Case Study 3: emotional dimensions

DOI 10.1108/EEMCS-01-2014-0010 VOL. 4 NO. 5 2014, pp. 1-15, © Emerald Group Publishing Limited, ISSN 2045-0621 EMERALD EMERGING MARKETS CASE STUDIES PAGE 1

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Emotional dimensions of intra-family transmission: Moroccan Shipping, a team adrift

Caroline Minialai and Gérard Hirigoyen

Caroline Minialai is an Associate researcher at HEM – CESEM, Rabat, Morocco. Gérard Hirigoyen is Directeur du Pôle Universitaire de Sciences de Gestion at Université Montesquieu, Bordeaux, France.

Disclaimer. This case is written solely for educational purposes and is not intended to represent successful or unsuccessful managerial decision making. The author/s may have disguised names; financial and other recognisable information to protect confidentiality.

In the beginning of 2010 Moroccan Shipping was confronted by the issue of the sustainability of the family business after 19 years in existence and suddenly the stakes were high and the data complicated. The company’s founder was known for managing the business with an iron fist, and his sons, who were educated abroad, were determined not to let the sustainability issue or their father’s methods and attitudes impede the business. The question was: how to solve this emotional imbroglio?

In 1992, Mustapha Louimi, in his 40s at the time, decided to found a consignee agent company at the port of Tangier (Exhibit 1). It’s a job he knew well, as he had worked in the industry in different capacities for 15 years. Almost completely self-taught, Mustapha, who had failed to get his high school diploma several times, received vocational training in the maritime school of Hamburg in the early 1970s, and this training led him directly to the port of Tangier.

The consignee agent business is a type of service industry in which the profit margin is very low and the natural market growth limited “because there is nothing but a small number of boats that can dock into the port per day”, explains Driss Louimi, Mustapha’s second son. Until 2008, the turnover of the company had increased slowly to reach nearly 4 million dirhams annually[1]. Over the years, Mustapha has become renowned within the industry for the quality and personalised service he offers to his customers. However, since 2008, sales have begun to stagnate and problems accumulate. Competition has increased, and there are now more than 100 active similar-sized companies on the market. In addition, staff problems have surfaced again and again, and Mustapha “blames himself for having trained employees, at the delight of his competitors”.

Yet, although the company intends to remain small and family-owned, Moroccan Shipping is one of the top 15 players in a dynamic[2] maritime market in Morocco. It is the agent of the Chinese National Company (COSCO) and several European companies and has developed a range of services covering the entire logistics chain of marine transportation. At Mustapha’s initiative and to comply with the new requirements of his clients, Moroccan Shipping obtained ISO certification in 2009. Mustapha, the entrepreneur

When he decided to create Moroccan Shipping, Mustapha was seeking autonomy. He wanted to start his own business. He would not stop, as his son Driss remembers, “running around to start the company, get the necessary permits and build its reputation”. Even though he has described himself as an angry and demanding man, the reliability and quality of his work were quickly recognised at the port, which allowed Mustapha to rely on the interpersonal relationships he has worked to build up with all the company’s stakeholders. This is also a key to the company’s competitiveness. Today Mustapha is no longer the only head of the company; he has brought into the business with him Driss, his

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second son. About sharing the responsibility, Mustapha says, “I’m now 64 years old, and I wish I could work half a day and be completely freed from day-to-day tasks”.

In fact, for the last two years, Mustapha no longer receives a salary because he has officially retired, but he relies on the dividends the company can distribute to maintain his standard of living. Of course, he is still the sole shareholder of the family business, which, as well as his children, is at the heart of his whole life. “I explained that, as I long as I was in full control of my capabilities, I would not retire, just step back” he stated before adding, “I would like for Driss to behave like a CEO, be responsible, but I think he is not doing what I expect him to do”. Consequently, although retired, Mustapha is everywhere: he trains staff on multi-tasking, a critical ability in a very small business, he approaches customers, finalises the acquisition of new headquarters and every morning he receives from his main staff a situation report that allows him to monitor the company’s activity closely. All this involvement has caused many clashes with his son.

The genesis of intra-family relations

To better understand the relationships within the Louimi family, it is essential to know the Moroccan socio-cultural context. In this family system (Exhibit 2), paternal authority is unquestionable and is often unchallenged. The patriarch is responsible for the welfare of his family until his death, and descendants have little choice but to submit to his authority.

Mustapha Louimi has three children: two sons, Abdellah and Driss, who have both completed their higher education and their 21-year-old sister, who is still a student[3]. The eldest, Abdellah, after initially training at a business school in Casablanca, continued his studies in the USA where he obtained an MBA in 2002. Driss, the youngest, left the family on obtaining his high school degree and continued his studies at the University of Florida (USA) where he graduated in 2003 with a master’s degree in accounting.

