Some New Thoughts on Old Ideas

This week I want to look at some ideas I’ve written about here over the years, and share some of the new ways I’ve begun to think about them more recently.

I just attended the annual FFI Conference in NYC, where my thoughts are always stimulated, as I get to gather and absorb the latest from many of the standouts in the field of family enterprise.

It was during the opening keynote that the seed for this blog was planted, when the speaker talked about how so often we need to sit back and see what emerges.

Hmmm, I thought; I often talk about how things need to evolve, but he’s talking about emergence. How are they similar and how are they different?

That question is where we’ll begin, but then later we’ll look at the idea of rebirth, which emerged in my mind after a fantastic breakout session the following day. (See what I did there?)

Evolution Vs Emergence – Compare and Contrast

Long time readers (thanks!) are familiar with the fact that I love to talk about evolution whenever the subject turns to family governance.

See The Evolution of Family Governance

I believe that the best and most sustainable governance is co-created and built very slowly over time. 

I always suggest this approach, because so many people need time to understand and accept whatever processes and structures they are putting together to govern the way their family relates to their business.

See From Understanding to Agreement, Via Acceptance

What I had not considered until now is how and where the idea of emergence fits into this long process.

While this is still relatively new thinking in my head, my initial view is that there are small ideas that emerge during this evolution, and then each of those needs to be looked at on its own.

Some of the things that emerge, perhaps as a suggestion, will turn out to be less than ideal, and then they should be discarded.

Other ideas will emerge, and seem useful, may become championed by some family members, and then could become part of how things evolve positively going forward.

Dealing with the Little Ideas that Emerge

That whole process of figuring out how to deal with the little ideas that emerge during the longer arc of evolution, becomes the day-to-day aspect of making sure that the governance being built will be “fit-for-purpose” for that particular family.

See Making your Transition Plans “Fit for Purpose” from last week.

Suggestions are mentioned, debated, and perhaps tried out. Some will stick, and likely get modified and improved over time, while others will prove to be unusable or detrimental, and will be discontinued.

Thus little things that emerge become, or not, part of the overall evolution of how the family decides how to be together.

All Good Things Must Come to an End

Switching timeframes now, there was another great session at the conference, called When It’s Time to Part Ways.

I typically search out the breakout sessions that deal with subjects we don’t talk about enough in our field, and this one fit the bill.

So many sessions treat finding better ways to make sure that we can support families we work with as they attempt to transition their family’s assets to the next generation, all while preserving family togetherness.

Many times, however, a family will be at the logical end of its ability to do this for one more generation, and trying to find a way to part ways amicably becomes an interesting and important option to look at.

Rebirth – Success After “Failure”?

During audience discussion at that session, it became clear that the most common reason this rarely gets pursued by families (and their advisors) is that it feels like a failure if the family is unable to keep its business or wealth under broad family ownership through their next generational transition.

But often by the time they do get there, they wish they’d done it ten years earlier!

As advisors, we need to have the courage to put such ideas on the table, showing families that it is not a failure, and actually becomes an opportunity for rebirth.

If wealth is separated after family members part ways, new ideas will surely emerge in various family branches.

The really good ones that emerge will continue to evolve in positive ways, and the whole family will hopefully have avoided a situation where family relationships have been irreparably harmed.

Isn’t that a success?

Just What Are You Trying to Achieve?

The subjects I cover in this space typically have something to do with families who’ve accumulated a certain level of wealth, who eventually get to the stage where transitioning that wealth to the next generation has become a priority.

When I work with such families, it’s always simpler when they’re still early in their journey, because when they start fresh, I can guide them through some of the important considerations that I know will become pertinent down the road.

Oftentimes they’ll have already begun with some of the legal and structural preparations that other professionals have suggested in good faith, but that end up causing issues on the human and relationship side of the family’s reality.

All of this preamble is designed to set up a look at making sure that a family’s transition plans are actually “fit for purpose”.

Consumer Protection Origins in the UK

The term “fit for purpose” is one I’ve heard off and on in recent years and at some point I noted it as a possible blog topic.

