Chief Emotional Officer
CHIEF EMOTIONAL OFFICER
In a Business Family
Who is the Chief Emotional Officer for your business family? When working as succession managers for family businesses, we often refer to “mom” as the Chief Emotional Officer (CEO) for the family involved in a family business. “Developing and implementing a succession plan for a family business should also include a succession management process for the family side of the family business” according to leading family business expert
Don Schwerzler.
“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 Chief Emotional Officer (CEO) as well.” Schwerzler has been studying and advising family business entrepreneurs for more than 40 years and he is the founder of the
Family Business Institute
and the online organization
Family Business Experts,
both of which are headquartered in Atlanta GA. “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,” suggests Schwerzler. 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 thatso often 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" as the Chief Emotional Officer 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. In most family businesses, 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 family-owned businesses, 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 can often be 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 a 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. When disputes between/amongst siblings bubble to the surface at succession time, the siblings in the business tend to be more "business rational" about the process whereas the siblings not involved in the business tend to deal with the succession process from a "family emotional" point of view. This creates an environment that produces many opportunities for significant conflict within the family and the business. It is that tension or anger amongst the family members in a family businesss that causes the mom or the daughter of the owner - even the daughter-in-law of a family business to reach out for our help in resolving family conflict. Women tend to nurture, they want to have peace in the family. Conflict, amongst family members in a business together, emotionally drains the cohesive energy of the family and the business will suffer as a result. 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 Chief Emotional Officer (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 Chief Emotional Officer (CEO) for the family.
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