Pretty much the same goals of course as every other business, continued growth and profitability. But if you own the company, obviously you want to build a profitable company for future generations and your family. And you want to give as many family members as possible employment. And then of course you want to choose the right family or non-family member for the right position. Very bad things can happen if you choose the wrong person. I will give you an example. An equipment dealer that I know hired his daughter to do the accounting. Her expertise was really in marketing. But he wanted her to have that job because the position came open. So he gave her the position. Mistakes were being made on invoices, sales people were getting complaints, suppliers were not happy, and the payroll was not going out the right way. And he gave her about six months and he finally had to remove her from the position and hire someone else, which ended up being a very disgruntled daughter, a very disgruntled employee because she felt that he wasn't giving her enough time. So it's very, very important to choose family or non-family for the right position. And of course, it's really important to choose the right person who is going to take over to lead in the future. From a well-known family-owned business, Bill Ford from Ford Motor Company, Executive Chairman and great grandson of Henry Ford, has a great attitude about being a family-owned business owner. I feel like I'm a caretaker of our culture and our legacy. I'm working for my children and grandchildren. And I feel I'm working for our employees' children and grandchildren as well. I think that is a great attitude to have. And of course, that's a large corporation. Now for family-owned business owners, there are many family-owned business goals. First of all, there's goals for the family. What do I want to do for my family? What do I want to achieve for myself? Do I want to build an empire? Do I want to build companies? Do I want to pretty much keep the business as it is but just grow it and have it become more profitable and perhaps add more employees? Do I want to have mergers and acquisitions? And of course, that requires a great deal of long-range planning. And also, there has to be business goals. So the owner has to set the goals for all three of these areas and, of course, involve their families. Strategy, planning, communication, and especially commitment of every family member is critical to success. And I think it's really, really important to realize that. You just can't step into a family-owned business without a great deal of planning. As I go along, I'll help you with some ideas on how to plan correctly. So those are things that we have to think about. Interesting stats. Forty percent of today's leaders are unwilling to relinquish control. And I have a client here in Chicago where I live, and I've worked with the family, and the father just will not, is 65, and just will not turn over the business to his son. He just can't give up control. And as a result, there's a great deal of frustration. The son has an MBA. Daughter-in-law handles marketing for the business. The son's wife, of course. And we have a very, very difficult situation here. But those are the stats. Forty percent are unwilling to relinquish control. Sixty percent own shares but will not work for the company. And usually that's because they don't like the principal or they don't like the person they would have to report to. This is unbelievable. Seventy-three percent of all businesses lack a documented succession plan. Here's another interesting stat. It's been said that between 30 and 33 percent of all family-owned businesses do not make it past the third generation. Common challenges for family-owned business, of course. And it happens a great deal, is conflict with the family and the business. Maybe there's conflict with family members. There's conflict on how the business is run. And that can happen. There can be employee dissatisfaction between if there's rivalry or jealousy or employees and family members are not treated equally. And often, the younger generation takes the business and the job for granted. Last example, a company that I have worked with, the owner had a young son who was very smart. But for a long time, he wanted him to come into the business. And he pretty much pressured him. And when the young man came into the business, he really was not very enthusiastic about it. He was fresh out of college. He really never had a scratch and claws way up like the father did. And what was happening is he was coming in every day at 3, I'm sorry, 9, and leaving at 3. And he was pulling up in his brand new hot sports car. And the rest of the employees were very unhappy. Fortunately, what did happen is after a period of time and after some ground rules laid down by his father, the son did take up an interest in the business and now is a very valuable asset to the business and vice president. Often, however, the third generation does take it for granted. And a lot of times, when I speak to audiences where family-owned business members are in the audience, I often say, how lucky you are to be able to step into a thriving business that someone in your family, your great-grandfather, your great-grandmother, your grandfather, your father, mother, whomever it may be, your uncle, established a thriving business that you could step right into. Very few people have that opportunity. And the other common challenge is our family-owned businesses are emotionally charged. So those are some of the