As I dusted it off recently, I decided to do some quick research and found that its origins are based in the UK, and derive from consumer protection laws.


That is, if a product is deemed to not be “fit for purpose” the purchaser can return it for a refund.

The term later got renewed life in a political context when an opposition party stated that someone or something in the government was not “fit for purpose”, and when that story got legs, the term became part of the lexicon.

So why am I bringing this up in a family wealth transition blog? I’m glad you asked.

Asking Some Basic Questions Is Key

When we attempt to determine if anything is “fit for purpose”, the first question that begs is “what is the purpose?”

Getting back to the general topic of planning for a transition of wealth, such plans are typically supposed to tick a number of proverbial boxes, i.e. they have multiple purposes.

Having both the wealth AND the family relationships survive the next generational transition are usually among the goals families have.

But because relationships are nebulous and hard to define, this can play second fiddle to other purposes that are more easily quantified, like, oh, maybe, saving taxes?

Most clients’ heads will nod when presented with an iron clad plan that guarantees that they’ll owe less taxes, without getting into the details of the side effects of such plans that may impinge the family relations purpose noted above.

Doing Things “On Purpose”

If we think back to our childhood, our first exposure to the word “purpose” was likely in the context of a sibling interaction where someone got hurt and then blamed the other.

“He did it on purpose”, you may have exclaimed to the nearest parent.

“No, it was an accident”, the other would say, in their defence.

So here we have our first nugget, one “opposite” of doing things on purpose is getting something haphazard, i.e. by accident.

As long as we’re looking at expressions that contain words about purpose, regular readers already know my love for the Purposeful Planning Institute and the great community I belong to thanks to that group.

For All Intents and Purposes

The word “intent” gets combined with purpose in the expression “for all intents and purposes”.

Families I work with need to be very intentional about how they make sure that their relationships will remain strong.

“Things don’t just happen by themselves”, I often tell them. This takes work and families need to be very intentional.

Getting back to “fit for purpose”, my intention here is to make sure that families make the effort to consider how their plans to transition their wealth are going to impact their family relationships.

Very Fit for One Purpose, Unfit for Others

Too often, some of the decisions families are advised to make for one purpose, like saving taxes or making sure that access to the wealth is severely limited, end up creating undesirable side effects.

I try to make sure families think through their choices so as to avoid those shortcomings.

Openly sharing the purpose of what the family is trying to achieve is also a big part of how families succeed, because that transparency is part of the solution too.

Continually asking “what are we trying to accomplish” never hurts.

There Are Different Ways to Take a New Look

LinkedIn is head and shoulders above all other social platforms for professionals, and I’ve found plenty of great content there over the years, not to mention the wonderful connections I’ve been able to make and nurture there.

This week’s post was prompted by something I saw there recently, and even though the majority of my network on LnkdN is connected to the world of family wealth transitions, this particular piece came from a local colleague whose professional life is very much elsewhere.

This friend had recently experienced a sudden and unexpected career disruption, after which he took some time away to think about how he wanted to come back fresh for a restart.

I was so pleased to see that he shared a quote from Leonardo DaVinci on the experience of stepping back and taking a fresh look at his life and career thanks to this experience, and I know that I can use it as fodder for some ways to look at my work with families.

Back to Some Translation Issues

Setting out to write about this topic this week, I hadn’t realized that I was going to once again run into an issue around translation, which is something we looked at last week.

See: On Coaching, Parenting, and Sub-Optimal Translations

But because the LinkedIn post in question was in French, I’m writing this in English, and I’m pretty sure the original quote from DaVinci was in Italian, I’ll need to take a bit of editorial licence here.

(Despite some attempts via Google, I wasn’t able to locate a direct English translation.)

Here’s my quick version of what he posted:

“Take a step back, and the problem looks smaller. And in one glance you’ll have a better view of the full picture, and a lack of harmony or proportion will be easier to see”   – Leonardo DaVinci.

Planning to Transition your Family Wealth

This is the point where I now switch from the inspiration for the post to the message for families whose main challenge is transitioning their wealth from the current generation to the next.

