How Values Help Families with Succession
From the main Highway 29, which is to the west, rows of vines stretch eastward like green corduroy, a seemingly endless linear vision quest. Here, on this 400-acre parcel in the heart of the Oak Knoll growing area, sits one of the oldest and most successful family-owned and family-run businesses in the region. Trefethen was a family operation from the very beginning. In the early 1970s, John Trefethen’s parents, Eugene and Catherine Trefethen, passed the winery along to John and his wife, Janet, who ran it for more than three decades and grew the small-but-mighty business into a local powerhouse with national distribution and a penchant for customer service. Fast-forward to recent years, when John and Janet repeated history and passed the business down to their children: 34-year-old Hailey and 38-year-old Lorenzo. Today, the duo is poised to build on the family legacy and take the company into the next decade and beyond. Along this multigenerational journey, the Trefethens have stayed true to one thing: Each other.
“One thing we’ve always done a good job with around here is keeping everything about the family,” says Hailey. “Yes, we’re running a business. But we’re also running a family. The two can coexist.” —Family Business Magazine, Published July 21, 2021 Matt Villano
Family Businesses. While they have all the opportunities and challenges of any organization, they also have the added benefits and liabilities of their unique family dynamics. Those families who successfully navigate passing the baton from one generation to the next share some common practices. Based on my observations and feedback from clients, the following are key to ensuring that both the business and the family can thrive for years to come.
- The perspective needed to ensure successful transition to the next generation:
• Being grounded in history –understanding of the family’s history, values, traditions, and business origin(s)
• Being willing to move to the future – having a passion and openness to moving the family business into the future
• Being open to doing things differently – willing to try other ways, take risks and learn new things
- The importance of building an intentional culture:
• Articulating a clear WHY, defining purpose and getting aligned on why the business exists
• Defining the values and supporting behaviors in service of the strategy and the desired culture of the organization
• Mentoring the future generations
–Training – teaching the business to the next generation
— Delegating – sharing tasks and responsibilities, providing direction and support, and creating an environment where one can learn from mistakes
— Promoting family ownership for the future success of the business
- The willingness to make investments in business strategy and organizational development:
• Developing a strategic plan
• Prioritizing goals and objectives – creating a timeline, committing to tasks and following through
• Evaluating gaps and providing the necessary training for family members in the business to meet those gaps
• Hiring people outside the family when necessary to fill positions critical for success
- The commitment to develop strong relationships within and across generations:
• Making time for meaningful connection
— Creating shared experiences
— Working together on the business side and the family side; paying attention to both to be successful
• Creating space for meaningful conversations
— Coming to conversations with positive intent and a willingness to hear others’ perspectives
— Allowing for honest and authentic communication
— Extending grace when the conversations get tough or messy
— Learning about different personality styles and how to effectively communicate
• Sharing cross generational knowledge, learning, ideas
Finally, according to the clients I spoke with for this blog, what makes these practices most effective is the positive impact of working with a facilitator from outside the family unit. Having professionals familiar with family business who bring credibility, objectivity, resources, and skillful facilitation is key to a successful outcome. Even the most committed, cohesive and connected families can find themselves in situations where they need another perspective. A good family business facilitator can help the family business by accessing the family’s collective wisdom to uncover a clear path forward.
This blog was originally written for the Smith Family Business Initiative at Cornell and published on their website.
The Coronavirus—which has, in a matter of months, unsettled lives, business and economies around the world—is only the latest example of a new fact of life for family business leaders: We are operating in a highly complex and fast-changing world.
Yet the impacts of globalization are not the only factors contributing to the increased complexity family business leaders face. The old model of one family running one business, generation after generation, is less apt to be true today than ever before. One recent study revealed that the average family business consists of five or more businesses.  The number of family offices and foundations is also on the rise. And, of course, the increasing sophistication of technology has led to disruptive innovation in countless industries. (Think Uber, Airbnb, and Amazon.)
Layering all of this change and complexity on top of the complexity inherent in all family business— actual family relations—and it becomes clear that family business leaders need a new mindset to help increase both their capacity and agility to deal with these new challenges.
One such mindset that I have used to great benefit with my clients is the family enterprise mindset. This says we are a family that aligns our purpose and values with all our enterprises to create success as we define it. That often means assessing if we have increased our talent, improved our reputation, perhaps even brought our faith or spirituality into our work.
