, ,

Prescribing an MRI for your Family Legacy

Just What the Doctor Ordered

This week we’re looking at a subject in a slightly inelegant way.   

Having previously written about a personal MRI story back in 2019, in You Want an X-Ray? I’ve Got an MRI! I have a spark and lead-in.

That event is irrelevant here, except insofar as my having previously written that allows me to introduce my new version of a “family legacy MRI”.

 

Legacy Families Need to Make Some Efforts

The field I work in is populated by professionals who work with families, and we try to help these families not only build wealth, but maintain it over generations, often with a certain “legacy” component.

Many families, as well as most advisors, believe that the amount of financial wealth is the key, and that more wealth will correlate well with how long a family’s wealth will last. 

That makes sense, in theory, but, regular readers know that I have other ideas around this.

As I wrote in 2017 in Is your Continuity Planning “PAL” in Danger? the assets that the family own will likely NOT be sufficient to guarantee the family’s legacy.

In that play on letters, I highlighted this “equation”: 

                                   People   +   Assets   =   Legacy.  

The people are as important as the assets (if not more so).

 

My Version of the Family MRI

So my prescription for what families need is another version of “M.R.I.”, and I hope you aren’t disappointed with the build-up.

In order to increase the chances of creating a family legacy, the family members need to make sure that they have plenty of: 

                         Meaningful, Repeating Interactions

That is my MRI Prescription. 

The rest of this blog post will look at those three components, and then explain why all three elements, the noun and both adjectives, need to be present.

We’ll start with the noun, “interactions” so it flows more logically.

 

Interactions Come in Many Forms

Current technology offers so many ways for people to interact, many of which our forefathers did not have at their disposal. And if our goal is to have meaningful and repeating interactions, the existence of more methods should work in our favour.

We’ve all been affected by the reduction of “in person” meetings this past year, but that won’t last forever.  

In fact, the pandemic has forced us all to adjust and that has resulted in more and more people getting comfortable with various online virtual meetings, including senior generations who may have previously resisted.

Even social media plays a part in this, and that brings up the whole “asynchronous” aspect of interactions that many people might overlook.

I have several professional relationships with colleagues that are “kept fresh” simply by commenting on their LinkedIn and Twitter posts.  

It doesn’t take much of a leap to move this idea into the family space, in fact many families are already there, using a variety of online social platforms to stay in touch.

 

Lather, Rinse, REPEAT!

Let’s move on to making sure our interactions repeat. One of my first rules for holding family meetings is that you don’t let people leave until you have scheduled the next one.

Whether you meet monthly, quarterly, or even annually, getting the next meeting in everyone’s calendar is a must.

Now let’s go back to the technology and note that even if you only have one, big, annual in-person meeting, you can supplement those with other regular get-togethers too.

This isn’t about either/or, it’s all about the both/and.

I barely remember much about any specific childhood family camping trip we took, but I do remember that we would regularly go camping, and those more general recollections still spark fond memories.

 

Thanks for the Memories

Making your repeating interactions meaningful is mostly about creating opportunities that will be fondly remembered as time well spent together.

It’s important to limit the amount of “shop talk” during such times, especially when there are some people present who aren’t privy to the details, and then end up feelings like outsiders. 

Of course it is important to level the information playing field with them, and those efforts need to be repeating too, but that’s not the matter at hand.

I’m talking about meaningful in a family way, and reinforcing the family bonds that will be necessary to maintain the family legacy, which really needs to be about non-business aspects of the family.

Try to maximize opportunities for Meaningful Repeating Interactions for the whole family. 

What family traditions will you reinforce?

/by
, ,

Maybe Efficiency Is Overrated in Family Enterprises

It’s not often that I go out on a limb right off the top of these posts, but I suppose coming out against the importance of efficiency could certainly qualify as going against the tide when talking about business.

Of course I don’t typically deal in true business subjects, since my preferred domain is that of family business, where my emphasis is on the family aspects.

Getting things done quickly and efficiently seems like a laudable goal of course, with some notable exceptions.

The main exceptions I’d like to note here are those where you need to bring in the entire wisdom of a group of people, and where it’s important for everyone to feel heard.

Such situations abound in the family circle part of family enterprises, or, said better, enterprising families.

