WHY DON’T 86% OF AUSTRALIAN FAMILY-OWNED BUSINESS MAKE IT PAST THE THIRD GENERATION? WHY IS THIS SO?
(Previous KPMG/FBA family business survey)
If you work in a family business, you will definitely relate to selected examples listed here through your own experience.
Some will remember a popular television series called Why Is it So? A USA University Professor, Julius Sumner Millar demonstrated how thing work in physics and offered easily understood solutions. He kept asking. Why is it so?
Over the years, through my experience of advising private companies, owning and working with other families in business I often ask myself. Why do families keep doing things that create negative internal culture issues that hold the business back from long term sustainable success.
It is no wonder only 12% of family-owned businesses make it pass the second generation.
The following is a series of comments and observations I have experienced first-hand and have been put to me over the years by non-family leaders, managers and employees.
The good news is, for every example listed there is a solution, as has been proven by those families in business who understand the benefits of open and trusted conversations, proper structures, systems and processes.
In every family business, it should be a partnership between all family members. The real issues develop when the power of control is vested in one person only and honest conversations are not held. For next generation working family members internal friction often leads to personal stress and family stress. Often, the solution and challenge for second and third generations is determined by their personal values, their own mental health and wellbeing and the angst within their own family unit.
Seek external advice, meet with the family leaders and do not be afraid to have the robust and honest conversations.
Copyright © 2021 by Bill Winter
Trusted business mentor/advisor. M: 0411536424
Recently I wrote an article about an issue I often come across in family business that ensures future success is compromised. Some commentators refer to it as fractured families.
This mind map is the result of a workshop I facilitated for an extended family business in the past.
I find it’s critical for families in business to hold an all of family meeting to ensure a common agreement is achieved across the generations.
Bill Winter is a renowned business mentor for business owners. He is a facilitator of the hard to have business conversations.