things that we talk about. And going back to what I said about the younger generation, research has told us that many third generation owners feel entitled based on the past success of their family business. And some of them don't want to go out there and work and get their hands dirty and really dig into the business and work hard. So those are some of the things that many family-owned businesses must face. And certainly, I hope that this is not your family-owned business, but it's not uncommon that this would happen. On the other side of the coin, there are many, many top-performing family-owned businesses that people love to come to work for them every day. And I know of a business, a parts business, that was established by a grandfather years ago. And the now existing grandfather, so it was great-grandfather, so the existing grandfather is transitioning the business over to one of the cousins in the business. And the reason that this person is getting the top position in the business is because he has amazing interpersonal skills. He started working in the business very, very young. Customers love him. His employees love him. And this business operates amazingly. The other thing that this business does is they treat their employees just as well as they treat family members and make their employees feel like family. All right, now here's some really great news about family-owned businesses. Studies reveal that overall, overall, family-owned businesses can be more profitable. They are considered a better workplace, a better place to come and work. And I know many people who say, if I ever leave the major corporation or manufacturer I'm working for, I want to work for a midsize or small company or definitely a family-owned business. And usually they have a shorter chain of command and definitely a less rigid culture overall, the majority. Now, if you do some research for 2015, what is happening and is projected well into 2025, and I would like to know how the crystal ball gazers can go on that far, look into the future. But there's tremendous optimism for growth in 2015 and beyond. We're going to see more and more family-owned businesses come up. And the other thing we have to think about with family-owned businesses, if there's a tight-knit managerial circle and the flexibility of related and deeply invested employees, whether they're family or non-family, this is proven to make all businesses resilient. And it can also confer a significant competitive advantage and impress customers who appreciate knowing that they're dealing with someone who cares deeply and who has the same surname that's on the letterhead. But as I said, family-owned management does present unique and can be intense challenges, including day-to-day emotional dynamics. Here's what we're going to address today, how to manage and avoid conflict, characteristics of smart family-owned businesses, and some best practices of top-performing family businesses. Then we'll have some question time, and then I'm going to give you a little bit on how to plan for succession, how the plan for succession would be great for you in family-owned businesses. All right. So most definitely, I would hope that you do not have a family-owned business that ever behaves like that. And of course, that's a bit extreme, but I thought it's a great example of what can happen. But the fact is that being business partners with family members creates a level of relationship complexity between the family members and for all employees in a family-owned business. And among the family members, there's often disagreements about the direction and priorities for the business, or who's going to get hired, who's not going to get hired, who's performing, who's not performing. Or there could be strained relationships because of childhood conflict or because of disagreements about spending. And maybe there's different interests for different shareholder groups. Maybe there's just basic personality conflicts that occur. So these are not all in common. And I'll give you a perfect example of a conflict situation. Often, someone who works for the company, and let's just say they have to report to the general manager, at that time, it might be the son or a brother, young brother, whatever, who is told to report to the general manager, has a problem. And instead of going to the general manager, they go to the principal of the company, their father or uncle. And that's a conflict situation right there. So conflict, you're going to have clashes, dissonance, disunity, disagreement. Sometimes there's friction, rivalry, disagreement, disharmony, people who are just unbendable your way or my way or the highway. And sometimes that can be between owners and family members. And that results in a great deal of stress. And again, there could be disagreement on business decisions, policies, new systems. As I mentioned, jealousy. Small example, a company I know of has the father running the company, the sister handling a marketing, a husband, and a son who will eventually inherit the business. Well, just because the sister has children, she gets to leave early every day and work for a very respectable salary. Well, the family isn't so unhappy about that as much as the employees. They feel it's just not fair because they're kind of having to pick up the slack from the workload, especially if something happens. What can happen if conflict is not resolved, as if we don't know? Of course, all these negative things, lost customers, employee turnover, I'm never going to get promoted here, service can