These families have many potential resources available to support and guide them on this journey, yet the hard work cannot be farmed out to outside professionals.

The idea of stepping back and looking at the problem differently is definitely something we can suggest as a worthwhile action.

Because I also understand the context of my colleague’s recent challenge, I also know that his “step back” was not just a simple one.

I know for a fact that he included both time and space in his reflection.

Time Away to Clear your Head

His efforts involved taking several weeks off and travelling across an ocean.  He was also able to spend a good deal of family time with those most important to him, and get his mind away from what had been his usual work grind.

Many family leaders employ similar methods, such as getting away and taking longer and longer vacations (and weekends) over their final years of working in their business, to allow those on their way up more opportunities to take on leadership roles.

That works well in many cases and isn’t anything new, but I’m talking about more than that here.

Clearing your head completely and beginning to think about “working ON the business” as opposed to “working IN the business” is a bigger step.

Being able to see the picture more fully, including where there’s a “lack of harmony” can take a bit longer and require more effort.

Add an Outsider to the System

In many ways what I’m getting at is that this requires a fresh perspective, which can really only occur after some kind of a break, either in time or space.

Getting away from being in the middle of something is needed to be able to look at things from the outside.

Having someone along who is also an outsider to the system can also be useful, because they will automatically have a different viewpoint, as well as way less “baggage”.

When you’re constantly surrounded by the same people who all look at things the same way, you can get caught in the tough space of “group think”.

Getting away in both time and space, and bringing in a coach who is there for you on your journey, are great ways to make a fresh start.

Getting the Exact Meaning Can Be Tough

Because I consider myself a bit of a wordsmith, I usually strive to be very precise with my choice of words.

I also admire those who take the time to ensure they use the right words during conversations, and I actually pointed out my appreciation to a colleague recently, as we were discussing something delicate.

And as regular readers are aware, I sometimes work in French and speak it daily, which allows me to play with the meanings of words in two languages.

This sometimes brings up situations where the most accurate word I want to use happens to exist only in the other language.

It actually happened to me earlier today on a Zoom call, but luckily enough the person with whom I was speaking was another Montrealer, so even though our conversation was in English, he understood me when I slipped into French to find “le mot juste” in a sentence.

I’ve Never Loved the Term “Coaching”

A few weeks back in Education as a Prescription for Discomfort I teased the fact that I’d soon be writing another “bilingualism-inspired” post, so here we are.

In some ways it’s been a long time coming, because as someone who trained as a coach and with a coaching certification, I’ve long lamented the fact that the term coaching doesn’t resonate well in many cases.

See No, Dad, Coaching Isn’t “Helping Losers”.

As it turns out, coaching is also something that my wife does a lot of as well in her work, although she deals with very different situations than I do.

But recently she was working on something and was trying to find the right word to describe what her team does, and even though she had the perfect word in French, she couldn’t seem to find the corresponding English word that conveys it properly.

“How do you say ‘accompagnement’ in English?”, she asked.

“You don’t”, I replied. “Accompaniment isn’t a word”.

“It’s too bad”, I continued, “because it’s so much clearer than the word “coaching” for what we both do”.

(As it turns out, it is a word, but the main definition is about music, so it isn’t helpful.  We could also get into wine pairings, but that doesn’t really apply here either).

Work with Me, Walk with Me

When I did my training to become a coach, one of the two fundamental takeaways was the we need to learn to “be with” the person we are coaching. (The other is listening without judgement).

Later while doing some conflict resolution training, I began to like the term “walk with”, because it speaks to both the “being with” and the journey that people take.

See Work with Me, Walk with Me

Being with someone and joining them on a journey are so important, but so is our motivation and attitude.

I sometimes refer to myself as a guide, because that also conveys the journey and the role I play.

I need to be there with you and for you, and be looking out for your interests, not mine. So when I coach someone, I accompany them on their journey.

But for “Parenting” It’s the Other Way Around

Lest you think that finding the right word is only a problem in English, let’s now turn to a word that really doesn’t translate well in the other direction.

Thanks to one of my mentors, Denise, for pointing this one out to me.