When Finishing Faster Isn’t the Key

I’ve dealt with certain examples of this before, notably in Going FAR? Go TOGETHER, which deals with a scenario involving a group of siblings in the rising generation of their family, preparing to eventually take on leadership roles, both in the business and in the family.

In recent months I’ve been involved in two group processes where I’ve truly embraced the idea of throwing efficiency and speed out the window, with positive results (so far).

The first example took place in a professional organisation I’ve been involved with as a volunteer for the past few years, as part of a committee charged with an important role in putting on our annual conference event.

The second example is ongoing, and has me playing a facilitation and mediation role with a sibling group who share ownership of some legacy assets together.

 

Professional Development “Live Case” Opportunity

In the first case, my role had recently changed from simply being a member of the committee to now leading it. I had the benefit of following in the footsteps of someone who had done a great job before me, but that also gave me big shoes to fill.

There are always challenges in putting on an annual event in the summer but having to make most of the planning decisions months ahead of time, and these are only magnified by the pandemic’s uncertainty as to what will even be possible regarding large groups six months out.

So we definitely had a number of considerations, lots of moving parts, and a general lack of clarity around much of the information we needed to base our decisions upon.

We also on-boarded three new volunteers to the committee, and the admin person from the organisation was also new, and had never been part of our annual event.

 

Learning About How to Be with the Group

There was plenty of pressure on us to come to some final decisions but I resisted the temptation to push for some closure on some items that I knew could and should wait.

It was way more important to make sure we took the time to consider all our options, evaluate a number of ideas, and take advantage of the wisdom of all the members of the committee.

As the head of the group, an important part of my role was to set the right tone and pace for our deliberations. 

Weighing many interdependent considerations and allowing everyone to share their inputs was more important than the somewhat arbitrary deadlines that could have distracted us.

 

Getting a Family to Take Their Time

The practice I got from working with that group set me up nicely for a new client situation where I’ve used some of those lessons to good effect.

This sibling group is getting used to some new realities and are learning to work under a more democratic decision-making framework than they were used to.

That kind of adjustment takes time, not only in terms of minutes and hours spent together, but in the days and weeks that are needed for new realities and understandings to sink in to each person’s thinking.

When you combine that with a severe “information asymmetry” between insiders who’ve always played key roles, and those who have spent their lives on the outside looking in, it’s key to set a pace that allows everyone not only to be a part of the process, but to feel like they’re part of the process, on relatively equal footing.

 

That methodology isn’t the most efficient, but wasn’t it the tortoise who won the race?

/by
,

On Rules, Relationships, Rebellion, and Respect

On Rules, Relationships, Rebellion, and Respect

Connecting the Dots on all these “R-words”

Regular readers (thanks!) know that my inspirations for these weekly musings are varied and eclectic. I’ve had a number that’ve come from listening to the radio while driving, and this is another of those.

This week I’m delving into something I heard that made me look for a place to pull my car over, so that I could jot down the exact words I heard before I could forget them.

I didn’t have to go that far, because thankfully I hit a long enough red light to grab a pen and piece of paper to get the key words down.

I think you’ll like what I heard, because although the words were relayed in a sports context, they also apply to the world of family enterprises and the relationships therein.

 

Who Makes the Rules?

There’s a search feature on my website that I’m certain I use more than everyone else combined, because after writing hundreds of blogs over the past 8 years or so, there are few topics I haven’t touched on, at least tangentially.

So I searched “rules”, and noted that I had used that word in a blog title just a few months back, see On Rules of Engagement for FamBiz

The rules we’re going to be talking about here are slightly different, because they refer more to how people relate to each other over the years as they work on the details of how they govern the business of owning and managing assets together.

See Who Gets to Decide Who Gets to Decide for more.

 

A Basketball Coaching Relationship

Back to the radio quote. Jack Armstrong is a TV broadcaster on NBA games in Canada, covering mostly the Toronto Raptors.

He also does radio hits a few times a week on various sports radio stations, where he chats with the local radio hosts about goings-on in the world of basketball.

On this day a few weeks ago, he was talking about a team that had recently gone through some turmoil due to a coach who was probably acting a bit too “old school” with some of his key players.

