Tag Archives: family business

09/30/16

Decisions—Instruments of Movement

When struggling with a theme for this blog, I often seek inspiration from Seth Godin, well-known author, entrepreneur and marketer. In a recent blog entitled The ripples, Godin opens with: “Every decision we make changes things.” http://sethgodin.typepad.com/seths_blog/2016/09/the-ripples.html

It follows therefore that every business decision we make changes the business. It can be large–move the business from Brooklyn to Florida–or it can be small–meet a casual contact for coffee at Starbucks. The apparent size of the decision does not foretell the size of the consequences.

Some decisions are made for the short-term, some for the long-term. But decisions are instruments of movement… and what is seen initially as a short-term decision can start a series of dynamic changes that continue far into the future.

At the end of the same article, Godin asks: “How did you get to where you are? Who is going to go even further because of you?”

It may be useful in the conduct of our day to day business to keep this in mind. What decision that you made today, however small and ordinary, may bring your business and your family further than you can imagine? For generations.

09/24/16

Women—A Powerful Presence in Family Business

Some of the world’s oldest businesses are family businesses, and women have perennially played significant roles in them. From generation to generation women have served in one or more of these high-level capacities:

  • Business partner, playing a functional or organizational role
  • Senior advisor and business confidante to the CEO
  • The keeper of family values and chief advisor to the family’s upcoming generations.

Today women have become visible as prominent business leaders worldwide.

At the 4th Annual Global Family Business Event, coming up on September 29th, the keynote speaker will be Harshbeena Zaveri, leader of the engineering firm NRB Bearings and one of India’s most powerful business women.

https://www.eventbrite.com/e/global-family-business-event-leading-an-international-family-firm-tickets-26881440111.

*Previous speakers at this event have included:

Lena Jungell, granddaughter of Fazer Group founder Karl Jungell. Starting in 1891 as a small cafe in Helsinki, the Fazer family now owns an international bakery and confectionary company.

Ana Urea, one of the owners of The Privax Group, a conglomerate of predominantly fashion-related family businesses, now involving its second and third generations. The Privax Group is the current industry leader throughout Canada and Latin America.

Raya Strauss Ben-Dror, and her daughter, Nava Michael-Tsabari of The Strauss Group. Starting in 1938 with two cows, the company sold dairy products. The Straus Group is now a multinational family business and Israel’s largest food and beverage company.

*See past events at http://blogs.baruch.cuny.edu/fieldcenter/global-family-business-event-3/

08/16/16

Facing Conflict in The Family Business

All family businesses—and all families—at one time or another face conflict. And it can be extreme. Understanding what triggers conflict and how it develops is useful. Understanding how to manage it is even more important—serious advice offered by family-business consultants Doug Baumoel and Blair Trippe in their new book “Deconstructing Conflict: Understanding Family Business, Shared Wealth and Power.”

In the course of their analysis of conflict in family business, Baumoel and Trippe argue that conflict plays a valuable role in our development; that only through being challenged by conflict do we learn, grow, and advance as individuals, families, companies, and as a society. Further, they submit that it is possible to learn how to manage family business conflict in ways that ensure the success of families and their businesses for generations to come.

Left unaddressed, they warn us, conflict leads to erosion of relationships and waste of valuable resources and opportunities.

The authors have developed an equation by which they can help a family enterprise understand why they are stuck or in conflict and what approaches are needed to move the system forward.

I heard Doug and Blair speak about their ‘conflict equation’ this past April at the annual conference of Attorneys for Family Held Enterprises. From their presentation, I took away effective language for discussing conflict, and a viable process for transforming the consequences of conflict from upheaval to growth.

08/10/16

Stewardship

One of my favorite perspectives on family business is that of stewardship, which is an attitude of seeing our responsibility in taking over the family business from our predecessors as a mandate to grow and improve it, and to pass it on to the next generation in better shape and with greater possibilities than it had when we received it.

07/28/16

Creating Lasting Value

LinkedIn affords business people the opportunity to learn from many important thought leaders through their posts. Among others, I follow the posts of Gerald Hassel, Chairman and CEO of BNY Mellon.

Hassell has published several posts on Alexander Hamilton, one of our nation’s founding fathers. He is interested in Alexander Hamilton not only because he founded the Bank of New York, of which Hassell is now chairman, and not because of the award-winning musical Hamilton, now playing on Broadway. He writes about Alexander Hamilton because he believes that Hamilton’s virtues hold lessons for today’s leaders.

In his LinkedIn post published June 9, 2106: “What Have You Done Today that Will Endure?” Hassell noted Hamilton’s ability to create institutions of lasting value, in contrast to the current trends of our increasingly disposable culture.

This immediately struck me as illustrating a mindset of long-term thinking that I have written about with regard to building multi-generational family businesses. In “Grow People” I quoted a Chinese proverb that formulates a strategy for 100 years of prosperity. In “Beneath the Surface of the Ground” I wrote about a Native American culture whose chiefs were mandated to make every decision with the seventh subsequent generation in mind.

