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Brainstorming your Family Legacy

The word “legacy” can conjure up a variety of thoughts and opinions, because everyone has their own take on what it is, as well as what it should be.  When you add “family” to it, and raise the subject of “family legacy”, there is even more disparity in the responses evoked.

I recently took part in a training program at the Canadian Institute for Conflict Resolution, during which we took turns leading a group brainstorming exercise. Given free reign to use the subject of our choice, I decided to pose the question “what is family legacy?” to see what I might learn from my small group.

As someone who thinks about (and talks about) this subject on a regular basis, I thought it would be interesting to hear what a group of strangers, most of whom did not come from a business family, might have to offer on the topic.

They were all between 25 and 55, most worked for the government (this was in Ottawa), and I am reasonably certain that none of them came from what one might term a “legacy family”.

The exercise was a success, insofar as I filled up five sheets of flipcharts and stuck them to the wall, with around 40 different words that came up from the group.

When brainstorming, one of the main rules is that there is no debating what is a good or bad suggestion, it’s just an open “brain dump” where what one person blurts out will hopefully tweak something in the brain of another, and spur even more ideas.

Some of the expected and positive words that came out were:

–         Traditions; Reputation; Loyalty

–         Money; Memories; Trust

–         Supportive; Caring; Community

Of course there were also some negative ideas that surfaced, such as:

–         Dysfunction; Limiting; Stressful

–         Gossip; Meddling; Conflicts

–         Secrets; Façades; Bullshit

A brainstorming exercise is normally just the first step in a longer facilitated process, designed to get people working together, overcome inertia, and put a bunch of the pieces of the puzzle on the table to get going.

The real work comes next, when you take the ideas gathered and start organizing them, debating their merits, and figuring out what you are going to do with that information.

Working with a real family, the follow up question, “what is OUR family legacy?” would have been an obvious next step.

There is a big difference between personal legacy and family legacy, but when the founder of a business family is still around, a large portion of the family legacy naturally comes directly from that person.

In order to create a true family legacy, the key is to start when the founder can still contribute, and in fact OWN the process.

The family needs to capture the major values, traits, and principles of that person and then figure out how to make sure that they are preserved and transferred down to the following generations. If this is done correctly at this point, the succeeding generations will then have the task of maintaining the legacy that has been established.

Of course none of this just happens all by itself.  Someone needs to care enough to first stop and think about it, talk about it, figure out what needs to be done, decide who needs to be involved, and get things moving forward.

In the long run, the family must also figure out how they are going to make decisions together, how they are going to communicate, and how they are going to solve problems together. All of this generally falls under the heading of “family governance”.

If you are the founder, what you do before you go is really all you can do. Once you are gone, it will all be in the hands of others. If you want to leave a family legacy, building the financial assets is just the first part, and some say the easier part.

Keeping the family together after you are gone, wow, that’s the tough part.  It can be done, but like I said above, it won’t happen all by itself.

Essentially, you need to stop working in your family business, and start working on your business family.  Intrigued?  Check out: www.ShiftYourFamilyBusiness.com. It is my #1 book recommendation.  I also like the website.

Need help getting started?  sl@stevelegler.com

The Roadrunner-Coyote Rulebook

Recently I gave a short presentation to a group of business people, all of whom have children, on the subject of possibly bringing their children into their businesses.

On one of the Powerpoint slides, the heading “Rules and Roles” appeared. I explained that it was key for every new employee to have a clearly defined role, and that this was even more important for family members upon joining a family company.

But in addition to the “Roles”, I really wanted to emphasize the “Rules” part. Most families do have a few rules that they use to govern household issues, but very few families actually write them down and keep track of them.

For families in business together, it is considered a “best practice” to not only have rules, but also to write them down, review and update them, refer to them as needed, and generally know what the rules are and understand how important they are in keeping things clear.

A few months ago I came across something on Twitter that I filed away for a future blog post, and since we are talking about rules, it seems quite à propos to pull it out now. Someone had taken a photo at the Museum of Moving Image in New York and tweeted it out, and it got retweeted by several others.

I don’t think it came close to going viral, but it did garner quite a bit of attention for a few hours. The photo was a list of 9 rules that Chuck Jones of Warner Brothers had compiled to govern the Coyote and Roadrunner cartoons of our youth.

