In his article The Re-Education of Jim Collins published in Inc. Magazine, Bo Burlingham of Editor at Large, Inc., writes about the lessons that Jim Collins, business guru and author of such business classics as Good to Great and Built to Last, learned during his two-year appointment to West Point’s Chair for the Study of Leadership. He came away with a new understanding of leadership based on a 3-point model he observed in the West-Point culture

Collins describes the attitudes among the West-Point cadets as points of a triangle: Service– Growth–Success. To my mind, these attitudes apply as much to family businesses as they do to the careers of the cadets.

Expanding on the triangle, Collins sets forth three bullet points pertaining to building a culture of engaged leaders and a great place to work. When applied to family businesses these can be paraphrased as three questions:

• Service–What cause or purpose are we passionately dedicated to, and that we are willing to sacrifice for?
• Challenge and growth–What huge and audacious challenges do we as a family have that will push us and make us grow?
• Communal success–What can we do to reinforce the idea that we succeed only by helping others?

Ongoing Discussion at the Family Business Mastermind

The Family Business Mastermind is a peer-to-peer learning group. Participants meet monthly at the Lawrence N. Field Center for Entrepreneurship at Baruch College of the City University of New York to discuss the pressures, challenges and concerns of being part of a family business.

http://www.meetup.com/Family-Business-Mastermind-at-Baruch-College-Manhattan/

At July’s Mastermind meeting, there was discussion initiated by second and third- generation family-business members. They were seeking to define their roles within the context of the three major family business subsystems: family members, business management and ownership.

They expressed their frustration with being ignored when seeking to initiate innovations they believe to be critical to business growth. They shared a sense of “being right” about what their business needs; what they need for themselves in order to work in the family business, and what needs to be done differently to grow the business.

Ernesto J. Poza, author of Family Business, states that each generation needs to “respect the past, while keeping an eye on the future.” The Mastermind participants all expressed respect for what their parents had accomplished. They were struggling though, with how to evolve into their own leadership, perhaps like a caterpillar struggling to escape its cocoon. The takeaway here is that without the struggle the emerging moth will not have the strength to fly.

This is a conversation to be continued, as leadership needs time to develop. It is ultimately a conversation not about who or what, but about family values, future possibilities and opportunities.

Seth Godin recently wrote a blog post on a characteristic bias of human nature regarding the perception of “reasonableness.” http://sethgodin.typepad.com/seths_blog/2015/07/unreasonable.html. He pointed out that in relationships, we consistently perceive and “act as though” it’s the other person, and not ourselves, who is being unreasonable.

This situation is not infrequently seen in the interactions between members of first and second generations in family businesses. The son describes, often from a place of frustration, that the father is being unreasonable, in one way or another, in restricting his being promoted to decision-making status in the business. Their ensuing stories may be buttressed on the father’s side by perceptions of being railroaded, and on the son’s side by the feeling that his father lacks belief in his abilities.

Perceptual disconnects like these are based upon years of family interaction, ripe with ingrained habits and complex attitudes invisible within the family itself. A professional family-business advisor can reveal the complexities and misperceptions, align expectations and help develop positive governance structures within the family business.

If I were asked to recommend top-of-mind best strategies for multi-generational success in a family business, I would advocate fostering the development of next generation-talent and leadership, and instilling a values-based commitment to being a multi-generational family business.

I was speaking with a long-time acquaintance with whom I went to high school. He is a third-generation member of a family business. He mentioned that his family has an ongoing policy, starting when the family’s children become teenagers. If any of them ‘think’ they want to go into the family business, they are expected to attend the annual family-business meeting.

The teenagers sit on the side of the room. They see who are the current and future leaders. They become familiar with the family’s vision for the business. They absorb the family’s values and begin learning what is expected from family members active in the business.

Writing on family-business policies, Craig Aronoff[1] describes them as the guides for decision making and defining relationships between the family and the business. Good policies help families build skills, gain confidence, and increase their ability to face issues together. The policies should emerge from the bedrock of the family’s values, beliefs, philosophies, and principles.

Most family businesses do not survive past their third generation. The policy put in place by my high-school friend’s family has not only helped bring them securely into the third generation, but it looks good to take them into the fourth and beyond; a real-life illustration of the merits of solid family-business policies.

[1] Craig Aronoff, Joseph Astrachan, & John War. Developing Family Business Policies. Family Business Consulting Group.

Day. Night. Tides. Phases of the moon. Ever occurring seasons–spring; summer; fall, winter…

Early adulthood and exploration; establishment and settling down; mid-life transition; maturity; late adult transition; late adulthood…

Single; married; married without children; married with children; children helping out/learning the family business; launching young adults; young adults as managers in the business; take over of next generation leadership; grand-parenting; next professional phase (your next act), retirement…

Solo entrepreneurship; owner-managed firm; family partnership; sibling partnership; cousins’ consortium; family collaboration…

Start-up business; survival; growth; maturity; regeneration or decline…

We can’t avoid life’s cycles, and its easier on us and those around us when we embrace them and swim with the flow of inevitable and inescapable change.

Some families maintain ownership of the business but have turned management over to a professional team, as has the Walton family that owns about half of  Wal-Mart. Other families such as the Toyodas and Suzukis own very little of the company that bears their name, but continue to run them.

“You see things; and you say “Why?” But I dream things that never were, and I say, “Why not?”–a quote often attributed to John F. Kennedy, who was actually remembering a line from George Bernard Shaw’s play, Back To Methuselah. It came to mind during a recent discussion about Benevolent (B) Corporations.

B Corporations are an established and relatively new type of company that uses the power of business to solve social and environmental problems. B Corporations are required to meet rigorous standards of social and environmental performance, accountability, and transparency.

Why not a “FB Corporation” intended to preserve the positive attributes, competitive advantages, benefits and legacies of family businesses, which in turn richly supports our economic and social fabric?