Next Generation Family Business : Finding your feet

Next generation : the theory

Site visits to successful family businesses such as the one organised by the IFB to Roberts Bakery really show the benefits good family businesses can bring to business operations. In theory shared family culture and values should lead to a smooth transition of leadership from one generation to another.  However in reality family dynamics are as complicated as those found in business leadership.  Combining the two does not simplify the situation.

This week I delivered a session on next generation family business to a group of enthusiastic  Lancaster University Masters Students .   Their questions really reminded me how complex these family business dynamics are.

Celebrating when things go right

The students questions were still ringing in my ears when my eldest pointed out we didn’t celebrate success enough.  He is right.  Like many growing businesses we tend to focus on the potholes on our journey rather than the beauty spots we pass.  That’s why I have really enjoyed my role as chair of the judges for the brilliant Northwest Family Business Awards.  Visiting the finalists and gathering the thoughts of our fellow judges has reinforced my belief in the value of family businesses from across the North West.  A huge well done to Sue Howorth and Dave Clarkson of the Family Business Network for organising this.

Finding your feet

So we know that the transition of leadership to the next generation is complicated.  We also know that done well next generational family businesses add huge value to their place.  Just look at the family businesses running farming, hospitality, manufacturing, food production and cafes in your area.  They are all dedicated to their business and their place and at some point they may look to pass their business onto the next generation.

To do this the next generation really needs to find their feet.  Each new generational business leader may have different needs. These could include gaining the confidence to replace the previous generation as leader. Or creating time to think about the future direction of the business. It could be finding a source of reliable answers to questions they may have on how to manage the transition in family business. Then it could be learning how to communicate with the family and the business as roles are changed.  Importantly the next generation need a supportive network of peers who are experiencing the similar business journeys to themselves.  Possibly most importantly they need a place where they can develop their leadership skills that will ensure the sustainability of their family business.

Offer of support

If you are reading this as a next generation family business member and you would like support with any of the issues raised please check out the Next Generation Family Business Event on the 17th March in Liverpool.  We (Thomas Jardine & Co) are really proud to be delivering this in partnership with Be the Business and the Family Business Network.

 

 

 



Next Generation : family business future

Family Business Future: it’s down to you

There is only thing more personal than running a business and that is raising a family.  After your relationship with your partner, parenthood is the most personal relationship you will ever have.  As a parent you are responsible for the future of your children.  As a business owner you are responsible for the future of your business.  All clear so far?

As a family business owner you are responsible for the future of your family business as you navigate through internal and external changes.

The future of your family business relies on communications.  Family businesses have to face the challenges of ‘talking family’, ‘talking business’, ‘talking change’, ‘talking innovation’ and ‘talking leadership’.  These conversations have to get round all the assumptions people in families and people in businesses make. In family businesses these assumptions are either made by the parents or by the next generation.  So we all have to ask ourselves a series of questions to check our assumptions.

Questions from the parents perspective

Consider the role of the parent.  Here are just a few questions you may be facing:  As a parent, are you there to look after your child, to prepare them for the evils of the world to pass on your sagely knowledge?  As the family business owner/manager are you there to ensure the future of the family business? Or as a family business owner, are you there to allow your children to grow their wings and find their own place in the world?

You are probably facing a mixture of all of the above.  What you might be missing is who should be running the family business?  Is it time to pass on the leadership of the family business to the next generation? Or should the business be led by non family members?  Then the big question are you really ready to pass on leadership of the family business to your next generation?  Family business lives in the next generation ,will you genuinely allow them to take it in their direction?

Like all BIG questions we usually tend to avoid them.  We tend to ignore the inevitable fact that eventually we all have to be replaced.

Questions from the next generations perspective

Now consider the next generation. Here are just a few questions you may be facing: As the next generation you are  prepared for the modern world but do you have the skills and confidence to change or evolve the family business? Are you prepared to share your world view with the previous generation? As a potential family business owner/manager are you there to ensure the future of the family business ? Or as the next generation family business owner are you confident enough to allow the older generation to spread their wings and find their new place in the world outside of the family business?

You are probably facing a mixture of all of the above. What you might be missing is who should be running the family business? Is it time to pass on the leadership of the family business to you?  Or should the business be led by non family members?  Then the big question. Are you really ready to take on leadership of the family business from the previous generation? Will you genuinely allow them to support you as the business moves on?

Like all BIG questions we usually tend to avoid them.  We tend to ignore the inevitable fact that eventually our role as the next generation is to lead, transform, sell or close the family business.

