Monthly Archives: October 2015

10/31/15

An Owners’ Vision

On October 22, I attended the Fall 2015, Global Family Business Event hosted by the Lawrence N. Field Center for Entrepreneurship at Baruch College, City University of New York. The keynote speaker was Lena Jungell, a fourth-generation member of “The Frazer Group.”She shared with us the story of her family’s business.http://www.fazer.com/our-brands/karl-fazer/finlands-most-valued-brand/.

Her talk, “The Development of an Owners’ Vision” presented a valuable model of the potential possible in family businesses. The Frazer Group has grown into an international company, now supported by and supporting six generations. One significant take-away from the talk was a picture of the strength the family derives from their collective values and the clarity of the firm’s vision—“to create taste sensations”. It’s simple, easily understood, and looks outward toward their customers and community.

Ms. Jungell added that the family-business’ vision has evolved over time through ongoing input from the owners, family members, society, and their environment. This reminds me of the statement made by Sam Johnson, former CEO of The Sam Johnson Company; that every generation has the responsibility to determine a vision for the firm under their leadership.

Next week I will write about family’s values as foundation of the owners’ vision.

10/22/15

Differences and Consensus

In his October 4, 2015, NY Times column “Corner Office” Adam Bryant presented his interview with Gary B. Smith, CEO of the Ciena Corporation: “Gary Smith of Ciena: Build a Culture on Trust and Respect.” In it Smith shares some of his history, his early influences and how his views changed with experience. In last week’s blog I wrote about Smith’s understanding that “it’s all about people.”

 And of course, with people there will be inevitable differences of opinion. Smith says that this is healthy. These differences should exist. But ideally, he aims at consensus. “I’m a great believer in getting consensus,” he says. But he knows that consensus cannot always be reached, so “you’ve got to say, O.K., that’s good enough.”

What’s critical he says, is that once agreement has been reached the leadership team must be synchronized and the agreement is communicated down the ranks of the organization so that all are moving in the same direction.

One of my first clients started our engagement by stating: “My dad has fired me twice.”

The point of contention was over my client’s approach for implementing a strategy. His father would neither acknowledge nor respect his son’s difference of opinion saying: “any way you do it is ok, as long as it’s my way.” Clearly there was no working toward a consensus.

Perhaps for the health of the organization it might have been easier, in the short run, for the father to fire his son, thus avoiding having the operation of the business skewed by trying to follow two conflicting directions. But for multi-generational longevity, an opening must exist, for at least a partial consensus.

To ensure multi-generational success, members of the next-generation need to be granted a degree of autonomy, allowing them to acquire leadership skills and giving them the invaluable opportunity to learn from their own mistakes.

Handling this transition is one of the most difficult challenges facing family businesses.

10/15/15

It’s All About People

In his October 4, 2015, NY Times column “Corner Office” Adam Bryant presented his interview with Gary B. Smith, CEO of the Ciena Corporation: “Gary Smith of Ciena: Build a Culture on Trust and Respect.” In it Smith shares some of his history, his early influences and how his views changed with experience. In last week’s blog I wrote about how Smith’s management philosophy of creating an environment that people could be successful in is important to the success of family businesses.

This week’s blog: “It’s all about people.” This is another important management principle, one that Smith says he learned early in his career, but that took time for him to truly grasp. “…if you get that right,” he says, “the other stuff will get addressed.”

In family businesses the people are all stakeholders–leaders, family members, team members, staff. The “other stuff:” smoothly running business operations, processes and procedures depends on careful attention to building and maintaining a culture of mutual trust and respect.

For me this means putting relationships first and business transactions second. It’s a philosophy for building a family-business legacy.

If you have thoughts or questions about building relationships of trust and respect within your family and family business, contact me through my website.

This is the second of three important management principles I pinpointed while reading Adam Bryant‘s interview with Gary B. Smith. I’ll share my thoughts on the third: “Differences and Consensus” in next week’s blog post.

10/10/15

Nurturing Next-Generational Success

In his October 4, 2015, NY Times column “Corner Office” Adam Bryant presented his interview with Gary B. Smith, CEO of the Ciena Corporation: “Gary Smith of Ciena: Build a Culture on Trust and Respect.” In it Smith shares some of his history, his early influences and his experiences as he took on his first management roles. In the beginning of his career Smith recalls, he managed people by the numbers. If they hit their numbers they were fine, and if they failed to hit them, they were not. Then, at a certain point, there came a kind “ah ha” moment that changed his thinking. From then on he viewed his role as facilitating and creating an environment that people could be successful in.

It struck me that the role of facilitating and creating an environment that will nurture the success of next generation leaders is relatively rare within family businesses.

In defense of family businesses however, it’s a role not often found in businesses of any kind. Perhaps it’s an anomaly, found in the character of particular individuals. But this role is vital for family businesses that are interested in building a multi-generational legacy.

Sounds too vague as a strategy? Smith offers a first-step towards achieving it. He stated that upon understanding his role of facilitating others’ success, he learned to listen more than he talked– a working axiom for success in any kind of relationship.

If you have any thoughts or question about your own listening skills or those of others in your family business, contact through my website.

This is the first of three important management principles I pinpointed while reading Adam Bryant‘s interview with Gary B. Smith. I’ll share my thoughts on the second: “It’s all about people” in next week’s blog entry.

10/1/15

Moving the Center

A point is reached in the life of a family-owned or closely-held business where in order to continue growing it needs to begin a process of transitioning from an owner-centric to a management-centric enterprise. This is one of the top challenges for businesses where family members maintain tight operational controls.

In order to move forward from this point new systems and procedures need to be established in areas of organizational structure, fiscal management, operations, marketing and sales, business development and even in the way a receptionist answers the phone.

I recently joined business attorney Nina Kaufman on a podcast hosted by Business Exponential.com, where we discussed this challenge and ways to meet it. Click here to listen: Scale From Owner-Centric to Management-Centric with Rick Raymond.

I would like to hear your thoughts and questions about this and other family-business challenges and concerns. Please contact me though my website.