This prompted the quote that I rushed to jot down:

 

Rules without Relationships = Rebellion

 

Rules with Relationships = Respect + Results

 

So that means that the key to making rules work for you, as opposed to against you, is the existence of quality relationships with those you are trying to “rule over”, or even “rule with”.

 

Making Rules for Working with Family

When thinking about rules in a family context, we normally imagine scenarios where parents make the rules for their children.

This is natural and works well enough as long as the children are young enough to accept being “ruled over”, and quickly loses effectiveness as they begin to want to assert more control over their choices.

That life stage rarely lasts as long as the parents would like, forcing them to change how they interact with their offspring as they mature.

When you think about it, it’s all about adapting your relationships to the situation, which need to evolve over time.

When my kids were young teens, it was much easier for me to “make them” do something or “forbid them” from doing something else.

Now that they are young adults, if I would like them to do something, my approach needs to be much different. I have also learned to adjust my expectations accordingly, but that’s a whole other topic!

 

The Need for Self-Control and Autonomy

Family business contexts by their very nature typically involve plenty of situations that have some rules inherent in them, due to the hierarchy in the business.

When you look at other family situations where there is a certain level of financial wealth present, with or without a current operating business, the family rules can be a bit trickier to impose.

As the rising generation family members mature, they have a natural desire and need to exert as much control over their lives as possible.

Too often, their parents resist this and unfortunately tend to revert to ways to use their financial resources as a way to enforce their preferred outcomes.

 

Respect Over Rebellion

If you are a parent who wants to have the respect of your offspring, and you want to avoid the pitfalls of rebellion, the secret is to work on your relationships.

Easier said than done, of course, but therein lies the key.

 

/by
, ,

Questioning Someone Vs. Asking Questions

Subtle Changes Make a Huge Difference

The ideas for these posts come from all over the place and from people who hail from many different locations. 

It shouldn’t be a surprise that in the past year or so, a bunch of them have come from webinars or other virtual settings.

This one comes from a webinar hosted by someone I never met, but whose two guests are both friends of mine, even though I’ve only actually met one of them in person.

It was yet another instance where upon hearing a certain sentence, I immediately jotted it down so that I could properly recall it for use as inspiration here.

Not an African Proverb

One of my favourite posts here over the years, which I also recorded as a video, was If You Want to Go Fast, Go Alone; If You Want to Go Far, Go Together.

The lengthy title there is also an African proverb, which served as my inspiration. This week my inspiration comes from Africa once again, but it was from a story told by Nike Anani, a friend I’ve yet to meet in person, from Nigeria.

Nike was a webinar guest, along with Mitzi Perdue, who I have met, and she was relating an early experience of hers as a member of her family business.

Nike had recently returned home to join the business, after working in the corporate world in the UK.  Her return to a smaller, less professional work environment required some adjustment.

 

Questioning Everything

As she put it, soon after arriving, she began “Questioning everything”.  She elaborated, making it clear that her attitude in those early days was less than ideal, and she was not simply asking questions.

While noticing the self-awareness required to recognize this in retrospect, I also made sure to capture the spirit she was conveying about her feeling of superiority based on her corporate experience, and how she was dismayed by how things were being done in the FamBiz.

With the benefit of some hindsight and added maturity, she now realizes how important it is to ask questions, grounded in genuine curiosity, rather than “questioning” how everything was being done.

 

Different Kinds of Questions

Courtroom drama fans and politics junkies are familiar with many techniques of asking questions that are really more about getting their point across.

When thinking about this I also flash back to days when my own kids were much younger and also employed dubious questioning techniques of each other.

I distinctly recall exchanges including, “What? I was only asking a question!”, to which I’d reply “Yes, I know, but ‘why do you always have to be such an A-hole’ is also ‘Just a question’ too”.

I suppose that in many ways that was in fact a rhetorical question on my part, but I digress.

 

Better Questions Require an Absence of Judgement

I’m pretty sure that if pressed, Nike would admit that most of her “questioning” in those early days was also accompanied by a whole lot of prejudgement, where she had already assumed that she knew better than the person to whom she was addressing her comments.

The best questions, as she now realizes, are founded in true curiosity, and in fact include a complete absence of judgement.

Here I’m addressing not only “prejudgement”, but also any judgement when one hears the answer.  See Judgement, Not Judgement.

