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  • Katherine Bullock

The case for case studies in family business



I read with interest this week's edition of FFI Practitioner, which set out a collection of case studies from different family businesses across the globe and in particular how each family had approached the various challenges that most family businesses and family business owners will face over time. In particular there was a fascinating article by Ashvini Chopra titled "Control of the dead hand" that debated the advantages and disadvantages of attempting to control a legacy from beyond the grave.


That article resonated with me. Sometimes I think that my main task as a family business advisor is to represent the wishes and intentions of individuals who are no longer with us and have passed on their legacy to the next generation. It is an honour and a responsibility to take on that role, but also inspiring to see the growth of both family and business that follows the careful thought and preparation that has gone before, often over many years. I am lucky that I do not regularly experience – after almost 30 years in practice – some of the extreme dysfunctional behaviour that is covered in different case studies and indeed in some of the cases that find their way to the Courts. However, I am often told by my clients of the difficulties that they inherited from previous generations, the problems that they have had to resolve and how determined they are to avoid repeating those mistakes. In fact, I cannot think of a single family that I have dealt with that did not have its own case study in the past from which it drew a cautionary tale.


"Sometimes I think that my main task as a family business advisor is to represent the wishes and intentions of individuals who are no longer with us"

There are three golden rules that I can distil from what I have observed. Firstly, it is important to plan, and the best plans are developed over time, carefully, consistently and cautiously. I can think of several examples where planning has begun when a legacy was inherited and ended, many years later, when it was passed on. Rather like the famous swan, all appeared to glide smoothly and effortlessly along but I know that the individuals concerned worked furiously behind the scenes.


Next, communication is key. Everyone from business leaders to family counsellors will tell you that it is important to communicate. The reality is that doing so is very difficult indeed – particularly for families, where the emotional undercurrents are strong and deep. The risk of mishandled communication can be very severe indeed. But it is best to start somewhere. Written communication – a letter of wishes – or communication to a trusted adviser is better than none at all. It can be a good start. If making a choice between individuals is a step too far, then creating the process for the choice may be the next best thing. Talking through how others have succeeded and failed in separating business and family, introduced the next generation, appointed leaders, worked with non-family members, can be a good way of having the conversations that need to be had.


Finally select and appoint a trusted adviser whom you like and trust and whom you feel "gets you" and the family. The reality is that you cannot think of and plan for every eventuality – particularly those that affect people who haven't been born yet and whom you can't possibly know. Change happens. At those points, having a trusted adviser who has a sense of the values of the family and business, the long term aims and objectives of the business and the skills, network and relationships to help the family navigate the unknown and unforeseen is essential. Independence is an important ingredient – it allows for an objective and disinterested voice at the table. I have found the ability to walk away has been a key to my own success in many negotiations. Interestingly when available, it is something that I have never found the need to use. But I learnt from others who found that without that independence they were mired in the same difficulties as those they sought to help.


Whilst few family business situations are unique, each family business leader will only navigate them once. Each family business leader therefore needs as much experience as they can gather from others that have navigated the same challenges. That is why the family business community shares its stories with such generosity – whether they show success or failure. And that is why case studies matter.

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