She does most of her work in French, and she laments the fact that there really isn’t a good French word for “parenting”.

(Google gives us “parentalité” but that’s not a word that anyone ever uses).

I can understand her frustration because poor parenting is a huge cause for many of the issues faced later on in life, especially in the context of a family that is expected to continue to own and manage assets together, even after their parents are gone.

Parents as Coaches?

As we think about coaching and parenting, we can naturally consider how they can be interrelated.

The key to being more of a coach to our offspring lies in the fact that once they are grown adults, we need to foster an adult-to-adult relationship.

The part about listening without judgement also comes into play.

And the “being with” can’t be overdone.

When I’m coaching someone, the call ends and I typically don’t see them again until the next call

Limiting just how much time you spend accompanying them can be tough.



A Convoluted but Useful Conclusion

Last week we looked at the various types of skill sets that people who work with families might need in order to provide them with the whole breadth of service they require.

See Liberal Arts Vs. STEM Skills to Serve Families

As I openly shared then, that idea and concept came to me from a colleague during a Zoom call with peers, which is nothing new.

We ended that post with another peer-inspired idea, that of thinking of this as a “left brain / right brain” dichotomy.

That one came from a different call, one that I’m part of locally in Montreal, that meets in French.

We’ll get to yet another bilingualism-inspired post soon enough, don’t worry.

Although this week’s idea is a bit convoluted, that has nothing to do with language, and more to do with the way my brain is wired.

You Can’t Have Too Much Education

During that call with my francophone colleagues, one of our leaders made the point that education is always her first “go to” when beginning to work with any family.

Heads were nodding across the screen at this, as it’s difficult to argue against.

But let’s look at that a bit longer here, to consider the context she was speaking about.

When a practitioner enters a family system as an outsider, we need to quickly try to establish some common ground on which we can then firmly stand.

We want to show that we are knowledgeable and trustworthy of course, but also able to communicate with all members of the family.

Most families suffer from a serious case of “information asymmetry”, as I like to call it.

That’s just a fancy phrase to say that some family members typically know everything about what the family owns and manages, while others are very much in the dark.

Bringing everyone up to the same level on some subject(s) with some education is an important first step for all of these reasons.

Assessing a Family’s Learning Orientation

Some part of the general agreement of our group around education naturally stems from the fact that when we get to work with a family that has an appetite for learning and education, such mandates are typically much more enjoyable and fulfilling.

Working with people who are “learners”, as opposed to “learned”, is very different, as anyone who has a “know-it-all” in their midst will readily appreciate.

When we start with any education content, we can begin to assess how hungry the family members are to learn together

Why Were We Called In?

Later on during this same call, a colleague shared his view that learning usually only happens in response to some level of discomfort.

Hmmmm; I needed to think about that one a bit.

Is discomfort a necessary pre-condition to my being able to learn? I suppose that it will increase my motivation, assuming that I am trying to learn how to ease my discomfort in some way.

Certainly the fact that a family has invited us in as an outsider to be a resource for them, there was some discomfort somewhere in the system that prompted that reach-out.

So somebody was suffering from some discomfort somewhere.

Now to the Prescription Angle

Somewhere along the way during the 2-hours we spent together, the idea formed in my head that education is always useful, and if it is to try to settle some discomfort, we could think of it as a prescription.

If education is a go-to solution to instigate some learning, and learning is a solution for discomfort, then this makes sense.

Like I said, it feels a bit convoluted and yet it might be useful, if it can remind us of these two ideas in our work.

Clarity Is More Comfortable Than Confusion

Education is almost always used with families in order to increase clarity, and to find places where every family member better understands what the family owns and how they are planning to transition that to the next generation of the family.

Educating for more clarity is always useful, because increasing clarity enables better understanding.

Ideally we want to get to the stage where everyone agrees with whatever plans are put into place, and if the family members aren’t able to comprehend the plans, it is difficult for them to agree to them in an informed way.

We’ll pick up this idea again next week, please come back!

Slotting the Right People into the Right Roles

Serving families who are hoping to transition their business or wealth to the next generation is always complex.

