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University Case Competition: Family Business Style

Last week the place to be was Burlington, Vermont.  I happened to be right in the thick of it for the first couple of days, and my experience was nothing but positive. So what was going on there that was so special?

For the third year in a row, the University of Vermont hosted the Global Family Enterprise Case Competition (#FECC15) at the Burlington Hilton and on their beautiful campus. It is the only competiton of its kind on the planet.

When they say “global”, they are not kidding either. While about half of the teams came from North America (including 4 from Canada and 2 from Mexico) there were competitors on hand from Europe, South America, Malaysia, Saudi Arabia and the UK, and I may have missed some.  Sixteen schools sent Undergraduate teams, and eight schools were represented in the Graduate league.

I have seen many business cases over the years, dozens during my undergrad and hundreds while doing my MBA, but I never read any cases like the ones used in this competition.  I was lucky enough to be a judge on the first two days, and I can say that the cases that the students had to present solutions for were like no business cases I had ever even imagined reading.

The competitors had a full seven days to prepare the first case, so they all had plenty of time to figure out what they were going to propose, how the were going to structure their presentations, and which teammates would be responsible for which sections.

The second and third cases, as well as the final on Saturday, were set up so that each team of three students would only have 4 hours from the time they received the case to the time they were required to present their viewpoints to a panel of “esteemed” judges.

But let me get back to the cases, because it can’t really be a family enterprise case competition if the cases are not situations that only a real family business would face.  I was only privy to the first two cases, but they were both fantastic examples of what successful family businesses face as they go from one generation of managers and owners to the next.

The first case was about a third-generation (G3) family who had been trying to write their family constitution for a few years already, without success, despite hiring a few consultants to help guide them. The four teams in the division that I was judging all came at their solutions in a different way.  Not only that, but each team brought up at least one issue that none of the other three had mentioned.

On day two, the teams were now faced with the time crunch of only having 4 hours to prepare, from the time they received the case until they had to begin their presentation.  But despite the fact that they had very little time, the solutions that I got to see and hear were quite remarkable.

This case involved a group of G4 siblings who were worried that their children (G5) were not showing enough interest in getting involved in the business. During the judges preparation meeting, I pointed out that the average age of the judges was likely close to the ages of the G4’s in the case, while the ages of the G5’s in the case was close to that of the competitors whose solutions we would be hearing.

It was a fantastic experience for me, as well as the judges that I worked with; I can only imagine how great the week was for those who came to compete.

The undergrad finalists included 3 Canadian schools and one from Chile, with Carleton U’s Sprott School of Business taking top spot in the final round over Dalhousie.  The winners of the Graduate section were from Jonkoping Unviversity of Sweden

I hope to take part again next year, at the 4th Annual FECC, in January, 2016.

 

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The Long and the Short of It

Most people spend so much time looking at the short term, they end up ignoring the long term. I usually have the opposite problem.

That is often a good thing, though, if only because focussing on the future usually helps guide your shorter term decisions. Let’s look at some examples of this issue.

I am relatively new to the field of family business consulting, and anxious to learn as much as I can from those who have been at it for years. I recently came across the Purposeful Planning Institute, which is a group of like-minded people who help others with their planning (in a purposeful way!).

For the past couple of months I have been listening in on their weekly calls and I have realized that the majority of the speakers seem to be far ahead of where I am, which is not that surprising. But not only that, they also seem to be looking so much further into the future on behalf of their clients.

Maybe I notice this because my typical preferred client is just starting to look more at their family, rather than simply their business. I identify most easily with my own family and that of my in-laws, both of which were lead by founders who focussed a great deal on their businesses, possibly at the expense of their families, despite the best of intentions.

Looking at the long term has many advantages, but can you look too far ahead? Maybe yes, but I find that it is better to look ahead too often, and too far, than the reverse. So many people are so busy putting out day-to-day fires in their business, making the long-term view suffer.