One of the first big takeaways from my coaching training is that “listening without judgement” is the first thing you need to practice and train yourself to do to be successful.

 

The Family Governance Angle

As we move to wrap this up, I want to look at this topic from the other angle, i.e. the ones who are on the receiving end of the questions, or the questioning, as the case may be.

Most families have what I call an “information asymmetry”, where there are certain members who are in the know and who control much of the day-to-day activity, and others who act as “interested bystanders” much of the time.

The “bystanders” will often have questions, and the insiders do typically “owe” them answers, in many respects.

Insofar as the insiders are able to provide coherent answers, they will also minimize and forestall the potential for questioning from these other stakeholders.

If the attitude of “how dare you question me” is replaced by one resembling “of course you can ask”, that is a recipe for more harmonious relationships going forward.

No question about it!

/by
,

Amphibious Guidance for Members of your FamBiz

Amphibious Guidance for Members of your FamBiz

The Old Family Business / Business Family Debate

Defining the kind of work that I do with members of business families is always a bit tricky for me, so sometimes I like to dive straight into the topic here, hoping I can either enlighten readers, or discover something new for myself.

My clients are either business families or members of such families, and I really don’t do much work with “family businesses”.

I know that may seem almost contradictory, but my focus is on the people and their family above all else, including whatever business they happen to own and run.

 

Not Really a Business Coach

It’s also taken me a while to truly embrace the term “coach” as a descriptor for what I do, but when I finally got my CPCC certification in 2019, it finally seemed to resonate with me and feel real.

But that doesn’t mean that I’m no longer an “advisor” or even a “consultant” to enterprising families and their members, although the former suits me much better than the latter.

The only exception is when I’m asked what I do while going through customs, where “family business consultant” has been my standard reply and it has never elicited much response, which is the ideal result in that situation.

 

So What’s with the Amphibious Stuff?

The idea for labelling the kind of advice and coaching I do as “amphibious” comes from thinking about the origins of many of the people I’ve encountered in this field.

Off the top I’ll admit that the term amphibious here is far from a fantastic metaphor, but I want to explore it anyways, because I think it might be instructive.

A quick search of the word amphibious brings back:

               “relating to, living in, or suited for both land and water”

What I was really going for was the “suited for”, which in my head would also include “at home in”, or even “native to” but instead of “land and water”, my version is “business and family”.

 

The Ambidextrous Triathlete?

Some other ideas that came up while considering this include the term “ambidextrous”, as in “able to use the right and left hands equally well”, which gets at a lot of what I want to convey, but still misses out on part of it.

Many of you know of my love for the Three Circle Model, and since the blog linked here dates back to 2013, you know that this is more than just a recent fling.

So if there are three circles, maybe my two-way amphibian isn’t capturing everything either.  Admittedly, it isn’t.

Maybe there’s something there to be explored later, where Ownership could be the swimming portion of the race, the biking part could be the Business, and the running at the end could represent the Family.

Those who know me will quickly recognize that all of this is quite far from my comfort zone.

 

And the Comfort Zone IS Key

But all kidding aside, the idea of a comfort zone is pretty important, and that’s where the amphibious part resonates.

People who grow up as part of a business family experience life differently form those whose parents have “regular” jobs.

Having grown up in such a family, I’m always comfortable sharing those experiences with clients as I coach them, and they frequently nod as they reflect on similarities to their own context.

We’re all more comfortable relating to realities of families similar to our own.

 

What About “Getting Out of Your Comfort Zone”?

But when working with folks who are part of a legacy family, in order to be part of a process where they make progress, they typically need to get out of their comfort zones, don’t they?

Yes, of course.

In order to do that, it’s always best to recognize all the realities that they’re living within that zone, which is precisely what their amphibious coach will be well placed to do, because they aren’t only comfortable there, they’re also natives.

 

Guidance and “Walking with” my Clients

The ability to “walk with” someone and to “accompany” them on their journey is something I expounded on in Work with Me, Walk with Me.

Yes, they’d typically be able to benefit from working with any skilled coach, no matter the type of family of origin of said coach.

However, if given the opportunity to work with a skilled coach who has a similar lived experience, the potential for a rich relationship goes up tremendously. And I’ll always say “ribbit” to that!