suffer, morale problems, anger, and broken families, broken hearts, and I'll go back to that in a minute, damaged reputations. And believe me, customers do talk, and salespeople talk, and if there's conflict in a family, that can happen and get back to customers. People feel victimized, stressed, loss of productivity, power plays, broken family. This is a situation that occurred, conflict could not be resolved, and this breaks my heart. Actually, it broke the founder's heart. The father had a lot of blood, sweat, and tears, and scratched and clawed his way up and built an amazing construction equipment company. What had happened was he turned the business over to the two sons. The two sons took over the business. There was conflict, constant arguing, customers that were unhappy, and eventually, they broke apart, and as a result, the father and the mother have a broken heart. The son ended up founding his own business in a nearby city, so that is really a bad thing that happened, but they tried everything they could, so it's very important to resolve conflict, better yet, present it in the first place. So let's think about how to resolve conflict. Whatever the conflict may be, if it's you that has to manage the conflict at all times, no matter what the situation may be, and without having you in a live audience where you can present what would you do about this situation, how would you suggest I handle it, I will walk you through these, and of course, if you choose to share anything, you can do that during question and answer. So always, whenever there's conflict, always manage your state of mind. How should I handle this? We've got to focus, I've got to focus on fixing the situation, whether you're talking to a team or one-on-one. How should I handle this, and stay calm, stay calm, stay calm. Right here, you need to tell yourself that in your state of mind should be respect, flexibility, and openness. When you communicate with any conflict situation, communicate in private, never in front of anyone else, and that might even include conflict in the family. So communicate in privacy, and always be very assertive, but with tact and diplomacy. Be sure to address the situation as you see it, or have them address the situation, and make sure that when you communicate, you're sincere, and that you are also a straight shooter. I think that is really important if you are in any type of leadership position, and maybe even if you're not, to always be a straight shooter, so that people never have to wonder what you're thinking. Listen to another person's side, or all sides, listen to whatever the conflict might be about, and strive to resolve the conflict. Here's something that is a good thing to apply in resolving conflict at business, and even in your personal life, always use this, what can I do to make it better? That is always a good thing to say to someone, or to say in a team, and so that is really very important to do. Then, ask for cooperation, may I ask that from now on, here is how you will perform, here is how you will behave, here is what we will agree to do, collaborate, let's help each other, and draw an agreement. Right here, if you are the leader, the manager, the facilitator of this conflict resolution discussion, or if you are leading the charge, always say, can we agree that from now on, or can I rely on you from now on? That is one thing that people fail to do, they fail to ask that question, and get the yes answer. I'm going to give you a perfect example, unfortunately this is true, I know of a company where the husband and the wife constantly argue, and they argue in front of employees, they just can't seem to stop. In that situation, it was the son who had to step up to the plate, and tell them how it was affecting people, and how bad it seems to customers, and how it can get back to employees, and then get back to customers. Another thing to remember about resolving conflict, and that is, admit it if you are wrong. Every once in a while, we do make mistakes, or we make a bad decision, or we say something in haste, and then we realize, hmm, I shouldn't have handled it that way. Admit if you were wrong. And by the way, never feel that if you did not handle a situation the right way, never feel that you can't go back to a party, or to a team, and say, I've given further thought to our discussion, and I'm feeling I could have handled it differently, or I've reconsidered, here's what I think. They will respect you for that. And if you made a mistake, it's okay to say, you know, I was wrong, I made a mistake. All right, so those are things to remember about conflict resolution. The most important thing is finish in a friendly fashion. Here is another thing that may be helpful to you. If you have conflict with an individual in your company, and you have that conversation, it's a great thing after it's all finished, and you end in friendly fashion, you shake hands, and say, okay, we're going to work together, we all have a common goal here, we're going to work together, we're going to work as a team. This is a great thing to do. Call the person, or email that person, say, glad we had that discussion. Have a good day. Something like that. Now, maybe your personality is quite different than mine, and you certainly don't have to handle it that way. In your own way, it's a great way to go back to that person. And why is that? Because conflict is very uncomfortable. Conflict is negative. And it's always great to go back and say, I hope I wasn't too hard on you, or I reconsidered the situation. So I think