This more holistic and integrated approach to creating a family enterprise presents its own challenges but it is essential for families that want to thrive into future generations. This greater emphasis on the family means that potentially everyone in the family will be invited to develop themselves over the long-term, not just for the enterprises, but for the well-being of the family, as well. So, how does it work?
How to Develop a Family Enterprise Mindset
Analogous to getting in shape, there are many ways to develop a family’s capacity and agility because different methods work for different people with differing goals. Let me share one practice that I have seen within vertical leadership development—the number-one trend in leadership development—that holds the potential to transform individuals, their families and even their enterprises.
The practice of Leadership Agility works, quite simply, by helping leaders develop a wider range of capacities and the agility to know which one to call on in which circumstance. Consider a simple analogy. There are many ways to get around: We can walk, run, ride a bike, drive a car, ride a train, fly in a plane. The agile traveler would be capable of them all but know that, even if she can fly, it makes more sense to walk to the corner store. Similarly, leadership agility helps you understand and develop your capacities—from seeing issues as individual problems to solve, to systemic issues to create a strategy for, to even cultural issues to influence—and the agility to decide which one is the best fit for the challenge you face.
For example, imagine it is another hectic day at the office. You feel like Indiana Jones trying to stay ahead of that boulder. Then your sister calls and asks if you can hire her son, Mattias. He is a good young man, a solid student and seems to work hard. To get one thing off your to-do list you say OK and think: One problem solved.
Now, imagine you have three other siblings with a total of nine children. Then it may be more effective to frame this as a systemic issue that requires a strategy: a family employment policy for all the cousins. It will take more time, no doubt, but is also likely to be far more effective than hiring process becoming nine one-offs.
Or, suppose you reflect on the situation and realize that although all nine cousins get along well as family members, they have no experience in making business decisions together as young professionals. So, you frame this as an opportunity to have them collaborate with an expert to recommend a family employment policy to the siblings. Again, it might not be as efficient in the short-term but it is likely to be highly effective at evolving the culture of the rising generation.
In today’s complex business environment, developing the capacity to frame what is a mere problem to solve, what is a systemic issue best addressed by a strategy, and what is a culture issue to start to influence—and the agility to choose which approach makes the most sense—is increasingly necessary. It also challenges the family to develop its overall capacity and agility to not only be a positive addition to its enterprises but also to the family itself.
Just like working out, you can avoid it and hope you are lucky; or you can commit to an ongoing practice and give yourself the best chance possible for success as you define it!
 The FFI/Goodman Longevity Study 2011
Every family has values. These values are the filters through which we see the world, interpret data, make decisions, and spend our resources.
One of my colleagues had grandparents who were raised on a farm with a value of working hard together. They believed that working together deepened their connection with each other. As new generations were added to the family, the grandparents wanted to influence their children and grandchildren to stay connected, be supportive of each other, and enjoy celebrating together! This couple had a plan; they asked the family to work together to build a cabin that would be shared by all. That project and process bound the family together in ways that still bear fruit in the 3rd and 4th generations.
At InnerWill, we have the honor of helping family businesses and the families behind them thrive through Values Based Leadership (VBL).
In our experience, most family businesses consist of folks who know how to work hard and have very high commitment. They have a deep desire and the drive to make their businesses successful over the long haul, while navigating the challenges of working with family members. In some of the families, we see the business focus taking priority over their personal relationships. In other families, the personal relationships prevent the business from moving forward in a way that insures the highest level of effectiveness, success and seamless succession to the next generation. It doesn’t have to be either/or. We believe that through Values Based Leadership it can be both/and, and two of the five practices of VBL seem to be foundational in this work: Build Awareness and Develop Relationships.
We begin our work together by building awareness of each family member’s personal core values and style, providing opportunities to share, ask curious questions and learn beyond what they already know about each other. Everyone learns more about themselves, the other family members, and how they can show up most effectively at home and in the work environment. They have the chance to work together to articulate their family’s mission, vision and values and flesh out the practical behaviors that support them.
A few weeks ago, I had the pleasure of facilitating a retreat for a family of six. The parents and their children have a desire for their family to stay connected in the coming years, even when each of the children move out on their own. They spent two days thinking, sharing, reflecting, playing and articulating their individual core values and developing their family mission, vision and values.
InnerWill provided the time, space and facilitation of the process, the family provided enthusiasm, openness, and a willingness to work together. Families who set aside time for this work and allow the space in their lives are taking a step to prioritize the important over the urgent, which benefits the present and the future of the families, their businesses, and also the communities in which they operate.
