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Family Business

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Prairie Family Business Association's Conference!

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Family Business Conference in Sioux Falls, South Dakota in April!

Are you interested in Family Business? Do you live in the upper-midwest?  Then you might want to check our the Prairie Family Business Association or PFBA!  They just released their full conference agenda. We've been members for a little over a year, attended the 2017 conference, will be at the 2018 conference as well. It's a great resource for anyone in business with the relatives!

 

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Mavericks . . . and Tips for Preventing Implosion at the time of Transition

Photo Credit: Ben White on Unsplash

Photo Credit: Ben White on Unsplash

 

After I had finished speaking, a family friend approached me.  He said, "I really enjoyed what you had to say, but I noticed that your parents walked out on you!"

It started like this . . .Several years ago I was speaking in a city near where my parents lived. It just happened that they had travel plans and were leaving from the airport in that city and told me that would swing by and listen to my "talk" . . . but, they would have to leave before I was done to catch their flight. I connected with them before the speech, started my presentation and, when they stood up--waving as they snuck out the back--I nodded in their direction to acknowledge the prearranged plan.

My response to my twinkle-eyed friend who delighted in putting me on the spot? I told him, "Well, that's okay, you can't teach your parents anything anyway!"

Which brings me to talking about Mavericks. Sometimes they are charismatic leaders. Entrepreneurial types. Visionaries. Sometimes they are ideologs--passionate about their mission. Sometimes they're family.

Too often the vary characteristics that make these Mavericks successful often sow the seeds that cause their work to implode once they are no longer "in the driver's seat." The dynamics of following a leader who was a "golden child" or domineering force are turbulent with threats of comparisons, resistance to change, and stress.

To make things more complicated, Mavericks rarely see the risk. After all, their nature tends toward confidence, maybe over confidence. They believe they can succeed where others do not--create a new product or market, improve upon the established product or service, out hustle and out sell the competition. The challenges of continuing that success beyond their reign seldom is a focus.

So, how do you help these Mavericks avoid an implosion that brings down the fortifications they have worked so hard to build?

  1. Determine who, relative to the Maverick, has the position or relationship that will allow them to be "heard.  As my opening story implies, relationships impact how information impacts us. If it hadn't been my parents who left and my friend had said, "I noticed someone walked out on you." The meaning is very different than having your parents walk out. Will the Maverick trust the guidance of a long-time advisor, a colleague, industry expert, extended family member? Who delivers the message can be critical to its success or failure. 
  2. Acknowledge their willingness to take risks and the importance of their leadership. Mavericks often react to any implication that they are not willing to face changes or that their ego is too attached to being in charge. Once again, the confidence they often exude does not lend itself toward being self-critical. Acknowledging that they have been willing to take risks and change (certainly true) set up the next step.
  3. Use their experiences to frame the present as a challenge . . . in a series of historical challenges. By getting them to review the decisions they had to face, the risks they had to overcome, and the threats they faced you can highlight how a failure to act would have resulted in missed opportunities or even failure. 
  4. Explore how the current situation is like past challenges. Mavericks once again tend to have a wonderful focus. They know what they think and believe. They know what their end goal is. What they often don't do well is to adequately consider factors that go against their vision. But, they have a history that where they have encountered roadblocks and threats. They have met them and made adjustments to survive. Help them recall this and focus on how to be proactive to prevent future threats.
  5. introduce the need for facing the current risks. By now, you should have gathered enough information to tie their experiences into a well-defined "argument" for how the current situation calls for facing the challenge and  risks of change. Lay out your argument. But don't offer a pre-designed solution. 
  6. Don't back down. The Maverick's first response may be to challenge you. After all, they are confident in their own thinking and simply trust other's take on a situation they know better than anyone. Displaying confidence here will likely help them consider the idea more seriously. Vacillating will only send the signal that you are uncertain and the Maverick will likely see this as a need to provide confidence and control and stick with their own plan.
  7. If they agree, utilize them to come up with a plan. After all, these tend to be very capable people at least in some areas. Engage them in coming up with ideas. But remember to challenge their thinking in areas in which they are not strong. So in the case that follows the answer is not "the son needs to be like me!" the answer lies in "how to support the son's growth-with his own strengths--as a leader."
  8. Give them a role or job. I think of the typical Maverick as a "working dog." Like a Border Collie or similar breed they do best when they have a job to do. Whether that job is to develop a new product line, find the right advising team for the son, or become a philanthropist or community leader . . . simply stopping or stepping back is a harder concept than doing something new. 
  9. Be willing to give up your position to help the organization. Who ever has the task of challenging the Maverick needs to accept that this may "poison" the relationship with the Maverick if he or she is not ready to consider and accept this new challenge. So often this role needs to be taken by a board member, colleague, advisor, or and "expendable crewman" for the sake of the organization. A family member, especially in a family business context, may be the wrong messenger due to the fact that this may have irreparable consequences for the family