I've made my point there. All right. If you are a leader, and you must intervene between a team or two people, always state up front that whatever is happening, that you will not be biased. You will not stick with a family member, non-family member. You will not be biased against a son, daughter, family member, and employee. That you will not be biased, and you will always do what's best for the business. That is what is so important. Always do what's best for the business. And this is what I find with family-owned businesses. Sometimes conflict occurs, and things don't get done, because they don't think as business people. They just take each other for granted because they're family members. But you have to always do what's best for the business. All right. Remind parties before you begin resolving conflict that people do have different opinions. People do have different agendas. But you will do what's best for the business. Listen to both sides, and always be objective for the business. And then resolve using the steps that I gave you, and make decisions for parties or teams or people if they can't agree. If it is some type of situation where you need to give it further thought, it's my opinion that you can say, I'm going to think on this overnight, I'll let you know in the morning. Now, there's something, a great thing called the one-minute manager, where catch somebody doing something great, tell them right away. Catch them doing something wrong, tell them right away, but in private. And that's wonderful for productivity. But sometimes, depending on the situation, you do need to think it through. So in that case, always make a decision. If you handle something on the spot, isn't that an awful picture? Or should you walk away to calm down, or consider how to handle the situation? All right, and please keep in mind that there's a lot of different people listening in, and each and every one of us is different. So do what is right, and what is comfortable for you, and the business. And if it's a heated situation, it has to be handled on the spot. In private, though, for example, if someone, I'm going to use this as an example. If you overhear anyone using profane language, you would take them aside, and you would say, that is unacceptable. In our business, we don't do that. And that's a family member or not. I'm a firm believer in that. So I believe that that's really, really important to do. All right. If you've ever heard me speak on customer service, employee motivation, you may have seen this before. When there's conflict or a problem, I use the example of peeling the onion. What's the problem? Okay. Then to find out the cause, you have to say, and why did that happen? And why did that happen? And why did that happen? Example, the president of the company who gave his daughter the accounting position didn't have a degree in accounting. If he wanted her to have the position, he should have sent her to a college course on accounting instead of marketing. So those are just some things that can occur. So what is the root cause of the problem? If there's conflict in a family or on a team, is the cause because they didn't plan, they didn't get agreement, they didn't set ground rules for how the family will operate? So the cause is really very, very important. Sometimes the cause is because people are unreasonable and the problem, though, has to be corrected. So peel the onion. Why did that happen? And why did that happen? And why did that happen? Did our new successor not get leadership training? Did we not make sure we trained him and coached him for two years before he's going to take over the business? Did he or she not have conversations with the employees to let them know that he's going to keep everyone, and he or she will do things differently, but has every intention of keeping the employees, and he wants ideas for what he should do when he takes over the position? All right. I need to say he or she. All right. So let me give you another example. It was brought to the attention of the president of the company by their CFOs. You know, numbers, as you know, numbers do not lie. And the CEOs keep, CFOs, rather, keep track of everything. And the CFO brought to the president's attention how much money it was costing the company for gas. And so he did two things. He asked the company people that were driving their trucks to go a little easy on the gas pedal, especially when going over railroads, and a lot of employees just charge away on that gas pedal. And every penny makes a difference. But to do that, you can't demand it. You can ask for it. But another thing he did was he found out that people who had a company credit card were using, charging gas for their own personal use. So therefore, he removed, he allowed them a certain budget, which he paid to them, and they no longer had a gas card. They were not happy. But the person had to do what was right for the company. All right. Now, what if you, and maybe you are not the owner, the leader, the manager, just like the son had to tell the mother and father to stop arguing. And there are many, many situations, perhaps there's someone on the team that's not performing. So if you are working for a family-owned company or managing it, you have to tell the principal how a situation is affecting you. And of course, in private, the second thing, and by the way, the Harvard Business School MBA program, and I work with the Harvard Business School Alumni Association, and their MBA program teaches this to their students. So the second thing is, tell them how