A great example of the long versus short question came from an unexpected source recently. I was considering having laser eye surgery to correct a problem with my vision. I wear glasses for driving and going to sports events, as they help me see clearly at longer distances. I don’t need glasses for reading, although my arms seem to be getting a bit too short when dealing with very fine print.

The woman who tested my eyes suggested I delay any surgery for a few years. I was not too surprised, because my eyesight is generally better than most people’s my age, and I have been told in the past that I was not an ideal candidate for laser surgery.

But then she really explained it to me in a way that I could understand, which I really appreciated, because I pride myself in being able to clarify confusing things for others.

She told me that everyone has a certain range of vision over which they have the ability to focus clearly without glasses or contacts. For some it is on the far end, for others, it is up close. Here is where it got really interesting. If you have surgery to alter the range, in my case to improve my distance viewing, then you will also affect the other end, adversely.

The surgery just moves the range in one direction or the other, it doesn’t make the range any longer. You cannot extend the range, you can just move it closer or farther.

Getting back to my family business analogy, let me attempt to put it in the proverbial nutshell.

If you want to start looking at the long term, you actually MUST stop spending time on the short term. You CANNOT do it all.

You have to make a conscious shift in you thinking. And that is the long and the short of it.

 

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.
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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.
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Philanthropy for All Ages in Business Families

Last week the TV series “Breaking Bad” wrapped up with its final episode, which featured one brief scene that most people probably did not really notice, but that struck me, as a family business advisor.

The show revolves around former high school chemistry teacher Walter White, who ends up becoming one of the biggest suppliers of illegal drugs in the southwestern US, thanks to his ability to “cook” very potent batches of crystal meth.

There are plenty of interesting twists in the plot over the 5 seasons of the show. The finale culminates in predictable fashion, with Walt becoming the subject of an international manhunt, set against his need to take care of some unfinished business before getting caught, succumbing to his cancer, or getting killed.

The show flew under the radar for its first few seasons, since it ran on AMC, a US cable network that could be considered HBO’s poor cousin. I learned about the show as its third season was winding down, thanks to my twitter timeline.

I follow a diverse crowd of people on my personal twitter account, covering sports, business, politics, and entertainment. On Sundays, I started to see tweets from a huge variety of people saying that they could not wait for tonight’s episode of Breaking Bad, or that they were closing down their computers so as not to be distracted during that evening’s show.

From those comments alone, I immediately ordered the DVDs of seasons 1,2, and 3.

I started watching the first season at the cottage, since I am the early bird in the family, and I could watch by myself before the others woke up. I should note that watching a violent show about illegal drugs is not something most people want to do as a family.

The show is addictive, kind of like crystal meth. Just kidding. Although one can assume that meth is also addictive, I am happy to say that I cannot speak from experience on this.

Sometimes my son would wake up early too, and join me in the living room, but I could not stop watching, so I kind of just hoped that he would not really catch on to what was happening on screen. That lasted about 5 minutes. Thankfully there was not a lot of foul language or nudity.

My parenting style is very open, in that just about anything that can be shared, is shared. The important part is that when it is shared, it is also explained. There are plenty of teaching moments in Breaking Bad, but you need to pause pretty often.

The Family Business angle that I mentioned earlier came when Walt went to see his wife one last time, and he started to repeat his old line about why he did everything he did. She interrupts him and says she can’t stand to hear him say it was for the kids.

Then Walt does something that too few famiy entrepreneurs ever do. He admitted that he did it for HIMSELF. He surprised me (pleasantly) by saying that he loved the power that he had, and that it made him feel good.

How many business people do you know that SAY they are doing it for their kids? How many of their kids would say, “What? He never asked me what I wanted”?

Walt brought his wife into the business, in order to launder all of the money he made, thanks to the success of his meth cooking. But Walter Junior did not learn of his real business until the end, and he was not exactly proud of his Dad.

My advice is to keep any family business on the right side of the law, but also to acknowledge for whom you are doing it. If it really IS for the kids, maybe you could ask for their input!