This notion is woven into InnerWill’s DNA as we were born out of the country’s oldest and largest family held and family run aggregate business – Luck Companies. The Lucks live and understand the impact of VBL in their relationships and in their nearly 100-year-old business. With generation four now involved in the organization, each generation has upheld the family values and encouraged a flourishing culture where the associates are a priority. They exemplify our belief that VBL starts from within and has the power and potential to impact the world for the better.
How are you using values to strengthen your family? Your business? Your community?
My grandfather was an entrepreneur, and I grew up working in our family businesses. When I was young, we had a heavy equipment repair shop, and a family farm, and a sawmill. When the repair shop burned down and the sawmill went bankrupt, my grandfather started an electrical contracting business, and a mini storage business, and on and on. My grandfather’s businesses would last for a few years or sometimes a decade or two, but eventually they would collapse, partly because he expected compliance from his employees and his family. He was an amazing man in many ways, but he couldn’t, wouldn’t, or didn’t do what was required to earn people’s commitment.
In order to create commitment, you must have a shared sense of purpose.
People must feel like everyone’s in it together, and that they will get out what they put in. In our family businesses, that wasn’t the case. For the most part, my grandfather had an idea in his head about how it should be, and he was going to achieve that vision by hook or by crook, whether others liked it or not. Most of the folks who worked in those businesses didn’t share in that purpose. Some were working for a paycheck, and if that paycheck stopped or if somebody offered a nickel more, they would leave. Some were working to achieve their own dreams, and when it became clear those dreams weren’t going to happen, or if my grandfather told them one too many tall tales, they left. Ultimately, the businesses collapsed because there wasn’t a shared commitment to keep them alive.
A lack of a shared vision is a leading reason for the failure of family enterprises to successfully transition from one generation of family ownership to the next. A true shared vision drives strategy, gives meaning to work, and creates commitment at all levels of an organization. It is especially important in a family business, because if family members don’t feel engaged in the business, the business is not likely to stay in the family. However, commitment is key to any thriving organization.
The ability to articulate and inspire commitment to a shared vision is a key characteristic of effective leaders. Commitment means people will go above and beyond what’s required – they’ll break down doors for you. On the other hand, compliance means that people will only do what they are paid or coerced to do.
There’s no question that a workforce filled with people who are compliant will get the job done, but if you’ve only got carrots and sticks, eventually you’re going to run out of both. That’s typically when the most talented folks walk away, because leaders haven’t invested enough time and energy to earn their commitment. Effective leaders inspire others, lead by example, and understand that if they really want to see their vision become a reality, it will require more than just compliance.
Remember the following leadership behaviors when you’re trying to inspire commitment:
• Model the values and actions you expect from your employees.
• Share your leadership vision and share it often.
• Connect with others personally and emotionally.
• Ask for feedback and get others’ ideas.
• Make it easy for people to contribute.
• Invest in developing your team.
• Look for ways to build excitement about the future you want to create.
What leadership behaviors have you found the most helpful when inspiring commitment?
Challenging times such as these may offer us an unexpected opportunity to pause and reflect on our experiences, and to consider what lessons we may be able to share with others. For much of my life, I have been a part of a family business. First as a child, observing my grandparents in a business that involved several different family members. And then spending nearly two decades co-owning and co-leading my own family business with my brother. As I have reflected on those parts of my life, these three observations have emerged:
• Business is challenging. Blend in family dynamics, challenges rise exponentially.
• Family businesses are a source of great joy, as well as immense suffering.
• When family relations breakdown, ultimately so does the business.
To blend and make both the family AND the business work successfully, what’s the leader to do? I offer 5 key lessons from my own journey, from which I earned a Ph.D. from the School of Hard Knocks:
1. Values + Purpose + Vision = Alignment
Each human being has a unique set of values, sense of what gives them meaning, and vision for their lives. These can generate very different business goals. For example, one member may wish to operate a small, locally operated business that serves its community, while the other dreams of creating a growing business with multiple locations.
Without having understanding of what’s important to each member and why, and what each aspires to create, family members can end up working at cross-purposes. Unaddressed, this lack of alignment leads to waste of significant time, energy, resources and can be a source of friction.
