July 15, 2004
ISSN 15465640
A free monthly e-zine with articles and tips from Family Business Experts who understand family values and business systems.
July 15, 2004 Issue #027 Family Business Experts
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In This Issue...
1. Our Managing Director Announces -
2. Business first family...Family first business
Succession Management For The Family Side of The Family Business
3. Legacy through Leadership
LP04. Using Strategic Long-Range and Tactical Plans
4. Around the Family Business Experts web sites
1. Our Managing Director Announces -
Last issue we looked at how an Advisory Board was possibly the single best succession management strategy for a family business - how it had a role in finding and training a new CEO.
This issue we look at succession from the family perspective. And find we are again focused on a CEO role... but this time it's Mom as the CEO - Chief Emotional Officer!
We continue with the Leadership Practices series, since these practices are the foundation for the processes that must be in place in order to achieve success.
Reminder: We've developed a couple of quick diagnostic assessments to help you. They are both fr*ee [at least for a while] and we try to deliver 48 hour turnaround of our analysis. Try them!
The Holonomic Top Down Assessment asks you about a combination of the 12 Main Enabling Processes that an effective organization has to have operating in order to achieve the 6 Desired Organizational Characteristics of effective organizations. Where your assessment indicates one or more of these are not working in your organization, we'll feed back suggestions as to the underlying Leadership Practices that might not be working.
Diagnosing from the other direction - Bottom-Up - we ask you to identify which of 29 Leadership Practices aren't present or working. From that, we point you to Enabling Processes and thus Desired Characteristics that probably aren't functioning.
Whether to contribute, challenge (or hopefully even praise) our newsletter, I encourage you to contact me directly Don, or our editor David.
Enjoy, and here's wishing you, your family, your clients... much success!
Don Schwerzler, Managing Director
Family Business Experts
2. Business first family...Family first business:
Succession Management For The Family Side of The Family Business
When we develop a succession management strategy for the management of the family business, we also know that a critical requirement for the next generation of the family is to have a succession plan for the family's CEO as well. We refer to mom as the CEO of the business family - the Chief Emotional Officer. Mom is often the peacemaker in the family. She usually has more leverage with dad than the kids and can influence how and when dad makes his decisions.
The actuarial statistics show that in most marriages, the husband dies before the wife. Our experience as succession managers for family businesses has taught us to know that when dad dies, the impact to the family and the business never seems so bad as when mom dies. When mom dies it seems like all the problems within the family and the business get amplified. It is not uncommon for the problems that had been smoldering under the surface seem to reach a flash point when mom dies and sometimes these problems tear the business family apart, irreparably. Those kinds of problems support our contention that mom is the glue that holds the business family together. So if it makes sense to have a succession management strategy for the business, it makes equal sense to have a succession management strategy for the family.
When we discuss the role of "mom" in the business family, our primary consideration is how the communication system works for the family in business together. Mom is involved in both the formal and informal communication systems. The business will have a formal communication system and an informal communication system that is often characterized as the "grapevine".
Likewise, the family has a formal or obvious communication system and it also has an informal system, the family "grapevine". As succession managers for the family business we are not surprised to find that many family issues, conflicts and misunderstandings occur in the realm of the family's informal communication system. One of the major problems is called "triangulation".
Unfortunately, mom is often a critical part of this communication problem. To visualize the concept of triangulation, think of mom, dad and son/daughter being the three points of the triangle. Son/daughter will go to mom with a problem they are having with dad. Mom then talks with dad who explains his side of the problem. Mom reports to son/daughter what dad said - or what he tried to say. In this example the communication linkage never directly connects son/daughter and dad. Consequently the problem continues to fester for it never gets resolved.
From my experience as succession manager for many family businesses, one last observation.
When disputes between siblings bubble to the surface at succession time, the siblings in the business tend to be more "rational" about the process whereas the siblings not involved in the business tend to deal with the succession process from an "emotional" point of view. This creates an environment that produces many opportunities for significant conflict in the family and the business.
Without outside intervention, reconciliation and remediation can be very difficult. For the parents it can be heart wrenching - especially for mom, the business family's CEO. She becomes the "shock absorber" for the business family's succession process.
Smart succession management for business families includes preparing the next generation for the leadership of the business. Smart business families also prepare for generational transition by identifying and training the next CEO for the family.
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3. Legacy through Leadership
There are 29 Leadership Practices [LP] that are really the foundation upon which 12 holonomic or enabling processes[HP] are built, and which, in turn, produce 6 desired organizational characteristics [DOC]. We'll look at each in this section.
LP04. Using Strategic Long-Range and Tactical Plans
The process of using strategic long-range and tactical plans is the strategic process by which the organization establishes and deploys its long-range strategic, tactical, and annual operating plans. It ensures that these important components are used to guide decision-making throughout the organization, and that the tactical and annual operating plans are implementable with effort.
Dr. Ken Mackenzie is our internationally-recognized organizational expert. These leadership tips are excerpted from the e-book Legacy through Leadership he and Don Schwerzler collaborated on. Email: ken@family-business-experts.com
Would you like to see how the 29 Leadership Practices are affecting your family business? Our assessment only takes a few minutes to complete!
Take our fr*ee assessment on the 29 Leadership Practices...
4. Around the Family Business Experts web sites
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