Innovation should always be rooted in the core DNA of owner-managers
Formosa Plastics, Siemens, Van Eeghen and Toyota are good examples of how founders passed on the diversification baton to the next generation
When people talk about the Formosa Plastics Group (FPG), the first thoughts that spring to mind are its huge contributions to the growth of the Taiwanese economy over the last 50 years. FPG’s advanced engineering know-how has provided Asian countries with some of the products that enabled them to build their factories and their housing on a scale and at a speed that remains unmatched half a century later.
Its legendary founder’s rags-to-riches story is well known in Asia: a man working himself to the bone as he, along with his younger brother, created perhaps one of the largest industrial conglomerates in Asia. A man who started out in life as a poor rice farmer but died as the second richest tycoon in Taiwan. But what is often overlooked and yet is perhaps the most remarkable dimension of his life is the amount of innovative spirit that he transferred to his 10 children. Y C Wang died in October 2008 at the age of 91, having groomed his offspring for top positions.
All his children were driven by their father’s determination to succeed. Consider just these four children: Eldest child Winston Wong founded Grace Semiconductor Manufacturing Corporation after being driven out of Formosa Plastics Group by his father ; second eldest daughter Charlene Wang founded First International Computer, one of the world’s leading suppliers of motherboards and other computer peripherals; Susan Wang is currently vice chairwoman of Formosa Plastics Group; and Cher Wang founded HTC, the creator of the first Android smartphone.
As the example of Y C Wang shows, owner-managers are often in a better position than they think in building innovation at the core of their organisations, families and successors. Family firms that already have a strong focus on innovation can use their family assets, history and legacy, networks and values, to institutionalise innovation.
In so doing, members of the next generation who are drawn to the successful role models will want to prove themselves in joining the business. Innovation thus guarantees the survival of the family firm.