4Thought Blog

We’re now a month into 2020. The holiday season is fully behind us and now is the time to enact your plan for the year ahead.

The role of CEO is one of the most demanding career opportunities anyone can face, combined with many highs and lows. Being a family-business CEO comes with an even greater set of challenges and opportunities that require a combination of business discipline and family dynamics.

The CEO is not only responsible for running a profitable business, but assumed to understand family dynamics in the workplace. Working with family members—especially if you’re not one—creates a unique set of circumstances stemming from both the emotions of the family and the needs of the business.

To lead a successful, multi-generational family business, a CEO must do the following 5 things:

Remember the reasons you started your business? Making your mark in this world. Freedom. More fun. Control of your destiny.

And then one day you woke up and it felt like you had an albatross wrapped around your neck. You’re working harder than ever. Your team isn’t clicking the way you want. There is conflict within the family. Money is tight. And fun – what’s that?

Unfortunately for many family business owners, they don’t experience the very things that attracted them to take the risk in first place. In fact, they are continually frustrated.

We all have great ideas and plans. But actually moving on them is really hard. (It really isn’t, but we make it that way.)

Why?

Because you can’t do everything. I know – nothing new there – but we all get caught up in it. There are three resources we all have in limited supply: time, money, and people.  And the most critical resource is time. I don’t care how much money or how many people you have, you cannot get any more time.

One of the first lessons of strategic planning is that the toughest part of strategy is not deciding what to say “yes” to, but rather what to say “no” to. Focus and priorities are where success lies.

Some of the best-laid company plans were created on the back of a napkin. Lots of scribbles and doodles, but in the end, that lunch time, strategy brain dump was like gold. And it all fit on “one page.”

As businesses grow, leadership gets so engrossed in survival that they forget to stop, review, and update their “plan” for growth. Eventually, the team loses sight of the “one page napkin” (or literally lose it) and the company begins to lose its focus, alignment and direction.

Most business owners dream of a business legacy and financial independence.

Many never reach their goals. But it doesn’t have to be that way.

So what’s the formula? It’s pretty basic: reduce risk, drive profit, and build a team stronger than you are alone.

The failure of successful family business owners to reach their personal goals, especially their financial goals, is not because they don’t try or care. In our experience, the main cause of failure is lack of clarity, a plan around the big picture, and a myopic pursuit of the "urgent."

There are 5.5 million family-owned businesses in the United States, comprising nearly 90 percent of all businesses. These companies comprise over half of the nation’s GDP and create three-quarters of all new jobs. Only 33 percent make it to the second generation and less than 12 percent make it to the third.  Many family business experts believe that one common cause of failure in family businesses is a lack of transition planning and preparation.

It is difficult to begin to think about management succession for many business owners who need to begin.

Consider these 11 guiding thoughts as a starting point:

Nearly 90% of all businesses in the US are family businesses. That is a lot of businesses!  

But the odds of a family business succession are not good – 33% make it to the second generation, and only 3% make it to the third generation. What’s going on? Are the kids that numb?

No! My experience is that for the most part, the parents are that numb! Not on purpose, but they have created a mess, and when pushed into the corner of their retirement, they have run out of time to correct the course.

Everyone in business wants to grow. But that doesn’t mean they will grow, because wanting is not doing.

If you are not growing, you are declining. There is no remaining the same. Life just doesn’t work that way.