Regular readers know that I encourage those who serve such families to collaborate for the benefit of the family, and that’s often easier said than done.

So many specialists are involved in creating the “perfect” plans, making it difficult to keep things simple enough for the family to understand them so that they can be effectively implemented.

With so many outsiders involved, it often takes a special skill set to be able to communicate everything so all stakeholders feel heard and can then work together with the plans that have been created.

Peer Group Inspiration Once Again

This week’s post was inspired by a statement from a member of a peer group who phrased something in a way I’d not heard before, at least not in a family enterprise context.

Then, in yet another group a week later, another valued colleague phrased something in a complementary way, making this blog a “must-write” for me.

Between the organisations I’ve joined and the peer groups I’ve been privileged to be part of this past decade, my interactions with like-minded professionals are at the top of my list of learning opportunities, and blog post inspirations.

So Many Content “STEM” Experts

The first instance happened during a case discussion I was leading in a monthly meeting I host.

We were talking about a family office where some new hires were facing some challenges in their communications with members of the family.

One the peers in the group suggested that there seemed to be lots of people with a STEM background (Science, Technology, Engineering, Math) on that family office team of professionals, but they didn’t seem to have anyone from the Liberal Arts field.

A light bulb began flashing in my head of course, as I now had a new way to think about this subject.

Liberal Arts to the Rescue?

I have two children who have recently graduated with Bachelor’s degrees from very good schools, and even though they share the same two parents, they could not be more different.

The first studied engineering and is now following that up with studies in business analytics, so very much from the STEM mold.

The second has a BA in philosophy, politics and economics (“PPE”) which I believe is one of the oldest and most classic fields of study at Liberal Arts schools, having started at Oxford about a century ago.

When I imagined which of my two offspring would be better suited to address the challenge that the family office professionals were dealing with, it was a no brainer.

They were not short of technical know-how, but their ability to manage the people side of things was glaringly absent.

A Great “Left Brain” / “Right Brain” Collaboration

Seven days after that call, I was with another group that meets in French every month.

This group is roughly 2/3 process and people practitioners, and 1/3 content and technical specialists.

We discuss all matters relating to family enterprise succession, and over the years we’ve been meeting, some collaborations have occurred.

As we went around the proverbial Zoom room to catch up (having not met since June), one member reported some news about a collaboration she’d recently done with another colleague from our group.

She being people-focused and her collaborator being an engineer, she noted that they made a great “Left brain / Right brain” team. (Actually “cerveau gauche / cerveau droite!)

Complementary Skill Sets Are Key

It’s heartening to see that those of us who specialize in people and process are increasingly being seen as important parts of the complex world of family business and family wealth succession plans.

Unfortunately, it’s usually only after the technical specialists hit a roadblock that they feel the need to call in some reinforcements on the human side.

The bigger the family and the more complex the scenario, the more there is at stake. And the more there is at stake, the more you need to make sure that everything is well communicated and understood by all stakeholders.

Too often, the experts brought in to handle the structural and financial intricacies are not well skilled at the human element, and even uncomfortable in such roles.

Please make sure that there are some Liberal Arts types to complement those STEM folks.

A Variety of Skills Are Needed 

Working with enterprising families as they prepare to transition to the next generation, as I’ve been doing for the past decade, I’m continually amazed at the different challenges this work throws up at me.

It’s been heartening to exchange with so many other colleagues who practice in this same space, to realize that this isn’t just something that affects me, but also everyone else who toils with family dynamics, in their various manifestations.

It’s probably the biggest reason this work is so rewarding, because you never know what you’ll discover when working in the “family circle”, and even what seems like it should be simple “discovery work”, often requires lots of detective skills.

I’ve written before about the importance of discernment, that is, figuring out what everything means and deciding what’s important, but going upstream a bit, just uncovering facts to understand each person’s context, can be an arduous process in its own right.

See: On Discernment and Resourcefulness for Family Clients

There’s Information in Everything

When starting with a new prospect, the mystery-solving begins, as the person who first reaches out presents their view of the issues and the presenting problem to be addressed.

