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Family Dyamics and Governance - A Positive or Negative Influence

 “Families” comes in all forms, shapes and sizes including in-laws, cousins, children, step children and even business partners who are also best friends. The relationships you have with those in your formal and informal family have a positive or negative impact on the achievement of your business goals and succession vision. Bickering among active and even inactive family members can frustrate, distract and weaken the focus and commitment of the management team that includes you!

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Case Study – No prepared successor and CEO ready to retire

Industry: Manufacturing

Location: Midwest United States

Company Overview: Second generation, family-owned company 

Succession Matrix® Issues: Leadership & Management Continuity, Management Synergy & Teamwork, Successor Preparation, Family Governance


Challenge: The owner is ready to retire, yet no successor is fully ready to take over. Two of his three children are working in the business with the inactive son uncertain about his future involvement with the company. The two active siblings and senior managers are all trying to compete for the opening CEO position.

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Case Study – Strained Family Relationships Impacting Potential for Successful Succession Plan

Industry: Automotive 

Location: Northeast United States

Company Overview: Family-Owned Group of Auto Dealerships 

Succession Matrix® Issues: Family Dynamics, Management Synergy & Teamwork


Challenge: First generation car dealer looking to pass the business on to the second generation, yet no clear successor. Environment for children full of sibling competition fueled by dad as well as fear of the impression their father has created of them with the other managers and employees. The active son in the business was at odds with the CFO who he felt was his biggest threat for becoming the successor. The daughter was a stay-at-home mom who wasn’t sure where she would fit in if she did decide to come into the car business. The younger son was unhappy and floundering without a clearly defined role (but still taking home a paycheck).

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Evaluating Successors - Have You Clearly Communicated Reasonable Expecations

For up-and-coming successor candidates in family businesses, oftentimes their evaluation is not altogether objective or even reasonable. Family member employees live in a fishbowl where nothing they do is seemingly ever good enough. The good stuff they do is seen simply as par for the course. And frankly, that's often because no one in the organization gets a lot of affirmation for their hard work, so why should the "heir apparent." Yet, the errors of successor candidates often become mountains rather than the molehills they are.

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How to Deal With Addiction in the Family Business

Addiction is an unfortunate but common issue that many families have to deal with, and families in business together are no exception. When a family member has an addiction—be it drugs, sex, gambling, or alcohol—the issue must be addressed in order to have long-term family harmony and stability. This is especially critical if the addict is the anticipated successor. Un-addressed, addiction can wreak havoc on a succession plan. 

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Choosing Your Successor - Who Gets to Wear the Crown?

During my first meeting with a client, he pointed to a picture of his two sons on his desk. The boys in the picture were 7 and 8 years old and both were wearing golden paper crowns. He said, “That’s my problem today, they both work in my business and both still want to be the one who wears the crown! 

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Succession Planning - Art and Passion

His ball was moving right and settled in the grass about ten feet away. As the leader of the senior tournament approached, I moved close to watch an amazingly small, relatively elderly, scrawny yet pot bellied gentleman size up his next shot, consult with his caddie and select his club. He briefly simulated his desired swing, appraised the challenge and nodded to his caddie to confirm their planned ball flight over a distant tree. Without apparent concern he addressed the ball, confidently drew back his five iron in a long, fluid swing and effortlessly launched the ball in an amazing high, left to right trajectory towards the green. "Oh my Lord, can you believe how he compresses that ball to a fade? The acceleration of that ball off of his club took my breath away. And the ball cleared the tree and landed on the green like a butterfly. I'm twenty years younger, outweigh him 75 pounds and there is no way I could ever pull of that shot!"

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Are You In Constant Conflict With Your Partners - When To Know You May Need Help!

When I first met my wife, Patricia, I was head over heels in love. We came from similar backgrounds, had countless common interests, and our relationship was storybook magic. However, just a few years after our honeymoon, our marriage appeared to be less than ideal. With the advent of children and the increased time demands of work, no longer was my yin totally harmonizing with my wife’s yang. After significant soul searching we recognized that marriage is not a natural state; we also decided that we wanted to be married and that we were willing to work at being married. So we found a counselor to help us understand and deal with the good and bad that we brought to our union. Now, after 30+ years of counseling we have a marriage that isn't perfect but one that is getting better every day.  

