Trapped
Dear Corporate Shrink,
I am the CEO and owner of a family business. I have been hoping to retire soon but I feel trapped. I have two sons in the business but they simply don’t get along. I have a daughter who doesn’t want any part of the company but I think she’s the smartest one. She has an MBA and runs a business twice as big as ours. My wife is putting pressure on me to sell the business and be done with it. I’m tempted to do it and move to Arizona. Suggestions?
Dear Trapped,
Given all the pressures generated by the dynamics and conflicts of the family component of a family business, I can see why you are tempted to take your wife’s advice to take the money and run. However, you sound ambivalent and asking for input so I will try to discuss other options.
A family business can be tremendously rewarding - monetarily as well as emotionally. When a family shares the family business dream, one based on the family’s values, it injects excitement, generates pride, loyalty and family identity, and it becomes a legacy to be passed on from generation to generation. Making this dream come true takes a great deal of work, and it doesn’t always succeed. Only one out of twelve family businesses reaches the third generation.
Let’s start with your sons. Have you thought of engaging a third party in conflict resolution? I know it must feel like walking into a minefield but sometimes it takes an outsider to facilitate such a process. You may not know what all the issues are that fuel their disagreements. I’m willing to bet the real issues are not being dealt with in the day to day arguments they have. Who knows, you may even be unwittingly contributing to the tension between two brothers. For instance, if you give the impression that your daughter is your favorite, that’s an important dynamic that would have to be dealt with.
In terms of your daughter - why doesn’t she want "any part of the company"? Since you didn’t mention it, I assume she doesn’t own any shares and you probably have full ownership control (Ownership of course is a major dimension of a family business system and usually becomes a disruptive force if not dealt with openly, clearly, and early.). How does she interact with your sons? Are they the reason she stays away? Would she contemplate entering the business if there was a clear potential for harmony?
If your wish is to keep the business in the family and it is decided that your daughter is the right one to run it, you have a shot at having them all get along if everyone shares the dream and is willing to work hard at communicating effectively. You then would have a team where each member contributes according to his/her skills. Ownership control of the business can be divided with each child owning 25% while you and your wife own 25%. I would consider this last scenario only after a lengthy period where all three siblings are accepting their roles and working well together. Of course, this all depends on your children’s willingness to explore these options - but it starts with you. You are the leader and you have the responsibility to initiate a process by which family emotions and differences can be worked through. You don’t need to do this alone.
I saved the most important question for last. Is the business financially viable? Engaging in a major process of change requires time, patience, and much effort. This would be worthwhile only if the entire family shares the dream, and the current financial reality and future potential rewards of the business support such an endeavor.
Don’t forget your wife; she probably has a good perspective on all this - and you need her support. These are all very complex and thorny issues. You may be feeling "trapped" because it’s your decision. You are the one who has to decide whether you want to explore the possibility of saving the family business. You may want to enlist an outsider to help you assess your options and implement your decisions.