At this point it’s important to be a sponge and try to soak up any and all information, putting as many puzzle pieces on the table as possible.

As more people are heard from, typically in one-on-one calls, more information is shared, and more puzzle pieces are added.

In addition to the facts that each person shares, there’s also information in how they share it, including who volunteers to step up for these calls quickly, and who needs to be cajoled into participating.

Imagining the Entire Puzzle, and Knowing You’re Wrong

When I first started this work, I’d get to a point once I’d heard from a few people and believed that I had a pretty good idea what the challenge was, who the players were, and how I could go about working with them to make some important progress together.

Nowadays, I’d much more realistic in my expectations, and I understand that early on in any family engagement process, it’s next to impossible to get a good read on where things should go, can go, and will go.  And that’s OK too. 

Well, it’s OK with me, but often harder to get clients to buy into the fact that whatever simple situation they initially believed needed to be addressed actually turns out to be much more complex and that a simple solution won’t likely suffice.

Subjectivity and Selective Sharing

Two of the major reasons underlying the difficulty in getting the full picture as an outsider to the family system come from the way we get our information.

On rare occasions there are ways to read up on a family from third party sources, but those can be fraught with misinformation in many cases, even where they do exist.

We get most of our info from the members of the family, each of whom has their own version of the truth.

Of course knowing how each person in the family perceives the facts is very important to understand, but when the goal is to develop an objective, “outsider’s” picture of reality, skills of discernment always come into play.

There’s a deeper level to the subjectivity question too, and that’s the selective sharing that also happens, meaning that skeptical family members will hold back on sharing their full and true feelings until they believe that the person with whom they are sharing can be trusted.

Trusted with What, and for What, Exactly?

Of course trust is a key concept in many areas of life, but when it comes to family businesses and the relationships of family members, everything seems heightened.

So when we look at developing trust as an outsider coming into the system, we need to do everything we can to make sure that each family member feels like they can trust us.

They need to trust us with their deepest feelings, many of which have not been shared with all their family members.

And they need to trust that we are there for them individually, as well as for the entire family as a whole.

To do so, we need to listen to them without judgement, in order to gather all of the clues we’ll need to be able to properly serve them.

See No Room for Judgement when Working with Families

It’s Often Right in Front of Your Nose

Although I personally try to shy away from using a simple “see problem, find solution” mindset, I recognize that many people do default to that way of thinking.

There’s no shortage of folks who prefer this shortcut way of looking at situations and trying to find a way through a challenge.

Dealing with complex family situations as I often do, a bigger picture, longer term, systems view of what they’re facing, typically yields better results for me when guiding a family.

There’s plenty of nuance in my work, and I also try hard to not present myself as the bearer of simple solutions to problems.

Inspired by a Tweet, Uh, I Mean, an “X”?

While I love using LinkedIn for professional interactions, I’m still a fan of what used to be called Twitter, although I spend less time there than I once did.

This week’s blog was inspired by a post I saw recently on X, from Dr. Nicole LePera (@Theholisticpsyc) a psychologist with over a million followers there.

Her post read simply:

                    If I am the problem, I am also the solution.

As you might imagine, I was intrigued and needed to process this more, but on the surface it held promise as inspiration for an eventual blog post here.

It’s so simple, and there are many ways to ponder it.

I immediately emailed it to myself and saved it in my “blog ideas” folder.

Complex Situations Have Multifaceted Problems

Back to the complex family situations I often learn of, and sometimes get invited in to assist with, there are always many people interested in finding a solution.

Not that many, though, immediately jump at the opportunity to look at the part that they themselves play in the perceived problem.

If (and when!) they do, they can eventually see how at least a part of the resolution is right there in front of them, when they look in the mirror.

While it isn’t usually easy to get anyone to the place where they even feel like taking that glance in the mirror, it is almost always a necessary step that needs to be taken.

As you might imagine, it’s also typically not something that only needs to happen for one member of a family, because any complex situation naturally requires some “adjustment” by several people.

Spreading the Responsibility Around

Challenging family situations affect many members of the family, and are also affected by many family members too.