For example: Rule 1 states that the “Roadrunner cannot harm the Coyote, except by going Beep Beep”. Rule 4 states, “No dialogue, ever, except Beep Beep”. Rule 8 says, “Whenever possible, make gravity the Coyote’s greatest enemy”.

This got me wondering why they actually took the time to write these things down, and whether they made these rules before they began, or as the went along over the years. Also, did they write the rules out all at once, or did the list get added to over the course of seasons? How often did they have to refer to the rules, was it only occasionally if there were creative differences, or if a new person was brought onto the team?

My guess is that they did find it useful to write the rules down in order to make things consistent over time. If the Coyote suddenly started buying his stuff from Amazon instead of Acme, viewers would have known immediately that something was amiss.

I think we all knew that the chances of the Coyote ever catching the Roadrunner were worse than for Charlie Brown to ever actually kick the football that Lucy was holding.

In an attempt to tie these rules into the realm of Family Business, I think it makes sense to look at the second rule on the list.

Rule 2: “No outside force can harm the Coyote, only his own ineptitude or the failure of the Acme products”.

Some family businesses fail due to outside forces, relating to their markets, their products, competition, new technology, and all sorts of other “business” reasons.

Unfortunately, a larger percentage of family businesses actually fall apart due to family issues, and not due to “outside forces”.

Does that make them “inept”? Well not necessarily, that may be too harsh a word for it. But if more families in business would take the time to create rules together, make sure that they are understood and followed, and kept all their lines of communication open, it would certainly lead to less family business failures.

Rule 9: “The Coyote is always more humiliated tham harmed by his failures”. Unfortunately in some families, some members do feel humiliated, and often some people are harmed.

It is never too early, nor too late, to start working on your business family’s rulebook.

 

Is It a Problem with Design, Material, or Workmanship?

This week’s blog post is one that I have been thinking about for a while, because I really liked the story from the time I started blogging, but I could not figure out how to relate it to the subject of business families. Until now.

The title, asking where the problem was, comes from a question that my father asked me over a decade ago, after I had tried to describe a situation that I needed his help with.

My wife and I had a couple of toddlers in the house back then, and during a trip to Costco, we saw a swing set with a circular slide that we thought would look great in our backyard. We hastily decided to buy it, not realizing the monumental task of assembling it that lay ahead.

Now I love Costco because they sell really good stuff at the lowest prices you will likely find anywhere, but that does not necessarily make their merchandise “user-friendly”. I am not the most “handy” guy either, but my wife is actually one of the best IKEA furniture assemblers I have ever met.

How hard could it be? “Next to impossible” was the eventual answer.

Literally four or five weeks later, the structure stood in our yard, but just barely. We hesitated to allow the kids to use the equipment, because we could not trust the thing the way we had put it together. “Maybe your Dad could help us”, suggested my wife.

So I called him up and described the issue as best I could. “Is it a problem of design, material, or workmanship?, came his question. I thought about it and answered “Yes, Yes, and Yes.”

In retrospect, I had not realized how good he was at getting to the root of the problem before trying to offer solutions, and I Iike to think that I inherited some of that from him, to make up for the lack of handyman skills that I got.

He came over a couple of days later to analyse the job we had done and immediately began shaking his head at the monstrosity we had cobbled together. Within an hour, we had put together a list of material and we headed to the local lumberyard to buy what we needed to address the shortcomings.

A couple of days later, after he returned with his tools and equipment, we had a veritable fortress of a structure. It was now strong enough for the whole family to climb aboard, and was eventually a heck of a job to remove later when the kids were too big for it and me opted for a pergola instead.

The business family lessons here are numerous. Dad founded a company with certain skills and abilities, some of which I inherited, some of which I did not. We still managed to work together and produce a great result, but it was not necessarily straightforward.

Let’s look again at the design, material, workmanship question. How does the family design the way it will work together, especially over the long term, and how are they going to govern the family enterprise as one generation will make way for the next?

The material of the business family is basically the family members, the human assets that are the heart of the operation, the ones upon whom the focus should be (as opposed to the widgets the company makes).

Is the family putting the emphasis on making sure the materials are the best they can be, thinking about education and finding the best role for each person?

What about workmanship? Hmmm, this one took a while for me to put my finger on. I am not 100% sure that this is the best fit for the analogy, but I am going to go with relationships.

