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Case Study

Aokang: Where do we go from here?

By Katherine Xin, Joachim Schwass, Lily Zhang and Bingsheng Teng

5 pages

May 2009

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Reference: IMD-3-2073

Aokang was one of China’s largest shoe manufacturers. In the early period, it was a typical family-run business, with many of the company’s high-level posts held by relatives. After two major adjustments, Aokang became a company mainly run by professionals. But Wang Zhentao, the founder of the company still owned 100% of Aokang and had firm control over the company. Aokang required a substantial injection of capital for further growth. Would Wang be willing to accept the dilution of shares thereby losing some control of the company?

Learning Objective

To provide insights into privately and family run businesses in China which evolve from an entrepreneurial to a more professionally managed business. The involvement of several family members in the business creates complexities which can be addressed either through the sidelining of some family members or the creation of effective multi-level governance structures.

Keywords

Family Business, Entrepreneurship, Succession, Partnership, Business Strategy, Ownership Strategy, Governance, Family Relationship, General Management, Strategy

Settings

China
1997-2008

Type

Field Research

Available Languages

English

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