I once talked to a family business owner who confided that he did not think his son could make his own independent decisions. He feared that this son, and mid-life manager was overly-attentive to what others thought and therefore needed his continued supervision. I was incredulous!  In fact, the two men were very similar in personality and willingness to be "in charge" and run the business. The younger man however had more "sensitivity" to employees and did not "run rough-shod" over them in his decision making. I knew this younger leader, and in my opinion he in no way, demonstrated an indecisive, tentative, "people pleaser" leadership style.  I challenged the father. "So, you are telling me that you raised a son that can't think for himself and make his own decisions?" Thinking this would make him rethink his assessment. It didn't. He replied, "Yes." 

While I still did not believe the father's assessment was correct--I saw the son as trying to move toward a more collaborative and inclusive style of management perhaps as a reaction to the autocratic and forceful personality of his father and the father being over confident of the success of his management style--this father's "reality" was where we had to start. "If that's true," I rejoined, "then you need provide the right conditions to help him develop this ability."  He didn't disagree. From this, we began to talk about how the father's experiences helped to develop the confidence to make decisions and take prudent risks. We then explored his experience and his son's, noting how the circumstances were different for his son and began to craft a plan to help the son grow in his abilities--including a planned "backing out" of the father's role, some training, and continuing and increasing some industry-specific coaching they had begun to continue support for the son.

We can never forget that most Mavericks truly care about the future of the business in most cases. Even if that caring at times makes them "hold on too tightly." They generally are motivated to help the next leaders succeed. But they may have trouble seeing the practical steps that need to happen to turn this into success without their direct involvement and may need someone to help them find a way to let go of the reigns.

 

Ebook available: Family Legacy: Protecting the family in family business. No cost, no obligation.

 

 

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Preventing and Handling Conflict in Family Business

Plan or fail. Is your family business proactive about protecting the family in the business?

Plan or fail. Is your family business proactive about protecting the family in the business?

 

 

The following is an excerpt from our free eBook. Family Legacy: Protecting Family in Family Business.

Preventing Conflict

Rarely do families implement guidelines or procedures for managing family interactions within a family business. However, in many consulting situations, ground rules for communication are a helpful tool. Consultants who work in emotionally-charged groups will often set up guidelines for communication to help the consulting process succeed. Thus a simple rule such as “Refer to titles not people” or “Only speak for yourself” can help to reduce the risk of escalating conflict, as a comment like “Everybody knows that Robert is failing as a leader” can become “We need more leadership from the President position.”

Family businesses often do not implement structures that could prevent conflict. Suggestions regarding setting up a family constitution, holding regular family councils, or annual family assemblies are often met with resistance. “We don’t have time” or “I don’t want to mix family and business” are two of many reasons cited not to formalize the family’s interactions with the business and ownership dimensions. Even more resistance can be felt when the suggestion is to bring in an “outsider” in the form of a “family expert,” as many see this as unnecessary at best and a threat at worst. Attitudes persist that “good families” don’t need help. Unfortunately, most wait until problems have festered for years or decades and much damage has already been done.