it's affecting your employees, affecting teams. And maybe it's okay to say, I'm confident that other employees feel this way, or they've discussed it with me. And then number three, tell them how overall it trickles down to affecting customers. And I'm a firm believer in that good old formula, happy employees equal happy customers equal long-term profitability. And once you've done that, the principal has the choice or the person who is in charge of a situation has that choice of what they're going to do. And so many people ask me, what do I do if it's that? And here's the situation. One company, the daughter had to be the one to tell the boss that he's, quote unquote, too bossy and that he doesn't talk enough to employees, he doesn't make himself available. Sometimes you need to tell them that someone needs to be fired. And so those things can happen. Here's a real world story. I got a phone call, I had worked with a company, and I got a phone call from one of their top salespeople who said they really did not know how to handle a situation and could I help them. And, of course, that was not my client. My client was the company, but I did provide a creating a high performance culture program for them. And he said that customers were talking to him saying that they heard that bad things are going on in the company, and there's talk of the two owners going through a divorce, and what should we believe, is the company going to be held together. So he had to ask me what to do about it. And I gave him those three steps. I told him to be straight, just tell the owner straight, and be a straight shooter. Okay, so having said that, here are some ways to, and this is already a best practice here, how to avoid conflict. It's just like avoiding customer complaints. I always talk about proactive complaint prevention. What can we do to be proactive from preventing complaints or problems? Here, today, we're going to talk about how to avoid conflict. It is a best practice for business. So obviously, an atmosphere of open communication, where people feel free to speak up, and they voice their opinion, they work together as a team. I know a lot of this is ideal now. And a chain of trust has been established with employees and with family members. Then there's transparency, transparency in what the plans are, what's going to happen, what they're thinking of doing. And so that's important. Now, the only thing I believe, this is one person's opinion, one person's strong opinion, and I'm sure there are many of you who agree, I do not believe that employees should ever know what other employees are getting paid, or most definitely what executives are getting paid. And how do you establish a train of trust besides transparency? Integrity in all your business dealings, honesty, integrity, doing what you say you will do, being respectful. And here's another thing, when a family member comes on board, or if it's time for you to have this discussion, clear roles and responsibilities must be established. And of course, in most family-owned businesses, people are wearing a lot of hats out of necessity. But it's really important, clear roles and responsibilities, and who you are to report to. Boundaries are also established. Now, boundaries are a little different than ground rules. Boundaries, what I'm talking about right now, is business-related, strictly business-related. Here's what I will tolerate, and this is the owner. Here's what I will not tolerate. And then you draw the family in on what they think is a good behavior, proper behaviors to display, proper ways to communicate. Those things are all very, very important. Here's another thing that I think is great to add. No finger-pointing, no finger-pointing. It doesn't matter what problem it is or what has happened. What matters is fixing it. And then here's another thing, written agreements about the business. You all have to agree on the way the business is going. Of course, the major shareholder or the president has the highest decision. All right, so those are the things that prevent problems in the first place. So those are really, really very important. All right. Now, successful family-owned businesses. They hire non-family members on their board of directors. I think that's a great practice. Or they have a trusted advisor, perhaps their accountant or someone unbiased, a business person, a friend, someone who's retired, for example. I know many companies will bring in someone who's retired, and they are instructed, give your honest and biased opinion. And if the family is incapable of facilitating a productive family-owned business meeting, then the advisor's job is to say, okay, okay, we're getting off subject here. Let's stick to the agenda. So those are very, very good things and very good practices to do. All right. So having said that, that is always a great thing to do. The next thing is successful family-owned businesses share the same vision. And that vision is definitely where you want to go, what you want to accomplish. So to achieve success in a family-owned business, every family member should have the same vision of that business and what the principle and what the team, family team, wants for the future. Now, if one person wants to keep it as it is and just grow profitability and customer base, and another wants to build an empire, that's not going to work. And if one person just wants to make a living and another wants to make a fortune, that's another type of problem. So if family members do not share the vision of the founder or top executive, they have