When looking at a business family and attempting to diagnose where to begin to help them, you might ask if their key issue is Governance, Human Capital, or their Relationships.

Hopefully it won’t be all three!

 

Say Goodbye to Succession Planning

So many advisors spend so much time talking to their family business clients about the importance of succession planning. Many of us are guilty of over-using the term to the point of rendering it nearly meaningless.

I hereby implore everyone to just STOP. I am not saying that we should not talk about how to get the business, the family, and the ownership from where they are today, to where they will need to be some time in the future, because those are are still very relevant and important. But can we please stop using the term “succession planning”?

My feeling is that when clients hear anyone talk about the importance of succession planning, what goes on in their minds is some sort of replay of their mother telling them to eat their vegetables. Yes, Mom, I know I should eat my vegetables, thanks for the reminder. But I’m an adult now with kids of my own, so please back off. There is only so much you can take.

Then there are the advisors who use the term succession planning in their own way, turning it into something that they will help their clients get through painlessly, with very clear benefits. Just put together this little tax-minimizing strategy now, and then you can go on doing what you were doing before, knowing that your succession plan has been taken care of.

These advisors have hijacked the fact that clients realize that they must do something that can be called succession planning so that they can check that box off and tell everyone, “don’t bother me with that, I already did it”, as if “it” is a one-shot deal.

But it feels good to do that, because not only have your advisors shown you exactly how much you will save in taxes with their plan (down to the penny!) but you can get on with your life knowing that you have taken care of this important issue. This is like your Aunt Bea, who shows you how to drown your broccoli in a thick cheese sauce so that eating your vegetables is somehow palatable, despite the fact that the overall benefit is questionable at best.
I think that the main reason people hesitate to open themselves to discussing succession is that it focuses on change, and it is the kind of change that has them moving from a good position now, to a worse position later. Most people will try to delay dealing with questions about when THEY will retire, and when THEY will die. And if Grandpa hated to talk about it, and Dad hated to talk about it, why should I enjoy talking about it?

So if I am suggesting that you say goodbye to talking about succession planning, what I am I offering instead? Welcome to the world of Continuity Planning. Now I understand that you may be sceptical about the benefits of changing one single word, but let’s look at some of the ways that continuity is a better label.

Rather than focussing on change, like succession does, continuity focusses instead on what remains the same. I want my business to continue, I want my family to continue, and I need to figure out the best way for the ownership to allow the other two to continue.

In essence, the continuity plan is the long-range plan, the overarching plan, the big picture plan. Within the continuity plan, there are indeed a number of succession issues that need to be dealt with,

But when we start by stepping back, and concentrate on all of the things that we want to have continue, long after we are out of the picture, the succession issues become a lot smaller in that context.

When people can better grasp WHY they are doing something, as part of a larger whole, better results are almost assured.

Steve Legler “gets” business families.
 
He understands the issues that families face, as well as how each family member sees things from their own viewpoint.
 
He specializes in helping business families navigate the difficult areas where the family and the business overlap, by listening to each person’s concerns and ideas.  He then helps the family work together to bridge gaps by building common goals, based on their shared values and vision.
 
His background in family business, his experience running his own family office, along with his education and training in coaching, facilitation, and mediation, make him uniquely suited to the role of advising business families and families of wealth.
 
He is the author of Shift your Family Business (2014), he received his MBA from the Richard  Ivey School of Business (UWO, 1991), is a CFA Charterholder (CFA Institute, 2002), a Family Enterprise Advisor (IFEA 2014), and has received the ACFBA and CFWA accreditations (Family Firm Institute 2014-2015).
 
He prides himself on his ability to help families create the harmony they need to support the legacy they want. To learn how, start by signing up for his monthly newsletter and weekly blogs here.

Le concierge est un faux ami

Ceux qui sont assez à l’aise en anglais et en français ont sûrement remarqué qu’il existe un certain nombre de traductions qui sont en effet moins évidentes qu’elles semblent à première vue. L’exemple que je cite souvent est “librairie” qui est un magasin qui vend des livres, et “library” où ils prêtent des livres, donc une bibliothèque.

Dans mes jours à McGill, j’avais pris un cours de traduction, et le prof surnommait ces instances des “faux amis”, et j’ai gardé sa terminologie et je le répète souvent, même s’il fait déjà bien des années que j’ai oublié le nom du prof.