/by
, ,

Asking for Permission Vs. Asking for Forgiveness

Which One Is More Appropriate in a FamBiz?

During a recent board meeting for a local charity, the Executive Director asked us for guidance around a situation that was troubling her. The answer I gave her reminded me of advice my Dad shared with me decades ago.

Since Dad was the first Family Business owner I ever knew, and still the one upon whose wisdom I typically rely most, this incident provided a nice opportunity to share it here.

While Dad didn’t have a specific FamBiz application, because he concentrated on his own business, I do think about other people’s businesses, so I will adapt it to that situation.

 

Pandemic Safety or Easy Cash

The non-profit on whose board I serve has a large hall we rent out on occasion. Since our province has been on “essential services only” lockdown, that rental income really dried up.

Our government has allowed TV and Film production to qualify as essential, which, while being a bit of a headscratcher, became and opportunity for us.

We were approached by production crews to rent our hall for their people to take breaks and have their meals.

“Should we accept these rentals?”, was the question from our E.D.  “With so many government regulations because of our food bank, maybe we should ask first.”

“How much do these rentals pay?”, came the first question.

 

Some Things Are “No-Brainers”

When I heard the answer, which was a decent sum, I replied that it was better to go ahead and do it, and ask for forgiveness later, if we got into trouble.

It seemed inadvisable to me to wait and ask for permission first. And that brought back memories from my father.

With Dad, it was typically when he wanted to build something that might require a permit.  He would “play dumb” and go ahead and build, figuring that asking for permission would cause undue delay and possible extra costs.

In our charity example, it was a no-brainer.

But what about in a family business, when you’re a rising generation “future leader”, does this advice also work?

 

All About Seizing Opportunities to Lead

There’s a plethora of potential examples that cover a wide swath of situations where this could apply, and the answer will of course vary depending on the context.

The message I want share here is that when there’s a doubt, oftentimes making the leap, and taking action, will be perceived as the better option.

When I work with different generations of a business family, I notice that some rising generation family members will defer to their elders on too many decisions, for far too long.

Yes, I understand the attitude of “But if I screw up, Dad will be mad”; been there, done that.

 

Act as If I Weren’t Here; What Would You Do?

As I wrote those words, I actually had a flashback to the 1980’s, when I once asked for Dad’s direction on a decision.  I don’t recall any details, but I do distinctly remember his words.

                     “What would you do if I wasn’t here?”

Interesting, I thought. And from that point on, for issues and decisions that were not critical, and for which a timely response was important, I began to make more of the decisions in my sphere of influence than previously.

Naturally it was better for both of us that way.

And, importantly, this began an ever-increasing responsibility load that I was able to successfully take on for myself. Another Win-Win.

 

They’re Probably Secretly Waiting for It

There are certainly some exceptions, but for the most part, parents are actually pleased, relieved, and proud when their offspring are able to take on more important roles, responsibilities, and decisions.

They’ll usually forgive you if you make a mistake, too.

Asking for permission on too many minor questions, for too long, is only going to delay the important transitions of knowledge, experience, and decision-making that are key to making a family business succession successful.

 

A Gradual, Iterative Process (Like So Many Others)

These transitions are a long time in the making, and tend to evolve gradually. They’re also iterative, meaning that you do something, learn from it, maybe take a step back, evaluate, and try again.

Over time, you make progress in the desired direction

Eventually, because a family is truly interdependent, especially over the long term, you may get to the point where you resemble a family discussed in Asking for Permission in a Family Business.

Eventually, the shoe gets to be on the other foot!

 

/by
,

Lessons from SG-FECC 2021 – The Kids Are Alright

University of Vermont Case Competition

Every January for the last several years, the college town of Burlington Vermont has become the center of attention for people from around the globe.

Okay, so maybe it isn’t (yet) a worldwide phenomenon, but, for students learning about Family Enterprise, this is the one place that hosts the annual Schlesinger Global Family Enterprise Case Competition (SG-FECC).

The University of Vermont (UVM) has been doing this for a few years (this was the 8th edition) and they have it down to a science.

This year it was held virtually, for reasons that don’t require much explanation, and that could have caused all sorts of challenges (and likely did) but you never would’ve noticed.

