Key Takeaways
from Family Run
Educational
Institutions:
by:
MR. PETER P. LAUREL
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
There has never been a more
challenging time in Philippine
Education than today:
K-12
ASEAN
2015
OUTCOMESBASED
EDUCATION
Amidst an increasingly
anti-private intrusive government
regulation.
TYPOLOGY
Lyceum of the Philippines University
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
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 6590% 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?
Some Take-away points
I. Fix the Family/Improve the Business
A strong family relationships foster
strong family business structure. (Barrets
2011)
Ownership
Family
Manage
ment
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?
Benchmarking from Industry:
What we can learn?
Gokongwei Way:
1.1. No in-laws
Benchmarking from Industry:
What we can learn?
2. No
conflict
of Interest
Benchmarking from Industry:
What we can learn?
3. No Work,
No Pay
Benchmarking from Industry:
What we can learn?
4. Personal
Assets should
be kept
separate from
company
assets
Benchmarking from Industry:
What we can learn?
5. Pay based
on
contribution
to the
business
Benchmarking from Industry:
What we can learn?
6. Being family
is no
guarantee of
Employment.
(Don’t force
kids to work
for the
company)
Benchmarking from Industry:
What we can learn?
7. Avoid
working
directly
for your
parents
Benchmarking from Industry:
What we can learn?
8. There can
only be
one Boss
Benchmarking from Industry:
What we can learn?
9. Give the
next
Generation
Wings
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? )
Quality Assurance
Student Achievement
Quality of Facilities
Learning from the Best
My favorite is the Honda line “
“When Good is not good enough”
(Honda)
Page27
Deppon
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.
V. Creating culture as a distinct
competitive edge (Parker 2012)
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.
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
Ownership
RIGHT
OF
PROFESSION
VS.
Stewardship
HOLDING IN
TRUST FOR
FUTURE
GENERATIONS
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.
VIII. Warren Buffet’s Advice
“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”
- 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
Line
ourses
n
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
Ownership Models
 Joint Ownership
Management Limited
to one Family
Family A B C
Business A
Family A
Business B
Family B
Business C
Family C
Ownership Models
• Joint Ownership
•Shared Management
Holding
Company
Business A
• Publicly Listed Co.
•Family & Professional Management
Public Company
Business A
Business B
Business C
rd
3
What makes the
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 interestExposure, 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.
2.
3.
4.
5.
6.
Family
Governance
Professionalization
Internationalization
Managerial Effectiveness
Succession
Above all to remain United under
PACU and COCOPEA to Promote
Private Higher Education within a
deregulated environment!
Thank you