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Succession, transition, change, transformation, adjustment – retirement! There’s a lot to think about as I step down from my role as Vice Chairman at Deloitte UK.
Having spent many years working with families and helping them through the challenges that succession brings, I am now finally doing it for myself. As I approach the end of a long career at the firm, I’d like to share my personal experiences as well as those that I have previously seen in a professional capacity.
At some point in time, many next generation family members will have a decision to make about whether or not to join their family business. This can be an extremely difficult choice, not least because of the tension between the opportunities afforded by family businesses and their inherent complexity.
This week, Niall Glynn, a partner with Deloitte in Ireland, discusses the compensation of family employees.
For family employees in family businesses, compensation can often be one of the primary causes of conflict. It is extremely important to have clear parameters for reward and avoid basing compensation decisions on emotive criteria.
This week, Tam Chee Chong and Cathy Chow from Deloitte in Singapore discuss the effects of Asian culture on succession in Asian business families.
Asia’s business families are in the midst of experiencing unprecedented generational change; the majority are transitioning their businesses from first to second generation, and some are making the transition from second to third generation. For many, family values, underpinned by culture, are one of the most influential factors impacting succession planning and the decisions made on that journey.
This week, Eefje Chalmers, a family business advisor with Deloitte Netherlands, considers the potential impacts of using technology on families and their organisations.
The internet is one of the greatest inventions. Few other things have so radically shaped culture, media, commerce, entertainment and communication. But as with many things, these benefits can have a downside, especially where family, wealth and business collide.
This week, Joanne Whelan, a partner with Deloitte in Ireland, looks at conflict in family businesses.
It is no secret that family businesses are complex. This complexity arises from a mixture of family chemistry, diverse family priorities, and the organisational challenges and opportunities which most businesses face. It can often lead to a degree of conflict in family businesses - lines may be more easily crossed and disagreements can become more heated, and personal relationships with family members can cloud judgement when it comes to making business decisions.
This week, Peter Pagonis, a senior partner who leads Deloitte’s Family & Individual Wealth practice in Australia, discusses the benefits of introducing a family council governance structure.
We often hear about how having a family council can be hugely important for family owned businesses. They seemingly bridge the gap between family and business, and in the best cases, manage to simultaneously meet the needs of both.
Roles for family in the business
A question we are commonly asked is whether family members, in particular the next generation, should be involved in the family business.
Some families choose to have a blanket rule that no family members can work in their business; they leave the ‘non-family professionals’ to it so as to avoid potential for conflict and ensure meritocracy. I have known one mother to say “No way are my children working in the business. It took their father, my husband, away from the family and his life revolved around it.”
This week, Yasmine Omari, a Manager with the Deloitte Middle East Family Enterprise Consulting team in Dubai, explores the importance of creating a family constitution.
When one discusses constitutional legacy, political connotations are often the first thoughts that spring to mind. Family business systems are not too dissimilar to political systems, be it autocracies or democracies. Successful family businesses tend to have certain key features that make them successful, such as clarity of purpose and values shared by their members. They adhere to an established code of conduct, and are aware of stakeholder expectations, undertaking activities accordingly. Such features are not dissimilar to successful political parties that are driven by a set of ideologies, meeting the needs of the people.
This week, Alain Nijs, a partner in Greenille by Laga, highlights the unique features of family dynamics in blended families.
Blended families (including stepfamilies) are common today. Statistics show that in some countries a growing number of families have shifted away from the model of the “intact” or “nuclear” family, composed of the original biologically bonded mother, father and children. In other words, these families have gone through various transitions: a breakdown (divorce), remarriage or another form of living together relationship.
When working with family businesses, it’s sometimes surprising to see the gap between the founder and the next generation, particularly when the next generation do not see the importance of the business. This week Rosine Makhlouf, a senior manager with the Deloitte Middle East Family Enterprise Consulting team in Dubai, considers how to encourage engagement of family members who don’t work in the family business.