Getting each family member to understand and accept this fact can take some time, but that “buy in”, to get everyone focused on doing their part in getting to a better place is crucial.

This work requires a “systems view” to be able to see what’s going on, and it also requires the guidance for each person in the system to make the necessary adjustments to get to a better place.

Getting a family to understand that there’s a shared responsibility at play can calm the whole system down as well, and that’s a huge piece of making progress.

The More and the Less of It

Families can benefit from making small, gradual adjustments, which can happen once some family leaders step up and show the way, by modeling such behaviours.

I’m talking about learning to practice more forgiveness and less blaming.

Nobody likes to have fingers pointed at them, even when they may internally acknowledge some of the fault for where things are.

Knowing that others are in a forgiving mood can become contagious, for the benefit of all.

Instilling an attitude of more gratitude and less lamenting one’s fate is also quite beneficial.

Benefits of the Mirror

Helping family members think about their own role in things, and getting them to think in terms of “I-statements”, as opposed to “you are to blame”, goes a long way.

Getting a family to a better way of being together requires an attitude of more self-efficacy, that gets everyone out of finger-pointing mode.

There’s typically a kind of culture to the ways families act, that can set in an add to the “stuckness” that sometimes exists.

Getting a family “unstuck” doesn’t usually happen quickly, and rarely in one step.

Taking the time to work with each person individually, to get them to understand and accept that everyone holds part of both the problem as well as the solution, is always worth the trouble.

Serving the Needs of “Enterprising Families” Varies Greatly

There are some subjects related to working with enterprising families that many of us don’t really ever think about, but that are always kind of there in the background somewhere.

This week we’re going to look at one of those, thanks to a new book that I just finished reading and that I highly recommend, which made me realize one of these issues actually does exist.

It got me thinking too, and when I do that, I typically try to find an analogy or a metaphor to help explain it more clearly, and so I’ll be trying out this new thinking here as well.

I bet you’re wondering what book I’m talking about.

Wealth 3.0 – The Future of Family Wealth Advising

I’ve known that this book was due out soon and was pleasantly surprised to see that it’s now available.

The authors, Jim Grubman, Dennis Jaffe, and Kristin Keffeler are all veterans of the field who I’ve known for years, and I’ve interviewed each of them of the Let’s Talk Family Enterprise podcast in the past couple of years. (Episodes 11, 29, 45)

They are mentors and colleagues and have each already authored other books on areas of this subject matter individually.

I think you can imagine why someone like me, who writes regularly about family wealth transitions, would’ve been eagerly awaiting its publication.

Business, Enterprise, Wealth

I could never do the book justice with a full review in this blog space, but I do want to share my thoughts on the new distinction that it clarified for me.

It’s a book about advising families about their wealth.

It highlights the fact that the field of family wealth advising is not very well defined and urges those who participate in this field professionally to do more to organize and advance it for the good of the families we serve.

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It also contrasts the needs of wealthy families with those who inhabit the world of family business.

The family business advising world is, in many ways, ahead of the family wealth advisory space, and is also distinct from it.

That was the “A-Ha” moment for me.

Some Families Make the Journey

My own professional journey in this ecosystem started with me working for my Dad in the family business he started before I was born.

I then found my calling to this work while enrolled in the Family Enterprise Advisor program.

And I now sometimes work with families who have significant wealth, without ever having had an operating business to speak of.

Even the term “family enterprise” feels a bit clunky, because it was essentially concocted to try to cover the fact that families often sell the operating business that made them wealthy, and then still have many of the same issues to deal with, despite no longer being concerned with the operation of a business.

The Family Firm Institute, started in 1986, has been playing a leading role in advancing and professionalizing the field of family business advising.

Wealthy Families Come in Many Forms Now

The Ultra High Net Worth Institute, for its part, has yet to see its fifth birthday, and they seem to be working hard to play catch up.

All three of Wealth 3.0’s authors are part of the UHNWI faculty.

While many of the world’s wealthy families have had a successful business as their main wealth driver, there are now more non-business-owning wealthy families than ever.

