“It's all in the family” is a common phrase in the lives of those who maintain a family business. Whether we realize it or now, we see the results of those family efforts in many of the things that touch our daily lives—from ketchup, to bug spray, to many home cleaning products. But what exactly is a family business and how do some continue successfully throughout the generations while others fail?
A Recipe for Success
A successful family business is one that recognizes the strengths and weaknesses of its family members and makes sure everyone is involved in providing input in day-to-day activities. Most importantly, a family business has the best chance of succeeding when family members believe in the product. If future generations do not have an interest in the family business, they won't possess the original passion that initially built the company.
Longevity is key in any family business. The oldest family business is the Hoshi Hotel in Japan, which has been in business since 718 AD and has been run by the same family for more than 50 generations. The hotel is listed in the Guinness Book of World Records as the oldest hotel in the world. How does a family business such as the Hoshi Hotel span generation after generation? Although passing that familial business baton can be tricky, two of the most famous American family businesses have been successfully passed down through the generations.
The H.J. Heinz Company
The success of the Heinz company dates back to 1869, when Henry John Heinz built his family business on the philosophy that profits should be fairly earned, employees should be fairly treated, and “heart power is better than horse power.” Nearly a century and a half later, H.J. Heinz's ideals ring true in the management and administration skills of Heinz's kin.
H.J. Heinz always promoted safety and care when developing and selling Heinz products, and this notion was continued by Heinz's son, Howard Heinz, who succeeded his father in both the family business and his father's philanthropic attitude. Howard Heinz developed the Sarah Heinz House, named after his mother, a Pittsburgh landmark that has offered after-school activities for children since 1915 and still operates today.
The ideals of the Heinz men have been sustained by their children—Howard's son, Jack, ran the company for 40 years through the 1980s, and the family's tradition of community support was continued by Jack's son, John, who was elected to the U.S. House of Representatives and later the U.S. Senate. Unfortunately, Senator Heinz was killed in 1991 in an airplane accident, but his wife, Teresa, has continued the Heinz legacy of philanthropic activism with the Teresa and H. John Heinz III Foundation, the Heinz Family Foundation, the H. John Heinz III Foundation, and the Howard Heinz Endowment. The philosophy of caring and activism started by H.J. Heinz has been carried in the Heinz products and the philanthropic activities of the Heinz children.
S.C. Johnson “A Family Company”
S.C. Johnson is a self-proclaimed “family company” that lives up to its designation. S.C. Johnson has seen five generations of Johnsons being integral to this company, starting in 1882 when Samuel Curtis Johnson, at 50 years old, decided to buy the flooring company in which he worked, entitled Racine Hardware Company. He grew this company into the mega-company that bears his name today, and it all started when he decided to mix batches of floor wax in his own bathtub. By selling the company's original parquet flooring product with a can of Johnson's Prepared Paste Wax, his creation began to outsell the flooring that was originally sold by the company, and the Johnson family company was born with “Johnson's Wax.” Through his success, S.C. Johnson donated 10% of his income to his community, particularly for programs that helped young people.
Four Johnson men have followed in S.C. Johnson's footsteps: Herbert Fisk Johnson, Sr. was the second generation Johnson to build the company, and his belief of globalizing the family company was successful through his expansion in England, Australia and Canada. He also integrated the company's profit sharing program so that the employees could share in the family business's success. Johnson's Wax was then made a household name in the 1930s through the efforts of H.F. Johnson, Jr., and the company expanded beyond the wax in the 1950s when Samuel C. Johnson brought new ideas. Not only did he wear his great-grandfather's name proudly; he introduced numerous brands that are familiar today, including Raid, Glade, Pledge and OFF!
Today, this family company is headed by the current Chairman and CEO, Fisk Johnson. As the fifth generation Johnson to lead this successful family company, he has continued his family's legacy of commitment to both the products sold and their community. In addition, the newest Johnson is also finding environmentally friendly ways to produce company products, showing a commitment to the company's customer base and the planet.
Other Notable Mentions
Heinz and S.C. Johnson are just two success stories that show that perseverance, commitment and philanthropy can be passed down through generations. Other family names that are being managed by a family's descendants can be seen all over the world—from the Trump Organization, to Marriott, Disney, Ford and Levi Strauss. Family businesses can be extremely profitable in their specific industries, and, as seen by the lives of the Heinz and Johnson families, success is based on what the family members believe is important, what the objectives are for the company, and how these objectives can be passed down and achieved.