Quand j’étais au secondaire dans une école anglophone, on m’a placé dans les cours de français avancé puisque j’avais complété mon primaire en français. Rendu en secondaire 4, ceci me donnait aussi le droit de prendre d’autres cours en français comme options. De loin, le plus mémorable de ceux-ci était le cours de comptabilité donné par Monsieur McGee.

M. McGee était un anglophone avec un sérieux accent quand il parlait français, mais il s’exprimait quand même très bien et l’effort était toujours là aussi de sa part. Il s’amusait à nous souligner plusieurs faux amis aussi, même s’il ne les appellait pas par ce nom.

Loyer, ce n’est past votre “lawyer” (avocat), c’est le rent, il nous disait. Les fournitures, quand à eux, étaient des “supplies” et non pas des meubles.

Je préfère trouver des exemples avec plus qu’un mot, des expressions. Je m’amuse avec la famille quand on voyage en campagne et je vois des pancartes indiquant une “auto-cueillette”. Je me demande souvent s’il y a des anglophones qui regardent dans leur Larousse anglais-français pour apprendre ce que veut dire cueillette, et ensuite présument qu’ils peuvent ceuillir des pommes directement de leur voiture, comme un genre de cueillette-au-volant.

Sur une note plus sérieuse, notez si vous ne le savez pas déjà, la différence entre “il n’est pas question”, et “no question about it”. En français, c’est l’équivalent de “no way”, mais en anglais, c’est plutôt “certainement”.

Et là, nous arrivons au mot du jour, concierge. Le premier concierge dont je me souviens était M. Aubry, qui lavait les planchers et les toilettes de mon école primaire. En plus, il habitait un appartement en haut du gymnase avec sa femme. Ils avaient même une corde à linge sur le toît, où une belle journée de printemps j’avais aperçu les sous-vêtement du concierge et je me suis mis à partager mon observation avec tout les autres élèves qui jouaient au ballon-chasseur. “Les culottes de M. Aubry! Les culottes de M. Aubry!”

Mais en anglais, un concierge (prononcé plutôt “KON-si-err-GE”) est une personne qui fait beaucoup plus que nettoyer vos dégâts. Il ou elle vous aide avec toutes sortes de choses. Nous les apercevons plus souvent dans les grands hôtels, mais c’est une profession qui prend beaucoup plus d’ampleur ces jours-ci.

Ce n’est pas tout le monde qui peut se permettre d’engager un “majordome” ou un “butler” en anglais, mais toutes les grandes villes ont un certain nombre de professionels qui se font engager pour règler bien des problèmes pour bien du monde. Ils vendent leurs service en explicant qu’ils peuvent se charger de bien des choses pour ceux qui travaillent de longues heures et qui ensuite sont débordés en arrivant à la maison.

Ceux qui gèrent l’argent des plus fortunés, essayent même parfois de mentioner qu’ils offrent, eux aussi, ce genre de service aux clients avec des gros portefeuilles. Je me demande s’ils ont vraiment des clients qui en bénéficent et qui en sont satisfaits.

Un bon concierge peux vous sauver beaucoup de temps et de misère. Il s’agit d’en trouver un ou une qui prendra le temps de vous connaître et de vous proposer des services qui rentrent dans votre budget.

Steve Legler “gets” business families.
 
He understands the issues that families face, as well as how each family member sees things from their own viewpoint.
 
He specializes in helping business families navigate the difficult areas where the family and the business overlap, by listening to each person’s concerns and ideas.  He then helps the family work together to bridge gaps by building common goals, based on their shared values and vision.
 
His background in family business, his experience running his own family office, along with his education and training in coaching, facilitation, and mediation, make him uniquely suited to the role of advising business families and families of wealth.
 
He is the author of Shift your Family Business (2014), he received his MBA from the Richard  Ivey School of Business (UWO, 1991), is a CFA Charterholder (CFA Institute, 2002), a Family Enterprise Advisor (IFEA 2014), and has received the ACFBA and CFWA accreditations (Family Firm Institute 2014-2015).
 
He prides himself on his ability to help families create the harmony they need to support the legacy they want. To learn how, start by signing up for his monthly newsletter and weekly blogs here.

Another Round of CAFÉ?

Saturday night, June 8, 2013. The place to be was the Sheraton Conference Center in Toronto. The occasion? CAFÉ’s annual Family Enterprise of the Year Awards (FEYA).