 

An Impressive Bunch of Young Leaders

The second part of my title references a movie featuring one of my favourite rock bands of my childhood, The Who, so perhaps I’m dating myself here.

But I really wanted to properly frame the “A-Ha moment” that I had this year, similar to the one I’ve had every time I’ve participated as a judge. If I’m not mistaken, this was my 6th time.

You may think that I’m talking about the competitors, who come from schools all over the world, every year.  And you’d be right, the students who compete in the Case Competition have impressed me every year.

 

It’s really nice to see the social aspect of the competition when it’s done in person, noticing that some of these undergraduate and graduate students are seeing snow for the first time in their lives.

 

A Huge Volunteer Undertaking by UVM Students

But it’s much bigger than just the competitors, it’s the entire organizing committee, which is composed of a few dozen students, who take care of everything from A to Z.

Yes, they are led by a few paid “adults” who work for UVM in various capacities, all of whom fall under the watchful eye of the brainchild and fearless leader of this project since Day 1, Pramodita Sharma.

But what impresses me every year is just how mature, competent, professional and diligent these young people are, and what they’re able to pull off, with only minimal supervision.

What they do have is structure and people who have done the job in previous years.

Come to think of it, this is a lot like many family businesses, and that’s where we’ll turn now.

 

Motivated and Aligned Young People

The young people of today, who many label as Generation Z, are so impressive to me, in so many ways.

I know that many business families can be hesitant to incorporate these youngsters into important roles, but from my vantage point, many of them are way more ready than the young 20-somethings of decades past.

They also benefit from having grown up with the latest technology, and with school systems that do a much better job of giving them practice at working together on projects from a young age.

Many also seem to be much better than their elders at harnessing the collective wisdom of the groups to which they belong.

They typically have plenty of motivation, so if you already have some structure and some vision, they can often handle way more than you might expect. 

 

Great Examples Abound

The recent Presidential Inauguration gave us another great display, as Amanda Gorman, a 22-year-old Poet Laureate knocked my socks off with her poem.

My own kids are 19 and 21, and I see so much promise in them and their friends too.  I see it in my clients’ rising generations and at SG-FECC every year too.

With the recent passing of Hank Aaron, I happened to hear his Baseball Hall of Fame speech, in which he said “A man’s ability is limited only by his lack of opportunity”. 

Amen.

 

Many Winners, Especially Wilfrid-Laurier and ESADE

There were many winners at SG-FECC this year, especially those from Wilfrid-Laurier University (Canada), who won the undergraduate competition, and ESADE (Spain) who took top spot in the graduate category.

I look forward to being back in Burlington for the next “in person” version, whenever that is possible.

Meantime, like so many other areas of life these past few months, we’re all adapting and realizing how much we can all still accomplish even in these sub-optimal conditions.

And with these promising young people taking on bigger roles all the time, the future is bright.

 

 

 

/by
, , ,

Sibling Compatibility is Not Sufficient

Family Harmony Is Very Important, But…

One subject that I harp on a lot is family harmony and making sure that everyone gets along together.  

This is important for families who want to ensure that the business they built, or the wealth they’ve accumulated, will be able to continue after the next intergenerational transition.

And while harmony really is something that families need to work on if they don’t already have it, in many cases it will not be sufficient.

I came across something recently that made me think about this and how I may not have been doing justice to some other key considerations in this space.

This week, I want to address a couple of them here.

 

If You Aren’t Growing, You’re Shrinking

The first thing many families ignore at their peril is the importance of competence.  

Of course this can take many forms, but bottom line, if no family members are competent in managing the business or the wealth, dissipation will often be the result.

I’ve noticed a lot more being written in this field about the importance of having an entrepreneurial spirit in families, so that with each generation, there is some renewal of activity to maintain and hopefully grow the family wealth.

In cases where there isn’t anyone with the inspiration and ability to at the very least maintain the family wealth level, some choices around how to manage things and what the next generation family members can expect to pass on to their offspring will need to be made.

If you just take a look at how many households are being supported by a business in the first generation, and then extend that down even two generations further, the geometric expansion in that number will be difficult to match without an equally rapid progression of the family’s wealth.