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Where in the World Did You Get The Idea That People Never Change?

Sometimes our beliefs hold us back.  I am talking about what we consider to be “a fact”.  If I had more time and room, I could cite comment after comment that was proven to be inaccurate. Perhaps one of my favorite misquotes is attributed to a former Director of the Patent Office, who supposedly said in 1899 “Everything that can be invented has been invented.”  There’s really no proof that Charles Duell ever said that, so I use it to prove my point and not to trash the former Director.

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How to Use Coaching to Develop Successor Leaders

Studies conducted by various authors and organizations indicate that it is becoming increasingly difficult to be a successful leader.  In fact, among the Fortune 500 CEOs over the last 20 years, 30% have lasted fewer than 3 years.  According to the Harvard Business Review, an astonishing 40% of new CEOs fail in their first 18 months on the job.   Statistics like those aren’t important.  Usually.  But suppose we’re talking about your successor.  Do you want your successor – and in a family owned business that means your daughter or son – to be one of those casualties or do you want them to become part of the 60% who succeed?

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Family Dynamics - The Different Child

What happens to the child who was different from the rest of the family and was ignored and neglected during childhood? This is a family dynamic that deserves attention. Children need to be noticed, comforted and nurtured to help them find their way in the world. Some children are an easy fit for their parents while other children are much harder for the parents to understand and manage. 

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Family Business Harmony Best Practices

As a business succession planner I believe family harmony is a component of the Succession Matrix®. On a day to day basis I deal with the good, the bad, and the ugly of family business. The good gives me encouragement that family business succession is worth the brain damage and affirmation that there is no such thing as a perfect family. The bad provides me a sense of job security and confirmation that all family issues can be resolved if the parties will just remain engaged. And the ugly makes me question my career choice and acknowledge that the problems on the have side can be worse than those on the have-not. Based upon my 40 years or so experience within this Matrix, I have concluded that facts are stranger than fiction when it comes to inter-family dynamics and no matter how bad circumstances are within a family it can always get worse. Furthermore, I have had an opportunity over my career to identify best practices of families who relatively speaking have achieved family harmony.  

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Family and Business - Have You Been A Cheater?

Recently a friend shared a book with me titled Choosing to Cheat by Andy Stanley. Choosing to Cheat is a quick read, but it is very intriguing and prompted me to do a little introspection. The author begins the book by stating that everyone cheats. Now before you wonder why a succession planner is talking to you about cheating, please let me explain. This is a book about what can happen when family and business collide.

Cheating in the context of this book refers to giving up one thing in favor of another. Each day we make choices with regard to how we spend our time at home with family and in business. When we choose to spend the majority of our time at work or building a business, many times family suffers. Several of my clients and countless prospects over the years have channeled a tremendous amount of time, energy and money pursuing business endeavors which has resulted in not only business success and amassing impressive personal wealth but also failed marriages and fractured relationships with their children. An overwhelming majority that have achieved what they define as the pinnacle of their business career want nothing more than to turn back time and recapture what they no longer have: a successful marriage or a meaningful relationship with their children.  

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Having A Hard Time Creating Buy-In? You May Be Confusing the Business with the Legacy

Not too long ago, a client asked how he could get his family members more excited about the family business.  "What would you do?” he asked.  "Well, what are you trying to sell them: The business or the legacy?"  I asked.  He paused and then replied, "I don't know the difference." 

Does that sound familiar to you?  If you're the family leader, can you distinguish between the business and the legacy?  While they may be one and the same to you, other family members may not make the same connection.

The farther away potential successors get from your motivation and perspectives, the more likely they are to have different understandings of what the legacy really is.  As an example, one of my clients has done quite well for two generations by pretty much ignoring the "green" movement.  Now comes the tail end of the third generation, and guess what repulses them about the business? 

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Debate vs Brainstorming - Which One Actually Generates the Results You Want

Some people like to think out loud.  In fact, they must talk in order to think.  They love brainstorming; it’s how they create their map of reality.  The problem is that they think everyone else has to engage in the same technique in order to have an abundance of good ideas.  As a result, they subject whatever group they happen to be playing with – family, business, community – to the same process of “out loud” and “out of the box” thinking.

