Lakkard leather company

Hiwad Abdulgafar
Hui Lin
Ommair Zahid
 INTRO
· Carl Friedrich Lakkard is the founder.
· Founded in 1966 in Wuppertal, West Germany.
· Gained a reputation for fine leather design and manufacturing.
· In 2003, the company employed 131 people.
Company Background
• Carl F. Lakkard was 24 in 1966, when he resigned for a sales representative job.

• Directly competed with his former company.

• Selling Car accessories, such as leather steering wheel covers and seat cushions.

• In 1994, acquired the Eggers Company, a regional competitor

• In 1998, Kaiser merged with the Eggers Company to form the Lakkard Leather Company.
Accidental Succession
• In 2003, Carl Lakkard and his wife Sandra were involved in a car accident.
• Their son, Peter took over as interim manager.
• Peter lacked the knowledge and skills.
• He discontinued his degree and ran the company.
• He learned quickly and adapted well.
• Peter was gentler which gained him favor with the employees.
 CONFLICTS

A. B. C.

The Conflict began when, He was expecting to Carl and Peter clashed
operate his business just
Carl returned after his as he always had. over many business
recovery. decisions.
 Key Challenges

• Leadership and Management

• Innovation and diversification
• Negative cash flow

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 INDUSTRY GLOBAL
TRENDS TRENDS
 Technological Advancements • Animal cruelty
 Competition • Rise of synthetic leather
 Cost of Manufacturing • Sustainability
 Location • Expensive

> >
Location
Specific
• Hard to attract young employees
• Cost of labor force
• Tax laws of Germany
Company
Specific
• Lack of vision and leadership
• No coordination.
• Lack of innovation
• Skeptical of hiring executives
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 FRAMEWORKS CAN BE APPLIED

To overcome these challenges, one of the following frameworks can be applied.

• Agency Theory.
• Transient Advantage.
Our Recommendations

• We Recommend That Carl and Peter should play to their strengths.

• Change of Structure.
• Hire trained and qualified executives.
• Adapt their business model and practices.
• Plan and have a vison of the company's future.
• Diversify the products line to attract more potential customers.
• If the above options are not feasible, sell the company and start fresh.

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BENEFITS Start

TO EACH
Benefits
OPTIONS
• Change of structure
Fresh ideas, innovation,
younger generation.

• Peter takes over

Fresh start, enthusiastic,
familiarity.

• Selling the company

Cash, start a new business

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 DRAWBACK
Drawbacks
S TO EACH
• Change of structure
OPTIONS
Different mindset, losing control of the
company

• Peter takes over

Change the DNA of the company

• Selling the company Finish

Emotions, values.

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 Hiwad Abdulgafar
KEY The main point I take away from this case is –

LEARNING A family business should be well structured where all

the members of a family share the same vision and can
have their say in the business decisions.

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 Hui Lin
KEY The main points I take away from this case is -

LEARNING • Keep the company's

international trend.
innovation and adapt to the

• Find the right partner

• Leaders need to cultivate growth mind-set
• Pay more attention to the company's financial situation

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 Ommair Zahid
KEY The main points I take away from this case is -

LEARNING • Have a well-structured goal and vision.

• Have open communication.
• Willing, accepting and adapting to change.
• When in doubt, ask for a second opinion.

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Questions

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