Kongo Gumi: Lessons from the Legendary Family-Owned Business' Longevity and Ultimate Demise
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Case Code: BSTR316 Case Length: 13 Pages Period: 578-2007 Pub Date: 2009 Teaching Note: Not Available |
Price: Rs.300 Organization: Kongo Gumi Industry: Construction Countries: Japan Themes: Entry Strategy, Competitive Strategy, Differentiation |
Abstract Case Intro 1 Case Intro 2 Excerpts
Excerpts
Kongo Gumi in the 20th Century
The period between 1868 and 1912, known as the 'Meiji Restoration' saw many changes with a push toward modernization and the adoption of Western cultural and political aspects. State-supported companies such as Kongo Gumi were affected as changes were brought about in regulations and financial arrangements. Faced with these challenges, Kongo Gumi was forced to diversify from building temples and castles to private and commercial buildings...
In the New Millenium
In the new millennium, Kongo Gumi was recognized globally as the world's longest running family-owned business (Refer to Exhibit II for a list of the Top 10 Oldest Long-lived Family Owned Businesses). As in the 20th century, the company continued to focus on temple building and repair works in the new millennium...
Secrets of Longevity
Experts felt that Kongo Gumi had many lessons to teach on how a family-owned business could be run successfully. Stability and flexibility in business practices, sound succession principles, and value-based management were the secrets of its longevity, according to them...
Lessons from its Demise
Experts felt that Kongo Gumi's demise too held many valuable lessons for family-owned businesses. Factors such as difficult market conditions marked by an ailing Japanese economy, social changes, and the company's failure to hedge against these external factors led to its eventual demise, they said...
Failure to Recognize and Respond to Market Trends
Though the company had been facing a relatively difficult business environment since the early 1900s, after World War II, funding for temple construction became more difficult to come by...
Exhibits
Exhibit I: Kongo Gumi - A Timeline
Exhibit II: A List of the Top 10 Oldest Long-lived Family Owned Businesses
Exhibit III: Motto, Principles and Management Ethic of Kongo Gumi
Exhibit IV: An Updated List of Top 10 Oldest Long-lived Family Owned Businesses
Exhibit V: An Updated List of Japan's Top 10 Oldest Long-lived Family Owned Businesses
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