CAFÉ (Canadian Association of Famliy Enterprise) is celebrating its 30th anniversary in 2013, and I recently joined as an affiliate member, given my renewed interest in the family business area. I had not realized that CAFÉ began in 1983, but found it interesting because my previous involvement with them was in the mid-80s, as they were just getting started.

At that time I was the second-generation (G2) son who was about to enter the family business, and someone got my father interested in CAFÉ. That was where he learned the importance of getting the family more involved, even those who did not work in the business.

He actually set up a family retreat, which I remember mostly because it was the only one we ever had. Not that it went badly, but running the company was more urgent, and nobody stepped up to make sure that the event became a regular part of our calendar.

We learned a few things from CAFÉ, not all of which were applied, of course. I vividly recall Dad telling me about how they recommend that kids work somewhere outside the family business for at least 3 to 5 years before even being allowed to come into the family company. Made sense to me, but Dad felt it did not apply to our situation.

So back to the FEYA event on Saturday.The best part of any CAFÉ gathering is the sharing of stories. Family businesses are all unique, yet there are always things that you can learn from others, especially how they have handled the intersection of the family with the business.

The three finalist families were all in attendance, each with about a dozen or so people there, representing two or three generations. They each had a little speech prepared, as well as a great video that the CAFÉ folks obviously put a great deal of effort into producing.

Not surprisingly, the families were all very thankful that they had become involved in CAFÉ, as the interactions had helped them figure out some things that they would not likely have picked up anywhere else. The stories were all very different, but each was touching in its own way.

A key benefit for families who join is the PAG (Personal Advisory Group) network. My father referred to his as his “CAFÉ Buddy group”. They used to have regular meetings, alternating whose family/company they would discusss. It became an informal board of sorts, where he could share stories, ideas, and problems with others who were undergoing many similar issues.

Even after selling our operations, he continued to meet with his PAG. After he passed away, a couple of his former PAG friends invited me to their annual Christmas gathering, which was really cool, as we spent the time reminiscing and sharing stories about him.

CAFÉ can be very powerful. Unfortunately, it is not nearly as powerful as it could be. That is not meant to be an insult, as I know that the board is working hard at making CAFÉ become an even more important part of the family business scene in Canada. They had just concluded some board meetings and were quite pumped at what they were working on.

There was even a bit of talk about Quebec and its lack of presence in CAFÉ. How could they find ways to get more invloved there? Apparently there was a new member from Quebec who was keen on helping mobilize things.

That would be me. If you are in Quebec and also interested in “another round of CAFÉ”, please reach out to me, and let’s see where we can take this

J’imagine que mon prochain blogue sera en français et devrait toucher sur le même sujet, mais du point de vue québecois. À la semaine prochaine…

Steve Legler “gets” business families.
 
He understands the issues that families face, as well as how each family member sees things from their own viewpoint.
 
He specializes in helping business families navigate the difficult areas where the family and the business overlap, by listening to each person’s concerns and ideas.  He then helps the family work together to bridge gaps by building common goals, based on their shared values and vision.
 
His background in family business, his experience running his own family office, along with his education and training in coaching, facilitation, and mediation, make him uniquely suited to the role of advising business families and families of wealth.
 
He is the author of Shift your Family Business (2014), he received his MBA from the Richard  Ivey School of Business (UWO, 1991), is a CFA Charterholder (CFA Institute, 2002), a Family Enterprise Advisor (IFEA 2014), and has received the ACFBA and CFWA accreditations (Family Firm Institute 2014-2015).
 
He prides himself on his ability to help families create the harmony they need to support the legacy they want. To learn how, start by signing up for his monthly newsletter and weekly blogs here.

Generational Shifts in Business Families

When we think of family businesses, many of us picture the Mom and Pop operation, or the hard-driven entrepreneur who spends long hours at work for the sake of his family. It certainly is a reality for a large number of traditional first generation (commonly called “G1”) companies.

As some of these grow, expand, and mature into what we would normally call SME’s (Small and Medium Enterprises), they become more of what we might call true family businesses in the sense that some members of G2 will often start to assume positions in the company.

The bigger the business gets and the more family members are involved, the more fun for everyone. Or that is the hope. Of course it does not always work out that way in the end.

