Happy families and happy businesses
Family enterprises potentially have advantages over other types of business – the ability to think long-term, access to patient capital, strong organisational values, for example. But they have distinctive problems too.
Tolstoy famously opens Anna Karenina with the observation that happy families are all alike, but each unhappy family is unhappy in its own way. In part this shows just how little Tolstoy understood the family business; in our experience, the sorts of problems that one family business has to deal with will appear in the life-cycles of most family businesses and so unhappy family businesses can appear quite similar. Tolstoy’s observation can seem true, however, as many family business problems are associated with inter-generational succession, both ownership and management, and for family businesses these issues might arise only every thirty years. Of course, those of us who help family businesses all the time see these issues frequently and can appreciate the parallels and similarities.
Multi-disciplinary solutions to multi-dimensional problems
Family business issues are particularly complex because they demand multi-disciplinary solutions. Advisers with insufficient experience of family businesses will default to their own particular sphere of expertise – tax planning or trust and inheritance law, for example. Whereas a family business’s accountants and lawyers will always have an important role to play, such businesses also need specialist support in subjects such as succession management, family business governance arrangements, family constitutions, and long-term wealth planning.
Further, solutions have to fit the needs of the business as well as the wishes of a disparate group of family members, many of whom have multiple roles to play often with conflicting objectives – for example as parent, CEO, shareholder and board director.
Where we come in
Too many family businesses leave things until too late. Too often only the death of a much-loved parent and shareholder will trigger a call for external help. Most family business issues take time to address. Succession, for example, is best thought of as a process not an event, and we encourage you to start planning early. Why not give us a call now and find out what other family businesses have done, and whether you might benefit from some external help too?
