"As seen in Figure, we adapted our “#Venturiroad of institutionalization”
model for Koç Group. On the right of Venturi
road, we sorted the important developments during stages
chronologically since group’s foundation."
For Koç Group, the most effective years of bottleneck on Venturi road are 1990s. In
early 90s, second generation was holding execution and board
chairman positions. The economic crisis in Turkey in April
1994 affected #KoçGroup as well. In 1996, the founder and
honorary president Vehbi Koç passed away. In 1999, like many
other businesses, Koç Group was also affected Turkey’s second
biggest earthquake disaster. Turkey joined the customs union
in 1996 with the treaty signed with European Union. Before
joining custom union all Turkish businesses have assessed the
possible effects of this treaty and taken measurements on their
own. Koç Group, also had in-house discussions about how to
compete with foreign brands entering domestic markets by
custom union, in terms of price and quality. In this stage, selling
the businesses not able to compete was brought to agenda.
By directing and taking the responsibility of cautious and
experienced managers, another solution was found instead
of selling. Before custom union, business’ R&D departments
were established to compete with foreign brands in early 90s.
The investments for R&D activities turned out in 2000s and
ensured group’s export volume to raise.
The end of confusion in Koç Group in terms of institutionalization and passing the bottle neck occurred in early 2000s. The last deficiencies in institutionalization and professionalisation were fixed especially by Mustafa Koç’s efforts.
Before assigned as board chairman, he got approval from
Rahmi Koç for getting support from an American family
business consultant and made studies. With the consultation,
he attended private courses about leadership and financing in
America. After assigned as board chairman, in an interview
about institutionalization in 2010 he said; “We would like as
much as possible professionals being charged, and to assign
best manager for most suitable position. Our aim is to keep
company value at the highest level. In that regard, we reached
the conclusion that when family members are involved, it becomes
difficult to do the best. If they (family members) want,
they can found their own businesses, but there is a consensus
for them not work in company.” The last family member within
the execution, third generation the younger brother Ali Koç
left his position in 2010. At that time Ali Koç quited the last
executive position “Head of Institutional Communication
and Information Group,” and just kept the board of management
membership. Remained institutionalization stages were
completed fester after that date.
As explained in this book, institutionalization, maturation and internationalization processes were completed for Koç Group when the last period of Mustafa Koç’s board chairman.
Namely, in a 90 years period between 1926 and 2016, institutionalization
has completed. Even this seems a long time, Koç
Group is a perfect example by being the biggest, oldest and
most global group which has completed its institutionalization
in Türkiye. Because there was no example business in Turkey
before them which was founded, institutionalized, matured
and internationalized. This example will be model for following
businesses and enable them to proceed this road faster.
After institutionalization and professionalisation was
completed by third generation, group’s #brands and #businesses
started production, sales and services in all continents worldwide.
Thus, Turkey’s oldest, biggest, institutional, mature and
international business, “Koç Holding” was born. In accordance
with the word of founder Vehbi Koç “Our most important
capital is our human resources,” the business successfully
trains talented and successful CEOs in-house. Thanks to successful
management of “Levent Çakıroğlu” assigned as #CEO
in 2015, group’s growth continues without any problem after
#MustafaKoç who passed away while in charge. Now, group
has passed venturi road of institutionalization and proceeds
on international wide highway.
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