Gotham Light/Bold - Myriad Pro Light- 10.5/15pt
Tranistioning Family Businesses... (cont’d)
The disagreements that create these fault lines are actually quite predictable. They usually involve, either individually or in
combination, the following five questions:
Who will control the business
and how will power be
distributed within the
business and between the
business and the family?
What are the values that should
drive our business decisions, and
how do we reconcile different value
systems, personalities, worldviews,
and communication styles?
These “hot button” issues often trigger
disputes among family members. Each
member tends to have strong feelings
about these matters and they can lead
to conflict. Many families maintain
a code of silence and don’t address
these issues because they recognize
the volatility of raising these questions.
When they do arise, they often lead to
conflict, the exit of family members,
the formation of opposing factions, or
a stalemate that is difficult to resolve.
At the extreme end of this spectrum,
people file lawsuits. Short of that, the
business’ performance will decline and
the family cannot thrive.
The Solution
Many family businesses attempt to
adopt best practices. They create
governing documents and structures
to coordinate both the family and
the business. They also work on
understanding and adopting role
differentiation and boundaries. While
these are valuable, if the family does
not have the underlying skills to make
these “best practices” work, they are
for naught.
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How do we communicate
information about the
business in ways that
create engagement and
sufficient transparency?
Who gets to work in the
business and how is
family employment
done fairly and
effectively?
How will money be
reinvested, divided,
and distributed?
One way to develop these skill sets
is through regular family gatherings
designed to address the tension