CASE
Ferré Media Group
(Part B)
Our success with continuity in this generation comes from
learning from the failure of the second- and third-generation
—María L. Ferré, fourth-generation president of the Grupo Ferré
María Luisa credits her father and her mother, Luisa Rangel, with promoting
strong family unity coupled with unusual support for individual differences in this
fourth generation. Perhaps because of the journalistic culture that runs in the family,
THE NEXT GENERATION
Between 1997 and 2004, every member of the next generation grew into a position of
significant responsibility. Antonio’s son Toño joined Puerto Rican Cement. He
1
worked in production and then management and eventually became the fourth-
generation president of the company. He reported to a key nonfamily executive,
Luis Nazario, then CEO of the company.
Daughter Loren played a key role in the development of City View Plaza, a real
estate development that appealed to her artistic and design capabilities. She later
Next-generation members continued their education and leadership-development
work in academic and seminar settings, but their true education was occurring not in
the classroom but in the workplace. They were getting feedback from the work itself,
their direct supervisors, and Antonio Luis Ferré. He regularly scheduled meetings with
top family managers and acted as their mentor and senior advisor.
Along with developmental opportunities, the new roles of next-generation owner-
managers brought visibility and profit-and-loss implications, both of which increased the
into chaos. Some next-generation members helped her in this role.
NONFAMILY MANAGEMENT: THE EXTENDED
BUSINESS FAMILY
During this final stage of the multiyear succession-and-continuity process, the family
appeared less united in the eyes of key nonfamily managers. Family members had to
come to grips with the fact that differences of opinion or priorities among Ferré family
2FAMILY BUSINESS
and its direction for all involved, thereby reducing stress and unnecessary wear and tear
on an important part of the fabric of the enterprise.
World-class professional managers had a long history in the Grupo. They had always
held responsible positions in Puerto Rican Cement, whose latest CEO, Miguel Nazario,
was not a family member. Various entrepreneurs had helped Antonio Luis Ferré launch El
Nuevo Día. For instance, Carlos Castañeda had had editorial responsibilities at the Associ-
CORPORATE STRATEGY MEETING
María Luisa became president of the Grupo Ferré in late 1998. A year earlier, some next-
generation members had observed that there was a significant gap between the planning
in which they participated at family council meetings and their ability to then make and
execute decisions. Key nonfamily managers, it turned out, had similar difficulties; there
was clearly a disconnect between planning the work and working the plan.
One of María Luisa’s first highly visible acts of leadership of the newly structured
FERRÉ MEDIA GROUP (PART B) 3
The FCC was in the process of changing regulations affecting the ownership of
multiple media companies within particular markets. Which would produce the
desired growth, while maintaining profitability—market specialization (concentrating
further in the Puerto Rican market with new media) or market diversification (invest-
ing in growth opportunities in new markets)?
Primera Hora was a successful example of growth through market specialization.
Management saw a need for the product in the local market; researched the product
EL NUEVO DÍA VERSUS THE GOVERNMENT
Directing its always independent journalistic voice at the incumbent governor of
Puerto Rico and his administration, El Nuevo Día had published a series of articles
that revealed incompetence, corruption, self-dealing, and undue process. The gover-
nor and his administration responded swiftly; they mounted a campaign to discredit
El Nuevo Día, pulled all government advertising (from tax notices to bond-issue
4FAMILY BUSINESS
MARÍA LUISA FERRÉ FACES NEW CHALLENGES
The organizational structure of the group had changed with the creation of the Grupo
Ferré as a holding company. Business units were more clearly separated from El Nuevo
Día, and the presidents of the respective units had more authority in the new struc-
ture. A strategy, strategy-implementation plan, and budget were developed for each
Next-generation members believed that, as a result of the five-year developmental
stretch, they had all found their niches and their unique ways of contributing to the
business. But they still harbored concerns about their ability to make the big decisions
as siblings and co-owners, without the tie-breaking role of Antonio.
Spouses of the next-generation heirs, the in-laws, seemed to be getting pulled into
taking sides over the amount of work and the pressures of public service and public-
After the fourth generation took over the management and ownership control of
the family enterprises, it decided it needed a family office to assist family members in
the combined mission of creating and preserving wealth outside the core businesses.
The family office was initially staffed with key finance and administration staff from
Grupo Ferré. It did not take fourth-generation members long to realize that
What does María Luisa Ferré need to do next? What advice would you give her
on leading her sibling owner-manager team and the fifth generation forward on all of
these fronts?
FERRÉ MEDIA GROUP (PART B) 5