Monthly Archives: September 2019

09/21/19

SWOT Analysis And Family Business

A SWOT Analysis is a valuable strategic-management tool for helping businesses of all types identify strengths and uncover weaknesses. It pinpoints places where improvements are needed and spotlights pitfalls to be avoided. It’s also useful for identifying opportunities and threats. Entrepreneurs and their advisors use it to discover circumstances that stand in the way of goals. These can be marketing issues, management deficiencies, threats from competition and many other serious business challenges.

Family businesses differ from non-family businesses in that they function through the interplay of three subsystems. These are: the family, the business and the ownership, a/k/a equity shareholders. SWOT analysis of each of these subsystems provides insight into this interplay.

We at The Family Business Leader recently performed a SWOT analysis with a third-generation family business. In the ensuing conversation we discovered several strengths within the family. One is that the members enjoy strong and supportive relationships. Another is finding that a rising-generation family member had useful industry experience gained working outside of the family business.

The analysis also uncovered some weaknesses in the areas of management, leadership and entrepreneurship. Threats were identified, coming from changes in the industry. Opportunities were found for expanding sales.

Now in possession of a larger picture of their business and the environment in which it operates, family members—both those active and not active in the business—became encouraged to come together and act as an advisory group. Together they discussed the SWOT findings, acknowledged their strengths and developed plans for addressing their weaknesses. Their strong family relationships supported all members in the discussions.

As a direct result of their talks, the family member with outside experience was offered a position in the family business. This addition made it possible to take advantage of the opportunities to expand.

The SWOT analysis was also useful in shining a light on ownership issues reverberating within the family. The Ownership subsystem is the source of some of the thorniest issues in family businesses. Enabled by the experience of having productive conversations, the shareholders are now ready to plan open conversations about transferring ownership to the next generation.

These benefits and many more can be gained through SWOT analysis. Consider applying this invaluable technique to your own family business.

09/6/19

Paul Klee and Late-Life Productivity

In prior postings I’ve told stories about parents having difficulty letting go the reins of their family business, and handing them off to the next generation; stories of their inability to let go, even though the next generation is more than competent to run the business.

A major reason for this situation may be found in the realm of psychology. The business is what the parent has always done, and perhaps constitutes a large part of their identity. After relinquishing control of their business, the parent has nothing ahead to go on to. They may also find themselves face to face with a crisis of meaning. As sometimes happens, and perhaps even more than once in the course of our lives, what we have done before; what has gotten us to the present moment, no longer inspires us as it previously had. This crisis misunderstood, unexplored and unresolved, can become a point of contention within the family and can negatively impact the business as well.

An article I came across written by historian Christopher P. Jones about the painter Paul Klee: Paul Klee & Late-Life Productivity https://medium.com/@chrisjones_32882/paul-klee-late-life-productivity-a2ed7a4cab6f, seemed to have meaning in connection to this family-business crisis, and some thoughts that might point a way forward.

Klee was not the head of a family business, so the analogies to be drawn from his life are not direct. His late-life story is about innovation and growth in response to adversity; the Nazi takeover of his German homeland; his deteriorating health from an ultimately fatal autoimmune disease. He did not have a choice as to these circumstances, but he did have a choice in his response to them.

He never did stop what he had done since his youth. But through adversity he found new meaning in it; developed new methods. Adversity forced innovation and new directions. It resulted in his highest degree of lifetime productivity.

Jones writes “Paul Klee’s innovation stayed vibrant to the end. It was unceasing because he never let the sense having arrived take over. Search and growth were essential aspects of his practice, one complimenting the other, neither of them fully complete.” 

“Klee was always building on past achievements, often re-using sketches and half-finished compositions as the basis for new paintings. Inspiration of this kind is intimately related to growth.” 

I think the above statements are key. It’s important that a parent, in turning over control of the family business, not see this as a personal having arrived at the end. As Paul Klee found new expression through the updating of old sketches, and remarkably through the limitations of disease, a new life of growth and accomplishment can be born out of the hard work, skills, connections and wisdom built over a lifetime…so far.