So if all you have is “one big happy family”, but nobody willing and able to drive the amount of wealth forward, it becomes a matter of time before dissipation will kick in.

 

Complementary Roles for Family Members

Besides competence, another area that becomes important in many families is the existence of complementary skills in the sibling or cousin group who will be taking on leadership roles after the next generational transition.

If everyone is good at the same thing, and there are areas where nobody has any skill or desire to take on leadership, there could problems.

Having too many cooks can cause unneeded conflicts, and having skill gaps can lead to being blindsided in certain areas.

Of course when a family attains a certain wealth level there are some benefits that are easy to see, such as having an ability to find roles for just about any interested and motivated family member.

And when they have skill gaps, a family with enough resources can typically hire outsiders to fill such roles.

 

Competent + Compatible = Complementary

As I was writing this I got to thinking that maybe complementarity is the intersection of competence and compatibility. Let’s work through this and see if it holds up.

If you have people who are competent, i.e. good at something, and then you get to the point where the group of people get along, i.e. are compatible, can you not then ascertain that they are complementary?

It feels almost like this fits with one of my favourite ways of pointing out synergy, which is to say that “One Plus One Equals Three”.

Earlier I mentioned the geometric growth of the family and now I just opined on synergy, I guess this is a good place to link to The Exponential Magic of Family Collaboration.

 

So Strive for a Complementary Team

This may be a stretch, but perhaps either competence or compatibility are scalar, while putting them together gives you complementarity, which is a vector quantity.

I just flashed back to my High School Physics class there, and since that was over 40 years ago, I admit that I needed to Google this to get the terms right.

As Mr. Henry used to say, “velocity is speed with a direction”.

So if you strive for a complementary team in your sibling or cousin group, you’ll be able to combine everyone’s ability to get along with a direction and a purpose.

This isn’t to be confused with complimentary, although if they also develop the habit of saying nice things to each other, that’s OK too!

/by
, ,

The Ownership Connection to Family Legacy

It’s More Than Just About Family and Business

There are some subjects I cover pretty often in these blogs, because much of the work I do revolves around areas where families have predictable challenges that I try to help them work through.

Regular readers know that I’ll often return to such staples as communication, governance, family meetings, harmony and working together.

Well lately I’ve been seeing and hearing much more about the subject of ownership, so that’s where we’ll turn now.

 

The Forgotten Circle?

I can’t believe it’s been over three years since I wrote Ownership: The Forgotten Circle of Family Business. I guess that at that time I was noting an absence of discussion on this topic, so it seems that may no longer be the case.

A few months before that, I penned Pruning the FamBiz Ownership Tree, in which we looked at the issues that arise over generations where ownership of a business ends up coming down to family branches with different involvement in the business, and how those issues need to be dealt with somehow.

But today I want to look at a specific area around ownership, and that is the way that the feeling of ownership is so important for families to recognize, if they are expecting their following generations to maintain their family legacy.

 

The Ownership – Legacy Connection

I typically make one similar assumption when I begin working with any family, which I normally end up validating early on. That assumption is that the leading generation of the family, the ones I sometimes label the “NowGen”, have at least some interest in creating a lasting legacy.

Those words mean different things to different people, so let’s look at this more. For me, a lasting legacy is one where even after the NowGen has left this earth, there is some continuity of what that generation built, grew, and/or stewarded, by the “NextGen”.

Let’s look at the opposite of that, which sometimes occurs, and which is also fine if that’s what makes the most sense for that family.

If the family wealth is to be split among the descendants and then they will all each go their own way, then there will be little or no legacy left.

In most families in what some call the 99%, this is standard practice.

 

That Feeling of Ownership

When a family attains a certain level of wealth, the idea of maintaining some sort of legacy will often come up.

Such families will then typically consult a number of professionals who are experts in the area of protecting that wealth so that it may then be preserved for future generations of the family.

One of the details that gets dealt with at that time is the ownership of the assets that make up the financial wealth, and this is where some important considerations sometimes get lost along the way.

“Family specialists” like me who work with the family members on how they will govern the family wealth often walk into situations after most or all of the ownership details have been cast in concrete.

And in situations like that, we typically note that there were some opportunities to make the future owners actually feel like owners.

