What Is A Family Business Consultant?
5th November 2017 Elle Hansen, Regeneration Partners
The specialty family business consultants can bring is the ability to deal with the psychological, emotional and interpersonal relationship issues that are unique to family businesses.
Hiring a general business management consultant to help with family business issues is a little like hiring a soccer coach to run an NFL team. They may both be called football, depending on who is talking, but the differences are profound enough that the soccer coach is not likely to play in the Super Bowl any time soon.
Like NFL coaches, family business consultants are highly refined specialists. The specialty they bring is the ability to deal with the psychological, emotional and interpersonal relationship issues that are unique to family businesses. A Ph.D. in management and a lifetime spent advising public companies will do little to prepare a general management consultant for the intricacies of navigating a family succession transition in a family business. It’s just not the same game.
Succession is perhaps the most common task for which family firms call on family business consultants for help. It’s one category of change or an inflection point that family businesses can benefit from outside expertise. Other change points that commonly call for family business consultant engagement include sale or merger of the business, instituting professional governance, setting up a board and organizing a family office. Ongoing or recurring issues that family business consultants help with include managing conflicts, leadership development, ownership planning and philanthropic strategy.
Because of the requirement for strong interpersonal skills and understanding, family business consultants often have formal training and degrees in psychology, sociology and communications, instead of or in addition to the MBAs other management consultants have. They may also have certifications specific to family business consulting.
Because each family business consulting engagement is somewhat different from all others, due to the complex interplay between different families and their enterprises, extensive experience in hands-on advising to family businesses is perhaps the most important qualification. In the best of all worlds, the family business consultant will have all these, plus personal experience growing up or working in a family business.
Even with all these skills, family business consultants rarely go it alone when advising family firms. A well-run family business consulting firm will have access to a broad network of experts including legal and accounting professionals who also have experience with family firms and can help with technical matters. Finally, because family enterprises will almost always have both male and female stakeholders, it is desirable to have gender balance in a consulting team.
A family business consulting engagement may last from months to years. Family business consultants can be expected to provide deliverables such as succession and leadership development plans, family retreats, mediation sessions and training in communication.
What don’t family business consultants do? They don’t act like regular employees, showing up to do repetitive tasks every day for years on end. They don’t buck for promotions and raises. They are there when needed to support and advise on key decisions.
Wise family business consultants will avoid taking sides, getting drawn into complex family dynamics or being painted as good guys or bad guys. While their advice and counsel can be invaluable, the actual decision making power will remain with the family business leaders. Family business consultants are always aware that the game must be won on the field, by the family business members and employees who are the real players.
About the Author - Elle Hansen is the Managing Director of Regeneration Partners, a firm of consultants specilaising in the family business sector. Please visit their website to find out more here