All posts by Jennifer M. Pendergast, Ph.D.

Intentional Communication

Jennifer Pendergast
Jennifer Pendergast

Too often we fail in our desired communication.  We often believe this is due to failure on the part of the recipient to accept our message.  And, sometimes, we may see failure on our part to deliver the message.

The more intentional we can be about substantial conversations, the more likely we are to achieve our desired outcome.  But, that begs the question – do we always know what our desired outcome is?  When entering into a substantial conversation, how often do we take the time to prepare ourselves?

The importance of intentional communication struck me over the holidays when I had the opportunity to simultaneously spend time with my parents and my teenage children. As I thought through my interactions with both, I realized that each generation was in a part of their lives that colored their communications.

Many teenagers desire in their communication with their peers is to be liked. So, that impacts how they communicate.  On the other end of the age spectrum, elders (parents, superiors at work) often have a desire to educate in their communications, to share the wisdom of their experience and prevent others from making similar mistakes.

While each of these intentions is real and important to the speakers, often they are delivered in a way that doesn’t achieve the desired outcome. Teenagers who desire to be liked are often evasive in their communication, not committing to a point of view or not being honest.  This can backfire, getting them into situations where they can be labeled as dishonest or where they have not been true to themselves and their values.  With elders, the desire to educate can often be perceived as judgement or criticism.  In both cases, speakers have failed at achieved their desired outcome.

As a result of observing this situation, and my frustration at reacting to communications from both generations, I decided to do an experiment for one week. Before I spoke in what I term a “substantial conversation” (meaning one where I sought an intentional outcome), I would stop myself to ensure that I was clear on:

  1. What my intention was in communicating. (Was it really to help someone else or was I venting?)
  2. What the desired outcome was of the conversation. (Did I just want to be heard or did I want something to change?)
  3. What was the likely receptivity of the recipient. (Would they be open to my message, discount it or ignore it?)

It was a very interesting exercise. I found that in the instances where I was able to stop myself to plan my communication (which wasn’t every time, I’m sad to say), my communications had a much better outcome.  I was clearer on what I was trying to accomplish.  My message was better prepared.  And, I set up the communication in a way that the speaker was likely to be more receptive.  In several cases, after thinking it through, I chose not to communicate at all because I realized that nothing good would come of that communication.

Families who are in business together have great needs to communicate effectively – it affects their relationship as well as their success in business.  Yet, they are often the most challenged due to unaddressed baggage or hurt, complex power dynamics and inability to “get away” from each other if needed.  Learning how to communicate intentionally is a process or skill that benefits families greatly on a one-on-one level as well as in planning group interaction. And like any skill, it requires a lot of practice to perfect.

Try your own intentional communication experiment and see how it works for you. (And if you figure out the key to conversing with teenagers, please share it with me!)

What it means to be values driven

Jennifer Pendergast
Jennifer Pendergast

Many people associate my home city of Atlanta with our airport (home of frequently missed layovers!), traffic (if you’ve had the misfortune to drive our highways), or the Georgia Aquarium, the world’s largest. Recently I had the opportunity to visit one of our newest landmarks, and one that I hope will grow to be one of our most popular: The National Center for Human and Civil Rights.

While the role of Martin Luther King and others in the civil rights movement is well known in Atlanta and around the world, the information on human rights is less well documented. As a consumer, I was particularly struck by the information on human rights violations in the production of chocolate, flowers, soccer balls, and mobile phones.

So, how does this relate to family business? Unlike the disconnected minority owners of public companies, who invest solely to make money, owners of family owned businesses can choose to purse objectives that balance ethics and values with profits. They can choose industries, customers, suppliers and business practices that may not be the most profitable, but are choices that they can be proud of.

I recently worked with an ownership group that articulated their driving shareholder objectives as: “How we make money is as important as how much money we make.” Owners of family businesses have a unique opportunity to shape how they make money, and in doing so, shape the lives of their owners, employees, communities and other stakeholders.