to be comfortable enough to express their feelings. But ultimately, everyone must be on the same page to avoid constant conflict. And obviously, a successful family-owned business is committed to more than profitability. They're committed to the community. They may even have a cause, a charity, that it's not only making more money for the shareholders and the owners, but it's also creating more jobs, which is a very good thing to do. All right. The next thing family-owned businesses do is that they create ground rules of expected behavior. Here are a few that I created. I'm sure that you'd like to create a few more. And if you can think of any that you'd like to add, maybe write them down quickly. Successful family-owned businesses, they remove that family hat. They know how to move from the kitchen table to the conference table. And they focus on the well-being of the business and the employees. That is most important. If they can't do that, they're not going to be successful. And by the way, that is not easy to do. They demonstrate respect and their core values at all times. Your values should drive all you do. I'm going to speak about that in just a little while. State your opinion at all times and don't hold back. Those are the ground rules that you should have for family meetings and for how you will work together. All right. Be open to the opinions of others and most, as I said, respect, which should be one of your core values. Another one is make sure that you walk out of all meetings as family members. Walk out of all meetings as family members. Now, here's a good one. No discussions of business at family events. I know a few families, they get so mad because their spouses or husbands or wives will talk about business with other family members and they're supposed to be there having fun, so there's a little tension. You might set a ground rule where only 15 minutes talking business or none at all at family events. You be the judge. Here's another thing, especially if you're a husband and wife or partners, no discussions of business after work hours, especially if you're husband and wife. There are many who just can't shut it off. By the way, husbands and wives should always have date night at least once a month or once a week and no talk of business. Also, there should be a shut off time that after 7 o'clock that there's no discussion of business. Whatever works for you. I knew of a couple that would argue all the way home from the business. How do I know? My wife is in the back seat. How to avoid conflict with employees. I have great examples. If you show favoritism to a family owned member, that's going to make employees unhappy. If there's constant nepotism and you don't hire from the outside or promote an employee who's a non-family member, that's another thing. If family members are taking two hour lunches and never seem to get reprimanded for that when they don't have a management position or a good reason and you're lenient, they are going to be unhappy. There are many, many examples. Don't pass up business expenses for family members and buy vehicles or give family members access to a company truck or car unless you do the same for employees. For example, if you have an employee that says, hey, can I borrow the truck for Sunday? I need to move some things, then you should allow anybody in the company to do that. Make a policy about it and that's important to do. Here's another issue. Oh, is this ever a sensitive, sensitive issue? I know so many companies that have this. Often executives will put family members on the payroll who do not contribute. They do not work in the business. Sometimes they have medical problems and financial difficulties. Well, I firmly believe that they should help that person, but I will tell you that CFOs and the general managers will be very unhappy about that. The last thing is to make employees feel like family. Make them feel like family. Treat them as well as you treat your best customers. Make them feel they're working with you and not for you and your family. Make sure you hold employee appreciation events and annual events. Include your employees' families as well as your own. Take a different employee to lunch once in a while. Here's another reason that there can be conflict. Here's a huge example. We all know what happened in 2008, 2009, 2010. It was really pretty bad. A company, their employees, they had to let go of a lot of people and they were also not given any raises. The owner of the company, who was the son of this prosperous dealer, once prosperous dealer, was a race car and he'd often drive his fancy race car to business and park it there that day. The president of an award-winning dealership that I've worked with, on the contrary, drives a Jeep to work. Here's another thing that happened. There was a low morale in a company and I was called in to improve the level of employee motivation. Before I began working, I said, what's going on here? I think one of the reasons that the employees might be a little disgruntled is they didn't get raises, they haven't for a couple of years, but I did buy all New Lincoln Continentals for the executive team. In family-owned businesses, that can happen. I know that in the bad economy, a family-owned business took a 20% pay cut across the board. Family members who were in management positions were given a 25% pay cut across the board. They hire talent outside the family, successful businesses, they hold formal and informal family meetings. It's great to have, hey, let's have a family get together, chit-chat