INSEAD, the leading international business school, announced today that it will enter into a joint research partnership with Copenhagen Business School (CBS) to develop a world-leading knowledge centre addressing ownership change in Danish small and medium enterprises. With the objective of maintaining jobs and production in Denmark, the new research will facilitate knowledge and tools supporting successful business ownership transitions. The Danish Industry Foundation (DIF) has awarded the joint grant of DKK 22.8m (around 3 million Euros) to INSEAD and CBS to address rising demands for help and knowledge around ownership change in Denmark. Owner-managed companies make up nearly eighty percent of businesses in Denmark but, in the coming decade, ownership of approximately 25,000 businesses will be transferred to a new owner or group of owners.
Professor Morten Bennedsen, Academic Director at The Wendel International Centre for Family Enterprise at INSEAD, which will lead the research, said: “Long-term planning is a key challenge for many owner-managed SME’s around the world. What is so exciting about this research project is that we are able to roll out the topic of ownership change at a country level - something which has never been done before – and with the input and insights of a large pool of SMEs. We are extremely grateful to the Danish Industry Foundation for its support, without which this level of unique research could not happen.”
Using the new grant, INSEAD’s world-leading research centre on family businesses, The Wendel International Centre for Family Enterprise, will work with CBS to provide the knowledge and research direction for a new centre opening in Denmark, the CBS Centre for Owner-Managed Businesses (COMB). The five-year research project will generate new intelligence around Danish family-led SMEs, economic consequences of ownership, successful transfer of ownership and the challenges faced. From this knowledge, INSEAD will work with CBS to develop new tools that owner-managers of Danish SMEs can use to ensure successful change of ownership. Tools will include a ‘Family Business Map’ and an online platform for benchmarking.
Danish Industry Foundation’s CEO, Mads Lebech, explained: “Denmark currently has no research-based knowledge or specific tools for guaranteeing the successful transfer of ownership. Sixteen thousand owner-managers are over the age of 65 and some of them have not yet considered the most suitable exit strategy for the transfer of ownership of their company that will take place within a short time. As a result, the goal of the Foundation’s grant is to provide Danish owner-managers access to individually tailored knowledge, tools and training in order to devise a suitable strategy for the change of ownership, regardless of whether that is to happen in one, five or ten years”.
“This significant grant given to CBS by the Danish Industry Foundation is a welcome opportunity to create a strong impact in an area of great importance for business. A large number of Danish companies are manager-owned and this will provide us with the opportunity to help them with some of the tough decisions they face,” says CBS President Per Holten-Andersen.
INSEAD’s Professor Morten Bennedsen added: “We intend for this research to lead to the development of new tools and methods that will help thousands of Danish owner-managed firms as the country moves into a period of transition, with more and more founders of small and medium businesses looking for effective exit strategies in the coming years. But even beyond Denmark, there will be many gains to be shared with firms around the world.”
The grant from the Danish Industry Foundation will cover the research projects’ initial activities for the next five years, including development of the CBS Centre for Owner-Managed Businesses which will begin operations in the spring of 2014. Meanwhile, INSEAD’s globally-recognised Wendel International Centre for Family Enterprise, which celebrates its tenth anniversary this year, will also benefit from the grant. Findings from the in-depth study of 3000 to 5000 SMEs in Denmark – which by nature are, in the large part, family owned businesses – will provide the centre with new insights and tools addressing the constantly evolving challenges associated with long term planning in family firms around the world. Research will be based on the analysis of registry data covering all Danish businesses as well as surveys undertaken among a large number of companies.
The Danish Industry Foundation supports innovative, inspirational and sustainable projects that can strengthen the competitiveness of Danish business.
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About The INSEAD Wendel International Centre for Family Enterprise
Founded in 2004 as a Centre of Excellence, The INSEAD Wendel International Centre for Family Enterprise promotes family businesses as sustainable business models largely representing the backbone of the world's economies. To celebrate its 10th anniversary, the centre will run a series of special family business events which will be held across Europe, Asia, and the Middle East to commemorate the Centre's first successful decade. For more information visit: http://centres.insead.edu/family-enterprise
