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Kintsugi for your Business Family

If it Ain’t Broke, Break It?

One place I turn for information and inspiration in my professional world is LinkedIn.  I find so much useful content and plenty of blog ideas there every week.

I’ve also “met” some great new colleagues there over the years, many of whom I’ve yet to actually meet in person, but most of whom I have met over Zoom.

Recently I saw a video by a local family business leader who, along with his daughter, shared some ways they were adapting to the reality of this pandemic-stricken world.

One of the take-away messages they shared was around the ancient Japanese art of Kintsugi, resulting in an A-Ha moment for me, and the impetus for this post.

 

There It Is, Again

The Kintsugi angle was already on my radar, but due to sloppy note-taking on my part, I don’t recall where I was first exposed to it.

When I saw that video, I quickly made a note this time, to properly contextualize my blog about it. I also took it as a sign that this post was now due to be created.

Regular readers may recall that I’ve been inspired by something from Japan before, having shared Ikigai: A “Four-Circle Model” of Human Capital in 2019.

So what is Kintsugi?

You’ve likely seen some version of it before without realizing that it’s a style of art, from Japan, where a pot, dish, or bowl is broken into pieces and then reassembled.

The art is in the way it’s put back together, with glue-like substances, enhanced with gold or some other “fancy” elements.

The result is a reassembled piece, which is now more beautiful and special than the original.

 

And the Family Business Angle Is…?

Of course there’s also a resilience angle here, which is quite topical thanks to the lingering pandemic.

Almost everyone has faced, or continues to face, some sort of breakdown, and it’s important to normalize that.

Additionally, we need to realize that after a challenge, it is possible to emerge stronger and more beautiful than before.

There are also some other business family angles I’ve thought of that could fit into the Kintsugi metaphor.

Some may seem to be a stretch, and that’s OK too; I’ll just use a bit more of that “golden glue” on those to make them work.

 

Family Members Aren’t All Equal

We all know that family members are not equal, as each person has their own strengths and desires, making each one’s contributions unique.

There are often some who experience challenges in life, which may be completely involuntary or for which they are mostly to blame.

Regardless, they remain members of the family, even if they might be slightly “broken”.

One of the strengths of some business families is that they have an uncanny ability to help those “broken” family members, and even put them back together and make them stronger, finding ways to make them contributing members of the group.

 

Family Narrative with All the Warts

Another place where I think Kintsugi might apply is in the family narrative.

Story-telling seems to be all the rage now, and creating and sharing the “family narrative” has become a valuable exercise for many families.

It’s crucial to share the failures and recoveries, not just the successes, when sharing the story of the family’s path to their current status.

For more on this, please have a listen to this podcast I recently hosted. The Family Business Myth and the Hero’s Journey

 

The FamBiz Wind-Down or Wind-Up

I’ve got one more possible business family Kintsugi metaphor to share, and it involves situations where the family business that created the wealth is no longer part of the picture.

When a family business is sold, and there’s a “liquidity event”, the family can sometimes struggle to define reasons for them to stay together to continue to manage their wealth and assets.

I’m picturing the business as the pot or vase that was broken, and the family’s work to create ways and reasons to stay together as the gluing things back together in a stronger and more beautiful way.

 

Kintsugi as a Team Sport?

I used the word “create” above, and perhaps I should have used “co-create” instead.

Business family continuity is truly a team sport, and it must involve a number of people if there is any chance of it “sticking” on an intergenerational basis.

The more people involved in piecing it together, the better it will work, and look. It truly is an art.

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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!

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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!

 

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On Hunger and Thirst in the Family Enterprise

Different Things Drive Different People

It’s fascinating the things one can learn by listening to “real people” talking about their lived experiences.  Too often our learning comes from reading more theoretical ideas that, even though they come from smart people, can lack in true substance.

In some other instances we may spend time with colleagues or other peers, exchanging stories, ideas, and learnings, but those too sometimes lack the “oomph” that we can get when we have the chance to hear from those who are actually in the middle of living through an experience.

So when I recently had the opportunity to listen to a panel of rising generation members of local family enterprises share their stories, I was all ears.

Sharing Viewpoints On What We Heard

Of course I absolutely love opportunities to share with peers too, and when that sharing follows a panel of real-world experience sharing, it’s the best of both worlds.

And therein lies the genesis of this week’s post: comments about this panel of young people assuming important roles in businesses owned and run by earlier generations of their families.

One member of our group marvelled at the “thirst for knowledge” that all the panelists shared.  “Hmmm… she’s right”, I thought, as I reflected on what I’d heard.

It was true that each of the three panelists did seem to share that part of their journey involved wanting to always learn more and more and finding a variety of ways to continue that path.

But is a thirst for learning enough, I wondered.

Thirst for Knowledge VS. Hunger for Growth

Just a couple of weeks ago, in Sibling Compatibility Is Not Sufficient, we looked at how important it is that those expecting to take over the reins of any family business be competent, and not simply know how to get along well with each other.

Inherent in that competence, at least in my mind, is a willingness to take risks in order to continue to grow the business.

And another way to express that could be to talk about one’s hunger.

So when my colleague noted the thirst for knowledge that we had witnessed during the panel, my mind went to hunger. (Okay, it was also getting close to lunch time).

One Without the Other Is Asking for Trouble

So when we think about the attributes we’d like to see in rising generation family members who will someday take on key roles in the family enterprise, ideally they will have both a thirst for knowledge and a hunger for growth.

Let’s look at what you’d have if you only had one, without the other.

If you have the thirst for knowledge, you’ll have people who are curious and always wanting to learn more. There’s nothing wrong with that, of course. But, without at least some hunger to drive them to take risks, they could easily succumb to “analysis paralysis” that could certainly lead to stagnation.

On the other hand, if all you have is someone willing to take risks, but without the curiosity and desire to inform themselves in advance, you could have a lot of reckless behaviour that could quickly sink the business too.

A Look in the Mirror for Me

When I do some self-reflection, I realize that one of those situations I just described actually fits me pretty well.

Whenever I do any kind of assessment like Strengthfinder, I always score very high on “learning”.  I’m constantly looking for any opportunity to learn more.

But if I were to assess my willingness to bear risk, I’d score at the other end of the scale.

I’m guessing that deep down inside, when my father decided to sell the operations of our family business, that he had started before I was born, he also realized that handing the reins to me might not work out as well as he might have originally hoped.

No Regrets and Back in the Family Business Game

As his only son, I recall from my earliest days being told that my duty was to eventually take over the business from him.

And for the first four and a half decades of my life, that was the direction I took.

Now that I am back in the family business game, working with other families, my goal is to not have any family members need to take so long to find their rightful place.

There is room for the thirsty and the hungry, and both, in every family.

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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.

 

 

 

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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!

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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.

 

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