family-business-succession-planning

The car business is synonymous with “family business.” Some of you work with family today. Some have a high possibility of the family entering the business in the future. Some of you are working with loyal, long-term employees that you consider family. At its best, a family business is a beautiful combination of communication and collaboration built upon a foundation of mutual respect and accountability. At its worst, family business falls prey to dysfunctional multi-generational communication, with family members giving the silent treatment, bullying one another, and grinding over emotionally driven exchanges. The “norm” among family members in a purely family environment can quickly devolve in the workplace with toxic consequences to relationships, productivity, and teamwork.   The delicate balance between family and business can be thrown into a tailspin, and the benefits of the family (unconditional love and acceptance) and business (conditional performance) are lost in the chaos.

Many of you experience ineffective communication and unreasonable expectations daily. What is often tolerated under the heading, “it is what it is,” becomes accepted as standard operating procedure and ultimately becomes a wrecking ball to performance in the dealership. Dysfunction dynamics strangle pathways towards growth, demoralize employees, erode business value, and deplete financial resources.

When the balance between family and business is off-center, it stresses the business, your personal life, and family life. For family shareholders who call the shots, it can feel almost impossible to be both a parent (Uncle, Aunt, Sibling, etc.) and a “boss.” For next-gen family in the business, it can feel as if they live in the shadow of their parents or as scapegoats for mismatched expectations. Differences in motivation, communication styles, and preferences can also be problematic. Family dynamics are challenging enough when circumstances are “business as usual.” They are hurled into overdrive when under pressure to grow the business, acquire a new dealership, replace the unexpected loss of a key manager, or deal with the next generation entering the business, to name a few.

Incorporating the next generation into your business is an incredibly complex endeavor. It is common and completely natural to feel worried, emotionally drained, or anxious about the future of developing family members into leaders and owners. The good news is that there are resources to help.  Getting guidance from others who have been down this road before can prevent you from creating unnecessary trauma for the family and the business. And if you feel like you have already gone too far down the wrong path, they can get you back on track. In addition, you can get help turning an environment of mistrust, dysfunction, and conflict into one that demands mutual respect, effective communication, and whole-hearted collaboration. These are learned behaviors and will improve with the right kind of practice. As the saying goes, “start with where you are, and do the best you can with what you have.”  

You can start by practicing the following strategies to create more positive family business dynamics and protect your financial future.

Transform Family Dynamics into an Asset

1. Communicate!

Based upon your family and business culture, this may require coaching on different communication strategies. A qualified family business facilitator can provide helpful (and tested) techniques, forums, and governance strategies. They can also help you practice and offer guidelines for productive interaction until mutual trust, respect, and collaboration become second nature.

2. Tune into what others value

Beliefs can change, but core values stand the test of time  – understanding and respecting what your family members, key leaders, and employees values most positions you to bridge almost any relational divide. For some, relationships are the highest priority, and it is important for them to have a sense of belonging, diplomacy, and help. For others, social responsibility is more important than individual relationships, so they are more motivated by fairness, honesty, tolerance. People connect to many different values in a variety of ways. Regardless, what others value is a core motivator in how they behave. So, if you don’t know what others value, consider asking them for their top 4.

3. Take responsibility for your behavior and communication

You can’t control others, but you can control how you listen, connect and respond.

4. Practice the 4 Agreements, authored by: Don Miguel Ruiz

  • Be Impeccable with Your Word
  • Don’t Make Assumptions
  • Don’t Take Anything Personally
  • Always Do Your Best

5. Discuss complex topics when connectivity is high

Working with dealers for almost half of a century, we have witnessed first-hand the impact of developing strategies to enhance communication in the family business and its effect on business value and financial welfare. The value of your business is directly dependent on the probability that the success of the business can and will continue through the next generation of owners, which requires the next generation to work with each other and not against each other. Whether this means your family taking over or someone else, the successful transfer of your business owners is critical to its value.

When “families” come together, the impossible becomes possible

Contact Us and we can help you with insights, other resources, and see if it makes sense to work together. At the very least, in 30 minutes, you may get some ideas you can apply to your business right away.

NADA 2022 Speaker: Overcome Family Dysfunction: Protect Your Financial Future

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Learn More

Dan Iosue, Partner, Succession Advisor

Learn how to deal with the trials and tribulations associated with running a family business to best protect your financial future.

  • Thursday, March 10, 4:00 PM – 5:00 PM
  • Room #W203



Family Dynamics and Family Governance

Family and Business alignment is hard to find when business issues liven up family dynamics.

However; with proper process, governance policies, and mutual respect built over time, a Family Business can thrive through multiple generations. Click the following links for more drill-down resources on  Family Dynamics and Family Governance.

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We can help you with insights, other resources, and see if it makes sense to work together. At the very least, in 30 minutes, you may get some ideas you can apply to your business right away.