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Family Legacy Series 2016

Celebrating the Rosen Family


One of Canada’s leading fashion retailers took centre stage at the 2016 Family Legacy Series (FLS), the flagship annual event of the UBC Sauder Business Families Centre.

The gala celebrated the Rosen Family, led by Larry Rosen, Chairman and CEO of Harry Rosen, Inc., a fashion retailer that currently accounts for 40 per cent of the country’s high-end menswear market – inspiring what was likely the best-dressed FLS audience yet.

More than 500 people were in attendance to hear insights into the world of family business from Larry Rosen, son of founder Harry Rosen. Larry and his sons Graham and Ian were the honoured guests at the event along with two senior members of the Rosen’s management team who have both been with the company for more than 20 years.

Larry was interviewed by award-winning journalist Steve Paikin on a stage decorated with ties, mannequins and other icons of the luxury brand. The rapport between the two long-time friends offered the audience a deep and candid lens into the history of the Rosen family enterprise.

He discussed the company values, rooted in Harry’s longstanding commitment to a customer focus and a true passion for the brand. He said Harry taught him that succession needed to be earned, and how they both felt it important for those in a successor generation to establish themselves first outside the company. Ian and Graham joined the conversation and agreed on the importance of getting MBAs to hone their business skills, keeping in mind how to apply what they’re learning to the family business.

Larry opened up about the firm’s future, and how he plans to navigate succession – which he says must be done early enough, as “we all have a best before date.” Harry Rosen’s success has been due to the strength of its people, like in any company, Larry said. While family members have the advantage of a more long-term, cross-generational outlook, he stressed that all succession decisions need to be highly purposeful.

In addition to being a venue to hear insights on tales of family enterprise, the nearly sold-out affair was an important networking opportunity. Those at the event had the chance to get acquainted with the Business Family Centre’s new faculty member, Dr. Vanessa Strike, the CIBC Professor in Applied Business Family Studies.

The annual FLS gala has been educating and inspiring the business community since 2001 with stories from some of Canada’s most successful businesses and the families who founded them, while highlighting the Business Families Centre’s leading family business educational programs, resources and academic research. This year’s event on March 2, 2016 was hosted by Samantha Legge, president of Canada Wide Media, and moderated by Professor Darren Dahl, senior associate dean of faculty at the UBC Sauder School of Business and director of the Robert H. Lee Graduate School.

For those who couldn’t make it to the event, read on for some of the highlights of what Larry Rosen, his sons and his colleagues had to say about their journey leading an influential and distinguished family business.

Q&A with the Rosen Family


On what Harry expected for the next generation of the family business:
Larry:
He never really spoke to us about joining the business or pressured us in any way. The only thing he pressured us to do was to get a great education - which all of my siblings and I did.  He was not a university graduate – in fact he was not a high school graduate – so he was in awe of people who got university educations.

He made it clear to me that we are a meritocracy and that I had to prove myself. But if I came and I worked hard, I would be a part of senior leadership.  Having the last name wasn’t going to be enough – he made that clear to me – but it helps. I articled, I practised law, I established myself on my own credentials. In fact, I probably came into the business too early. If we had been more methodical about it, we would have said, get some more experience and come into it at a higher level. I think in any family business, anybody in a successor generation should get out there and really establish themselves to a certain extent on their own.

On the values of Harry Rosen:
Larry:
My dad is amazing.  He is passionate, he is obsessed with customer service and doing the right thing by customers. In executive meetings trying to make million dollar decisions, if a customer would call over a pair of socks, Harry would halt the meeting and we all would wait for 20 minutes while he would discuss socks with the customer. He set that bar – the customer was the most important thing. We recently won the 10 most admired corporate cultures.  Those are the types of things that really establish a corporate culture, that priority of everybody in the company knowing how to sell and how to take care of a customer.

On transitioning from generation one to generation two
Larry:
I became the CEO in 2000 and in 2004, Harry would’ve been about 73 or 74, he came to me and he said “It’s time, you know a fashion business’s needs can’t be run by a man in his 70s.”  We passed ownership down to me and my siblings and he assumed the role of a mentor and consultant.

It took me until 2010 [to purchase the entire business], and I made my siblings and I very happy, but I learnt so much from that. We all had outside advisors, we had evaluations, we had great bankers and we worked it through. But as I said, there’s so much emotion at a family level, it really shouldn’t be like that. We really were successful in some ways almost despite ourselves. It did work.

On preparing for generation three:
Ian:
When I got accepted into my MBA program, the director of Harry Rosen put together a rotational program so I could go into school thinking about how this might apply to Harry Rosen. So I audited, worked in the marketing department, I sold on the floor for the first time, I worked with the operations guys – it was a lot of fun.  I was a fly on the wall and soaked it in like a sponge. I think it has paid great dividends while at school.

I’ve similarly [to my dad] been watching and being very impressed at what he is doing. I thought, eventually, I am going to want to be a part of this. So we started talking about my expectations, what I should be doing with my personal life. I have to get myself ready, and those kind of conversations have organically developed over the last few years.

