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SPONSOR | EVOLUTION OF A BUSINESS BEYOND NUMBERS! Presented | LSE Third ANNUAL BUSINESS RESEARCH CONFERENCE ON MANAGING BUSINESS IN PAKISTAN | Apr15

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Page 1: SPONSOR | EVOLUTION OF A  · PDF fileManagement Entrepreneur Strategic ... Engro Fertilizer Engro Foods Dawood Hercules ... The presentation should not be

SPONSOR | EVOLUTION OF A BUSINESS

BEYOND NUMBERS!

Presented   |   LSE Third  ANNUAL BUSINESS RESEARCH CONFERENCE ON  MANAGING BUSINESS IN PAKISTAN  |   Apr15  

Page 2: SPONSOR | EVOLUTION OF A  · PDF fileManagement Entrepreneur Strategic ... Engro Fertilizer Engro Foods Dawood Hercules ... The presentation should not be

Who Is Sponsor?

ONE WHO HAS THE FINAL SAY!

Page 3: SPONSOR | EVOLUTION OF A  · PDF fileManagement Entrepreneur Strategic ... Engro Fertilizer Engro Foods Dawood Hercules ... The presentation should not be

Why Sponsor Is Important?

Sustainability [Competitive Standing]

Longevity [Beyond Generations]

WHENEVER A BUSINESS RUNS OUT OF SPONSOR, CHANCES OF SURVIVAL DIMINISHES!

Page 4: SPONSOR | EVOLUTION OF A  · PDF fileManagement Entrepreneur Strategic ... Engro Fertilizer Engro Foods Dawood Hercules ... The presentation should not be

Fate of Businesses – Classic Example The 22 FAMILIES OF PAKISTAN [1968]

Winners

Dawood

Ali

Habib

Nishat

Gul Ahmed

Survivors

Saigol

Adamjee

Colony

Crescent

Gandhara

Rest in Peace Jalil

Fancy

Valika

Bawany

Ispahani

Khyber

Beco

Arag

Hafiz

Milwala

Karim

Dada

Page 5: SPONSOR | EVOLUTION OF A  · PDF fileManagement Entrepreneur Strategic ... Engro Fertilizer Engro Foods Dawood Hercules ... The presentation should not be

Sustainability How to bring it to a business?

Page 6: SPONSOR | EVOLUTION OF A  · PDF fileManagement Entrepreneur Strategic ... Engro Fertilizer Engro Foods Dawood Hercules ... The presentation should not be

Sponsor of a Sustainable Business

Reward Risk

• Consistent revenue generation • ABILITY Reward

• Staying afloat in times of financial distress

• ADEQUACY Risk

ADEQUACY OF ABILITY

CREATES A BALANCE

Business acumen

Knowledge & Understanding

Experience (related & unrelated)

Page 7: SPONSOR | EVOLUTION OF A  · PDF fileManagement Entrepreneur Strategic ... Engro Fertilizer Engro Foods Dawood Hercules ... The presentation should not be

• Control

• Competitiveness

• Control

• Competitiveness

• Governance

• Alignment

• Governance

• Alignment

• Money

• Ownership

• Money

• Ownership

• Right Opportunity

• Risk & Reward

• Right Opportunity

• Risk & Reward

Identify Incubate

Operate Monitor

Sustainability Cycle

Page 8: SPONSOR | EVOLUTION OF A  · PDF fileManagement Entrepreneur Strategic ... Engro Fertilizer Engro Foods Dawood Hercules ... The presentation should not be

Longevity How to bring it to a business?

Sustainability

Page 9: SPONSOR | EVOLUTION OF A  · PDF fileManagement Entrepreneur Strategic ... Engro Fertilizer Engro Foods Dawood Hercules ... The presentation should not be

Sponsor | Typical Lifecycle

• Willingness What we loose along this lifecycle?

Management

Investor

Strategy

Management

Ownership

Strategy

Ownership Ownership

Strategy

Management

Entrepreneur Strategic Shareholder

Page 10: SPONSOR | EVOLUTION OF A  · PDF fileManagement Entrepreneur Strategic ... Engro Fertilizer Engro Foods Dawood Hercules ... The presentation should not be

The Correct Approach

Page 11: SPONSOR | EVOLUTION OF A  · PDF fileManagement Entrepreneur Strategic ... Engro Fertilizer Engro Foods Dawood Hercules ... The presentation should not be

Longevity Matrix IT IS POSSIBLE TO HAVE SAME SPONSOR STRENGTH

WHILE MOVING ALONG THE LIFE CYCLE

Let’s put our ownership in a STRUCTURE

Succession planning

Corporatize Sponsorship

Business Management

Now Sponsor is a LEGAL person

Cha

lleng

es

Page 12: SPONSOR | EVOLUTION OF A  · PDF fileManagement Entrepreneur Strategic ... Engro Fertilizer Engro Foods Dawood Hercules ... The presentation should not be

Longevity | Pakistan Story

House of Habib [Habib Family]

Engro Corporation [Dawood Group]

Shirazi Investments [Atlas Group]

Key Businesses Indus Motor [Toyota]

Habib Metropolitan Bank Metro Cash & Carry

Key Businesses Honda Atlas [Cars]

Atlas Honda [Motorcycles] Atlas Asset Management

Key Businesses Engro Fertilizer

Engro Foods Dawood Hercules

150+ years 100+ years 50+ years

Page 13: SPONSOR | EVOLUTION OF A  · PDF fileManagement Entrepreneur Strategic ... Engro Fertilizer Engro Foods Dawood Hercules ... The presentation should not be

Sustainability

Longevity

Another Dimension

Page 14: SPONSOR | EVOLUTION OF A  · PDF fileManagement Entrepreneur Strategic ... Engro Fertilizer Engro Foods Dawood Hercules ... The presentation should not be

Impact of Sponsor

4 6 10 9 8 10 11

15 19 20

24

05

1015202530

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

PKR

bln

UBL | Profitability Trends Sponsor | Bestway Group | Since 2002

6 10 13 10 11 13

17 22 23 23

32

0

10

20

30

40

20042005200620072008200920102011201220132014

PKR

bln

HBL | Profitability Trends Sponsor | Agha Khan Group | Since 2004

4 4 4 7 8

10 12

15 15

0

5

10

15

20

2006 2007 2008 2009 2010 2011 2012 2013 2014

ABL | Profitability Trend Key Sponsor | Mukhtar Family | Since

2002

-12 -16 -16 -15

-9

3 7

13

-20-15-10-505

1015

2007 2008 2009 2010 2011 2012 2013 2014PKR

bln

K-Electric | Profitability Trend Key Sponsor | Abraaj Group | Since 2008

5.5 times

3.5 times

6 times

The turnaround

Page 15: SPONSOR | EVOLUTION OF A  · PDF fileManagement Entrepreneur Strategic ... Engro Fertilizer Engro Foods Dawood Hercules ... The presentation should not be

Contact

Muhammad Shahzad Saleem [email protected]

Samiya Mukhtar [email protected]

Nayab Shafique [email protected]

Contact Number: +92 42 3586 9504

DISCLAIMER PACRA has used due care in preparation of this document. Our information has been obtained from sources we consider to be reliable but its accuracy or completeness is not guaranteed. The information in this document may be copied or otherwise reproduced, in whole or in part, provided the source is duly acknowledged. The presentation should not be relied upon as professional advice.