Thus, it’s critical to engage in conversations to understand what each family member values and why they value it, and what the shared values of the business will be. Take the time to explore what each wants to create and why, and then arrive at a shared purpose and shared vision. Let each family member see for themselves how to achieve what’s most important to them, while creating alignment about the future of the business.
2. Roles + Responsibilities = Accountability
In family business, clear roles and responsibilities are often missing. Given this, it becomes nearly impossible to hold each other accountable.
Family members often end up feeling that they are the ones who are working hard while the others are not doing their fair share. This can lead to negative feelings such as anger, resentment, cynicism, and ultimately disengagement and infighting.
It’s crucial to engage in conversations to establish clear roles and responsibilities, and to hold yourself and each other accountable. And when someone doesn’t keep their end of the bargain, it’s important that conversations take place to establish accountability. Of course, these are best had in the spirit of “Care-Frontation”, which means that, even when difficult, we have these conversations because we care.
3. Events Do Not Equal Explanations
Communication and collaboration are challenging. What makes it even more challenging is that many of us are unaware that we live in an interpretive world, where Events Do Not Equal Explanations. We often do not distinguish facts (events) from our interpretations of those facts (explanations). Our interpretations unconsciously trigger emotions, which then lead to actions and impacts.
If we do not learn to recognize and separate Events from Explanations, the resulting impact can end up driving wedges in the relationships, and ultimately damages both the family and the business.
4. Leaders Must Have Clarifying Conversations
As leaders we create everything via conversations. In other words, leaders are conversational engines. Thus, one of the main roles of leaders becomes to design, convene, lead and facilitate conversations that keep both the family and the business functioning well. It’s crucial to learn to engage in Clarifying Conversations to “clear the air”, to surface and remove misinterpretations, and to see situations more clearly. Done well, this pays big dividends.
I feel so strongly about the power of these leadership conversations, I wrote a book about it! If you’d like to delve into the power of conversation more deeply, I invite you to read Language and the Pursuit of Leadership Excellence: How Extraordinary Leaders Build Relationships, Shape Culture and Drive Breakthrough Results.
5. Consider a Neutral External Facilitator
Given family business dynamics, it can be a game-changer to involve a facilitator who can help design and facilitate these types of conversations, help you to establish clear roles and responsibilities, and guide families through the development of shared values, purpose, and vision. Skilled external facilitators can often ask the hard questions, surface the undiscussable topics, and keep conversations productive and moving forward. This is a high-leverage investment.
It’s my great wish that the families that operate family businesses can use these lessons – or discover their own – so that their businesses thrive and their families find joy in the work of creating something together.
Which of these lessons have you experienced in your own business? What would you add to these five?
Values Based Leadership isn’t just for individuals and organizations, it’s also an incredibly powerful tool for families. Many of the principles that apply to organizations and family businesses also apply to another type of community – the family unit.
Like the keel and the rudder of a sailboat, the values and culture of an organization have an impact on how it moves forward towards its’ goals and achieves success. In families, the same is true. We understand that one generation lays the groundwork for future generations, with the potential for positive legacy.
Self and others’ awareness are foundational pieces of this work. How we show up as individuals impacts the family – and how we show up as a family unit impacts the individual members of the family and the greater community. Understanding our own core values and the core values of our family members increases our awareness of self and others. It gives us insight into how and why we make decisions, what encourages us, and what causes us to become emotionally hijacked. It helps us to connect to one another with grace and empathy.
Several years ago, I facilitated a personal core values exercise with a family spanning three generations. The youngest members of the family were in their teens and the matriarch was around 80. After they completed choosing the values that were most important to them, we took some time to share and engage in conversation. The grandmother watched and listened but withheld sharing anything with her family. We surmised and later confirmed that one of her core values was privacy. Even though she was not willing to share this, her behavior reflected this core value and it had an impact on the family dynamic and discussion. Each one of us is important!
Honoring each family member’s core values is key, however, articulating a shared set of family values can be powerful. Family values serve as a filter for decision making, conflict resolution, communicating, prioritizing, and how we want our relationships to be in the generations to come. They set the standard for how the family wants to relate to each other and be known in the world.
Creating a family purpose is also a powerful part of this work. As a family, we can achieve this by looking to the past to times that the family has been very satisfied and has felt the most connected. These shared family memories serve as a great foundation for understanding purpose. We can also consider the present and when we seem to be most engaged, effective and having fun together – what makes it special? And we can look to the future – what do we want others to know about us? What do we want others to see in us? What’s the most important legacy that we can leave?
