If you are the CEO or owner of a family business and are preparing for a succession transition to the next generation, it is likely you are facing some very difficult decisions that will affect the lives of your family and business team. After working with family businesses through the maze of succession planning issues for nearly 20 years, I have come to believe there is no business gain worth a family loss. The only way through difficult issues is to address them in a straightforward objective manner with a commitment to finding a win/win solution, not a win/lose scenario on anyone’s behalf.
Does this scenario sound familiar?
Key members in a family business have been battling with each other for the last several years as to how to manage and share assets related to their family business, as well as who should assume the mantle of President. Issues have now escalated where legal action may be initiated.
Is there any way they can avoid this and find a win/win solution?There are three steps that must be taken before you create an environment where people feel comfortable to share their concerns and ideas so that, as a group you can identify potential win/win solutions:
- Take an honest look in the mirror. It doesn’t help if you skew the reflection with what you want, hope or feel you deserve to believe. An apple’s an apple, nothing more, nothing less. No matter how much you want to make it be a tangerine, it will never live up to your expectations of being so. It’s just an apple. So it is with our experiences – if you can remove the emotional baggage as you look at your situation objectively, it is far easier to understand the key issues.
- Take responsibility for your part in the situation. No matter how much you may want to blame others, there is absolutely nothing gained by doing so because it does not call for personal action. Stop pointing at each other and everything else and ask yourselves, “What can I do differently at this very moment to get closer to where we need to be?”
- Begin to build a solution together by utilizing a skilled facilitator to develop an action plan. You can’t build a house on a foundation of muck with substandard materials and expect it to stand up for any length of time, much less hold up to the challenges of changes in the climate. Once you have put aside the personal agendas, are self-managing your emotions and have elevated your perspective to the 30,000’ view (of perpetuating your business into the next generation), it can become a creative and even energizing process for your family, key managers and succession advisors.
Drop the blame game and take action
You may have taken the time to look into the mirror, drop the blame game and have begun trying to build a plan. But emotional issues keep undermining your progress. How can you achieve the win/win when your family continues to be at war?
As the owner of a family enterprise, you may be standing at the precipice of compromise – a hair’s breadth away from implementing a succession solution. No one’s very happy. You may feel exhausted and ready to put the entire struggle behind you, feeling some consolation that at least you have some kind of a plan. And then, a very sad but typical thing occurs: once everyone leaves the room and returns to their own corners, nagging insecurities, fears, and sabotaging thoughts creep back into the family dynamic and SNAP! Everyone reverts back to their habitual acrimonious, dysfunctional or even hostile behaviors. Once everyone has had a chance to think about how unfair it is to what they feel they “deserve” and talk to their spouses and pals, they revert back to their original grievances and you are back to square one. Not uncommonly, this could be the second, third or fourth time you have reached this impasse. What happened? What do you do to get out of this endless insane cycle?
Pointing fingers will not work (see #1 above). Reflect back upon how you might have contributed to this situation (see #2 above). Each time you pulled the family team together did you listen to all ideas and considerations or did you announce your plan to a somber and silent audience (see #3)?
How could you have reached an agreement yesterday and still be at opposite sides of the ring today?
If you have found yourself at the crossroads of frustration, despite the many meetings to negotiate differences between family members and/or partners, you may be asking yourself this very question. It is my experience that if every time you are close to reaching a settlement between opposing family members, only to have those agreements disintegrate time and time again, there were too many conditions put upon acceptance. Remember: A family is all about unconditional love. A business is all about accountability and performance.
In this type of situation, ask yourself: What is your family relationship worth to you? Is it more important than money or status? It is more important than your stuff? Is it more important than being “right”?
Remember, family comes first
Money, status and stuff deteriorate. Being right is no fun if you are all alone.
If you’re struggling with this situation, step back and rethink the postures of your discussions. An experienced succession coach can facilitate this type of reflective discussion to help you have a non-litigious, objective and even upbeat outcome. If each family member can narrow their list down to one fundamental objective, without conditions and accusations attached, there just might be a way to bridge the gap privately, rather than in the public venue of the court system. The demands, postures and emotional buttons have got to be abandoned if you are going to create a future for your family and business that is unified and productive. You will have to get out of your comfort zone, and it will take a great amount of courage, faith and willingness to take a chance on each other. Defy the odds and the naysayers. Take the first step and ask for help. As the great philosopher Johann Wolfgang von Goethe wrote so long ago, “The moment one definitely commits oneself, then providence moves too. All sorts of things occur to help one that would never otherwise have occurred. A whole stream of events issues from the decision, raising in one's favor all manner of unforeseen incidents and meetings and material assistance, which no man could have dreamed would have come his way. Whatever you can do or dream you can, begin it. Boldness has genius, power and magic in it. Begin it now.”
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Ricci M. Victorio, CSP®, CPCC®, is Managing Partner for Mosaic Family Business Center