The crucial question to ask is “what are we doing today that will create an enduring legacy and heritage for our family enterprise?”

07/23/16

Is Philanthropy Right for Your Family Business?

The meaning of the word philanthropy is “love of humanity.” Much more than just the giving of money, philanthropy embraces ever voluntary act of giving to others.

The form that philanthropy takes is as varied as the philanthropists themselves. For example, consider David Bohnett whose foundation supports a wide range of social issues; American rock star Jon Bon Jovi whose organization focuses on the issues of hunger and homelessness in the United States; Arpad Busson, founder of Absolute Return for Kids Academy.

Philanthropy can be misunderstood as being the province of very wealthy individuals or of large corporations. But many family-owned businesses are in a position to help others. The opportunity exists to make philanthropy a part of the firm’s culture.

Bruce DeBoskey, founder of The DeBoskey Group, a Denver based philanthropic strategy firm, advises that to achieve meaningful results, philanthropists should focus on a few select causes, rather than spreading their giving in smaller amounts over a wide area. Following this advice, family-owned firms can manage an impactful giving plan without placing undue stress on their resources. http://www.denverpost.com/2016/07/10/on-philanthropy-six-years-six-important-lessons-about-philanthropy/

The altruism of philanthropy affects and helps the lives of millions. But, as DeBoskey points out, giving benefits the donor as well. The work of helping others brings families together around shared values. It builds relationships with your community, supports and strengthens your brand, boosts your bottom line and promotes employee engagement.

Philanthropic businesses enjoy improved employee recruitment and productivity, greater customer loyalty and enhanced profitability. Within family businesses, community-centered activities engage upcoming generations whose different viewpoints and fresh ideas can prove invaluable to future successes.

07/15/16

Checking The Corner-Office Timeclock

On March 5,, 2014, the Wall Street Journal published findings of a study by professors at Harvard Business School, the London School of Economics and Columbia University’s business school in which they examined differences between family and non-family businesses. The Journal article focuses on the work schedules of CEOs in the two types of firms. Do CEOs of Family-Owned Businesses Work Less?

The data indicates that heads of family businesses work less hard than heads of non-family enterprises. They suggest that the incentives and risks that motivate professional CEOs to burn the midnight oil just might not be a factor for CEOs of family-owned firms.

Results showed differences between first and second-generation family-business leaders. First generation CEOs were found to work harder than their second-generation counterparts. In my own experience, this conclusion cannot be set in stone. I personally have seen instances of both a lack of motivation and a strong work-ethic and drive in second generation leaders.

The research suggested that family business CEOs may be spending their time differently. Instead of clocking long hours in the “corner office,” they may be focusing on balancing work-family responsibilities. Family CEOs might be adding value to their firms in ways not captured by the hours they are formally working, such as participating social activities that indirectly benefit the business.

According to the Journal article the jury is still out as to whether family-owned businesses with inside CEOs perform better or worse than non-family firms with outside CEOs.

06/17/16

Beneath the Surface of the Ground

In my last post I cited a Chinese proverb about creating long-term prosperity. Today I refer my readers to the thinking of a Native American culture–the Five Nations of the Iroquois.[1]

In American Indian Environments: Ecological Issues in Native American History, Chief Oren Lyons of the Onondaga Nation writes: “We are looking ahead, as is one of the first mandates given us as chiefs, to make sure and to make every decision that we make relate to the welfare and well-being of the seventh generation to come. …“[2]

Can there be any thinking more relevant than this to family businesses? Without upcoming generations, does the term “family business” even apply? And therefore, is thinking about the well-being of generations to come not every bit of a mandate for today’s incumbent leadership as it is for the chiefs of the Iroquois?

This is by no means an easy task. Today’s leaders are challenged by the intense pressure to produce short-term success; to please shareholders; to produce wealth now; to feed the spending frenzy of a voracious consumer society. 

Short-term thinking produces short-term results. Most contemporary family businesses do not last beyond their third generation. But there are family businesses alive and well today that have prospered for 100 years and more; whose very existence proves that paths to such longevity are open; can be found; can be learned.

Seventh-generation thinking is finding its way into our collective consciousness; changing our current worldview. Perhaps learning more about how this works will help business families to build a mindset, actions and behaviors based on their impact on the seventh generation to come: “even those whose faces are yet beneath the surface of the ground…”[3]

[1] https://en.wikipedia.org/wiki/Seven_generation_sustainability

[2] An Iroquois Perspective. Pp. 173, 174 in American Indian Environments: Ecological Issues in Native American History. Vecsey C, Venables RW (Editors). Syracuse University Press, New York.

[3] “The Constitution of the Iroquois Nations: The Great Binding Law.”