A recent conversation will illustrate this sad situation. The author had a family business owner referred for possible consultation due to the fact that three siblings were beginning to “lawyer-up” for a fight over the assets of the parent’s estate and business holdings. The discussion was about how the siblings had reached the point where two had retained lawyers and the third was feeling compelled to “do something.” As we discussed the situation, the brother decided that it was unlikely that he could engage his co-owner siblings in a consulting process. He stated forlornly, “We should have had you come in years ago.” It is a sad comment family business consultants hear far too often.

When families are passive about the family issues, when they delay acknowledging tensions, and do not avail themselves of quality help, they often allow resentment, bitterness, conflict, and separation to grow and congeal. Businesses develop plans, engage in strategic thinking, hire experts to assist them . . . families deserve no less consideration and support. 

“Strong fences make good neighbors.”  Old Saying

“Love thy neighbor, yet don’t pull down your hedge.” Benjamin Franklin

Robert Frost, in his poem “Mending Wall” bemoans the division that barriers represent. He indicates “something there is that doesn’t love a wall, that wants it down.” Most of us, especially in our families can agree. We want connection, not separation. But . . .

Handling Conflict

Family members need to understand what it means to be a good bystander. When humans experience conflict they often respond in one of three basic ways: avoid, freeze, or fight. When a family member sees conflict between two other family members, the tendency is to try to determine who’s right or assess who needs their loyalty or protection. This usually serves to broaden the fight from a two-person problem to a three-person problem, or even a whole-family problem.

Yes, there are times when assessing and acting if someone behaves in an unfair, unethical, or aggressive way—and confronting that issue—is necessary. But with most family conflicts the problems are less black and white and usually come from real differences in opinion, experience, or coping strategies. 

How to Protect the Family: Structure and Process for Family Businesses

Researchers have found that families benefit from structure, routine, planning, and communication. Recent attention in the news to findings like the positive impact of families who eat at least four meals together a week would be one example. Family businesses benefit from these structures as well. Here are some of the vehicles that family firms use to protect and help the family succeed:

Family Constitution or Mission: A document created to state the family’s values and goals. Used to continue to provide an anchorage for the family to return to as the family business grows and changes.

Annual meetings: Annual events, often combined with a family reunion, to engage the family and inform them of the strategic planning and performance of the family business.

Family Councils: A representative group meeting regularly to develop plans, policies and procedures for the family business; with a particular focus on creating good communication and interrelationship between the business and the family.

Succession Planning: A process to create a plan to guide, sustain, and promote the health of the family and business as ownership, management, and family roles change and pass from one generation to the next.

Sadly, the old adage, "those who don't plan . . . plan to fail" is still often proved true, even  often in the modern day family business where information and resources are widely available. 

Help your family business or the family businesses you serve. Get our free eBook: Family Legacy.

 

 

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On Independence Day . . . Visiting relatives . . . at the family business!

The Amboy Cottage Cafe, Amboy, Minnesota (Photo from website)

The Amboy Cottage Cafe, Amboy, Minnesota (Photo from website)

So our family--or those of us still at home--just returned from our mid-summer vacation. We went a wandering to the north shore of Lake Superior and then on to Apostle Islands this time . . . and the experience was a good reminder of the value of family.

Later, I may tell you about the families that lived at the lighthouse for an entire season since the only way to access the spot was by boat, or of the Nebraska families that helped settle Madeline Island, or of going to school across the "ice road"--but today, I'll tell you about a part of our extended family and their business.

The historical stories of family and the time our "core family"  spent together were a good reminder of the value of the family--always easier to remember when away from the bustle of chores, work, and such--but an even more delightful reminder came when we visited relatives.