There is an analogy that some use to describe how each generation differs as the business ages and goes from G1 to G2, and then from G2 to G3. I do not know the exact origin of it, but I learned it in the Family Enterprise Advisor program in which I am currently enrolled.

It is a sports analogy that goes like this. The G1 is a tennis player. Tennis is an individual sport, they are all alone, them against their opponent. They are responsible for their success or failure.

G2 is a different sport. Mom or Dad the tennis player is not what works best anymore, although many hope to find a son or daughter who is just like them to take over, believing that that is what is required. But now the game is basketball, a team sport with a few players playing, as a TEAM. And the leader is not even a player anymore, but the coach.

Playing tennis and coaching basketball are not that similar. When we go from G2 to G3, the analogy continues, we get to what is commonly called the “cousin consortium” stage, where there may be various branches of the family involved. The game changes once again.

Basketball has only five players on the court at a time. The G3 cousin consortium is soccer or football. There are a lot more moving parts that need to be coordinated if the team is going to succeed. Look at the sidelines at a football game, and you will see lots of coaches, with one head coach who must coordinate them all.

We are pretty far from the tennis player and the one-man show now. My Dad was the prototypical entrepreneur and I was very diferent from him. He worried about that and deep down I am sure he had his doubts about how I would be able to succeed him. In the end we sold our operating company and that was fine with me since I did not have the passion for that end of the business.

Generational differences show up in other ways as well. G1 may be more about growth and G2 may be more about maintaining the wealth. Or G1 may be more about growing slowly with little risk, and G2 prefers to pile on risk and grow too fast.

This week I was fortunate to be invited to attend a local gathering at which 3 local family businesses received awards for having successfully transitioned their businesses to another generation. I got to speak with a couple of people who were at the G2-G3 stage in their businesses.

I sensed that just by their presence at this event, they were much more in tune with what is involved in these transitions than those who are in G1 and preparing for G2. It is a lot of work and very complex, and the G3’s seemed to really appreciate how fortunate they were to be in the positions they are in.

Here is hoping that many others get to this stage as well.

Steve Legler “gets” business families.
 
He understands the issues that families face, as well as how each family member sees things from their own viewpoint.
 
He specializes in helping business families navigate the difficult areas where the family and the business overlap, by listening to each person’s concerns and ideas.  He then helps the family work together to bridge gaps by building common goals, based on their shared values and vision.
 
His background in family business, his experience running his own family office, along with his education and training in coaching, facilitation, and mediation, make him uniquely suited to the role of advising business families and families of wealth.
 
He is the author of Shift your Family Business (2014), he received his MBA from the Richard  Ivey School of Business (UWO, 1991), is a CFA Charterholder (CFA Institute, 2002), a Family Enterprise Advisor (IFEA 2014), and has received the ACFBA and CFWA accreditations (Family Firm Institute 2014-2015).
 
He prides himself on his ability to help families create the harmony they need to support the legacy they want. To learn how, start by signing up for his monthly newsletter and weekly blogs here.

Questioning the Question Instead of Answering It

I have a habit of turning things around and looking at them from a different perspective from most people. So while many are pre-disposed to think in terms of finding the answer to a question, I prefer to step back and question the question before answering it.

This habit goes back to my days of working in the family business in my early twenties. When we needed to hire someone to fill a position, the task of finding good candidates somehow fell to me.

I suppose that it was because we did not yet have an HR person in those days, so the occasional need to fill a position became a project that went to “Steve Junior”.   So here I was being put in a position where I needed to first figure out a number of things before I could even begin.

The department head’s question would start with “Can you find someone to fill this job in my department?” While there was a brief answer (“Yes, of course”), what became more important was the series of questions that soon followed. What is the job description, what kind of experience are you looking for, what is the salary, etc.

I got into the habit of asking lots of questions, and I still do lots of it today. Like many things, the more you do something, the more comfortable you become doing it.

Sometimes when doing job interviews I would ask candidates “What is more important, knowing the all the answers or knowing the right questions?”  I can tell you that we never hired anyone who did not hit that one out of the park.

Many people spend a lot of their time trying to find answers, even though they may not have taken the time to make sure that they are answering the right questions.

Somehow when we begin looking for the answers we feel like we have started down the road to finding a solution, while thinking through the questions still feels like we are in neutral and not making progress.