This work connects deeply with both head and heart. Families want to be known, not just superficially, but to be authentically known for something that’s important. If we want to have honoring, fully functioning, healthy families, that are more connected, committed and cohesive, then it’s important for us to identify our values and articulate our purpose.
Have you done any of this work with your family? We’d love to hear about it!
Great vision without great people is irrelevant. – Jim Collins
It’s an often quoted statistic that the majority of family businesses don’t get passed on to the second generation, and the vast majority of second generation businesses don’t get passed on to the third. Finding a thriving fourth or fifth generation business equates to finding that rare unicorn.
The issue wasn’t that these businesses weren’t successful or that they simply got wiped off the map. The issue was more likely related to a lack of attention towards succession planning.
More than 8 out of 10 family businesses have no succession plan.
The critical need for sustainability and business continuity is talked about frequently, and succession plays a huge role in both. But succession gets super complicated super quickly in family businesses.
Not only must you manage the complexities of the business while finding the folks who can lead exceptionally well and model the culture you’ve created as they set a new path into the future – you must also manage all the intricacies of the family dynamic.
Perhaps you’ve asked yourself some variation of the following:
- Is there somebody in our family with the will and skill to run this business? And have they developed the leadership required to execute on the vision?
- If there are multiple family members interested in running the business but I can only choose one, how will that affect our family dynamic?
- Are the kids in the next generation even interested in the business?
- When do we look for a non-family executive to lead the business?
The underlying psychological elements in answering these questions complicate succession and are compounded by the challenges felt by owners.
Sometimes the current CEO of a family business is insecure. They worry that if they identify their potential successor, that will demonstrate that they are less committed to the business. But identifying a qualified successor and putting a succession plan in place is a statement of supreme confidence and commitment to the long-term health and sustainability of the business.
Successful succession planning in a family business requires a few basic building blocks:
- As a leader in your family and family business, check your ego, fears and insecurities. Instead think about the legacy you want to leave by creating a succession plan.
- Make sure that you have a good process to help you identify the most qualified successor. Sometimes successors are chosen because of family relationships and not because they’re the best person for the job. Having a good process can alleviate these concerns.
- Understand that your successor is going to do some things differently than you. Choose someone who can adapt to change and carry out the future needs of business needs.
- Identifying someone as a potential successor doesn’t mean you’re promising them a guarantee. They should demonstrate that they are the ideal candidate based on the leadership behaviors and skill required.
- Remember there is typically more than one role that will require a successor. Develop leadership at all levels of your business, and provide a framework and success measurements to establish next-gen leader readiness.
- Consider bringing in a third party to help facilitate the process. Somebody who doesn’t have the same level of emotional and financial investment that you do, means they can potentially see the situation more clearly. They can propose solutions and offer objective clarity and guidance.
The big question to ask yourself is:
- If you were to retire tomorrow do you trust the person that you’ve identified and hopefully developed to keep the business robust and high performing?
If the answer is no, you need to work on succession.
When it comes to effective leadership in family business, the leader’s job is to help develop and ignite the potential in the people behind them. They have a responsibility and opportunity to leave things better than they found them. One of the key processes to do that is succession. It allows family businesses to be competitive, sustainable, and successful far into the future.
Succession planning is really just making sure that you have the necessary talent to step into the key roles to ensure success down the road.
How are you creating a culture where each leader can optimize their purpose, passion, and competency in a way that prepares your business for the future?
According to the 2019 edition of PwC’s US Family Business Survey the number one area for family businesses to consider in order to build a lasting and profitable legacy is “to codify their values”. As a 3rd generation family business owner whose been on a Values Based Leadership journey for the better part of the past two decades, I couldn’t agree more.
Values help attract and retain the right people
Back in 2003, we defined the culture we wanted to create at Luck Companies using a set of organizational values and behaviors that support them. Our values are not just a fancy poster on the wall, but a set of principles that shape how we make business decisions. How the work gets done matters just as much as what work gets done.
Over time, our values have seeped into every aspect of the business, from processes to customer experiences to hiring to compensation. We’ve committed to building a sustainable and growing family-held enterprise, with a culture where people come first and have roles that invigorate their purpose, passions, and competencies.
