“When you are in a family business, you need to regularly ask yourself two questions: ‘Am I really being evaluated by my merits?’ and, ‘What am I doing here?’” says Guler Sabanci, chairperson and managing director of Sabanci Holding — Turkey’s second-largest financial and industrial conglomerate — and founding president of the Board of Trustees of Sabanci University, Sabanci Foundation, and the Board of Sakip Sabanci Museum. “You shouldn’t only be involved for the heritage or the family; it also should be for yourself. Otherwise you become a burden to the company and family, and it becomes a burden to you.”
Sabanci, who was recently named a member of Columbia Business School’s Board of Overseers, shared takeaways from nearly four decades in her family’s business as part of the School’s Brown Brothers Harriman Family Business Leadership Speaker Series on April 25. In particular, Sabanci highlighted how Turkey’s turbulent history intertwined with that of Sabanci Holding — and her own career.
Sabanci Holding was founded by Guler’s grandfather, Haci Omer Sabanci, in 1967, though the company’s true beginnings were with Haci’s purchase of a stake in a cotton ginning mill in 1932. When Guler graduated from college and joined the firm in 1978, Turkey was in the midst of a volatile period of coalition governments and external pressures. A secular Islamic state, Turkey dates back to the antiquities of the Ottoman and Byzantine Empires. Prior to 1980, the country had largely operated with an insulated, state-directed economy. That year, Turkey experienced a military coup, and like the country, Sabanci Holding found itself on the verge of bankruptcy.
“At that time, a lot of people left the company, but I never did,” Sabanci says. “I was the oldest grandchild, and it was always expected that I would join the family business. I didn’t even realize that I had the option to leave, so I stayed.”
That (non) decision paid off. Sabanci Holding shareholders brought in turnaround management, which included Sabanci; after four years, the firm was once again in the black. She says the challenging experience was “on-the-job training in crisis management” — and, importantly, put her on equal footing with non-family leaders in the firm.
“There cannot be any special treatment when you are handling a turnaround, which is exactly what I wanted,” Sabanci says “Everyone is equal and evaluated according to performance. My last name was irrelevant, because the task itself — to turn around the company — was a much bigger and stronger pressure than anything else.”
The financial firm’s turnaround and continued growth throughout the 1980s was supported by the larger economic forces at work within Turkey and around the globe. US President Ronald Reagan and UK Prime Minister Margaret Thatcher led the way in a worldwide shift toward free markets and privatization — the beginning of globalization. Turkey’s parallel turnaround was based on export-fueled development, market forces, and integration in the world economy. “Sabanci Holding benefitted from those changes,” Sabanci says. “My uncles championed the new economic approach, and Sabanci Holding was one of the first companies that brought foreign capital and partnerships into Turkey.”
Starting in 1985, Sabanci helmed a small manufacturing company owned by the family firm, diving headfirst into the relatively new arena of Turkish exports. The country’s signing of a Customs Union agreement with the European Union in 1995 (Turkey would become a full member in 1999) further opened doors for new international partnerships with companies like retailer Carrefour and insurer Aviva. Despite a 2001 financial crisis that affected many banks throughout Turkey, Sabanci Holding’s Akbank weathered the storm unscathed, according to Sabanci; in 2016, the combined revenue of Sabanci Holding was $17.8 billion, with Sabanci Group companies operating in 16 countries.
Sabanci credits the business’s long-term success with a focus on consensus and adaptability, while remaining true to the principles that guided her grandfather’s first investment nearly 90 years ago — even as the world, and company, evolved. “Change revitalizes people,” Sabanci says. “I have seen in throughout my career. It’s a challenge, but if you communicate it right and have the right team, it revitalizes them.”