Many businesses bring in consultants hoping to find “the answer” to their problem. I believe that anyone who promises you answers without first ascertaining that you are looking at the right questions is someone to be avoided.

I maintain that if you take the time to ask all the right questions, the answers often take care of themselves.

An outsider can often bring a different perspective to your situation, and the simple fact that they must ask a lot of questions can make you think in terms that you might not have thought of, and this can in turn help you with both the questions and the answers.

Don’t be afraid to ask questions, but try to avoid Yes/No questions. Learn to ask a lot of “why?” questions, as hearing people’s answers to those are usually the most enlightening.

It should go without saying that actually listening to the answers that you get is pretty important too.

Every once in a while, it is good to ask yourself a couple of big picture questions, because the answers you come up with on those will help you put a lot of things in the proper perspective.

I like to start with “Where are we trying to go?” followed by “How do we plan to get there?”

They are very simple and quite general, but I think if more people in more businesses took the time to stop and ask themselves these two simple questions, on a regular basis, they would be more likely to make progress and stay on track.

So, where are you trying to go? And how do you plan to get there?

 

Steve Legler “gets” business families.
 
He understands the issues that families face, as well as how each family member sees things from their own viewpoint.
 
He specializes in helping business families navigate the difficult areas where the family and the business overlap, by listening to each person’s concerns and ideas.  He then helps the family work together to bridge gaps by building common goals, based on their shared values and vision.
 
His background in family business, his experience running his own family office, along with his education and training in coaching, facilitation, and mediation, make him uniquely suited to the role of advising business families and families of wealth.
 
He is the author of Shift your Family Business (2014), he received his MBA from the Richard  Ivey School of Business (UWO, 1991), is a CFA Charterholder (CFA Institute, 2002), a Family Enterprise Advisor (IFEA 2014), and has received the ACFBA and CFWA accreditations (Family Firm Institute 2014-2015).
 
He prides himself on his ability to help families create the harmony they need to support the legacy they want. To learn how, start by signing up for his monthly newsletter and weekly blogs here.

Being Proactive versus Being Reactive

When I first heard the word “proactive”, about 20 years ago, I really did not like it. It sounded funny and awkward. It sounded made up. But I have learned to like it, mostly because it fits so well with my way of thinking.

The easiest way to help someone understand it is to contrast it with the word “reactive”. You react to something after it happens. When you are proactive, you plan and act before something happens.

Anyone can react. All of us do, every day. We start doing it from the day we are born.

But not everyone gets to the stage where they do things proactively. It’s almost as if there is some sort of maturity required of people to get to where they consistently look ahead at what is coming, and try to get things prepared in advance.

In some ways, I wonder if the ability to see the “big picture” is somehow correlated with how proactive people will be. When you see how the large pieces of the puzzle fit together, you are more likely to anticipate many of the steps in advance.

So why am I even talking about being proactive? Well, in large part it is because I don’t think enough people do it naturally, and there are some people for whom it is really really important.  Can you guess that I am talking about family business owners?

Founders of businesses, entrepreneurs, first generation family business people become successful thanks to certain traits that they have. Whether we are talking about drive and determination, knowledge of their industry, or the willingness to take risks, there are key traits that almost all of them share.

They often become consumed with running their business on a day-to-day basis, fighting fires, making their next payroll, getting the big order out the door. Long range planning? Who has time for that?

Succession planning? I don’t need that? I am never going to retire anyways. And entrepreneurs live forever, don’t they?

In second- or third-generation family businesses, planning, whether for succession or other major transitions, is usually much more structured and formalized. Could it be that the ability to make long-term plans has contributed to the fact that these businesses survived into a following generation?

Maybe being proactive does not come naturally to everyone.  Even those who acknowledge that it is important are often not able to get themselves to take a longer-term view. Some people are natural procrastinators, who only do those things that are marked URGENT, at the expense of things that are truly important. (Note to self: there is a whole other blog right there).

Let me conclude with an idea that I think can be helpful. We have all heard that people who start an exercise program with a partner are more likely to stick with it. We also know that there are some people who only succeed when they have to answer to someone else, such as a personal trainer, who keeps them on track and motivated.

I believe that being proactive, especially when we are looking at major transitions like business succession, is easiest when someone from the outside is brought in to help organize, lead, and steer the process.