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.
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Three Circles + Seven Sectors = One A-Ha Moment

Over the past 8 months or so, I have taken on a renewed interest in family businesses and what makes them different and what makes them tick. I have enrolled in courses that do a great job of teaching what family business is all about and how and why they are special.

The courses have covered some in-depth ideas like having a family mission statement, holding regular family meetings, setting up a board of directors with non-family members, getting advisors from different fields to work together harmoniously, facilitating meetings and helping with conflict resolution.

But the single most important thing that I learned was right at the beginning of each course. And it is still the most powerful place to begin any discussion with a family businessperson. It is called the Three-Circle Model. It is SO simple, yet we kept coming back to it during the courses.

The Three-Circle Model (TCM) has only been around for twenty to twenty-five years or so. I am not sure who gets the credit for it, and I would not be surprised to learn that its exact origin is disputed. I recently read an artice from the 1980s that was still talking about family business from a “Two Systems” point of view, which leads me to believe that the TCM evolved afterwards.

(Note from 2016: Please see http://johndavis.com/three-circle-model-of-the-family-business-system/ for more on the origin of the model)

Without further ado, the 3 circles are, “Family”, “Business”, and “Ownership”. F-B-O, a simple Venn diagram of three overlapping circles.

The premise is this: Most people look at a family business as one thing, one entity, one system. But upon closer inspection, there is a LOT more going on there. So in the 80s they started to look at how the Family and the Business were different, and needed to be looked at separately. Later, it was determined that Ownership was also worth spinning out as its own circle.

So part 1 of my equation above in the title of this post is the TCM. What about the seven sectors? Glad you asked. When you draw the TCM as a Venn diagram, you get seven different sectors. Picture yourself asking a three-year-old with a box of Crayolas to colour each portion with a different crayon; they would need seven of them.

So why is this important to Family Businesses? Well mostly because the people who inhabit some of those sectors aren’t even part of the family business. Some of them are part of the Business Family!

People who are only in one circle (the 3 sectors without any overlap) will look at the family business much differently than those who are in one of the three sectors within a two-cirlce overlap.

And then there are those in the middle sector, who are part of the Family, who work in the Business, AND who are also part of Ownership. They often lament the fact that everyone else doesn’t see things the same way as they do!

People who inhabit different sectors will view things in different ways. It is only natural.

Once you learn to view any family business through the TCM, it is like turning on a floodlight. All of a sudden some things that were difficult to comprehend become more easily understood.

And then when you realize that the four sectors where there are overlaps are the ones you need to really concentrate on, you can start to make a lot of progress. I like to think of this as the “flashlight” stage.

The TCM was the floodlight that allowed us to see many things in a new way. Shining the flashlight into the nooks and crannies of the overlapping sectors will help uncover the key areas that will need to be monitored and worked on going forward.

For a visual perspective on all this, please visit my website: click here

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.

 

 

 

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Lost in the Woods, without a Guide

In a strange set of coincidences, this turned out to be “University Week” for me. I am writing this in Lewisburg Pennsylvania, home of Bucknell University.

I am here mostly as chauffeur for my mother, who today witnessed the first University graduation of one of her grandchildren. I also got to watch my niece walk across the stage and pick up that diploma that she worked towards these past four years.

Listening to speeches always gets me thinking, and today a lot of time was spent praising the faculty. I guess that every school thinks that they have great teachers, but they sure did a great job of making a believer out of me here today.

Earlier this week, I had the pleasure of meeting some important people from the business schools of a few of the Montreal-based Universities.

As a participant in the FEA Program in Toronto this year (given by UBC’s Sauder Business Families Centre) I am interested in helping the Institute of Family Enterprise Advisors (IFEA) expand their reach across Canada, as they look for the right education partners.

I had offered their new President any help I could with the search for Quebec partner(s). This week she was in Montreal, and I met with her and people from HEC, McGill, and Concordia.

Now most of the talks were only in their very early stages and it is way too early to say what if anything may develop as a result. But for me it was an opportunity to talk about (okay, I was mostly listening) programs, courses, instructors, designations, etc.