Upon his MBA graduation, Abdellah returned to Morocco and, following his father’s offer, joined the family business. He worked as a consignment manager but resigned in less than a year, as he felt that the situation was unbearable and he often found himself expressing his growing anger and frustration, even venting his emotions one night by ripping up his work shirts. He asked himself: Do their personalities conflict? Is the emotional weight of working in a family business under his father’s rule too heavy? Abdellah eventually left his father’s company and moved on by joining a Moroccan company in a completely different field and years later, the relationship between father and son is still marred by these events.

During this period, Driss was in Florida. He married very young and had two children, and with his wife he established a successful recruitment firm. But the marriage was in trouble and late in 2008, Driss decided to return to Tangier for three months. “My father then offered me to come and see what he was doing, and I agreed to spend three months in the company on a part-time basis”, he recalls. After the three months were up, as he was leaving back to the USA, he said to his father, “I think I’ll return to work with you”, he recalls. “My father was delighted”. He temporarily returned to the USA where Driss and his wife finally decided to get a divorce. Mustapha who, since his youngest son came to Tangier, had never ceased to remind him that “he relied on him” and finally asked the question: “Are you coming back to help me?” At 32 years old and, although nothing had actually been discussed, Driss sold his US business shares to his ex-wife and an associate and joined the family business in Tangier. “I granted myself two years to see if I could take over or not!”

Working in family business

He arrived at the airport on a Friday in December 2009 and joined the company on the following Monday morning. Driss, following the instructions given to him by his father and spent his first six months “behind his desk” to observe and understand the company (Exhibit 3). In July, the consignment manager, exasperated by Mustapha’s methods of management by terror, resigned. Selma, who had been with the company since its inception and was hitherto known

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as the disbursement account and billing manager took over his position, while Driss found himself on his own. Gradually, Driss realised that, although multi-tasking, the position assigned to Selma was too complex for her actual skills, as her errors accumulated and in addition, due to her seniority, her salary was high and too heavy a burden on the company given its size and Driss convinced his father to dismiss her. This would be his first victory, though it wouldn’t last for long! Indeed, after this costly dismissal, seven people were hired by Mustapha successively to take the position of consignment manager:

He hires and fires ceaselessly. One does not take enough initiatives; the other takes too many decisions; the third does not use the correct font [. . .] It is impossible in such a situation to solicit new clients as we hardly meet our current customers’ needs, says Driss.

Keywords: Family business, Emotions, Succession, Morocco, Management style

Used to working in a friendlier environment, Driss could not believe what he witnessed in the company. “At the office, my father has a very authoritarian management style; he shouts, spreads terror, blows hot and cold. He’s the boss; that’s all!” He was a boss who could not delegate, even after the implementation of a certification process. Through that process, every member of staff, Driss included, saw his/her responsibilities clearly described (through job descriptions and organisational processes) and had to agree to them after signing his/her job position description. Today, this patriarchal management not only has had consequences internally but also externally, as some customers began to question Mustapha’s behaviour and the father and son working relationship.

Since his return to Morocco, Driss had lived with his father, and it was common for them to go motorcycling in the Atlas Mountains on Sundays. To his acquaintances and relatives (Exhibit 4), Mustapha presented Driss as “the successor”. However, Driss was a “successor” in what capacity has never been revealed.

In August 2011, in the middle of Ramadan and 18 months after his return, at the end of yet another dispute, the sleep-deprived Driss told his father: “Your business, you can keep it; I quit!”

“I never knew nor wanted to know why my eldest son has left the company. Maybe it was already for the same reasons as Driss today [. . .]”. Mustapha confided, as he added “I know that my way is not always the good one, and I may have upset Driss in front of other employees, but I believe he does not do what I expect of him, and he does not behave in accordance with the job description he signed. [. . .] I, however, need his help today, but if I do not get it, I’ll have to recruit new employees”.

The mission is to support the Louimi family that reaches out to you, as a family friend, to help them find solutions to their problems.

References Allali, B. (2008), “Culture et gestion au Maroc: une osmose atypique”, Gestion en contexte interculturel: approches, problématiques, pratiques et plongées, Québec, Presses de l’Université Laval et Télé-université (UQAM), pp. 1-36.

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Bah, T. (2006), “L’accompagnement du repreneur par le cédant dans les transmissions de PME – une approche par la théorie du deuil”, Thèse de doctorat en Sciences de Gestion, Université Montpellier1.

Barsade, G.S. (2002), “The ripple effect – emotional contagion and its effect on group behavior”, Administrative Science Quarterly, Vol. 47 No. 4, pp. 644-675.

Bauer, M. (1993), Les patrons de PME entre le pouvoir, l’entreprise et la famille, InterEditions, Paris.