Let those who run the business run the business. But in order to make sure that the long term is not an afterthought, someone needs to pull those people out of the trenches and force them to think through, discuss, and plan what needs to be done for the long term.

It’s called being proactive. I hope this blog elicits an appropriate reaction, and starts you thinking about this important subject.

Steve Legler “gets” business families.
 
He understands the issues that families face, as well as how each family member sees things from their own viewpoint.
 
He specializes in helping business families navigate the difficult areas where the family and the business overlap, by listening to each person’s concerns and ideas.  He then helps the family work together to bridge gaps by building common goals, based on their shared values and vision.
 
His background in family business, his experience running his own family office, along with his education and training in coaching, facilitation, and mediation, make him uniquely suited to the role of advising business families and families of wealth.
 
He is the author of Shift your Family Business (2014), he received his MBA from the Richard  Ivey School of Business (UWO, 1991), is a CFA Charterholder (CFA Institute, 2002), a Family Enterprise Advisor (IFEA 2014), and has received the ACFBA and CFWA accreditations (Family Firm Institute 2014-2015).
 
He prides himself on his ability to help families create the harmony they need to support the legacy they want. To learn how, start by signing up for his monthly newsletter and weekly blogs here.

Transitions, Part 2: Recognition

Last week we looked at some definitions surrounding transitions, and this week we move into the recognition stage.  Next week we will wrap up the topic with a look at propositions surrounding transitions.

We all remember watching cartoons where the Coyote chased the Roadrunner all over the place and ended up in very precarious situations.  Sometimes he would accidentally end up going over a cliff, but he would remain suspended in mid air for quite some time before ultimately falling to his demise.

The turning point, of course, was that he looked down. Once he recognized that he was no longer on solid ground, gravity took over and he would begin hurtling towards the ground.

Now we all know that animated cartoons can make anything seem to happen regardless of how possible it is in real life. But the point that I want to make is that recognition is an important step in just about any transition.

Let’s go back to last week’s blog, where we looked at how the different people involved in a transition each have their own perspective.  Each of their recognitions of the transition is different, and may have come from an event, a decision, or a realization.

So not everyone recognizes transitions at the same time or in the same way. But it is only AFTER everyone recognizes the transition can it be properly understood in a way that everyone is on the same page.

In the same way as a doctor cannot begin to cure what ails you before she knows what illness you are suffering from, it is very difficult to move through a transition in the most productive and useful way before you recognize the transition.

And since business family transitions almost always affect several people, it is important for each of them to recognize the transition as well. Given their differing perspectives, it becomes key to get everyone to a more-or-less “common recognition” of where things stand.

I began with an unstated assumption that the goal is for the transition to proceed as smoothly as possible. In the interest of seeing that goal through, communication with all parties that are key to achieving a smooth transition is paramount.

Some leadership is required in order to get most families through major transitions. Sometimes the leadership all comes from those who are part of the family. Other times, non-family members of the business can be major players. Sometimes a facilitator can be quite useful.

Last week’s examples of the sale of a business, the passing of a founder and the appointment of a successor, all have several things in common. In my view, the most important is that they all affect several parties, and the cooperation and understanding of most or all of those parties is crucial to ensuring a smooth and successful transition.

Last week’s definitions help set us up for the recognition stage, but this week was more about making sure that everyone involved gets to a shared recognition of the transition. So now that everyone involved is “on the same page”, we can move into the proposition stage, which we will look at next week.

Steve Legler “gets” business families.
 
He understands the issues that families face, as well as how each family member sees things from their own viewpoint.
 
He specializes in helping business families navigate the difficult areas where the family and the business overlap, by listening to each person’s concerns and ideas.  He then helps the family work together to bridge gaps by building common goals, based on their shared values and vision.
 
His background in family business, his experience running his own family office, along with his education and training in coaching, facilitation, and mediation, make him uniquely suited to the role of advising business families and families of wealth.
 
He is the author of Shift your Family Business (2014), he received his MBA from the Richard  Ivey School of Business (UWO, 1991), is a CFA Charterholder (CFA Institute, 2002), a Family Enterprise Advisor (IFEA 2014), and has received the ACFBA and CFWA accreditations (Family Firm Institute 2014-2015).
 
He prides himself on his ability to help families create the harmony they need to support the legacy they want. To learn how, start by signing up for his monthly newsletter and weekly blogs here.