Entertainment celebrities, world class sports figures, tech billionaires, and even well-compensated executives can easily end up in the Ultra High Net Worth category.

When these successful people end up with more money than they could ever spend, and they have families, they then face many issues that they hadn’t even realized before.

Do You Need a Dentist or an Orthodontist?

So as I contemplated all of this, I began to think about family business advisors as dentists.

They help business families with lots of little things, many of them mundane, and work with them to help keep their mouths healthy.

Maybe family wealth advising is more like orthodontics.

They still concern themselves with your mouth, but they look at things very differently, and help with more specialized services.

Orthodontics surely evolved from the field of dentistry and then took its own course of professionalization.

Every orthodontist needs to study dentistry first, and then move on to that specialty afterwards.

Perhaps family wealth advising is now beginning to follow a similar path?

Not Everyone Can Be the CEO

In the world of family enterprises and their ubiquitous challenges in transitioning from one generation to the next, there are a number of misconceptions that continue to plague those trying to help families get things right.

A pervasive one that’s a pet peeve of mine, is the focus on finding that one singular person who can take over the top job, let’s call them the CEO.

When you think about a business founder, the person who’s the “G1” (first generation) head of the family business, you typically imagine certain traits and characteristics that they likely exhibit and even exude.

I suppose it’s natural to assume that once they’re no longer around, the ideal replacement for them would be a clone, or the person who is most like them.

And that’s the first part of the misconception.

Not Everyone WANTS to Be the CEO!

Fans of TV dramas like Succession may believe that the members of the next generation of every family business behave like the fictional Roy siblings.

Now I’m not saying that their portrayal of the battle to succeed their father is completely unrealistic, or that the efforts they each made to try to outmaneuver one another never occur, but they are surely the exception, not the rule.

Additionally, as a Family business goes through each successive generational transition (G1 to G2; G2 to G3, etc.) those qualities of the original founding CEO become less and less important.

Already by G2, the leadership that works best is often very different from that of the founder.

And not everyone even wants to be the CEO.

Sticking with the Hollywood Theme

Having mentioned a TV drama, I guess I can stick with the Hollywood theme a bit longer, and invoke another misconception, or actually probably more like a “misquote” or “misnomer” that gets used far too often.

Whether it’s the Emmy awards for TV or the Oscars for movies, awards shows always honour two different categories of actors.

There’s one category for the “lead” actors and another for “supporting” actors.

But that’s not actually what they’re called, even though that’s the way most people say it.

It’s actually best actor in a “leading role” and “supporting role”.

OK, not a big deal, right? Or is it?

Maybe not in Hollywood, but what about in a family enterprise?

Playing Second Fiddle to your Sibling?

Let’s get back to the sibling drama situation we touched on earlier. These kind of superiority contest plays do happen, especially when they happen in an environment where there’s a “winner-take-all” mentality.

When things are seen as a contest to find the best person, and all others are less good, that “winners or losers” dynamic isn’t helpful at all.

While you can’t always make it disappear, there are ways to try to frame it as more about the roles than about the individuals.

Many Roles in Large and Complex Families

There’s something that I recognized after entering this field a decade ago that I hadn’t appreciated until I began working with several large and complex families.

It isn’t something that most people would consider, and even those in such families often need to have it pointed out to them before they eventually say, “Yeah, that’s true”.

I’m talking about the fact that there are usually several major roles that need to be played as a family enterprise moves from G2 to G3 and onwards.

Not Just the Roles in the Business

Besides the roles in leadership in the operating business, there are other key roles that someone from the family can, should, and hopefully will take on.

Governance roles are so important, and exist in various places and forms during the evolution of a family business becoming a family enterprise.

Family office roles, ownership council leadership, being the family champion and taking on leadership of a family council, leading a family foundation, being part of the board of directors, leading the education committee and being the Chief Family Learning Officer all come to mind.

These roles don’t start with a job posting and typically evolve as a family matures from one generation to the next.

They also come with various advantages and disadvantages, suit different kinds of people during different life stages, and are sometimes compensated and other times not.

Helping families recognize this is the first step to finding the right spot for each person who wants to participate.