Creating meaningful leadership transitions

Jennifer Pendergast
Jennifer Pendergast

A few weeks ago, I attended the installation of the new senior minister at my church, the church’s version of the CEO. It gave me cause to reflect on leadership transition. This transition was very significant for our church. It is a large church in a large city which has played a pivotal role in support for the inner city homeless and abused, as well as globally through mission work. Our prior leader, a truly charismatic CEO, had a significant impact on our city and our church over 30 years of service. Our new minister, unknown to the congregation before his selection, was coming with a mandate to build upon our strengths and expand the church population.

What struck me was the significance of the installation ceremony. It was a joyful and very personal celebration, where several peers of the new minister flew in from around the country to participate alongside his family and senior leaders of our church. Our leaders charged him with answering a set of questions about what he would commit to us, in front of the entire congregation. And, then the congregation and his leadership team responded to questions where we voiced our support and commitment to him.

The sense the ceremony conveyed was that we are all in this together – we have a responsibility to support him and he has a responsibility to us to move our church forward. We are working as a team to create success. It really felt like we were ushering in a new era.

I then compared that to the first day of a new CEO. Perhaps, he or she addresses the employees, shares a vision and requests their support. But, rarely is there a sense of partnership, shared expectations and aspirations. Rarely is there an explicit commitment from employees and owners to support the new leader and from the leader to steward the organization’s legacy and carry it forward.

I left thinking there were lessons to be learned about the transition to a new family business CEO.

Unlike CEOs in the public company realm, who often have a short tenure and limited capacity to impact the organization’s culture, family business CEOs are more committed for the long-haul. Wouldn’t it be nice to honor and memorialize the transition, to set mutual expectations and to foster a true sense of commitment to a shared future?

Be Your Own Cupid

Jennifer Pendergast
Jennifer Pendergast

3 facts we know to be true:

  1. We often treat the ones closest to us the worst. (Who knows why?  We are most comfortable with them.  We know they won’t leave us.  They know how to push our buttons!)
  2. Being in business is hard.  Making decisions with family is hard.  So, by the transitive property, being in business together as a family can be exponentially hard!
  3. Valentine’s Day is about love. And, there are lots of kinds of love, not just romantic love but also love born out of respect, appreciation and shared history.

So, given these facts, isn’t Valentine’s Day the perfect day to reach out to someone in your family business and share a little love?  The best kind of love is unconditional – given with no expectation of something in return.  Surprise someone in your family with a little appreciation today!

Learning from the Wealthy

Jennifer Pendergast
Jennifer Pendergast

History is full of examples of leading business families who have used their wealth to make the world a better place.  Witness the contributions of the Rockefellers, who have had a family foundation since 1913.  You will find this description on their website, “ In the years since John D. Rockefeller inaugurated the first global US foundation, scientists, scholars, economists, and grassroots leaders supported by the Foundation have spearheaded the search for solutions to some of the world’s most challenging problems. Through their efforts, plagues such as hookworm and malaria have been brought under control; food production for the hungry in many parts of the world has been increased; and minds, hearts, and spirits have been lifted by the work of Foundation-assisted filmmakers, artists, writers, dancers, and composers.”  Similar examples can be found in reading about the Ford Foundation, where a recent headline states, “Ford Foundation grants $6 million to 7 organizations to reshape the global human rights movement”.  Or, a more recent entrant, The Bill and Melinda Gates Foundation, where the Global Health Division, one of four focus areas, aims to harness advances in science and technology to save lives in developing countries.  Regardless of where you stand on issues these families have chosen to tackle, it’s hard to deny that they have set their sights high and aspire to make a meaningful difference in the world. 

While the scope of these endeavors may be out of reach for most of us, every family, regardless of its wealth, has an opportunity to make a difference.  And, business owning families are in a prime position to do so, given their visibility in their communities and relationships with other well-connected people.

At your next family gathering, be it at the dinner table, conference table, or large family meeting, ask yourselves the question “What can we do together as a family to make a difference?” Think about the unique assets your family has that it can bring to bear to address an unsolved problem.  Often, creative use of assets at your disposal, scrap materials, distribution networks, excess warehouse capacity, can have much greater impact than writing a check. Regardless of the financial resources at your disposal, your family can make a difference. And, in doing so, you will find yourselves in good company.

