What matters the most in a family company? Is it financial indicators such as return on investment, profit, sales and capacity growth? Is it harmonious family relations? Does the business contribute to the well-being of the family perhaps not only financially but also psychologically by giving family members a way to increase their closeness? Or, is it individually? Perhaps the business gives family individuals business opportunities (executive job roles) that the family members could never have anywhere else. This question comes to the forefront at times of radical change – such as sale or succession of the business or critical job promotions of various family members. At these moments the critical question of what matters most often arises.
The XXX company was growing beautifully. Originally a manufacturing plant with one product, the company today boasts seven factories, distribution in 18 countries, 2000 employees, and a solid growth rate over the last ten years. The return on investment has been acceptable enough to draw several major investors. The company has recently hired a Strategic Planning firm which is drawing up plans worthy of continued optimism. The morale in the company appears excellent with the exception of significant conflict between two key family shareholders.
These conflicts appear in the Boardroom, in the CEO’s office and on the shop floor. In fact these conflicts have been going on for years and appear to be worsening. The conflict between these two brothers is reminiscent of the conflict between their father and his brother (who was bought out) 40 years ago. They seem to disagree about everything. One accuses the other of lazy, slovenly performance, the other accuses his sibling of drinking on the job using perks for his personal enjoyment, using certain employees to spy on him and not showing any leadership in the company.
In the last family get together the wives of these two brothers glared at each other throughout the holiday dinner. The children of these families have been pitted against each other by their parents stories of unhappiness and distrust. The only reason the cousins even talk to each other is because they have to interact at work.
From an individual perspective it is even worse. The older brother is actually depressed and had been on medication for years. When asked central questions about his life such as: what would make you happy? What would you like to do for work? He has no real answers although he is over 50 years old! His brother is seen as totally incompetent by non-family members. When told of any failings in the company he quickly blames his brother. He considers himself a victim of family circumstance.
The two brothers have begun to consider future options. Should they sell the company or prepare their children to become responsible owners and/or executives? Or should one of them buy the other one out? One child from each brother is pushing for more significant leadership roles in the company but their ability to work effectively as a team appears worse then their fathers. Most important, how should they make this decision?
At times like this, the brothers should consider what matters most. It appears that their past decisions have valued the company over their personal and even family needs. In order to address this question correctly they (both the brothers and their offspring) must identify their true personal, family and vocational needs. Further they need to determine the kind of family they want to build. Even if they were to sell the business to each other how would this effect the individual character of the next generation, the family and business as a whole?
What we have here is a successful business, unhappy primary shareholders and a disintegrating family. What matters is the values of all the family members AND how they make this great decision that will most likely determine the success of their choice. If smart, the family members will use this moment to search their souls to change those parts of their life that is causing distress, find a way for authentic and compassionate dialogue and make the best decisions for all of these arenas.
Marc@Sii-Inc.Net