Answers to the questions

Jacqui recently presented Thomas Jardine & Co’s family business story at the Fambiz Conference in Carlisle.  Whilst presenting her story she offered the audience a chance to consider what they would do at various points of generational hand over.  Jacqui is well experienced in supporting family businesses.  This includes the design and delivery of Lancaster University’s first transgenerational family business programme last year.  Jacqui is well aware that each transgenerational handover is a unique blend of family and business perspectives and interests.  There are common themes but no “cut and paste” solutions.

The best advice will always come from people who are walking in your shoes.  This is why peer group support is so important.  Jacqui is developing a solution with Be the Business and the Family Business Network.  This will bring generations together to find answers for themselves.  The first event from this partnership will be a ‘Next Generation Workshop‘ taking place on Wed 6 Nov at
Dunsters Farm in Bury.

This is your chance to talk about what you want to know about ‘communication’ in family business. You will explore with your ‘peers’….. those, who like you, are tackling or avoiding the elusive challenge of ‘talking family’, ‘talking business’, ‘talking change’, ‘talking innovation’, talking leadership and what really gets in the way of that highly productive conversation? What are all those assumptions doing there? What light can your peers shed on this challenge?

The future is bright if we let it live in the new generation.

If you are interested please get in touch.


Family business dimension in place

Family and place

Family owned firms are critical to your place.  Imaging loosing just under half your retailers, restaurants and hotels from your place. Statistics highlight the impact of family businesses on these sectors. According to the IFB 85% of all private businesses in the UK are family owned. 46% of all those employed in retail and wholesale work for family firms. Family owned hotel and restaurant businesses also account for 46% of the total employment in that sector.

How the ‘family business’ is lost in place consultations

It’s simple. Family businesses are involved in consultations but they are identified as retailers, hoteliers, restaurateurs or wholesalers.  Numerous academic papers acknowledge that family businesses do have an impact on regional planning.  They argue that the regional impact of family business may be down to a combination of the embeddedness of the family firm in their community and the role personal relationships play in local networks .

The academic argument on family business impact

Academic papers show that network roles and choices made by individuals within family businesses are different to those in non-family business.  This is because family firms have a social and emotional attachment to their place, which is referred to as ‘socioemotional wealth’.  Those with high socioemotional wealth tend have more positive impacts on their local community than non-family firms.  In some cases family firms may value socioemotional wealth over financial performance.  It should be noted that there is some evidence that this commitment to place, above financial reward, is not exclusive to family business. But family connection to place plays a key part in this decision .

The emphasis of public sector support for regional development on quantifiable measures such as GVA  can identify the impact family firms have on place.  However at times this may be overlooking the long term value of socioemotional wealth to that place.

Practical steps to ensure the longevity of family firms

Several organisations such as the Family Business Network and Family Business United celebrate the best of family businesses regionally and nationally.  There are also others who work on supporting the successful transfer of a family business from one generation to another. Be the Business offer various levels of support or family businesses and are working on  next generational family business workshops.  Thomas Jardine & Co work with the Family Business Network and Be the Business and would be happy to put you in touch with either of these great organisations.

Bring place and family closer together

When making plans for the business sector in your place, please do not just focus on the standard industrial sectors.  Consider the generational firms based in your place.  Support them and encourage the birth of new family businesses in your place.  Successful businesses that are based in a place will look after that place for generations to come.

 


Peer Learning and The Family Business

So, who is your peer?

A peer: “A person of the same age, the same social position, or having the same abilities as other people in a group”

Does this mean the family business is the ultimate peer group

The very nature of family business makes family businesses self contained peer groups. Family members working in a family business are  business owners tend to have the same social position.  All family members have  the opportunity to contribute to the success of the business.  A ‘husband and wife’ team will probably  be of similar ages. With a generational family business there is a possibility that there will be a number of them of similar ages.

Running your business with your spouse you will be both learning to manage business and personal life. You will be doing this with the one person who knows you better than anyone else. Growing up in a generational family business you will have felt the impact of the peer group. As a family business child you would hear kitchen table conversations between mum , dad and grandad. These family conversations create business actions (or inaction) driven by frank discussions in arenas of trust.

Nothing is more powerful than  your peers challenging you

Family businesses are used to everyone from suppliers to customers challenging their plans.  We all treat these challenges with the respect they deserve.  We know that the  challenges that really test us are made by folk who walk in our shoes.  Family business owners are used to been challenged by other members of their family.  This is what makes them different to non family businesses.  Our most memorable impact from facilitating the Lancaster University Family Business Program was the impact of family business owners working in peer groups to challenge each other.