 

Just Trust Me On This, Kids

Of course when the offspring are still children, it is normal for their parents to make important decisions for them. The problem comes up when those children become adults, and yet their parents continue to treat them as children.

I always encourage parents to work on having adult-to-adult relationships with their offspring, because a “one-up, one-down” framing can be crippling to the development of the rising generation.

Growing up in my family, I had legal papers put in front of me and was told to just “trust me, sign this”, and many others went through the same thing too.

 

Feeling Like You Actually Own It

Getting back to those experts who prepared legal documents about the wealth, they understand the differences between legal ownership and beneficial ownership for assets in a trust, and my point here is that at some point those beneficiaries need to have this explained to them as well.

Who will share ownership of what, and when those changes are expected to happen are also key.

To preserve a family’s legacy, feeling like you own it cannot be overlooked.

If the debate is to share this information now or later, my advice is that sooner is always better.

 

/by
, ,

On Observing and Absorbing in Enterprising Families

When Two Words Arrive in the Same Sentence

This week we’re going to do a bit of “freestyling” in this space, and see where it goes.

Regular readers are likely familiar with my penchant for taking some seemingly arbitrary topics or words and trying to weave them together into something useful and entertaining for those interested in the family enterprise space.

I’m writing this during the Christmas holidays, so it feels right to just reflect a bit and see what comes out. Thanks for joining me.

 

A Coaching Session as an Inspiration

As a coach, I think it’s important to also work with my own coach too, because it really helps to underscore how much one can gain from this kind of relationship.

It would feel pretty disingenuous if one of my clients asked me about my coach and my reply was “Who?”.

A few weeks ago during one of my sessions with Melissa, I uttered a sentence that contained “observe” and “absorb”.

Now you may not think that that’s noteworthy and I wouldn’t blame you. But as someone who writes 52 blogs every year, I need to find my inspirations wherever I can.

 

Observation is an Obvious One

When I work with members of a business family, one of the biggest things that I bring to them is an outsider’s perspective on what they’re living.

Lately I’ve been using an aquarium example to illustrate this, and I think it works pretty well.

I have a 90-gallon aquarium at home and a 55-gallon tank in my office, so this inspiration is never far away.

I know that the way I observe the fish in my aquariums is quite different from the way they observe each other.

The fact that I’m outside the system gives me an ability to see the bigger picture, and it allows me to have a much wider perspective of what’s going on within the system.

I need to constantly remind myself, though, that I need to work at staying out of the system, or else I’d quickly lose much of the objectivity that my outsider status affords me

 

And What About the Absorbing Part?

The part about absorbing might be a bit less obvious, but let’s see if we can make it make sense here. Whereas the observation part was more about the space aspect (i.e. big picture, outsider) the absorbing is more about time.

This is where thinking about a sponge can be helpful. When a sponge is completely dry, it has a lot of potential to absorb liquid, but it can’t do it instantaneously. It takes a few seconds to be able to take everything in.

And whereas the observing is typically something done with the eyes, the absorbing involves the heart and your emotions, and is more of a full-body experience.

Absorbing Anxiety from the Emotional Field

As an outsider to a family system, a great deal of my focus is on observing the emotional field of the family when they’re together.  It’s amazing to note the difference in baseline anxiety levels from one family to another.

Some families have a “modus vivendi” of being together that’s very easygoing and free, while with others you can almost feel the tension. See Family Governance, More than a Modus Operandi

You can guess which families are more fun to work with, and they also seem to have more success in transitioning their business and wealth to the next generation.

When working with a family where there’s some tension, part of my role is to absorb some of it, almost like taking a sponge and soaking up some of the extra and trying to keep things tidy.

 

Family Members Assuming Their Roles

Naturally the observing and absorbing are not limited to the outside coach or facilitator, as each family member is also doing some of each.

Families with whom I work have typically already recognized a certain level of interdependence that they have with each other, and they are therefore part of a system where there’s a good deal of focus on all of their one-to-one relationships as well.

When the family members are able to make factual observations about each other, that’s usually a sign of progress.

At the same time, they’re hopefully acting in ways where there is less “absorbing” going on.

When all family members have adult-to-adult relationships and everyone becomes a resource to everyone else, you’re really in business. I love to observe that.

 

/by