Boisard-Castellucia, S. and Van Hoorebeke, D. (2010), “Le management de la diversité des équipes par la contagion émotionnelle, au cœur de la performance de groupe?”, Revue Management et Avenir, No. 38, pp. 240-256.

Birley and Westhead (1994), “A taxonomy of business start up reasons and their impact on firm size and growth”, Journal of Business Venturing, Vol. 9 No. 1, pp. 7-31.

Cadieux and Lorrain (2002), “Le processus de la succession dans les entreprises familiales: une problématique comportant des défis estimables pour les chercheurs”, 6ème Congrès international francophone sur la PME, HEC-Montréal, Octobre.

Christman, J.J., Chua, J.H. and Litz, R. (2003), “A unified systems perspective of family firm performance: an extension and integration”, Journal of Business Venturing, Vol. 18 No. 4, pp. 467-472.

Deschamps, B., Daval, H. and Geindre, S. (2002), “Proposition d’une grille de lecture des profils d’entrepreneurs”, Revue Sciences de Gestion, Vol. 32, Printemps.

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Gomez-Mejia, L.R., Takacs Haynes, K., Nunez Nickel, M., Jacobson, K.J.L. and Moyano-Fuentes, L. (2007), “Socioemotional wealth and business risks in family-controlled firms: evidence from Spanish olive oil mills”, Administrative Science Quarterly, Vol. 52 No. 1, pp. 106-137.

Gross, J. (2002), “Emotion regulation: affective, cognitive and social consequences”, Psychophysiology, Vol. 39 No. 3, pp. 281-291.

Gross, J. (2010), “Emotion regulation”, in Lewis, M., Haviland-Jones, M.J. and Barrett L.F. (Eds), Handbook of Emotion, 3rd ed., Guilford Press, New York, NY, pp. 497-512.

Gross, J. and Thompson, A.R. (2007), “Emotion regulation: conceptual foundations”, in Gross, J.J. (Ed.), Handbook of Emotion Regulation, Guilford Press, New York, NY, pp. 3-24.

Hatfield, E., Cacioppo, T.J. and Rapson, L.R. (1993), “Emotional contagion”, Current Directions in Psychological Science, No. 2, pp. 96-99.

Hochschild, A.R. (1979), “Emotion work, feeling rules and social structure”, The American Journal of Sociology, Vol. 85 No. 3, pp. 551-575.

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Hofstede, G. (2011), “Dimensionalizing cultures: the Hofstede model in context”, Online Readings in Psychology and Culture, Vol. 2 No. 1, available at: http://dx.doi.org/10.9707/2 307-0919.1014

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Kabasakal, H., Dastmalchian, A., Karacay, G. and Bayraktar, S. (2012), “Leadership and culture in the MENA region: an analysis of the GLOBE project”, Journal of World Business, Vol. 47 No. 4, pp. 519-529.

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Kittel, F. (1996), La transmission d’une PME familiale: les processus psychologiques entre le père et son fils, in Le pouvoir dans les organisations: masques et mouvances, Muller, J. (coord.), Editions L’Harmattan, pp. 173-190.

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Kets de Vries, M.F.R. (2010), La face cachée du leadership, 2ème edition, Pearson.

Minialai, C. (2014), “Succession in Moroccan family SMEs. A family system’s Approach”, PhD dissertation, Université de Paris-Ouest, Nanterre La Défense.

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Notes 1. 1€ is approximately 11 Moroccan dirhams.

2. The Port of Tangier Med is one of the flagship projects of development in the Kingdom of Morocco.

It intends to compete with the Port of Algeciras and to become one of the leading ports in the Mediterranean.

3. Although Mustapha offered her to join the family business after completing her studies, she rejected the offer by asking, “But what kind of future are you offering me?”

4. Title given to the marine carrier in recognition of the merchandise that the vessel will carry.

5. Phenomenon frequently observed in Western societies.

6. Le travail de deuil procède d’un travail psychique consécutif à la perte subie d’un objet d’attachement fortement investi sur le plan symbolique, narcissique et/ou fantasmatique. Il renvoie à un processus de renonciation, au passage d’une perte subie à une perte acceptée.

References

Cadieux, L. (2005), “Succession dans les PME familiales: vers une compréhension plus spécifique de la phase de désengagement”, Journal of Small Business and Entrepreuneurship, Vol. 18 No. 3, pp. 343-356.

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Chaulet, C. (1997), “Agricultures familiales et politiques agricoles en Méditerranée”, Options Méditerranéennes, Vol. B No. 12.

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Van Hoorebeke, D. (2008), “Emotions et prise de decision”, Revue Française de Gestion, Vol. 182, pp. 33-44.

