Case Scenario 2: Yepsen Timber Farms, Inc

Case Scenario 2: Yepsen Timber Farms, Inc.
Yepsen Timber Farms, Inc., (YTF)was started around 1933 by Danish immigrants. The firm's primary operations were timber harvesting on several thousand acres in Oregon acquired in part under the Homestead Act, and in part through direct purchase. The firm was founded, initially as a partnership, between brothers Mogens and John (Jack)Yepsen. The Yepson brothers were among the first four graduates at Oregon Agricultural College (now Oregon State University), worked for the forest service and private industry in Oregon for a number of years, then quit their respective jobs to manage the forest they had been developing for a number of years. While timber is considered a low-tech type business, Mogens and Jack were very innovative from the standpoint that they established "tree farms," that is, harvesting then replanting acreage so that it would yield timber on a sustainable basis. At the time, and in certain parts of the world to this day, timber lands were typically "clear cut" where all the trees were stripped from a property, then the timber harvester simply moved to another parcel. This practice left thousands of acres barren, and often damaged valuable animal habitats and watershed. The brothers also introduced hybrid Pine and Douglas Fir trees that grew considerably faster than the native forest stock. These factors allowed them to grow trees that would be ready for market in 25 years, about half the time of that required to grow native trees. The brothers' idea about regeneration, care for the environment, and hybridization defined the YTF business. Never would land be harvested faster than it could replenish itself, or in a manner that threatened habitats or watersheds. Eventually, Mogens and Jack passed on and their only surviving children, Marjorie, Mary Jane, Burton, and Betty inherited the property. Two of these heirs took a strong interest in further building the portfolio of Oregon properties, and also converted the holdings to an S-Corp. to allow for the distribution of ownership and earnings to their own children. Under their guidance, YTF was tremendously successful and garnered much community acclaim for its sustainable farming practices. Now, the four siblings are in their 70s and few of their children have expressed much interest in managing the extensive portfolio of timber holdings. Among those that have expressed an interest, some are very knowledgeable about forestry, while others have a track record of incompetence and self-promotion. At the same time, ownership is now spread among some 40 children, nieces, nephews, and grandchildren of the four siblings. Many of these individuals' only interest in YTF is the annual dividend check they receive.
-(Refer to Case Scenario 2). One of the Chapter 12 Key Leadership Actions that stands out in the Case Scenario is "Sustaining an Effective Organizational Culture." Both founding brothers Mogens and Jack infused a culture of innovation and sustainability. As the firm grew,however,and ownership became spread among 40 family members,that culture became diluted. This case shows that organization culture cannot be a source of competitive advantage as organizations grow.