The Challenge We Identified
No matter their size, family businesses are complex. Certainly, there are the day-to-day challenges of running (and growing) the business. And then there are the challenges of family dynamics – with parents, children and sometimes children’s spouses trying to work together while maintaining healthy family relationships.
These very dynamics came into play recently when the owner of a successful multi-division company asked Decision Associates for help. Though the owner had four children, only two of them had pursued careers in the family business. In fact, both had earned an ownership stake in the company over several years. While one of the other children had developed a successful career outside the business, the youngest sibling had taken a different path and struggled in his career. When this son returned to the family business, he came with a desire to help his brothers and make an impact. He also hoped to be an owner with his siblings.
As could be expected, this request was concerning to his siblings (and their spouses) who had worked hard to grow the business. And while their father understood the concerns, he and his wife also hoped for a positive resolution to this family dilemma.
Our Approach To The Problem
As Decision associates gained an understanding of the family members’ desires as well as the company, its structure and plans for continued growth, a possible solution began to emerge:
- The company had two divisions, each run by one of the two siblings who had an ownership stake. In turn, the family had been considering the development of a new division that would provide services to the two existing divisions as well as to outside customers.
- This new division presented the third son with the opportunity to help grow the overall business and eventually earn his way to an ownership stake. While this solution did not offer the immediate ownership role and financial gains the youngest brother sought, it did provide a pathway. In the end, it was a solution that everyone agreed on.
What Has Happened Since
While still in the early stages of this transition in ownership of their business, the owner reports that all divisions of the company are growing. What’s more, he is watching his children grow in their respective roles. Soon he will finalize the transfer of full ownership of the company to them. Further, the child who built a career outside the family business has agreed to serve on a board of directors for the family business. Outcomes such as this are exactly what the Decision Associates team work hard to deliver.