The instructors that we have had in the FEAP course modules that I have had thus far have all been excellent and inspirational. Being involved in the IFEA meeting in Montreal also got me pumped up even more about the program and the ways I expect that it will evolve and help business families in the future.

Coming to the Commencement this weekend at Bucknell was a further catalyst for me personally, as I heard a few professors talk about how inspired they are when they teach. Knowing that my newly-graduated niece is going into teaching (and we all just know that she will be fantastic at it) also has me thinking more and more about this subject.

We have all heard the expression, “Those who can, do. Those who can’t, teach”. Sometimes it is true. But most of the time it is full of crap. The best teachers have of course already DONE. And now they are teaching others.

I have been married for 20 years. My wife knows me pretty well. She often used to tell me that I should write a book. Well I now write a weekly blog. She also often tells me that I should be a teacher. I have always agreed with her that it would be interesting and I believe I would be pretty good at it.

But until now, I never really had anything for which I had enough passion to teach. If you have followed my recent posts, you will know that I am slowly (or maybe quickly) discovering that family business is my passion.

I have lived it, I understand it, from all the angles. I know that it is complex and that there are many issues that need to be discussed, and that often those issues are not discussed.

Teaching, and family business. Time to figure out how to put it all together. Stay tuned. If you have any ideas, I am all ears.

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.
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Those Who CAN, Teach

In a strange set of coincidences, this turned out to be “University Week” for me. I am writing this in Lewisburg Pennsylvania, home of Bucknell University.

I am here mostly as chauffeur for my mother, who today witnessed the first University graduation of one of her grandchildren. I also got to watch my niece walk across the stage and pick up that diploma that she worked towards these past four years.

Listening to speeches always gets me thinking, and today a lot of time was spent praising the faculty. I guess that every school thinks that they have great teachers, but they sure did a great job of making a believer out of me here today.

Earlier this week, I had the pleasure of meeting some important people from the business schools of a few of the Montreal-based Universities.

As a participant in the FEA Program in Toronto this year (given by UBC’s Sauder Business Families Centre) I am interested in helping the Institute of Family Enterprise Advisors (IFEA) expand their reach across Canada, as they look for the right education partners.

I had offered their new President any help I could with the search for Quebec partner(s). This week she was in Montreal, and I met with her and people from HEC, McGill, and Concordia.

Now most of the talks were only in their very early stages and it is way too early to say what if anything may develop as a result. But for me it was an opportunity to talk about (okay, I was mostly listening) programs, courses, instructors, designations, etc.

The instructors that we have had in the FEAP course modules that I have had thus far have all been excellent and inspirational. Being involved in the IFEA meeting in Montreal also got me pumped up even more about the program and the ways I expect that it will evolve and help business families in the future.

Coming to the Commencement this weekend at Bucknell was a further catalyst for me personally, as I heard a few professors talk about how inspired they are when they teach. Knowing that my newly-graduated niece is going into teaching (and we all just know that she will be fantastic at it) also has me thinking more and more about this subject.

We have all heard the expression, “Those who can, do. Those who can’t, teach”. Sometimes it is true. But most of the time it is full of crap. The best teachers have of course already DONE. And now they are teaching others.

I have been married for 20 years. My wife knows me pretty well. She often used to tell me that I should write a book. Well I now write a weekly blog. She also often tells me that I should be a teacher. I have always agreed with her that it would be interesting and I believe I would be pretty good at it.

But until now, I never really had anything for which I had enough passion to teach. If you have followed my recent posts, you will know that I am slowly (or maybe quickly) discovering that family business is my passion.

I have lived it, I understand it, from all the angles. I know that it is complex and that there are many issues that need to be discussed, and that often those issues are not discussed.

Teaching, and family business. Time to figure out how to put it all together. Stay tuned. If you have any ideas, I am all ears.

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.
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The Defensive CFA ®?

Over the past few weeks, I have continued to read, to look around, to think, to search, to find people to emulate, to connect, to reach out, and to attempt to redefine the evolution of my current (final) career transition. My feelings have ranged from total confusion one minute, to complete exhiliration the next.

