Honesty is such a lonely word. Everyone is so untrue. Billy Joel
Maybe not everyone is “so untrue”, but I think we can all relate. Billy Joel has penned many memorable lyrics, and while these may not be among my personal favorite of his, they still remain true. In family business, honesty may be the one trait that trumps all other skills in determining success, as well as perhaps happiness or some measure of it.
Question: What do the most successful family business do?
Answer: They are brutally honest.
By my last official count, there were 2, 679 books on family business that proclaimed to share the “secrets” of family business success (that count might not be entirely honest on my part, sorry). Sift through any search of recent book titles and there is no shortage of experts proffering their secrets. It’s catchy, and we all want to be in the know, especially if it leads to success and untold riches. The cat’s out of the bag however and I am not entirely sure there are many secrets left to reveal. Honesty breeds trust, trusts yields communication and communication leads to ____________________________ (fill in the blank).
Question: And how do those businesses achieve such honesty?
This is where it gets a little sticky. Very few people, let alone business leaders would admit to being poor communicators. It’s a blind spot that afflicts many of us. What are the signs of good communication in a family business, any business?
- Conflict – Not necessarily a lack of conflict, but conflict that is met head on and not left unresolved.
- Meetings – While meetings may be the bane of many of a business, best to not confuse unproductive meetings with efficient and effective meetings.
- Written policies – In particular when it comes to guidelines for family employment and succession planning.
- Technology – Using technology that works, not only for the business but for the family as well. Think private Facebook for family members, secure intranet.
- Creativity – Innovation does not materialize in a vacuum, yet when openness and trust abound.
Question: But where do we allow this communication to thrive?
Answer: Everywhere, but start with good governance.
Most families are built on generations of implicit knowledge. Much remains unspoken but known. In the family owned business, this can be perilous. Family roles that conflict with business roles, assumptions vary with an individual’s perspective, and what will happen when the CEO gets run over by the proverbial bus?
Where I have witnessed the most successful businesses, thrive, it is often because of good communication carried out through good governance in all three circles; family, business and ownership. While governance is not the cure for all ills, it can be a conduit for effective communication, conflict resolution and well thought out succession planning. Start now, be patient, involve others.
Honesty is hardly ever heard, and mostly what I need from you.