"Visiting relatives on vacation" always evokes a feeling of an ominous, discordant, chord in my head--I probably was too influenced by Disney as a kid. But the truth is, my family often visited extended family on vacation. Most of the time it was the vacation. So, I really only have good associations with the events . . . despite Walt's affects. This time would be no different . . . .

The last time we visited Lisa in Amboy, our cousin, on my wife's side of the family was on the roof. (After 36 year in the family, I claim them, and I guess, they claim me too), Why was Lisa on the roof? Because the roof needed shingles. So there was Lisa on the roof shingling this remodeled gas station in preparation for opening her own cafe. Now, many years later, the cafe is a full-fledged thriving operation and obviously, to an outsider's eye, a critical part of the community.

I'll spare you the details of setting up the visit but suffice it to say that both Lisa, and her mother, made concessions to allow the visit to occur--after much of the following: "exactly what day and time will you arrive?" And scheduling and rescheduling a round-trip drive to Amboy for our Aunt Maria who lives 45 minutes away but still bakes pies for the cafe.

The thing my "consulting mind" noticed right away--after our brief "hello" and settling into a table at the south end of the cafe while Lisa hurried back to the kitchen--was all the marks of a successful venture.

The Amboy Cottage Cafe us a very busy place for one thing. In a very, very small town. It was not early, most people would already be at work, yet there was a full house and a constant caravan on customers the entire time of our visit.

The customers going in and out of the cafe, I noticed, regularly go out of their way to connect with Lisa--sticking their heads through the swinging door into the kitchen, bantering about their last visit or preferences--lots of connecting and evidence of strong relationship-building in full view. This was verified by the rows and roes of special mugs (see photo) that line the wall--evidence of how many customers had taken advantage of, and paid the $100 fee, to join the life-time free first cup of coffee club. (I lost track somewhere around 125-ish)

Coffee club mugs. Each personally crafted for the customer. I think we we came away with 6 or 7 ourselves.

Coffee club mugs. Each personally crafted for the customer. I think we we came away with 6 or 7 ourselves.

I wasn't at all surprised to find evidence of success at "Lisa's shop"--despite the cafe being in a very tiny town (2010 census lists it at 525) with too few people to support a cafe. Lisa's family has always been high achievers with an amazing blend of intelligence, creativity, and insatiable curiousity--the kind that creates that feeling of  "they-can-do-everything-better-than-me" that would make you would want to avoid them just to protect your own sense of self-worth . . . if they weren't such great and personable people as well. (By the way, it's not just my assessment. Two of Lisa's brothers worked for NASA)

Finally, after waiting for Lisa to prepare breakfast for all her regulars and us as well, Lisa sat down to chat with us. Here are some of the things my consulting brain noticed:

1. This wasn't just a cafe . . . it was a community. The customers were there for the food and coffee no doubt. But they were really there because of Lisa. The plans of a recently result antique bridge were in display (Lisa headed up the push to get it restored). She was part of the fabric of the town and local area. (See a Star-Tribune article and picture of the bridge)

2. Lisa talked like a business owner. In our short visit she mentioned profit margin, her five year plan. Her eventual goals for the business and her life. She expressed a wish that my wife was closer so she could make use of her organic, sustainable produce and edible flowers.

3. She demonstrated that the business was about the people. Yes, it is great food. Yes, the decor is perfect. Yes the creativity is evident--where can you go that you can order your pancakes made into any shape you want? Or get Maria's homemade pies?

4. She works hard. i noticed the cafe is open seven days a week. Many days are long opening at 6 am and closing at 8. Lisa, of course, will be there earlier and later than the "official hours."

When we were done with our visit we drove out to see the reclaimed bridge. While we were there a car approached, stopped, and out jumped my wife's Aunt Maria. Had we forgotten something? No, She was bringing out the Fedora my 11 year old had admired in the local thrift shop. She thought he should have it, so . . . she bought it and set out to catch us before we left town.

