Carvajal, S.A.: Building on a Century of Business Growth and Family Values Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

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Carvajal, S.A had offered products related to printing such as Yellow Pages, Notebooks and other various products and services regionally and globally. The case tracks the history of this family owned, Colombian based, more than billion dollar holding business, operating from more than a century ago.

The case describes the company’s state of affairs in early 2011, when the products demand diminished significantly and the business matured rapidly due to the emergence of digital technology. Although, the company’s revenue remained constant, but the leaders had the huge concern regarding the strategies and execution to uphold the business legacy of returns, extensive philanthropy, and dividends for all family members.

Along with the strategy issues, Carvajal encountered various other challenges with her first non-family Colombian CEO, Ricardo Obergon, who was appointed over two family executives, in 2008. Ricardo had a proven tenure, which made him to lead this business. Obergon had to manage a complex governance network, including seven operating units with a holding company. Simultaneously, the management and boards of each one of the seven companies, a family council, and 280 members of a shareholding family in its sixth generation.

It was needed to strengthen the various value creating relations, including the relationship between the family and the board, between the family and the new CEO, between the operating companies and the holding companies, and among the many members of Carvajal family, many of whom resided outside of Colombia and Latin America. This strengthening was essential to prevent the risk of taking public the operating companies or holding companies, due to the recent market issues. On the other hand, they had to maintain Carvajal’s long term values of unity, respect, philanthropy, and ethics.