a little bit. Sometimes it's just to get together for a lunch or breakfast, and sometimes it's a formal meeting where we have something we need to talk about. In fact, quite often, something that the family needs to talk about, and in this situation, not involving non-family members. You will find on the internet that family retreats for leaders and all family employees where they can give input and enjoy being a part of the family-owned business is very good. A lot of people think that when the family works and plays together, there's a good chance the family and the business will stay together. Some families also have rituals, like an annual event and things like that. All of that is very important. Here's another thing. Successful family-owned businesses have a great culture. They establish a culture for high performance where dynamic leadership, teamwork, service excellence, and internal service excellence occur. They break down any silos, any territorialism, and the company works together to support sales, business growth, and profitability. Employees are happy. They work very, very hard on that culture, and dynamic leadership is practiced. I'm a firm believer that in any endeavor, any company, everything starts and stops with leadership. The leader has to be the type of person that employees want to follow. They have to learn to be a leader and not a boss. They have to be great communicators. Dynamic leadership, and they have to set the tone. They have to express that they desire excellence in all they do. In fact, it should be the core values. Those are the beliefs and principles that guide the individual behavior and form the foundation upon which your family and business should operate. The family should discuss the company's core values and agreed on how they will demonstrate them to employees and each other. Honesty, integrity, respect, teamwork, all those other good things, and family relationships should be among every company's core values. Oh, and did I forget health and safety? Okay, and there's a high level of employee motivation and employee satisfaction. In family-owned businesses, there's also a great deal of accountability where people, and this is culture now, what families will agree to be accountable for and what employees will agree to be accountable for. Employee members are accountable to each other, to be great leaders, to set the tone and the performance for others, and yet accountability in your company should be very important. We will make every effort to put every part away before the end of the day. We will help others when we need it. We will practice peer support, but things that are most important, we will not suggest the warranty and we will be accountable until we are sure it applies. Write down, and for every company, it's different, so family accountability for how the family will work with each other and then overall culture and employee accountability. So those are things, and of course, a successful family-owned business always focuses on teamwork. All right, here are threats to a family-owned business. Refuting unresolved conflict, nepotism, letting the motions run the business, losing non-family employees, and no succession plan. Before I begin, to give you some key points on your successor and the succession plan, actually the successor, do we have any questions? Are you still out there, people? No questions at this time, Christine, I just want to highlight that it's almost 10.40. I got it. Okay. All right. So here are a few tips, and what we need to remember is that preserving wealth in a family-owned business is not a static process. It's dynamic and progressive. The successor should be the same. All right? They should be, ideally, committed to business and business growth. They should have an incredibly strong work ethic. They should have positive relationships with leaders and employees, ideally. Ideally, they should have learned the business from the bottom up and or worked elsewhere. So it's a great thing to bring them into the business, and definitely not pressure them from childhood on, but bring them into the business and talk about it, let them have job role, let them learn, but it might be a good idea to have them work elsewhere for a short period of time, perhaps one year, before they come to work for the company. All right? So those are important. And then the next thing is, if they hold an advanced business degree or have incredible expertise on parts, on compressors, on how you run the business, however it may be, that would be a great successor. If they're a strong communicator or if they're willing, they have to strive to excel in what I call the five essential facets of leadership. All right? And the five essential facets, and by the way, you can be coached and you can improve on all of these things. If and when this person will take over the business, are they capable of creating their own vision for what they want the company to do? Can they create a smart competitive strategy that includes marketing, advertising, customer growth, all of those different things, how to differentiate the company from the competition, creating a high performance workplace, and the goals. And then the next thing is communicate that to the same thing to employees and be able to influence them and create a buy-in. So there's an influence factor involved there as well. The third essential facet is the leader needs to have the ability to implement changes, any changes that are necessary to create and sustain success. They also need to sustain the momentum of