I don't think Lisa's done. By that I mean that I don't think the cafe is her final goal. The cafe is a means to an end . . . to an independence to pursue her dreams. But in pursuing those dreams, she has created a successful family business

Hope you all enjoy your holiday . . . and the family.

Own or work for a family business? Check out our free eBook: Family Legacy: Protecting Family in Family Business.

Are you a social science professional? Are you interested in developing private contracts to provide services outside the insurance market? Dr. Miller has just formed a private Facebook group to provide a place for conversation and sharing our experiences and lessons learned. If you would like to be a part of this group, contact Bryan and he will send you an invitation to join. Limited to professionals or students in the social sciences only!

 

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It's Here! . . . It's Free! Our newest eBook.

Well, it's finally here. Our new eBook on Protecting the Family in Family Business. We apply our knowledge and experience with families, business consulting, and work with family businesses to five our readers ideas on how to minimize the risks and maximize the advantages to the family who works together.  We hope you enjoy it!

You can also get our other free eBooks below . . .

Engaging Your Team: A Framework for Leading "Difficult" People

Private Practice through Contracting: A path away from insurance dependency.

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New eBook almost here . . . and it's free!

Here's the cover . . . Credit Andrew Miller

Here's the cover . . . Credit Andrew Miller

I just got the final version of our new free eBook--Family Legacy: Protecting Family in Family Business--and it looks amazing! Thank you to Andrew Miller, graphic designer at Andhedrew. Once we have the download set up we'll send out a link to where you can download it.

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Don't leaders know?

When I explain to people what we do . . . use intensive interviewing to understand work teams and assist leaders through the development and implementation of action plans  . . . I often get the question, "Don't leaders already know what is going on with their employees?  Good question. I think implicit in this question is a common misunderstanding.  I think what is being asked in this case is often something like, "Do you really think that there are a lot of leaders out there with no idea of what is going on with their employees?"  If this revised question is closer to what they are really asking, then the answer is an emphatic, "No!"

In fact I trust that most leaders have a good idea of what is going on with employees. I believe that the majority have spent significant amounts of time trying to understand their employees and the impact of their leadership decisions on those employees.  (This is why I think that consulting approaches that do not see the role of the consultant as a collaborative one are often misguided!) But . . . consider this . . .

Parents, arguably, know more about their children than anyone, yet often "what they know" can become the seeds of problems between them and their offspring.  "You don't understand!" is a common complaint among those children. Couples, likewise, know more about their partner than they know about any other of their relationships . . . and often have more trouble. Regularly it is at least partially because their knowledge invites them to assign blame and an unwillingness to make changes.

No, simply "knowing" is not enough. Leaders need to continue to challenge what they know--testing it to check it's validity. Leaders need a vision of where they want to go but they also need a clear understanding of where they are--without the polarizing lenses of self-deceiving "knowledge."  The gap in a leader's "knowing" is reflected when a leader proclaims of his/her team "we are a family" only to have an employee mutter "a dysfunctional family."

 Here is a list of things that leaders "knew" when we were contacted by them or began working with them. In each case, this knowledge proved to be a barrier to knowing rather than an accurate understanding of the situation.  

  • people understand my irritability because I come from a different part of the country . . . it shouldn't effect how they view me as a leader
  • we provide information about employee benefits in a number of ways and times so employees can't have issue with that
  • if we tell employees about the financial status of the company they will have worse attitudes than they do now
  • my daughter is just stressed but she still appreciates working in the family business
  • the way we interact with employees works . . .  its these particular employees attitudes that are the problem
  • we have a plan that all the leaders have agreed to and support
  • if I'm not in the room bad things happen (leader who refused to leave when board talked about his job performance, salary, etc.)
  • we already fane a (financial) consultant we can just use him to help us figure out the people issues
  • our family can handle these issues without getting an "outsider" involved (family business member now in litigation with siblings)

 

 Free ebook Engaging Your Team: A framework for leading "difficult" people.

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