Part 1 of 2 – The Pros
The expression “liquidity event” is not necessarily well understood among the general population. Let’s take a look at it from the Family Business point of view.
Essentially, a liquidity event takes place when the owners of a business, in this case a family, sell a substantial portion of their business (either shares OR assets) to an outside party, for cash or another form of asset that can more readily be turned into cash quickly.
A few weeks ago, at the end of “Family Governance, Aaaah!” I promised to follow up with more on the subject, in my “5 Things” format. I said it would be out in February, and this being my final blog of the month, that means now.
Sometimes the right word for something doesn’t exist, so we need to make one up. Okay, we don’t actually need to, but it can be a useful exercise.
On sports radio last week, a commentator was talking about a certain hockey goaltender and how his calm performances had helped his team get their season off to a good start. Right after uttering the word “calm”, he moved on to the fact that the team was quite “confident” playing in front of him.
That was when the “word” calmfidence sort of hit me, and it also fit nicely with some of the personal work that I continue to do, trying to become and even better advisor to legacy families.
(When I Googled “calmfidence”, I learned that while it certainly is not very popular or well known yet, I am not the first one to use it. If you also decide to do this, please say hello to Juneous for me.)
Bowen Family Systems Theory
Let’s get back to the idea of calmness as a key ingredient to helping a family. I am now into my third year of studying Bowen Family Systems Theory (BFST), and it has been eye opening to say the least.
I have already vowed to write a book on Bowen Theory as it applies to family business and wealth, because I have yet to find the book that I was hoping to find when I first took an interest in BFST.
That book is still in my plans, but it will be a couple of years away at best.
As any “amateur” Bowenite can tell you, there are eight concepts in BFST, and as some of those will surely note, being “calm” is not one of them.
So where do I think I am going to go with this? I am glad you asked.
Anxiety versus Calm
One of the over-riding issues that Bowen talked about throughout the eight concepts is anxiety.
When Bowen spoke of “Differentiation of Self”, which we might more simply call “emotional maturity” today, he regularly noted that those who are more differentiated (i.e. mature) can and do function well, even during times of anxiety.
Those with lower levels of differentiation or maturity will have their everyday functioning impaired during times of high anxiety.
Anyone who is part of a business family will certainly recognize that family discussions can be anxious times, and are often far from calm.
Bring an Outsider Inside
Advisors will preach to any family who will listen, that it is important to have an external person at the table to help them with these discussions, especially when important subjects like succession are on the agenda.
Most families prefer to keep things private, not wanting to air their laundry to an outsider, and also often assume that they alone are going through their particular difficult family situation.
They also recognize that an advisor who suggests bringing in an outsider is being self-serving, you know, like the barber who hints that your hair is getting a little long.
Bring in some Calm-Fidence
So here is where I want to bring things back to calmfidence.
When an outsider to your family enters the scene, there are two ways to quickly evaluate whether or not they will ultimately be useful to the family. You guessed it, they are “calm” and “confidence”.
This outside resource should bring a calm presence, no matter how much anxiety there is in the room, whether that anxiety is actually on the table, or hidden behind an elephant somewhere.
After a couple of meetings with the advisor/consultant, the family (or at least a significant portion of it) will begin to feel much more confident that they are on the right track.
But what if they are not calm, and the family does NOT feel more confident, you ask? Simple. Get someone else!
Too Important to Ignore
You’ve probably heard “the biggest investment most people make in their lives is buying a house.”
Families with a business, wealth, and a legacy to pass on are not “most people” though, and this is the biggest issue that they will ever face.
Inter-generation wealth transfer is not easy, and getting the whole family on board is the toughest part.
Find someone who gives you the CALMFIDENCE to get it done properly. Keep trying until you find them.
Most people are familiar with the concept of a “To Do” list, but there are so many different ways that they are used, and their relative importance in various people’s lives got me thinking. And of course when something gets me thinking, a blog post invariably soon follows.
Along the way, I am going to touch on the “will do” question, the “must do”, as well as the “could do”. As usual, there won’t be much “telling you what to do” from my end, because the older I get the more I am convinced that telling people what to do is one of the worst ways to get them to do what you want them to do.
The “will do” question doesn’t necessarily fit with this topic, but I could not help but include a quick discussion on it. It comes from the world of HR and hiring practices, and I have seen it a couple of times recently.
When you are looking to bring someone into your organisation, you will undoubtedly look at their qualifications to see what they “can do”, because you prefer not to hire someone who cannot do the job. But more and more, HR people are also being asked to look into what candidates actually “will do”.
I’m not sure if this is a “millennial” thing, but having people decide that some tasks are beneath them is becoming an issue that more and more companies are dealing with.
Moving along to more conventional “to do” list questions, I have found that it can be quite helpful to separate things out into a “must do list”, with a timeframe, and then everything else.
Some people rank their items A, B, and C, and start with the A’s until they are done, and then move on to the B’s. Some people plan things out for the week, others on a day-to-day basis. Whatever works for you is better than nothing, but coming up with a system that becomes routine has been a key for me.
I plan things out on Sunday as I look at the upcoming workweek, slotting in important tasks among whatever scheduled events I have booked.
If you are also trying to incorporate some physical workout goals (4 times a week has been good for me) this can be useful too, in the mode of “making an appointment with yourself”.
The items that are less urgent and don’t need to be done this week still need to be housed somewhere, because you need to keep longterm ideas, projects, and goals in focus. I use a whiteboard in my office, where I keep monthly and quarterly items in view at all times.
After looking at an important item for a while, I will often begin to feel some guilt about not having started it yet, and that will usually get me to break it down into more bite-sized pieces, the first of which will then go on to my following week’s “must do” list.
But my favourite aspect of this “_____ do list” question is the one I call the “could do”list.
To me, life is all about possibilities, and I find it liberating to have a number of big ideas laid out as things that I could do, both personally and for and with my family. I even like to think this way about client families that I am working with.
Whenever I am in a leadership position with a group like this, my preferred modus operandi is to share a variety of possibilities with members of the group, and then lead a discussion where the group selects what they think is best as far as next steps.
Of course there are some choices that I might logically prefer over others, but when harmony is important, whether it be in my own family or in a client family, this method works much better that the old style authoritarian way.
This is not exactly leading from behind, a concept that some people love and others despise, but more akin to leading from within.
Now, you don’t have to do this, but you could!
