As part of the series of interviews on “Family Businesses in Times of Crisis”, we are pleased to share the conversation of Rania Labaki, Associate Professor and Director of the EDHEC Family Business Centre, with Jean and Jean-Alain Cheung-Ah-Seung, third generation members in charge of the Operations of CHEUNG AH SEUNG Enterprises based in the Indian Ocean (Reunion Island and Mayotte).
Founded in 1964 by their grand-father who emigrated from China at age 13, CHEUNG AH SEUNG Enterprises is a medium-sized group of specialized service companies that strive to offer their customers turnkey and packaged solutions powered by 5 areas of expertise: logistics and transportation, lifting, construction equipment, maintenance, and removal.
The COVID-19 pandemic had a ripple effect on the world economies and societies. How have the family and the business been particularly impacted?
Youngsters from the 3rd generation, who are studying overseas, had to stay home and followed their distance-learning courses. Lockdown away from home was not easy to handle but they showed great solidarity between them. We created a task force to exchange intel from our different industries but also to quickly take the necessary measures to protect the family integrity.
Regarding the family real estate assets, we have been trying to assist our tenants as much as possible.
As for the Operations, the pandemic variously impacted our different business units.
Some of these business units, such as our removal companies, had to thoroughly stop their activities. Similarly, all construction sites closed down, impacting our equipment rental and lifting activities.
On the other hand, businesses like industrial maintenance, logistics and transportation never stopped. We guaranteed a service continuity for our customers in charge of vital activities. In the meantime, the on-call duty service was reinforced.
The diversity of our industries has always been a managerial challenge on a daily basis. This said, we developed some kind of natural resilience and agility that helped us face the ordeals. Thanks to the commitment of every employees (office staff, truck drivers, sales rep, technicians, managers, executive committee members, head of business units) and the agility of the organization, we managed to curtail the loss of revenue to 30%.
In Mayotte, our main concern was the complex social climate. Luckily enough, the team natural resilience is helping them to navigate quite well through the crisis.
How did these changes translate into initiatives (or strategies)?
Firstly, neither the 2nd, nor the 3rd generation, ever faced such a scenario and we are handling the situation with great humility. We focused on our family values, on our employees and our customers. We are lucky enough to be able to share our opinions and experience with family friends, suppliers, customers and partners which helped us to decipher the trends. Moreover, the trust given by the 2nd generation made us more confident in the actions taken.
At a very early stage, the Executive Committee, together with the managers, came up with and agreed on the following action plan:
- Focus on cash flow: everyone, at every level helped with the debt collection
- Protect our employees: we managed to maintain the salaries (yet we had to take hard decisions such as stopping the temporary workers). A COVID task force was set up to organize a regulation watch and carry out all actions required to protect the employees’ health
- Stay close to our customers: we have never called so frequently our key account customers and a transversal sales team was created.
- Implement our activities’ sheds: activities digitalization, paperless processes
- Get ready for the end of the lockdown: we hastened the decentralization of decision-making processes and made the teams more autonomous. We learnt to delegate more and worked better together as a team. We spoke the truth to the employees; as a result, they trust us, and everyone worked shoulder to shoulder. This is a capital point as we think the hardest part of the crisis is yet to come!
Family businesses are known for their values of social responsibility, acting as ambassadors of the territories in which they are rooted. How did these manifest themselves in the current context?
As descendants of immigrants, we have always felt indebted to France and Reunion Island, hence we are trying to do our part for the local people and economy. We decided to formalize our commitment by creating, since last year, “Give Back operations”, where each year, our employees choose an association to support. Last year, together with “Ti Prince Marmailles” association, we organized a Christmas party for children affected by cancer.
During the COVID crisis we decided to give a hand to the local Red Cross with regular transportation of food pallets across the many warehouses on the island. In parallel, we donated masks to hospitals’ staff, who were indeed in great need.
An ongoing key subject for us has always been: “how can we give back more to the territory that welcomes us?”
How are you preparing for the post-crisis phase, in line with medium or long-term challenges the family business will be facing?
As an entrepreneurial family, all our actions are taken to lay the foundation for the next generation: in a nutshell, we try to be long-term focused.
The crisis consolidated our idea that agility and efficiency in implementing plans is key to survival. The idea is to continue the digitalization of our activities to gain productivity. Moreover, the development of our e-commerce platforms is speeding up.
In the meantime, we endeavour to develop new complementary activities and seek new business opportunities. Building a cluster of competences in different fields is of paramount importance.
Another core idea is to strengthen our CSR policy: we need to put humans and our environment in the midst of preoccupations. At our humble level, we trust we can do our bits to change things. For instance, we decided to use biodegradable hydraulic oil in our machines to curb the pollution emitted by our fleet.
In the last few weeks we had a good opportunity to stop and listen to ourselves. With a positive attitude, is it possible to see this emergency as an opportunity to improve our lives and businesses? If yes, how?
Speaking of our (recent) experience, our belief is that the resilience of an entrepreneurial family is to acknowledge its weaknesses and build something stronger. In accordance with Kintsugi philosophy, the failures our family experienced is part of our history and will guide us to a more balanced and serene future.
The crisis triggered many questions we are trying to answer side by side with our employees. Namely, how can we find a better balance between private and working life? What actions can we take for our social, economic and natural environment ?
We deeply believe that each of us have lessons to learn from this crisis so that individually and collectively we can build a more sustainable and fairer future.