In this age of mass communication and information availability, it is so easy to see what others are doing and to try to find others who seem to be doing the kinds of things we want to do. Sometimes I feel like it took too long for some things to click in my life, but then I slow down and try to be thankful that it finally feels like a fog is lifting. “I can see clearly now, the rain is gone…”

Much of this introspection came about in March when I attended the CFA Wealth Management conference in Boston. Attending that 2-day meeting with a whole bunch of other CFA charterholders reminded me why I had signed up for the CFA program in the first place.

It was late 1999 that I decided to do it, and at the time I thought my reasons were sound. I was working in the family holding company. I had been doing quite well with my stock picks in the late 90’s (like every other “bull market genius”, no doubt) and since I was managing family assets I thought that becoming a Chartered Finacial Analyst would help me career-wise.

A former MBA classmate had just published a book, and on the back cover I noticed that he displayed his CFA status. Funny, he knew NOTHING about finance 10 years ago. If he could do it, so could I.

Now I am very glad I completed the program, and it was not easy by any stretch. But in retrospect, I realize that I had done it more for defensive purposes. Yes, the defensive CFA, that’s a new one, isn’t it.

It is when a person completes the CFA program because he knows that in the future, other CFA-types will be pitching ideas at him, because they know he has money, and they will smugly hand over their business cards with those magic three letters. If you can give them your card with the same three letters, the reasoning goes, you can just give each other the secret handshake and avoid all of the BS.

Back to the Boston conference. I spent 2 days with other CFA’s, listening to many interesting presentations on all sorts of topics. I was not bored. I had no trouble following along. The stuff was actually very interesting. But I flashed back to my defensive preferences when it comes to how to manage wealth.

I concluded that there are so many smart qualified people in the wealth management space, and in the end, it is sometimes difficult to differentiate them. And I most certainly do not want to even try to play that game. I never did want to. And I certainly don’t want to go “all in” now.

The Family Enterprise Advisor Program in which I am currently enrolled has been eye-opening and enlightening. Most of the others in my classes are accountants, insurance experts, trust specialists, etc. I come at it from the family office side. But even that feels forced.

The course leaders are all family business advisors and seem more like generalists, and I identify so much more with them than my fellow classmates, almost all of whom are in the program to learn how the different specialist disciplines need to learn to work together.

I am already a family business generalist. I get it. And I love it. And I think I finally figured out what I want to be when I grow up. These are exciting times. I hope you will stick with me as all this continues to evolve. In the meantime, I would love to hear your family business stories.

Allow me to close this with a dictionary definition:

Catharsis: Purging of emotions or relieving of emotional tensions, especially through certain kinds of art, as tragedy or music

I could modify that to: Relieving of emotiuonal tensions and getting something off one’s chest through blogging.

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.
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Nothing Succeeds Like Succession

Succession is a huge subject in the realm of family business. It is literally a subject about which complete books have been written. I just want to touch on one particular aspect of it here, because it is too often overlooked.

A lot of time and effort is usually required in order to make sure that a succession is well planned and executed. The process often takes years, as it should when you think about all that is at stake.

When you are looking at your family business and how you are going to hand it over to the next generation, getting it right so that the business will contine to be successful for generations to come is complex and fraught with all kinds of potential stumbling blocks.

Last year I wrote a blog about the difference between “family businesses” and “business families”. There are important distinctions here, and this is precisely where the complications come in.

My premise is that far too often, a great deal of effort is placed into making sure that the business succession is successful, and very little effort is made into making sure the family succession has been handled effectively.

Maybe it is because the business is easier to look at in quantitative terms. The business is still profitable, is still growing, and is still a leader even after the next generation has taken control. Wonderful and congratulations, it is not an easy accomplishment and likely took a great deal of planning and effort to make it so.

I only hope that everyone in your family sees it as the success that the professionals who helped make it happen do.