On expectations from Larry for generation three:
Graham:
He has set up a few key conditions from the start: a strong business education, a strong outside work experience, a desire to work for the business and the business wanting us. So he’s always set strong business experience – he didn’t quite say MBA, but we’re both going to have our MBA so I think that was part of it.

You know, I think I wanted it myself too, similar to my dad speaking about proving  yourself, I think an MBA goes quite a long way teaching you the ropes of business and getting a lot of hands-on experience as well as academic experience. As someone from a family business, I think there’s always that desire to prove myself first, to succeed elsewhere first. It’s always been in the back of my mind.

On what Larry thinks about his transition out
Larry:
My primary responsibility as CEO is to make sure that regardless if it’s family or not family, that we have incredible succession. At the end of the day, anybody in business knows it is all about your people, inspired people, people committed to it. It would be wonderful in my opinion, if family can be a part of that. I think family businesses are wonderful – I think they have a great perspective. They are not under the pressure of public scrutiny, and they can think long term. My goal is really just to transition that way, but to bring in outside advisors and not do it by accident.

I involved all three of my sons and my wife; we know a lot of other family businesses around the world. We got the name of the three or four best family consultancies, transition consultancies in the world. We interviewed them. I tried to get as many of the boys involved in the interviewing process, my wife as well. At the end of the day we chose one – Ian actually made the call. It’s a good thing when you are choosing a consultant, you have them make the call because then they are going to buy into it.

The one thing that is really wonderful about their approach is it’s not just about people who may have an interest in the business. It is about the whole family and how they are involved. You can be involved in a family business in a governance role and you have to be educated to do that as well. They have been very holistic in their approach.

Ian and Graham on working with an outside consultant:
Ian:
I think what I am looking for is someone I can speak to about feelings I am dealing with and what it was going to be like to work with my dad.  They have worked with so many families so they could set up that type of expectation and what my job should be when I join. They put together a really great team that could speak to each generation.

Graham:
They frame the best succession practices in the world from clients they have worked with. That has been extremely valuable to me. And it has been really nice to be locked up in a room with my three brothers. They lock us up in a room and let us talk about our feelings, what our anxieties are – it’s really great actually.

On what it is like not being a Rosen at Harry Rosen Inc.:
Michael Peters, Managing Director - Western Canada, 28 years with Harry Rosen Inc.
One of my first conversations with Harry was, “I want you to view this as your business. You are working under the umbrella of Harry Rosen but we hire innovative, entrepreneurial, caring people and we think you’ve got the potential to be a big player on our sales team. So go for it, try your hand at it, use your ideas, we are open to it, we’re excited about it.” There has never been a time when they have stopped me from trying something innovative to gain market share. That was the key for me. There’s nothing that I can’t do within this organization – still to this day.

On getting people who are not family to be as loyal to the company:
Larry:
We have a culture, we are a meritocracy, and Wes said it well, it is a professionally managed company based on the vision of my father. Yes, it’s a family business but at this size we have to be professionally managed, we have to have structures, and we love to recognize innovation and passion.

On inspiration from other family businesses:
Larry:
There’s a family business out in the States called the Mitchell family of stores. We’re part of an international organization together, we meet once a year and they really inspire me. They strike that wonderful balance between being in a family business and being a business that really promotes their people, so I really look up to them.

We all belong to an international organization. Eleven members, one from each country. They are all family businesses in luxury apparel. We meet once a year and we have an agenda, we open books, share ideas, and talk about all these issues. I have found that very supportive and very helpful. I always walk away with about three or four meaningful ideas. It is very worthwhile.

On whether Larry should pass the business down to the next generation or sell it all together:
Wes Purdie, Regional Director – Vancouver, 23 years with Harry Rosen
I think that the example of Harry moving his business on to Larry has been a tremendous success. It has allowed our organization to grow. There’s inculcated vision within that lineage and I would say that we saw these two young gentlemen come up and talk about their passion for what their father is doing –  that’s inspirational. And it’s great to work with someone or for someone that is that passionate. I think I’d feel far more comfortable working alongside them than I would with someone outside coming in and trying to re-curate what Harry Rosen is. That would be a big culture change.

On beliefs about the nature of a family business that are no longer true:
Michael Peters
That your ideas would have to be scrutinized heavily by the family first before they get pushed through nationally. That is definitely not the case in our company.

On regrets:
Larry:
No, I have zero regrets, I am so proud of my sons and how they handled themselves today. I’m so proud of everything we’ve built. I’m so proud of the people I work with. I have no regrets.

On how the notion of family has led to success:
Larry:

First of all, I’m so honoured to be speaking at a legacy dinner for family businesses, I think it’s great what Sauder is doing and the efforts that you are making to glorify family businesses. We’re not compelled to make decisions with shareholders looking over our shoulders. We can make decisions with the right criteria for our employees and for our customers. Those are longer term decisions, they don’t pay back as quickly, but it doesn’t matter how quickly they pay back. It does matter, but it doesn’t matter that we have quarterly earnings progressing everything and I think that allows us to be more astute, to make the right decisions, and to make the longer term decisions.


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