Category: Family businesses

My love for family businesses has meant that I never have to work, I simply live my passion for the complexity that each company challenges me to, each one of them so unique, so special. So I thought I would share a compendium of elements that must be considered when working with family businesses, from the heart and the mind.

A – Family harmony | Family harmony is essential in family businesses. It refers to cohesion, understanding and cooperation between family members, which contributes to the long-term success of the business.

B – Benefits of family businesses | Benefits include the ability to make long-term decisions, loyalty and commitment of family employees, and the ability to maintain family culture and values in the business.

C – Efficient communication | Effective communication is essential to avoid misunderstandings and conflicts in family businesses. This includes openness in discussing problems and transparent decision-making.

D – Challenges in succession | Succession is a complicated process where a family member takes over the leadership of the business. It can be challenging due to expectations, rivalries and generational differences.

E – Long-term success | Family businesses have the advantage of thinking long-term, which can lead to sustainable success if managed properly.

F – Strengths and weaknesses | Family businesses often have strengths, such as trust and commitment, but also weaknesses, such as lack of professionalism or family conflicts.

G – Family governance | Involves the creation of structures and processes for decision-making within the family and the business, such as family meetings or family councils.

H – Family History | Family history and legacy can be a valuable asset in a family business and should be respected and passed on to future generations.

I – Innovation in family businesses | Innovation is essential for the adaptation and growth of family businesses over time.

J – Boards of Directors | Boards of directors in family businesses may include family members and outside professionals to provide independent guidance and oversight.

K – KPIs (Key Performance Indicators) | Setting KPIs helps measure company performance and ensures effective management.

L – Leadership in family businesses | Leadership must balance family and business interests, and can be exercised by family members or non-family members.

M – Business model | A family business’s business model must be robust and adaptable to changing market conditions.

N – Family norms and values | Establishing family norms and values helps guide the behavior of family members in the company and in everyday life.

O – Customer Orientation | Family businesses must maintain a strong focus on meeting customer needs to be successful.

P – Succession Planning | Careful succession planning ensures a smooth transition of company management to the next generation.

Q – Bankruptcy and Recovery | Family businesses can face financial difficulties, and resilience is essential to overcome such challenges.

R – Corporate Social Responsibility | Family businesses often have a strong sense of responsibility towards their communities and engage in CSR activities.

S – Conflict Resolution | Effective management of family conflicts is crucial to avoid business disruption.

T – Tradition and change | Family businesses must balance the preservation of tradition with adaptation to new trends and technologies.

U – Family Unity | Unity and mutual support are essential to the long-term success of a family business.

V – Vision and mission | A clear vision and a defined mission help guide the company’s strategy and growth.

W – Willingness to Change | Willingness to adapt to new circumstances and embrace change is crucial to a company’s survival.

X – X-Factors (Key Success Factors) | Factors that contribute to success can vary by company, but often include effective leadership, innovation, and adaptability.

Y – Innovation Reservoirs | Identifying and leveraging new opportunities and ideas is important for continued growth.

Z – Comfort zone | Getting out of the comfort zone is necessary for development and innovation in a family business.

Interesting, isn’t it? Family businesses are undoubtedly the most interesting thing a consultant can experience.

Author: Smart Consulting.

Challenges related to business succession and continuity.

In family businesses there are numerous challenges related to the succession and continuity of the company, with it a natural process of adaptation of the family successor, one of the strongest challenges is to eliminate the shadow that is created by the founder.

Creating the successor’s own story has the following challenges:

• High expectations | The successor often faces very high expectations from the family, collaborators and other members interested in the company. This can create significant pressure to demonstrate his leadership ability.

• Pressure to maintain the legacy | If the previous leader (usually the founder or leader of the previous generation) has left a strong mark on the company, the successor may feel the pressure to maintain and build on that legacy, which can be a challenge in itself.

• Complicated family dynamics | Family dynamics can complicate the relationship between the successor and other family members who are not involved in the company or who have different visions about its future direction.

• Resistance to change | If the successor seeks to implement significant changes in the business, he or she may face resistance from employees and other family members who are accustomed to the way things were done under the previous leadership.

• Pressure for immediate results | The pressure to demonstrate quick, positive results can be intense, which can lead the successor to make hasty or risky decisions.

• Need for ongoing development | The successor often needs ongoing professional development to acquire the skills and knowledge needed to effectively lead the business.

• Balance between family and business | Maintaining an appropriate balance between family responsibilities and business responsibilities can be challenging, especially when working in a family business.

• Managing the shadow | The successor must learn to manage the shadow he or she casts and how this influence can affect the business and business decisions.

• Effective communication | Establishing effective communication with all stakeholders, including family, employees, and business partners, is crucial to addressing the challenges associated with the successor’s shadow.
• Managing these challenges requires a strategic approach, careful succession planning, development of leadership skills, and open and honest communication with all stakeholders. It may also be helpful to engage external advice, such as family business consultants or counselors, to successfully navigate these challenges.

Author: Smart Consulting

What is a family genogram?

A family genogram is like a drawing or graphic that shows the structure of a family and the relationships between its members over time. It is used to visually represent information about the family, such as who parents, children, grandparents are, and how they take each other.

Practical application in family businesses

In the context of family businesses, genagrams can be very useful tools. Here I show you how they can be applied:

1. Understand family dynamics | Genograms help business families to understand their structure and dynamics. They can show who is involved in the company, who has influence and how they relate to each other.

2. Succession planning | Genograms can identify family members who are interested in the company and can help in the planning of the succession. They can show who could assume leadership roles in the future.

3. Conflict resolution | If there are family conflicts in the company, a genogram can help visualize relationships and conflict areas. This can facilitate communication and problem solving.

4. Knowledge of skills and strengths | A genogram can highlight the skills and strengths of family members. This can be useful for assigning roles and responsibilities in the company based on individual skills.

5. Personal interest identification | It can help determine the personal interests and goals of family members in relation to the company. Some may be more interested in the financial aspect, while others can focus on expansion.

6. Communication improvement | Using a genogram in family and business gatherings can promote open communication and facilitate mutual understanding.

In summary, a family genogram is a powerful visual tool that can help family businesses to understand and better manage family and business dynamics. It helps identify who is involved, who could lead in the future and how family and business challenges can be addressed more effectively.

Author: Smart Consulting.