Columbia Business School Alumni Keep it in the Family
Columbia Business School’s blog recently published an article by Agatha Bordonaro on the long-lasting impacts and assorted daily challenges of family-owned businesses, with personal anecdotes and insights from CBS alumni.
According to the article, family-owned businesses constitute an estimated “70-90% of global GDP.” Stefan H. Robock Professor of Finance and Economics Daniel Wolfenzon believes that the resilience of family-owned businesses is due to “the owners’ desire to pass them on to the next generation.”
Wolfenzon adds, “Traditional companies can learn a lot from family businesses.” And traditional companies would do well to take notes from Alan Wasserstrom ’63.
Wasserstrom is Chair and former president of the Wasserstrom Company, a Columbus, Ohio-based restaurant supplier whose customers include Wendy’s, Dairy Queen, and Giant Eagle. The company, according to the article, “boasts 1,500 employees across six US cities and in England, India, and Venezuela.”
Wasserstrom’s grandfather, Nathan, founded the company in 1902. Nathan parlayed his success as a door-to-door “novelties” salesman into a popular neighborhood bar, whose popularity happened to coincide with 20’s Prohibition. Nathan quickly pivoted when Prohibition struck and turned his bar into a “shop for home-brewing equipment.”
When Prohibition was repealed, Nathan opted to move away from hospitality into building construction material, rechristening the business “N. Wasserstrom and Sons,” to recognize the contributions of his eight sons. Following World War II, Nathan expanded from mill-work into “commercial kitchen equipment as the restaurant industry soared with the return of young veterans.”
Alan noted that these challenges taught the Wasserstrom clan a hard lesson that “change was part of the landscape.” Alan elaborates: “A number of local companies went out of business because they kept doing the same thing in the same way for decades. All of a sudden, they’re doing a really great job of making buggy whips, but there aren’t any buggies.”
Alan believes that keeping it all in the family maximizes efficiency without compromising a good-natured atmosphere. “We put the next generation in a part of the company where they had a boss who wasn’t my cousin or me. That ‘real’ boss taught them from the ground up about our industry, our culture, and our business.”
Read the rest of the article to learn about how other Columbia Business School alumni navigate the long- and short-term challenges of family firms.
About the Author
Jonathan Pfeffer
Jonathan Pfeffer joined the Clear Admit and MetroMBA teams in 2015 after spending several years as an arts/culture writer, editor, and radio producer. In addition to his role as contributing writer at MetroMBA and contributing editor at Clear Admit, he is co-founder and lead producer of the Clear Admit MBA Admissions Podcast. He holds a BA in Film/Video, Ethnomusicology, and Media Studies from Oberlin College.
