Awkward! Family Meeting Retreats.

“I want you to arrange a meeting with the heads of the five families”

The Godfather

We pulled up to the clandestine location for the secret, covert meeting. We made sure to cover our tracks and not let anyone know we were gathering. The subject matter was confidential and extremely sensitive. This was how our first family meeting retreat went down.

I’ll give our family credit for trying something new. We are great at finding ways to look at the big picture. But our first family retreat was a little uncomfortable and a lot awkward. Uncomfortable can be good, because it means you’re changing and growing. Awkward is, well, just plain awkward.

Working “In” the Business vs Working “On” the Business

When your business is growing rapidly, you’re totally immersed in the day-to-day running of the business. Rarely do you have the ability to step aside and look at the big picture. You’ve heard it called working ‘in” the business vs working “on” the business.

Most family businesses are motivated to begin strategic planning because of a crisis or difficult situation. In our case, our business was facing increased competition and we needed to grow the business more rapidly to remain competitive.

  • We needed to formalize our planning and prepare a strategic plan.
  • We had to extract our plans from our heads and put it down on paper
  • For the first time we were formally discussing the direction of the business
  • We needed to get the family on the same page.
  • We were inviting more non-family members into decision making positions and committees and needed a plan that could be shared with them.

Up until this point we were riding a wave of success and the sales drove the business direction. We needed to flip this around and determine where we were most successful and effective and create a more deliberate path.

Some random thoughts about family meeting retreats: More…

Tag. You’re It! Defining Future Roles in the Family Business

“In real-life, few family businesses really formally prepare the next generation for leadership”

As the younger generation takes on a more active role in the family business we need to better define their job positions and responsibilities to avoid conflict. In real-life, few family businesses really formally prepare the next generation for leadership, because it’s a little like succession planning where it’s often treated as a process you need but don’t want to work on. Avoiding the discussions increases the likelihood of future job role confusion and conflict and having a higher number of family members entering the company than the business can support.

What risks are there to DOING it?

  • Spark up family conflict
  • Create unhealthy competition between family members vying for increased responsibility
  • Potential for compensation discrepancy issues between family members

 What risks are there to NOT DOING it?

  • No real strategic direction for the leadership of the company
  • Not financially viable without having the right people in the wings to manage and grow the family business successfully
  • Risk not having next leadership prepared for taking over in an orderly way
  • Create concern for outside lenders with no clear founder succession plan
  • Might create the unplanned need for an interim CEO
  • Risk over-hiring family members and having to grow the business faster than desired to absorb higher payroll or worse have to terminate family members and “prune the tree”

Five Takeaways to make the transition work

  1. Identify Future Top Job Positions – Create a Future Organization Chart
  2. Determine the Best Job Candidates – Family and non-family Members-Be objective
  3. Anticipate Potential Trouble Spots – Sibling conflict, compensation inequalities, role competition
  4. Prepare Comprehensive Development Plans for Incoming Generation-Skill, education and experience gaps
  5. Gain  Acceptance from Related Parties-Family members, employees, suppliers, customers, advisors