To remain ahead of the game in business, your learning has to be greater than the rate of change.  Otherwise you will be left behind.

INSEAD an institution that works closely with some of the largest and most successful family firms from across the world. INSEAD puts the success of these businesses down to bedrocks of:  “Clear and well defined family values, trust, networks and innovation” . In todays rapidly changing business environment family busineses can build on their values, trust and networks to be at the forefront of innovation in systems and products. So, our learning must keep up with the rate of change, otherwise we will be left behind.

Action Learning is a powerful tool to enhance your decision making skills on your business journey, fundamentally there is no learning without action!

We have found that combining peer to peer learning with action learning creates a powerful tool.  This combination of learning  leads directly to actions  encouraged by a group of trusted peers.  It takes place in a confidential setting of your peers of  family business leaders from a variety of sectors.  Your peers asks you to examine the challenges within your business in an open and honest way, using open question techniques.  By doing this, the peer group  improves your confidence helping you achieve personal and business goals and achieve your overall ambitions.

Come and join us with Be the Business

Thomas Jardine & Co are working with Be the Business, the Family Business Network and Cumbria Growth Hub to deliver a family business programme based on peer to peer action learning and would love you to be part of it.  Take your first action and  come and join us.


Think Plan Do

Those who think and those who do

Our world is made up of three types of people.  Those who think and spend time planning before they do. Then there are those who do and spend time fixing what they’ve done after its done. Then in the middle are those who do a bit of  thinking and a bit of doing.

In business thinkers frustrate those who do and  those that do tend to worry thinkers.  People run good businesses when they know when to think and when to do .  Achieving this is down to habit and behaviour.

At Thomas Jardine we help businesses grow by supporting small changes in their behaviour that allows a constructive focus on thinking and doing.

On it not in it

At the Guild we run the ‘on it not in it’ club where we all spend time rebalancing the time we spend on our businesses (thinking) and the time we spend in our businesses (doing).  This is a real peer group of people who can genuinely support each other as we balance the need to think and do.

Be the Business and develop good habits with your peers

We must stress that the best people to encourage habits that balance your thinking and doing are those in the same boat as you. This is where peer groups and advisory boards come into their own. We are working with Be the Business to deliver both peer learning and advisory boards for the North West Family Business Programme. If you want to know more contact ourselves or any of our partners (The Family Business Network, North & Western Lancashire Chamber of Commerce; East Lancashire Chamber of Commerce and Cumbria Chamber of Commerce). Of course some times you need more than peer support to develop an idea and this is when you need more focused time thinking about and planning for your businesses future.

Innovation Design Programme

There are numerous programmes available that allow businesses the time and space to plan and innovate.  We are currently working with Lancaster University to develop a programme to encourage innovation in Cumbria’s  Supply Chain.  This is an exciting concept working across a supply chain and is based in part with work we did with Cumbria LEP on the food and drink sector.  For more details please contact Lancaster University Management School . 

Take time to talk to potential customers and fellow businesses

Programmes aren’t the only way you can share experiences with your customers and peers.  Last year we spent three great days in the company of  This is Cumbria.  At surface level this was a Cumbrian Food and Drink Pavilion at the Farm Shop & Deli Show.   Like all trade shows it allowed our businesses to connect with old and new customers alike.  The extra benefit was the time that these businesses could share their experiences with peers from the local area.  You get new ideas that drive your business thinking forward by talking with other businesses.  If you want to join us in 2020 please give us a shout.

Sometimes you just need to see the bigger picture

Most businesses don’t get a lot of time to really step back and think about the bigger picture. Some would argue that this ‘thinking time’ is just too far removed from actually working in the business.  However taking a deep breath and occasionally scanning the horizon can really help you check that the short term direction of your business matches with your long term goals.  With this in mind we are working with Cumbria Forum on a  two day event in September.  This will use design thinking to deep dive into future relationships with customers and suppliers.  If you’re interested please contact the forum.

Always leave with an action plan

Thinking and planning are essential for sustainable business growth.  But they are useless without actions. So hopefully this article has made you think and you are now tempted to make a new plan.  Please, please  give yourself up to three actions that you will take to make sure you convert thinking into doing.  Ideally share these with one of your peers ( they can then hold you to account) or if you want share them with us and we will remind you of your plans in 6 months time.  Let’s all think and do and make our businesses the best they can be.