Exhibit 1

The consignee agent business (www.marseille-port.fr)

A consignee is a remunerated employee of the ship owner and acts in the name and on behalf of his principal, the owner, for the purposes of the ship and what it carries. The consignee performs all operations that the ship owner himself would do were they there or that the captain would do. In the past, the captain was the “sole master on board” who directed himself in all necessary operations during a trip and its stopovers. However, the complexity of the rules and procedures applicable in maritime transportation require the presence of a specialist with a detailed knowledge of the uses and local jurisdictions. Some also believe that the consignee is the “captain ashore”. Thus, the consignee carries out the following functions:

• they receive the merchandise and issues bills of lading[4]; upon arrival, they deliver it

to the recipient after obtaining customs clearance;

• they attend to the normal needs of the ship and the expedition, prepare the call, assist the vessel while docked and deal with all problems resulting from the stopover;

• they manage the facilities or units of multimodal transportation of goods (including containers, trailers and slave-trailers) on behalf of the ship owner;

• they receive all judicial or extra-judicial acts addressed to the owner that the captain is entitled to receive; and

• they perform all other duties assigned by the ship owner.

The consignee can also be a maritime agent. For this function, he is responsible for the negotiation and conclusion of contracts, financial management, freight research, establishment of a trade policy, customer contacts and relationships with authorities in charge of maritime issues in the area under his control. The extent of his power of representation is determined by the agency agreement signed by the owner (port and general agents). He receives as a compensation for his services a percentage of the amounts involved.

Exhibit 2

Elements of the Moroccan family system

Different types of family systems are characterised primarily by involving several levels of family relationships. In Morocco, the traditional family structure is that of the extended family. As defined by Durkheim, the extended family has, under one roof, two or more elementary units, each consisting of a couple of spouses and unmarried children. Sociologists interested in the evolution of Moroccan society, however, show that even if society is moving towards nuclear family structures (Déchaux, 2009)[5], not including a basic structure, the dependence on kinship networks remains very strong and is embodied in a high frequency of households living in the same place as their parents (Report of the Haut Commissariat au Plan, 1995). However, beyond the sole structural component of the family, we can also distinguish family structures taking into account their operating modes. This is the approach that has been adopted in sociological and anthropological works on family systems that highlight strong differences between countries. Emmanuel Todd, in a 1983 essay, identified five major types of family systems, with the purpose of exploring the links that these systems have with development or demographic changes. There are four parameters used to build this typology. The first is the authority (or freedom) rapport that children have towards their parents, often characterised by the presence or absence of unmarried children in the home. The second is the nature of rapport among the siblings, vis-à -vis the assets of the

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family; these rapports may be equal, unequal for institutional reasons or depend mainly on testamentary dispositions. The third criterion is that of endogamy and exogamy, i.e. the possibility for children to seek a spouse outside the clan or not. Finally, the last element considered is related to the values of masculinity or femininity that determine the weight of mothers’ authority in the family. Based on these four elements and on previous works, Todd draws a map of five family systems. These systems are not permanent but rather capable of evolving over time and space (Todd, 2011).

The Moroccan family system can, thus, be described as being made of community endogamous families, essentially patrilineal (Chaulet, 1997) characterised by parent– child, mainly paternal, authority relationships and fraternal relations of equality. This form of community organisation is one that is more rigid and more anti-individualistic (Todd, 2011). In this respect, they differ from systems existing in Western societies today that are founding families, and nuclear families in particular, that release children from their parents’ authority.

The endogamous nature of these family structures goes beyond the “simple” choice of a future spouse for children. Individuals are part of a larger group, the “kinship” in which relations are perpetuated from one generation to another.

Exhibit 3

Figure E1 Organizational chart of Moroccan shipping (Summer 2011)

Mustapha Louimi, CEO

Billing and Disbursement Account Manager Driss

Consignee, 1 employee Accountant, 1 employee Port Agents, 2 employees Maintenance Personnel,

2 employees

Concerning the organisation of the company, Driss considers himself as both “under his father and responsible for billing and disbursement accounts”.

Exhibit 4 Summary of an interview with Mr Benhadou. Mr Benhadou is a close friend of Mustapha and himself an heir and transmitter of a family business. Mustapha and he recently had an extensive exchange on the current situation of Moroccan Shipping:

“Mustapha is wondering how to react today. He considers that his son Driss does not respect his job position description. Asked whether he actually wants to transmit his company, he responds unequivocally yes I do”,

But the work that needs to be done is, for him, not completed. In addition, following the dismissal of his long-time employee, he finds that his own workload is much more important and has to perform many tasks directly. “Finally, I know that, financially, Mustapha still needs to enjoy the fruits of his activity. I really would like to be able to help them find a solution and to change this situation for the better”.

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Exhibit 5

Figure E2 The integrated process of transmission

Corresponding author Caroline Minialai can be contacted at: [email protected]