The new year is upon us! This is a great time to consider the power of renewal and its impact on multi-generational continuity of your family enterprise. Multi-generational continuity requires commitment to the future for the family enterprise to sustain itself and renewal results in commitments. Consider engagement in renewal on three fronts: family relationship, strategic and personal. This engagement will result in commitments on these fronts, all working in concert and serving to energize the family business system for multi-generational continuity.
Let’s consider the meaning of renewal. The Merriam-Webster online dictionary defines renewal as “the act of extending the period of time when something is effective or valid; the state of being made new, fresh, or strong again.” When you consider that “it’s natural for families to tend toward dis-organization and separation over time”, that business strategies are always moving toward commoditization, and that individuals tend to get into and remain in their comfort zones and become complacent, renewal on all three fronts extends and strengthens the effectiveness of your family relationship, your strategy and yourself.
The most significant risk to multi-generational continuity is deterioration of the family relationship. The result of engaging in family relationship renewal is an increase in affinity throughout the family making it more attractive to be together and work together thereby decreasing the risk. Increasing affinity requires spending time together in settings where individual family members feel their voice is heard, their contributions matter, and they are able to enjoy the company of other family members. Options include family events such as family celebrations, family meetings, family vacations, family business conferences and family retreats.
If your family events are feeling stale and the lack of energy or participation is waning, reach out to a broader segment of the family for input on freshening up the content and activities. Sharing your own expectations and getting updated on others’ is perhaps the most powerful outcome of family relationship renewal.
Competitive pressures are fierce and maintaining an edge in your marketplace is a continual challenge. Strategic renewal helps you maintain, if not gain, an edge. Strategic renewal involves making decisions to commit resources to evolve how your business creates value and competes in the marketplace. It results in commitments such as: deepening customer and/or vendor relationships to increase their cost of switching; building your brand; evolving your processes to achieve a higher level of operating efficiency; divesting of a legacy business enterprise; or increasing your geographic or product line scope to gain economies of scale.
You know a commitment is strategic if the investment requires making a trade-off such as between the investment and increased dividends. Investing in strategic renewal takes courage, particularly when things seem to be going along rather well and there is not a crisis at hand.
Personal renewal is about focusing on yourself in order to learn and grow your capability to be effective in your multiple roles as a family member, business leader, shareholder and director. Although seemingly more simple because it requires only you to commit, personal renewal requires courage as it involves self-examination and an increase in uncertainty. Personal renewal involves engagement in such things as changing the way you behave, learning a new or deepening an existing functional skill, understanding better the impact you have on others, taking on new responsibilities which involve risk of failure, and sharing power and control. Making commitments in these type of areas can be tremendously energizing for you due to the sense of satisfaction gained from the growth which takes place.
A practical framework to apply to renewal on each of the three fronts – family relationship, strategic and personal is:
- Reflect on the past.
- Assess the present.
- Imagine the future.
- Commit to action.
Periodically applying this renewal experience framework will result in commitments which create the energy critically important to achieving multi-generational continuity.
What will you do this year to renew your family relationship, your strategy and yourself?
 David Lansky article: “Ties That Unbind” in Private Wealth Magazine; March/April 2015.