Improving Family Business Performance
Understanding the Family Business
by Gerald L. Sherman
Some family owned businesses (FOBs) have a long-term history of consistent profitability. Others, however, have a similarly long-term history of weak performance. The obvious question is why.
Having worked closely with hundreds of small and medium sized family owned businesses for over two decades, it has become clear that there are a small number of salient factors which are critical.Ultimately, these factors coalesce into a series of “Core Business Values” which can substantially determine the FOB’s performance throughout the entire course of its existence. More…
From Birth to Succession
A baby is born.From that moment on, expectations build.What kind of person will the child be?Perhaps later:Will this be the successor to the family business?Will s/he take what the owner has built to new levels?
Lee Hausner is a psychologist and recognized authority in family systems and effective-parenting techniques.She calls the children of family businesses heir apparents because their are so many ‘ifs’ involved in succession.If the heir apparent develops their self-esteem and a unique set of skills; if the family business is presented in a positive manner; and if the family dynamic encourages it’s members, then a good chance exists for a positive transition.The road to succession begins at day one and requires constant maintenance throughout an heir apparent’s life.At the core of the challenge, says Hausner, lies the realization that successors to family businesses are not born.They develop.
What Is This Family Business?
Even before a child can say the words, they may understand more about family business than adults think.Hausner has consulted with family business owners whose work is a continual source of tension and stress.Why would a child aspire to spend their time there?If the business preoccupies the parents 24 hours a day, the heir apparent might grow up thinking of the business as a rival for his or her parent’s affection.
“Children don’t understand why they are unhappy,” says Hausner.”They simply know that they are angry or frustrated.”If the family business is associated with those emotions, it becomes a less attractive option for a career. More…