Contrary to traditional arguments concerning family-run business, leading Thai business groups have always undertaken innovative reforms in the fields of raising investment funds, reforming management structure and developing human resources. Table 21 takes the Charoen Pokphand (CP) Group owned by the Chiarawanon family as an example. The table shows that the CP Group has continuously undertaken various attempts to improve its business activities. Such moves have included shifting its business base from trading to manufacturing; diversifying into growing industries (the late 1980s); introducing new management styles such as the American divisional department system (1985); establishing a holding company-cum- headquarters to centralize its decision-making process (1990); listing affiliated companies on the stock market to attract fresh money (since 1987); employing professionals in finance, technology and investment planning (1957-1963 and 1979-1981); and developing intensive human resources development programs (CP, Personal Information System, since 1995).
Thanks to these reforms, the CP Group has enjoyed rapid growth over the past three
decades, becoming the third largest business group in Thailand, following the Siam Cement Group and the Bangkok Bank Group (see Suehiro, 1998; do., 2000d, C hapter 9). These two leading groups have developed in a similar way to the CP Group, introducing innovative reforms into their management (see Suehiro and Nambara, 1991).
What distinguishes Thai business groups from the zaibatsu-type groups of prewar Japan is their strategic alliances with foreign corporations. When advancing into new businesses or industries, local business groups with no information, production technology or marketing know-how have frequently utilized foreign partners’ managerial resources through the joint-venture system. In this way, they could maximize the economic backwardness advantage of latecomers and could accelerate their business expansion. Unless we take these aspects into consideration, we cannot adequately evaluate the real picture of local business groups.