the business through the ability to motivate employees, to do those good things, reward, recognition, making employees feel like family, and that is how it is important to do. And then the most important facet and where we fall short is, and many leaders and companies fall short, is to execute the ideas, policies, and the competitive strategy that you have in place. So those are the essential facets of leadership. And think of your successor, or if you're going to take over the business, you need to improve upon those things. So provide that person with leadership training two years, one year before. Very smart, many smart family-owned businesses will hire coaches to coach the individual from outside the family who can help them. And then they have to know the difference between being a boss and a leader. A boss tells people what to do and drives people, a leader pulls them and helps them pull the load. All right, so we do have some time for questions, anyone? Anyone have any questions? Kristy, I'm not seeing anything come in, or nothing waiting at this point. Nothing waiting at this point. All right, well here's what I'm going to do. I'm going to continue talking a little bit for those of you who wish to listen. And I want you to know that if you would like to contact me to perhaps ask a question that you don't want to ask over our webinar, you can contact me here. If you're interested in receiving my Monday morning motivation, I have lots and lots of people in this industry and many others who receive it and hopefully find value in it. Hopefully they have told me they find value in it. All right, and a few more things I wanted to mention while we still have time to talk. You know, for all leaders and family-owned businesses and maybe even a new successor, one thing that is important, and I call the kiss of death for any business, is to maintain the status quo. So in a family-owned business and any business, efforts must be made to ensure the delivery of consistently superior customer service. Consistently superior. Not great service at one branch and poor service or average service in another. You have to have a reputation within your community, within the area of your customer base for excellent customer service. And that is one of the things that family-owned businesses can often say in their marketing materials. We're family and we care. We treat you by family. But don't be afraid to challenge the status quo. And if new ideas are proposed by a family member or a younger employee, a common phrase is, well, we've always done this with this way. Why do we have to do it that way? Or maybe the owner won't change. Maybe they're more comfortable doing things the same way because that is how he or she gains success. But these attitudes can frustrate employees and family members alike and can hamper business efforts in today's very contemporary service-savvy and competitive world. So those are things that we always need to remember in family-owned businesses. I think that what is really most important is to make sure that your business operates like a well-oiled machine where everyone is performing to full capacity. I'll share two other stories with you for those who are with me. There was a situation where I was called into a dealership and the reason he called me in was because he lost two mechanics, two technicians, in the same day. They went over to work for a competitor and he claimed that it was just for a couple dollars an hour more. And although that does happen, by doing a little further digging and some confidential conversations with other employees and the office manager, I had to be the one to say it's you, you're the problem. Because they said that they worked for the father for so many years and he was such a wonderful person and this son, I guess, did not treat employees really well and was very bossy and they resented it and they left. And that's a really bad thing to lose two top technicians at the same time. One more and then we're done. A situation occurred where a highly successful business founded by the father and president eventually, planning to turn it over to his son, hired the daughter. The son was to get the, hired the daughter to do marketing. The son did not have the interpersonal skills the father had. He wasn't articulate. He did not have, as I say, a great command of the English language. Employees were really worried about what was going to happen. And so was the father. So the father brought in, took the son-in-law off of Wall Street and paid him a lot of money and brought him in to handle operations. Now the father knowing, and by the way, the company is growing exponentially and prospering because of the son-in-law and the father working together. The father still plans on turning the business over to his son and the employees are really worried about their future. And they expressed that to me. So those are some things. Okay. I invite each and every one of you. I want everyone to have a wonderful day. I'm Christine Corelli. I do hope you found value in this presentation. I invite you to send me an email or give me a call if I can help you. I may not be able to return your call right away, but I will most definitely help you in any way I possibly can. Have a wonderful day. Thanks, Christine. I just wanted to formalize that there are no questions, but I appreciate you doing a great presentation and I hope everyone has a great day. Bye-bye.

family-owned businesses

goals

challenges

growth

profitability

future generations

employment

communication

succession planning