Life Long Development

Jennifer Pendergast
Jennifer Pendergast

A few weeks ago, I had the opportunity to participate in a family business conference.  I was struck by the number of sessions devoted to the topic of education – educating the next generation of owners, educating the next generation of leaders, educating responsible stewards of wealth.  The audience was clearly attuned to the importance educating the next generation to ensure they are prepared to carry on the family business…  Yet, they didn’t seem to think much about what they, the current generation, may need to be doing themselves to ensure they were doing the best possible job as owners and leaders.

One of the experts leading a session raised the point that the words training and development, often inter-changeably, are actually not the same.  Training refers to a set of exercises or activities that are designed to lead to mastery of a topic. Many of the conference attendees were seeking advice on how to train their next generation members, so they would be well-prepared owners and leaders.

 Development, on the other hand, is an ongoing pursuit, with no end point.  While one may work on development of leadership skills, leadership will never be fully mastered.  There are always opportunities to learn ways to become a better leader.  So, while preparing the next generation is important to the perpetuation of a family enterprise, we shouldn’t forget the importance of the ongoing development of the current generation. 

We know that the best way to perpetuate a desired behavior in a younger person is to model that behavior.  The old adage “Do as I say, not as I do”, is NOT a recipe for success. 

If you are a member of the current generation of family business leaders and owners are concerned about the next generation, consider what you can be doing to develop yourself.  Ask yourself the question – “What could I work on that would help me be a better mentor and teacher for the next generation?” “How could I model the behavior that I hope to see in them?” By expanding the focus of your education programs beyond those that come after you to include yourself, you are setting the best example of what you hope for – owners who are constantly thinking about how to develop themselves.

Legacy and Evolution

Jennifer Pendergast
Jennifer Pendergast

One of the key differentiators of family businesses is a committed ownership group who are proud of the legacy their family business represent.  Research shows that family businesses outperform non-family businesses, and this focus on the importance of legacy is one of the contributors to superior performance.   However, an overemphasis on the past can also have a negative impact on family business performance. 

Ability to change is also important.  Every generation is different, and requires different structures and rules to succeed.  Take just one element – ownership structure.  In earlier generations, many family business owners created a structure where stock was consolidated in the hands of those who involved in the business.  Many felt the alternative of entrusting ownership to family members who may not be as interested in the business could lead to non-employed owners getting in the way of family management’s ability to make decisions.  Further, some thought it unfair that those not involved benefit from the hard work of those involved in the business by participating in the financial gain created by employed owners. 

While this model of ownership may have served a family and company well in the past – as the business evolves and typically gets larger, there can be many benefits to cultivating a group of informed and committed owners who are not employed in the business.  In the interest of brevity, lets just focus on the financial benefits. 

By limiting the ownership group, family businesses may limit the pool of capital available for investment in the business.  For instance, if a business founder has 3 children, only one of whom goes into the business, and he decides to give the business to that child, he will often make a financial gift to other children to treat them equitably.  That money could have been used to fund business growth.  Or, if he gifts shares to all three children at a young age but requires them to sell back their shares to the company if they decide not to pursue a career with the business, again the business capital is limited.

A great strength of family businesses is the patient capital they have by virtue of an ownership group that is interested in managing the business for the long term.  This mindset leads family ownership groups to support management decisions that contribute to long-term business success even if they may not show immediate results.  In fact, research shows that family businesses invest more in R&D and employee training than non-family businesses.  The benefit of a larger ownership group is that they provide capital at a lower cost with a longer time horizon than other investors (including banks) – providing their businesses with a significant competitive advantage.   

So, let’s circle back to legacy.  A commitment to the principles that served the business well in the past is important.  Equally important is a thoughtful analysis of what changes need to be made as the business evolves.  Just as it would be impractical to use a typewriter to generate business correspondence today, it may be impractical to maintain the same ownership requirements from generation to generation (or the same employment requirements or other elements of the family legacy). 

