More than four decades ago, Billy “Mack” Jameson (a real character with a fictitious name), founded a modest grocery store in San Diego, CA. Over the years, his tireless effort, the unconditional support of his wife Martha and his business eye for real opportunities, turned his initial venture into a solid retail organisation, constantly diversifying it services and growing as a leading business.
Ten years ago, after the founder’s death, his three sons Jamie, Linda and Bobby, took over the set of operational assets that today directly employs more than two thousand five hundred people throughout the state of California. However, the Jameson siblings decided from the beginning to impress a differentiating feature on the family’s relationship with the company: they did not want to make their father’s mistake by spending so much time with the company and neglecting their family, so they decided that their children would not “be contaminated by the vice of constantly talking about work”, and they agreed not to talk about the company at home, leaving the next generation to enjoy without worries the benefits and privileges that belong to a wealthy family with a good social position.
A few months ago, after a surprise heart attack from which he is successfully recovering, Jamie, the older brother, begun to seriously talk to his sister about the succession to the third generation. However, none of the founder’s five grandchildren (now in their mid-twenties), has so far had the greatest interest in the business.
In fact, they have done little in their professional lives. They were neither motivated to finish their studies nor assume responsibilities in any job (it is forbidden to work in the family business, according to the rules imposed by the founder’s children). After all, the grandchildren think that “thanks to their charismatic and successful grandparents, they have their parents’ wealth that will support them in the future.” Jamie realised this cruel but true reality of his family and commented to his sister: – “We have to talk about the family business with our ‘children’ … but where do we start?”- To what she replied: – “We should start by ourselves. First thing’s first…”
This is a real-life case that shows the reality of some families I have had the opportunity to work as a family business consultant. The lack of communication between family members is often the main cause of the conflicts they face. Attempts to create moments of coherent conversation about shared heritage often end in heated discussions between sibling partners, who have different perspectives of the same reality.
One of the main goals when working with families in business is to help to create minimum conditions that allow effective communication between the owners, who must discuss, analyse and propose the different scenarios to face the future of the legacy they’ve been sharing. The initial conversation should then determine if the family truly wishes to remain united around this heritage with a defined purpose.
Implementing these processes is neither simple nor free from obstacles, but the degree of satisfaction can be increased as long as two conditions are met:
First, all agreements must be consistent with the purpose of the legacy and the future projection of the family (known as the “shared dream”).
Second, all decisions in a Family Council must be based on the concept of “consensus” which, unlike “unanimity”, fuels debate and increases the group commitment.
At certain point, families must face the question: “When is the next generation going to participate in this process?”. The answer is always “When the generation in charge is ready.”
It is not possible to create a programme that prepares future owners if the current leaders are not clear about the intentions and rules of engagement for the next generation. Cousin problems (third generation) are usually due to relationship problems among their parents (second generation). The best way to achieve a second-generation preparation plan is to have a fully functional Family Council consistent with its members’ decisions.
Through their Family Council, the Jameson siblings found a way for having a forum that allowed them to strengthen the role of their Family Office and Board of Directors, focusing on their responsibilities as owners and building a more efficient wealth strategy.
But all this was only possible through the creation of a space exclusively dedicated to the conversation of family and legacy issues, based on effective communication and mutual respect and recognition, with the awareness that the leadership inherited from their father was now divided among the three siblings.
And precisely, thanks to the leadership of the Family Council, in a couple of years a special educational programme was designed and implemented with external and in-house resources, focused on the motivations, skills, attitudes and knowledge needed for the third generation to be responsible future owners of Mack and Martha legacy.