These brainstorming fanatics have even gone so far as to set up rules on how this unbridled creativity is to take place.  The most important rule requires that no one say anything negative or critical of another’s ideas.  In many cases, groups – family, business, community – leave a room pleased that the walls are covered with contributions.  This ideal, feel good boost to productivity or problem resolution seems to be the ultimate in creativity.

There’s only one problem...

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Living in Dad's Shadow

“My father is so good at everything he does.  Everything he touches seems to turn into gold.  He is revered by his employees and respected in the community. I am not sure I will ever be as good as my father!” These were recent sentiments shared with me by the child of a successful business owner. Have you ever wondered what it would be like being a son or daughter in a successful family-owned business? On one hand, the perception is that it is such a blessing since business success affords the opportunity to enjoy some of the finer things in life. On the other hand, being the son or daughter in a family business can be quite challenging because the microscope is always upon you and at times it appears surpassing Dad’s or Mom’s accomplishments is insurmountable.

During my travels and interactions with business owners and their children, I frequently encounter adult children who feel as though they are living in their parents’ shadows. Generally, a person who has built a highly successful family business is extremely driven, hard working and all consumed by his or her work. Often the children of these driven business owners are raised in privileged environments and find it very difficult to create their own identity. Other times the children harbor resentment because their mother or father spent more time with their first born child, the business, than they did with their real children during their childhood years. The fact is that it can be very difficult to be the child of a successful business owner.

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Family Business Harmony – DNA Doesn’t Always Cut It

As a family business succession planner I am commonly asked

  • How do I help families find harmony? - And then more specifically;
  • How do I convert skeptical, envious, petty, self serving, back-biters into unified families? And;
  • How do I help them find agreement on goals and processes that will help achieve a mutually agreeable mission?

My response is that I don’t deserve too much credit because family harmony issues on their lightest days are far bigger than this little guy. What I can really take credit for is being a diehard optimist about the potential of family and not knowing when to give up. As you would expect, like most conundrums, there are multiple answers to questions about family harmony. I’ll take a shot at shedding some light on how some families find harmony and others just remain in a quagmire of resentment, angst and anxiety.

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Family Business Harmony - It's Not An Inalienable Right

To continue my thoughts on how to find family harmony, I think the second thing we all need to remember about  family unity is that none of us have a right or entitlement to a loving, supportive, unified family. Family love and support is not an inalienable right. I contend that outstanding family business relationships, just like outstanding businesses, are achieved as the byproduct of a mystical commodity known as hard work. Those who want to achieve family and business success work beyond the pain to achieve the gain. And if you have not had a dose of reality lately, just trust me when I tell you that wherever there are relationships, there will be pain.

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Remembering to Forget - The Secret to Building Family Business Harmony

My final thought on why some families are more effective at achieving harmony and unity is that successful families dwell more in the present than in the past. As even the presumed role model families will admit, it is not always hunky dory on the family front. The fundamental family motivation is “the good of the present outweighs the bad of the past”. My encouragement and advice to clients seeking family harmony and unity is to “remember to forget.” You have choices. First, do I want this/these relationship(s); do I want to have family in more than name only? If yes, you have to remember to forget the pain of the past as it can and will totally pollute the relationship prospects of the future. Being practical, I am not talking about forgetting that your brother-in-law is a convicted bank robber or that your son is a struggling drug addict. I am talking about the personal stereotyping and resentment that if allowed to taint every personal interaction will build and sustain insurmountable boulders in the pathway to strong interdependent families.

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When Sybil Shows Up At Meetings - How to Deal With Emotions that Impact the Succession Planning Process

In some of my recent client meetings, I’ve felt as though some of my clients that have shown up were completely different people compared to my previous interactions while working through their succession planning issues. When I called one of my clients out on this “difference” recently, it was her remark that “Sybil had shown up,” calling to mind the movie depicting a character suffering from a multiple personality disorder. Not meaning to make light of a true multiple personality issue, I’ve been using the analogy ever since, applying it to the dynamic process that I’ve learned succession planning can be.

So, how can an advisor work effectively with the dynamics of succession planning? First and foremost, we all need to remind ourselves that we’re dealing with people and people are, fundamentally, emotional. Therefore, we are dealing with emotions. Further, we need to understand that those emotions are playing out in the relationships of the people involved in and impacted by succession planning.

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