In today’s global market, there’s an ever-increasing competition for talent. At Luck, part of right for us means finding people that are interested in our mission of igniting human potential. That takes an others-oriented kind of person. The person that’s going to do the best work here, sees our values and aligned behaviors and says, “Those behaviors and values speak to me. They speak to who I am and who I want to be from the time the alarm goes off in the morning until I go to bed”. If you want to find associates who will thrive at your organization, look for people who are really switched on by your mission, vision, and values.
Values help sustain growth during times of change
Recently, we acquired Stephens Industries – a rock quarry, along with a concrete and construction debris recycling business that sits outside of Hartsfield-Jackson International Airport. Due to the confidential nature of the transaction, we did not have access to really understand what the beliefs, values, and principles were of the 80+ associates.
A company’s culture may be the most overlooked and undervalued aspect of mergers and acquisitions. Many folks are much more comfortable dealing with costs and synergies than culture, despite the potential for culture to enhance or destroy an acquisition’s value. We understood this was a business risk, because if the majority of associates leaned out we would incur huge transition costs. We also understood that forcing the company to immediately conform to our cultural mold was not the solution. We understood that we needed to lead with our values and approach this as a mutually beneficial learning opportunity.
We met with small groups of associates and shared some of the things that were important to us culturally. At a high level, we talked about our four company values of integrity, leadership, creativity, and commitment – and the aligned behaviors we look for in our associates. But we also talked about important parts of our culture that we knew they would instantly relate to – like safety, family, and consistent leadership. From day one we started talking about our values. Our expectation is that the new team will be curious about our values, understand what they mean, and try to make choices that are in alignment with them. Because when they do, we will be an incredibly effective and high performing team.
Values have an impact far outside of the office walls
I believe that people are reaching for Values Based Leadership. They want to understand the mission, the purpose, and the reason for being of an organization. Twenty years ago, the focus was mainly on financial performance, customers and stakeholder value. Clearly their importance is not up for debate, but now there is an added expectation of social responsibility and impact beyond profit. Many of today’s most successful family-owned businesses are extending the power of their values to benefiting others—not only their businesses and people, but also the communities in which they operate.
Family businesses employ 60% of the U.S. workforce and create 78% of all new jobs. So family businesses have this incredible opportunity and responsibility to make a difference in the world. Values help us see success through a different lens – and that success can truly come to life when values are integrated and embraced as part of the business.
How are you building on your family business values for success?
Running a family business presents a wonderful opportunity to create an organization grounded in close relationships. However, when issues arise, sometimes tough love is needed along with familial love. Sometimes, family members need to reevaluate their own characters as employees. Competency and Alignment are two elements that are essential to remember for the healthy growth of any family business.
Last week, I discussed the importance of Communication for creating strong, trusting relationships and Boundaries for upholding professionalism. This week, I’m sharing the rest of my advice for ensuring that your family business thrives.
Requiring competency is an extension of establishing boundaries. There must be a high level of competency throughout the organization. No business benefits from employing less than competent individuals.
Employees are motivated by recognition, opportunity for input and opportunity to do interesting things. The less competent employee will not get recognition, won’t be invited to give their input and will ultimately be shunted to the side doing boring tasks. When that person is employed in a typical business, it is easier to face their incompetency and help that individual find another avenue to fulfillment. However, when that person is in the family you have a real problem. You end up with an unhappy employee and an unhappy family member.
I urge families to require substantial experience from potential employees to prove competency. If a person is not a competent employee elsewhere, chances are they will not be a competent contributor in their family business.
Alignment begins with you. That means in a family there needs to be a process whereby each employee finds out who they are as individuals, their values and the values of the family.
I like to have each family member develop a Personal Values Statement. Sometimes I add the task of creating a statement about how the individual wants to show up in this world. That is followed by family members developing a Mission Statement and a Vision Statement, both of which get posted throughout the company. The family can then be held accountable for what they say they will do.
Research on Values Based Leadership, and VBL-led companies, has demonstrated that when family business owners are clear about their values and fully aligned around those values, they become the guiding principles for operation of their business. In addition to being more profitable, businesses operating in this manner evidence a higher level of satisfaction among owners, non-family leadership and employees.
Successful, profitable management in a family business looks like any other business. The business offers goods and services at a fair market price, controls costs, pays fair market wages and is prudent with corporate finances. It treats all employees, family and non-family, with respect and kindness and cuts family members no slack. Family members need to stay longer, work harder and be humble about ownership.
If family business owners recognize the importance of Communication, Boundaries, Competency and Alignment, their companies will not only be successful, but healthy and happy, too.