
into a diversified business group in few years.
cement factory.
Mohammed’s first son Rashid chose to pursue his engineering
In the 2000s however, Mohammed faced sudden health
studies in Egypt. While in Cairo, he got married to Mona
problems. He trusted Rashid’s expertise and sense of business
Al Masri, whose family owned and operated a large cotton
and put him in charge of the day-to-day business activities. As
plantation in Egypt and they had three children together
the two brothers got on well, they decided to start a holding
after they moved back to Kuwait: Ahmed, Marwa and Tarek.
structure, Al Mamnoon Investments, to ensure that the family’s ownership remained clearly structured. Both Rashid and
Khalid, Mohamed’s second son, had always been passionate
Khalid would own 30% each while Mohammed kept 40%, and
about the fine food and service industry and wanted to
remained the non-executive Chairman. The brothers arranged
establish the Al Mamnoon Group as a leader in five-star
the management of the companies amongst themselves.
hospitality. However, his father was reluctant to start a
10
business so different from the core activities of the company
In the meantime, two of Rashid’s three children, Ahmed
in trade and manufacturing.
and Marwa, finished their studies and decided to go and
Tharawat magazine Volume 15
www.tharawat-magazine.com
FamilyBusiness2FamilyBusiness Introduction
Rashid and Khalid got together to discuss the situation of the next generation. After the discussion, they were both unsatisfied.
live in Egypt to work in the Al Mamnoon Cotton business
in Egypt. Their uncle Khalid did not appreciate this, since
which Rashid had founded together with his wife’s family.
neither Ahmed nor Marwa had ever worked in another field
Ahmed and Marwa worked for the two cotton factories in
than the cotton industry.
Cairo (spinning and yarn manufacturing) and in Alexandria (the weaving plant).
Meanwhile, Ali, Khalid’s son, has not been very motivated to stay in the family business. One night, he was out with
Khalid and his wife Alia had two children, Ali and Yasmeen.
a group of friends and he started to express his frustration
Since he finished his studies in 2004, Ali is active in the family
about his situation. One of his friends captured his angry
business as a junior manager of Al Mamnoon Investment, the
speech on video and posted it online. What was supposed to
holding company. Yasmeen followed her father’s passion for
be a normal chat between a group of friends, now became
fine food and is a highly decorated Chef in London. With
hot gossip in the Kuwaiti business community.
offers to open her own restaurant in Europe, Yasmeen is still reluctant to join the family business.
Rashid and Khalid got together to discuss the situation of the next generation. After the discussion, they were both
In 2011, Ahmed and Marwa returned to Kuwait after the
unsatisfied: Rashid felt that Khalid did not want his children
political unrest in Egypt. The future of the Al Mamnoon
to join managerial positions, even though they had been
cotton factories was uncertain. Back in Kuwait Ahmad and
working for a while. Khalid on the other hand felt his brother
Marwa wanted to work as mid-level managers, as they had
was angry with him because of Ali’s remarks.
www.tharawat-magazine.com
Volume 15 Tharawat magazine
11
Introduction FamilyBusiness2FamilyBusiness
Survey Results
After sending out the Al Mamnoon case study in a survey to over 100 family business executives, responses produced the following results.
On a scale from 1 to 5, how justified to you think Khalid’s negative reaction to giving Ahmed and Marwa managerial positions in the group?
Very unjustified
Unjustified
00%
42.86%
Neutral 28.57%
Justified 28.57%
Very justified 00%
Would it be beneficial for Ahmed and Marwa to have some education before joining the family in Kuwait?
Very unlikely
Unlikely
00%
00%
Neutral 00%
Likely
Very Likely
71.43%
28.57%
Will Ali’s action have an impact on the Al Mamnoon family reputation?
12
Very unlikely
Unlikely
14.29%
28.57%
Tharawat magazine Volume 15
Neutral 00%
Likely
Very Likely
28.57%
28.57%
www.tharawat-magazine.com
FamilyBusiness2FamilyBusiness Introduction
Do you think that what Ali did is something that the family can control and solve internally?
85.71% YES 00% NO 14.29% Other: Has to be solved internally and publicly
Should the Al Mamnoon family consider getting into the food industry to fulfill Yasmeen’s ambitions?
71.43% YES 14.29% NO 14.29% Other: If beneficial, depending on a feasibility studies.
Results Summary for the Al Mamnoon Family
When summarising the results above we can see that respondents have the following opinions on the Al Mamnoon family case:
85.71% 71.43% 71.43% 42.86% The great majority of surveyed family members believe that the problem caused by Ali’s mistake can be solved within the family.
www.tharawat-magazine.com
Over 70% agree that the Al Mamnoon family should go into the food industry to fulfil Yasmeen’s ambitions and to provide her with a place in the family business.
Respondents believe it would be beneficial for Ahmed and Marwa to get some further education before joining the family business.
Less than half of the respondents believe that Khalid’s negative attitude towards his nephew and niece joining the business is not justified.
Volume 15 Tharawat magazine
13