Honoring legacy is important, but if part of that legacy is a desire to maintain the business for generations to come, perhaps a new addition to the legacy needs to be an ability to change.

What is Stewardship?

Jennifer Pendergast
Jennifer Pendergast

Stewardship is a term often used when describing the perspective of family business owners.  As many owners of family businesses seek to pass their business on to future generations, the term stewardship is an accurate one.  The dictionary definition of stewardship is “the careful and responsible management of something entrusted to one’s care.”  This is quite different from the term ownership, defined as “the legal right of possession, full claim, authority or dominion.” 

I see stewardship and ownership as two sides of the same coin – the former emphasizes responsibility, the latter emphasizes rights.  In truth, ownership implies both rights and responsibilities.  Too often, owners are concerned about their rights – to a dividend, to a say in how the company is managed – but pay less attention to their responsibilities.  Yet, if they seek to pass on their business to future generations, owners should be equally or perhaps even more concerned with responsibilities.  What are the responsibilities of owners?  They include:

  • Ensuring the business is well-run, ideally by electing a qualified board of directors who oversee a capable management;
  • Planning for the orderly transition of ownership across generations;
  • Staying informed about the business and its operating environment;
  • Representing the business and family well to employees and the community
  • Investing time in education to ensure one is prepared to make big decisions around the business.

As the old adage goes – to whom much is given, much is expected.  An emphasis on stewardship responsibilities will help to ensure that the aspiration to pass the business will be achieved.

Spring Cleaning- Parting with Treasures

Jennifer Pendergast
Jennifer Pendergast

Spring cleaning is a time to go through everything that has accumulated during the year (or years, depending upon how often you go through the ritual!) and determine what is still relevant to your life.  This ritual can serve as an analogy for the important process of evaluating people that support your family business –  board members, advisors, service providers – to ensure they are still the people you need to achieve your goals.  Family business owners are often challenged by the prospect of replacing someone who has been invaluable to the business over the years but who may be ready personally to move on or who is no longer a good fit.  Often these individuals stay on longer than the family or they would like because no one is willing to broach the subject.  Recently I watched a client deal with the retirement of a long-time board member in a courageous and honorable way.  The family members on the board informed this gentleman, a board member with well over a decade of service, that they felt it was time to refresh the board.  They asked him how he would like to handle the announcement to the board – Would he like to retire or resign? Would he like to tell the board or would he like them to tell the board?  Then they planned a dinner honoring his service. They worked with his wife to identify a gift that would be special – in this case tickets to a sporting event and an opportunity to meet the owner of the team.  All of these steps showed respect for the director’s contribution and allowed the process to unfold in a way that made him comfortable.  The result – the board members and family involved felt good about the decision.

Spring Cleaning – A Fresh Start

Jennifer Pendergast
Jennifer Pendergast

We’ve devoted the week to spring cleaning. For many people, the process of spring cleaning is not much fun, but they do enjoy the outcome – a more organized, clean and clutter free environment. Family businesses aren’t the best at fresh starts, and indeed getting rid of history, legacy and culture can take away what can be one of a family business’ greatest strengths.  However, we all know of elements in our family businesses that we would be better off leaving behind, inter-personal animosity from prior generations, outmoded business practices, or unhealthy family dynamics.  Families have a difficult time letting these things go, because they represent an important part of the family history or perhaps the family  isn’t even aware of the pattern they are perpetuating.  Whether these unproductive elements of the family are acknowledged or not, they would benefit from spring cleaning.  Consider one of two exercises for your next family gathering –

  1. Ask each family member to write down one thing about the way the family works that they would like to keep and one thing they would like to let go.  (Note that saying “let go” rather than “get rid of” takes the sting out of the process).
  2. Ask the family to think about starting with a clean slate.  If you didn’t have your traditions, history, legacy, what is one thing each person would do differently than what you do today?

Either of these exercises will lead you to a productive discussion of what things your family might want to leave behind so that it can operate in a more organized, clean and clutter free environment.