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Case Study

The Midea Group

By Denise H. Kenyon-Rouvinez and Nan Li

4 pages

November 2015

Reference: IMD-7-1668

The Midea Group, a large family-controlled, publicly traded company was one of China’s largest household appliance manufacturers and widely considered a market leader. Founder He Xiangjian grew the small plastics production company he created in 1968 and turned it into a successful household appliance manufacturer that went public in 1993 as “Guangdong Midea Electric Appliances Co. Ltd.” It was Xiangjian’s firm belief that family should only exercise an ownership role and not be involved with managing the company. He himself resigned from the Midea Group board in 2012, naming a non-family member as his successor. The seven members of the senior management team were all professional managers and held Midea Group shares with voting rights.

Learning Objective

This case sets the scene for a discussion about whether family members should be involved in company management as opposed to having an ownership role only. It also opens a debate on the pros and cons of giving shares to employees .

Keywords

Home Appliances, Family Business, Family Ownership, Non-family Chief Executive Officer, Non-family Member, Shareholder Rights, Public Company

Settings

Asia, China
Midea, Manufacturing
1993-2014

Type

Published Sources

Available Languages

English

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