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August 17, 2021

How to personify your business within your family to help its survival

family business owner next generation transmission

Sustainability is key to survival and success in multigenerational families, particularly when transitioning from one generation to the next. However, many businesses do not know how to describe and understand what sustainability actually looks like for their organisation and how the value of sustainability can be used to engender the productive discussions that will lead to successful intergenerational transition. 

Many family members do not necessarily understand their role in the business, or know about the inner workings of the company, but they do know the extent and nature of their emotional connection with it. By using a four step coaching process that helps personify the company within the context of the family, businesses can develop a common understanding and a framework for conversations among and between generations. This process seems complex but can be broken down into steps, and supported by coaching professionals if required. It helps family businesses understand not only how the entrepreneurial spirit that has shaped their business continues to develop throughout the generations, but also the activities of the organisation that add to this entrepreneurial orientation. In this way, the next generation can better understand the role they can take in shaping the future of the business, and balance their own needs with the needs of the wider family and with the business.

There are three key emotional factors that can influence the next generation in terms of whether or not to join the family business. The first is a perceived duty to the family, which can push them to join the business and make them feel obliged to do so. The second is the desire for leadership, where they want to contribute to the family business and actively choose to join it. The third is effective identity factor, which is linked to what is actually at stake within the family business and on a more global scale. This is the main factor that can be better understood by utilising a framework within which family members can discuss the business in the context of the family itself.

The first step in the four step process is to sketch a genogram, which is a pictorial representation of not only the family tree over multiple generations, but also the familial and emotional relationships between the members in the family tree, in terms of emotional closeness, level of personal conflicts, friendship status, and strength of relationships. Men can be represented as squares, and women as circles, for ease of visibility. The genogram is a powerful tool that is used by psychotherapists to delve deeply into family dynamics, and in the context of the family business it is useful for a higher-level understanding of family relationships. Each family member will have their own views and draw a different picture, but this in itself can be useful for discussion purposes.

The next step is to visually represent the family business in two time periods, now and in 20 years time, in the form of a pair of freehand diagrams. The ‘future business’ representation shows what emotion is projected onto the drawing of the ‘current business’. One of the most interesting elements that often emerges from this step in the process is that the likely impact of climate change and environmental issues over time are clearly represented in the ‘future business’ representation. This is demonstrative of the fact that the current generation of the family sees climate change as a key driver for the sustainability of the company, despite not necessarily expressing a concern for the environment as one of the company’s key values at the outset of the process. Typically, the ‘future business’ diagram also is typically lighter and more positive from a visual perspective, which could be seen to represent the positivity and energy of the next generation coming into the business. Climate change can clearly be seen as a locus of emotional ownership and can be a catalyst for younger generations breaking with the family business if it is not addressed: a failure to take into account the environment within a 20 year period impacts the emotional ownership and has potential for ruptures within the family itself. This learning alone provides a useful talking point for families when discussing the sustainability of the business and the level of involvement of the next generation. Additionally, the future version of the business typically shows a move away from a diagram demonstrating order, direction, goals and planning to a more freeform diagram showing creativity, innovation and empathy, with the entrepreneurial orientation of the next generation being a key call to creativity in the face of the environmental crisis.

The third step in the process is to “invent a character”, which means personifying the two versions of the business, now and in 20 years time, as two imaginary people in your family. They cannot be based upon anyone already known, but must be entirely new people. Each of these two ‘people’, now effectively a single entity, should be superimposed upon the family genogram which was developed in step one of the process and connected to the rest of the family members using the same genogram principles of drawing the emotional relationships with the rest of the family members. While every organisation will have its own version of this enhanced genogram, experts have seen three key factors that have emerged from the majority of organisations. These highlight lessons that can be useful to help family businesses discuss the topics of survival and sustainability even if they have not been through all the coaching steps. These are:

  • The ‘current business’ was predominantly inserted as a male character into the family, whereas the family member inserted as the ‘future business’ was typically female
  • The ‘current business’ character was typically older than the ‘future business’ character
  • The ‘future business’ character typically had stronger relationships with other people in the family than the ‘current business’ character

It is clear that family businesses need to evolve to bring the younger generation with them, and the steps above help highlight the disparities between generations. This disparity is however a context for conversation, and provides a starting point for the fourth step of the coaching process, which is to, as a family business, compare and assess the different versions of the current and future business personas and family genograms. A forum can be established to communicate together as a family business. It is usually useful to communicate together at the lower levels of the organisation, where relationship dynamics are often less complex and conflicts can be less entrenched. Where the relationships are strong, conversation is easier. A family charter can be established around the younger generation, sharing thoughts and insights upon how the family business can evolve, particularly in a context of environmental concerns, and remain sustainable. These conversations can help the younger generation continue to be involved, not because they feel duty bound but because they want to and feel they can genuinely contribute to a family organisation that values their beliefs and positivity. The conversational activities can then be expanded throughout the family business, bringing in more generations, with a united front from the younger generation focused on positive change rather than conflict.

By its very definition, a family business combines both the worst and best of family dynamics while running a business. This four step process helps position and understand the family business in the context of people to people relationships, as well as the relationship between people and the organisation, by effectively personifying the business as a family member. It can help unite the younger and older generations of the business by giving them common ground to talk about and a framework in which to develop a roadmap for the future of the organisation. Bridging the intergenerational gap through structured and supported conflict-free conversation is what will help family businesses achieve success and sustainability.