I believe that the succession of the business is wonderful, but only if it does not happen at the expense of a successful succession of the business family.

This week I listened to an interview with James E. Hughes Jr., who is seen as a guru in the field of family wealth preservation and whose books are now at the top of my reading list. He makes a distinction between the transfer of wealth and the gift of wealth.

The parallel that I am drawing is that the transfer is that of the business, whereas the gift is more about the whole family. Hughes has seen his share of situations where the transfer was emphasized and likely seen as a success by most, but the gift was not made in a fashion anywhere near its potential.

I am still very much a neophyte in the space of family business consulting, as I have only recently begun moving away from managing my own family office and into helping other business families with their transition and succession issues.

But when I hear veterans of the space, or read their books, or follow their courses, I am very much inspired that I have found my sweet spot. I have lived many of the situations that they speak about either through my own family or my wife’s, or through others who work with family businesses on a regular basis.

Too often people are guided by professionals who are well-meaning and knowledgeable, but whose solutions have negative consequences that just aren’t understood. It is relatively easy to find specialists to help you save taxes or set up a trust for your grandchildren.

What is harder to find is someone to help you work through all these proposed solutions and examine their consequences to your FAMILY first, and then only your business.

I believe that the success of your succession should be viewed first by your successors’ ability to succeed. Whether the business is even involved at all at that point should be a secondary consideration.

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.
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Three Peas in a Pod?

In a blog post a couple of months back I mentioned that LinkedIn was becoming a really good resource for me. It continues to be a treasure trove of information and contacts.

I recently discovered a LinkedIn group called “Business Succession Planning Group”, so I joined and it did not take long for it to pay off. A group member from Minneapolis, Daniel Kurth of Human Performance LLC, made a post to the group that caught my eye.

I will use the key point of his message as the starting point to my blog this week. He introduces us to the “Three P’s of Transitioning Owners”.

Without further ado, they are: Paycheck, Purpose, and Place. Kurth’s thesis is that the exiting owner will only readily move on from the business once he has been able to replace those three P’s that the business has been providing.

Anyone who has ever worked in a business where the owner does not seem to be ready and willing to even entertain the thought of retirement can probably identify with at least one of these P’s being a major factor in the hesitation.

If the business has been successful for a number of years, the paycheck should be easy enough to replace. There is an entire industry of financial advisors and insurance product reps that will gladly help the future retiree ensure that monthly income to spend is replaced in a satisfactory way.

Let’s skip ahead to the last P, Place. Keeping and office, setting up a new office somewhere else, or simply getting into a new routine of meeting friends and colleagues somewhere on a regular basis, are all ways that people have gone about making sure that they “get out of the house” after retiring.

I really think that the toughest P to replace after selling or passing down a business, or even retiring from any job really, is Purpose.

I remember some friends of my parents who had 9-5 jobs who said they were looking forward to retiring, but once there, it almost drove them crazy. Somehow sleeping in, reading the paper, going for a walk, etc. can only cut it for so long.

For type “A’s” like most business owners and entrepreneurs, I wouldn’t give it more than a week or two before they would start going stir crazy. Folks who disliked their jobs look forward to retiring from the “grind” and they have trouble, imagine those who have a company they built to inspire them every day when they wake up.

Their business is often the driving purpose of everything, and has been for a long time. It cannot simply be switched off overnight. It can’t be expected to work that way. In theory, sure; in practice, no.

So for all those who want to help encourage someone to think about retiring some day, sooner rather than later, I suggest that you help them replace that P, the sense of Purpose that the business gives them.

Whether you are the succeeding generation waiting to take over, or the spouse who would rather spend more time together or take longer vacations, this is the place to concentrate your efforts.

But do not expect things to happen quickly. Start early and try to help them find hobbies, causes, worthwhile organisations, boards of directors, anything that can get them excited and where they can put their skills, energy and desire to good use.

There are surely other purposes that can slowly but surely become more and more important in their lives, and eventually allow them to exit the business because they have found a new sense of purpose. If they don’t get there, they might stay around forever.

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.
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