07 Apr 2015
Had Garvin Brown followed his heart when growing up in Canada, the chairman of Brown-Forman Corporation would now be a lawyer rather than leading one of the world’s biggest wine and spirits companies. But things changed when his curiosity for his family’s fifth-generation business – which produces well-known brands including Jack Daniel’s and Southern Comfort – got the better of him.
“Eighty per cent of me wanted to be a lawyer in Montreal, but the remaining 20 per cent was always intrigued by this Kentucky-based company south of the border,” he says. “I was in my mid-20s, so I thought I’d give it a go and have absolutely no regrets about doing so.” That was in 1996. Today, Brown is Chairman of a global, NYSE-listed business that was started by his great-great-grandfather, George Garvin Brown, who founded the company more than 140 years ago.
Brown’s first role with the company involved selling wine throughout New York’s outer boroughs. He then worked in trade marketing before joining London Business School in 1999 to do a full-time two-year MBA. After completing his studies, Brown returned to the US and spent three years working in corporate roles for Brown-Forman. Then, in 2004, he moved back to London to oversee Jack Daniel’s marketing for Europe, the Middle East and Africa. The culmination of Brown’s rise came in 2006, when he was appointed Chairman of the board and given responsibility for Brown-Forman’s operation in Western Europe.
From salesman to chairman, Brown’s rise has taught him much about the governance of a family business. Here, he shares his main insights and lessons.
On what makes a family business so unique
“We try to strike a balance between what’s best as a family company and what’s best as a public company. We have a non-family CEO, non-family leadership team in many operational roles and non-executive directors on our board. We’ve been public since 1933 – we needed to raise capital after prohibition, which was a challenging time for the business – and our organisation has the best traits that you’d find in both a family business and in a public company.
“From a public company perspective, we have transparency, strong financial reporting and controls and a meritocratic management system. On the family side, the Brown heritage gives the company a sound footing. We hope that this gives the board of directors the freedom to stretch their wings, plan ahead for years and flourish.”
What Brown’s first job, as a salesman, taught him about the family business
“It was one of the first rungs of the ladder, but it was also one of the highest because it was energising, exciting and so much fun. There are a lot of functions in any company and they all have coalfaces. The sales function is a good way to get an introduction to any business. There hasn’t been a job at Brown-Forman that I haven’t got a ton out of, and every day I use the skills I picked up in field sales or trade marketing in my role as chairman.”
Applying LBS lessons to his career at Brown-Forman
“I rely mostly on organisational behaviour and the strategy analytics that I learnt while at LBS. Prior to that, I had a marketing job in Europe and the brand management courses were great for that. The corporate finance courses were also phenomenal and I rely on those principles in my job. For strategy analytics, I did a great module called Dynamics of Strategy which uses engineering metaphors to help you think about strategy. You look at a company through the lens of its resources such as the people, cost of goods, route to market, brand equity and balance sheet, and see how they work together. It gives you a holistic view and you see people as a resource in the same way that you see intellectual property as a resource, which is very insightful.”
Why studying at LBS was instrumental to Brown’s career
“One of the problems of coming into a company like Brown-Forman when you don’t have a business education is that you lack perspective on how everything works. I thought it would be good to go to a place like London Business School, to be in a world-class city and to be somewhere that worked for my wife, who was in publishing at the time. At the School, I got to dive into all the different functions and left with a much better perspective on how companies operate. The core curriculum left me with, metaphorically speaking, a good sense of how a Rubik's Cube is put together.”
The Old Forester Water Tower in Louisville, Brown-Forman headquarters.
Author: Rob Morris