Family Businesses in Transition

09. 22. 2015    |    posted by: Martin Dukler

Family Businesses In Transition 

Ever been through a family business transition or know someone who has? They frequently are a big emotional investment by all direct and indirect parties. Here's an example of a customer contact. "I've spent my life building my business. It could be better but it does very well. My kids have worked there, it has supported my family and many others. One of my kids has stuck with it. I'm ready to pull back and she says she wants to take over. I'm very proud and scared. How do I know if it's the right thing to do? How do I do it? What do I do? She has learned everything on the job - not so much from me. She's very educated, smart, has strengths and weaknesses and works hard. She's young and inexperienced in the world. We're different. I don't want to set her up for failure. I don't want it to affect our family. I want the business to thrive. I want the employees and customers taken care of. "

Family business transitions are one of the most difficult changes a business can go through.

A family dynamic is unique and fraught with personalities, strong vocal opinions and big emotions. Nobody is completely objective, everything has personal over and undertones. All discussions, decisions and plans are influenced by your relationships, expectations, biases and passions. There is huge potential for hurting and for enhancing your relationships and building your business.

When it comes to making the transition, many people hire a third party to work through the transition with them, to have a neutral party present. You can but it is recommended that you do not do it yourself. If you choose to enlist a guide, they will get to know you and your family member(s) and see what makes each of you tick... what your priorities, fears, biases, hopes, dreams passions, and parameters are. Everyone is searching to learn what is sacred and what is not. When choosing a guide, it is also recommended that it not be someone that has a relationship with you or your family. Whomever you choose, the person's independence ensures that all parties start with trust and openness. You should work together, with the help of your guide or with just your family, to plan a realistic transition process and find the path that works best for you all. Identifying conflicts in an unemotional way and to try to facilitate unemotional resolutions between everyone is essential. Also identifying what else needs to be done to ensure your family member's and the businesses success as well as help you plan for the execution of that support is equally essential. If you do hire a guide, they will be there when things get rough. First and foremost, protect your family. If you do that well, the business strategy has a better chance of success.

The most important thing in family business transitions is to protect the family and not to assume that it will protect itself. If you can do that well then the business transition has a better chance of success.

 

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