A common challenge for family members in business together is communication. How well family members are communicating impacts the family’s ability to work together effectively, a capability that is foundational to healthy families and healthy businesses.
One key to effective communication by leaders is being thoughtful and deliberate about WHO Knows WHAT and WHEN (WKWW). Information and its flow is a powerful influence within families and businesses, and WKWW sends signals as to one’s standing.
If family or business leadership conveys important information to one or more persons at the exclusion of others of supposed ‘equal standing’, this can signal that some have favored status. This will likely lead to anger, hurt feelings and an erosion of trust among those who feel they were slighted by not receiving the information. Further, those who received information may start to believe they are ‘special’ and entitled to different access – making it difficult to adjust to any requests to change the flow of information going forward without escalating resentments in the system.
A few thoughts on how to reduce the risk of these problems. First consider whether the information to be communicated is primarily a family matter, a business matter, or an ownership matter. Then communicate within the proper venue – family matters at family meetings, business matters at management meetings, and ownership matters at board or ownership council meetings. That way the right people will more likely received the right information at the right time.
The second thought is role clarity. For very good reasons some family members or management team members should know certain important information exclusively or before others in the family or on the management team. Having clearly defined roles within family and business governance will help set appropriate expectations as to the flow of information.
Finally, for important information that needs to be communicated, think through and visualize: the appropriate venue, the best person to convey the information, the sequence and the timing. Consider who will be most impacted by the information and the magnitude of any changes that will come along once the information is conveyed. Taking the time to visualize the roll out of the information will increase the odds that you will get the roll out right.
WHO Knows WHAT and WHEN? Getting this right will help your family and business go a long way to not hurting others feelings, an important part of working together effectively.
Parents in North America are caught in a dilemma. Baby boomers have more money than previous generations and one of our core cultural values is to give to others. Naturally, parents form the notion that “we have money so we should share it with our kids”. This type of thinking leads to children getting what they want and often much more than they need. They get caught in the entitlement snare.
Recently when working with a wonderfully loving and giving family, I realized that love is not enough – especially in a family business. The famous line “love is all you need” may be leading us to believe in a fallible principle.
Parents need to establish and manage clear, reasonable boundaries from an early age in a family firm. Boundaries are rules or expectations you have as an individual, in your home and family, and in your business. As with many things in life, it is not the articulating of boundaries that is the challenge but rather the enforcing of the same. Most of us have a shared notion, for example, of what we consider to be healthy expectations and rules within our family firms: show up on time, deliver on what you promise, be respectful, accept feedback as positive input to your development, pay your own way and the like.
The real challenge comes with managing our boundaries and doing so with grace, finesse and wisdom. Boundaries can too easily get blurred due to the complexity and emotional context of a family firm. Unfortunately life is not simple. Circumstances and relationships are not black and white.
As leaders of a family and family business it is imperative to consider what boundaries are important for you, your family and your business. In addition, it is critical to evaluate the type of support you may need to keep your boundaries strong.
One important cautionary note… It is too easy to suggest that we “set and hold” our boundaries one hundred percent of the time.
Sometimes it is fitting to re-assess and move the line you have drawn in the sand to more aptly address the situation at hand. Only good judgment and wisdom can help us understand the rare situations in which we need to be flexible with our boundaries.
Entitlement is one of those sticky and sensitive issues in family business. Entitlement is a difficult subject to raise because it creates defensive (and offensive) behaviors in family members. When most families start talking about entitlement (if they talk about it at all) it feels like a blaming game: “I wish my daughter would be financially responsible and stop relying on us to pay her bills”, or “my son has no work ethic”, or “my brother acts like he can show up for work any time he likes”.
Entitlement, as defined here, means the belief that one deserves or is at liberty to access certain privileges that others are not based on arbitrary factors such as family lineage. In other words it is an unrealistic or unjustified sense of deserving some type of benefit. Those who are labeled as “entitled” in a family business are a target for criticism, and judgment and even resentment, even if only behind closed doors. The entitled are considered fully to blame for their entitled behaviors, attitudes and transgressions. Too often there is a great deal of energy consumed by strategizing on how to work around these folks and address the issues they create.
However, entitlement is a two-way street in that liberties may be taken by the entitled but those privileges were likely bestowed on to the entitled by parents or other family members at some point, either intentionally or unintentionally. In addition, when unwarranted liberties are taken, too often there is no or inadequate consequence within a family firm.
The development of entitlement is a complex and layered process. Sometimes clear rules or boundaries are not clearly articulated because it is assumed that children, siblings, or cousins should know the rules. Sometimes family members do not hold their ground when boundaries are pushed or challenged which children and certain personalities are prone to do. Sometimes too much is given to the next generation without requiring of them an offsetting contribution. Sometimes parents worry too much and take accountability for things the next generation should be accountable for.
As a family and a family business, one place to start is to stop blaming those who are considered entitled and recognize our role in the development of the entitlement snare.
Part B: The Entitlement Snare: Exploring Our Boundaries coming later this week.
I’ve recently been dealing with a number of family businesses where the “next generation” is already in their 40s and even 50s and whose parents are “protecting” their children. Protection comes in several forms: providing lots of money; bailing them out of trouble; giving them jobs in the family business with little or no accountability for behavior or performance, and the like. As one family business business leader put it: “I want my children to be accountable — I just don’t want their feelings hurt.” Paradox aside, the result can be a next generation full of entitlement, unprepared to rise to the responsibilities of management and/or ownership, and oblivious to their own shortcomings.
New York Times columnist David Brooks recent column aimed at new college grads sound a similar note. He describes current graduates as “members of the most supervised generation in American history,,,they have been monitored, tutored, coached and honed to an unprecedented degree.” Brooks points out the mismatch between the mindsets and skills learned under such circumstances and those required for success in an environment “requiring a different set of skills which they have figure out on their own.”
Self reliance is the key and it is difficult enough to develop in affluent young people even when the conditions are right. The ability and confidence to figure out which problems need solutions and how to go about developing and applying solutions are essential to successful family business leadership. Such skills and attitudes can be developed only with the opportunity to make and implement decisions, to get rigorous and unvarnished feedback, and to be explicitly held accountable for behavior and results. Young people held to high standards won’t always feel “happy” with such discipline. They may even decide (or have it decided for them) that a career outside the family business is a wiser choice. In the long run, such decisions are usually best for all involved — the young person, the parents, the family and the business.