No more “muddling through.”

In the Cornell class, Leaders in Family Enterprise, students are asked to capture their reflections based on weekly readings and our many guest speakers. From time to time, students reveal their own progress and learning in many inspiring ways. We have kept the identity of this student anonymous.

In class so far, I have really enjoyed learning about the various frameworks developed to
analyze family businesses. I am currently in a position where I have the option to work at my
family business, to potentially have a board seat, or to walk away from the business. My family
business was started my grandfather and great grandfather, my father is currently the CEO and
he is interested in getting me involved or looking at other management options if I’m not
interested. The “Analyzing Family Business Cases: Tools and Techniques” article resonated with
me in how I frame the decision of whether to enter my family business, how I think about the
conversations I’ll need to have around the topic and how I think about my family’s management
of its investments from other businesses.


The framework of thinking about family business through three lenses, (1) The Family
Business, (2) The Family in Family Business and (3) The Business in Family Business seems to
me to be a particularly powerful in framing the various decisions and potential problems inherent
in having a family business and family wealth to manage from that business (and potentially
others). I’d like to dive into the Family Business view in this reflection. The three circle model
provides a powerful tool for understanding the various options available in a family business
setting and how to frame the conversations. I enjoyed how Michelle Ho showed her own version
of the three-circle model for her business. It showed her as part of the company and her family
definitively outside of the company. From her talk, she seems to have minimal drama on the
family side and I speculate that the clear assignment within these 3 circles helps keep both the
business and the family running somewhat smoothly with minimal additional drama.
The Family Axes framework, which includes the three circles but with additional
information on the stage of each circle, for my case seems to be specifically applicable to the
family investments and wealth more so than the business. For my own family situation, there is
much less uncertainty around the business then there is around other family investments and how
they are managed. By utilizing this framework and placing stakeholders in their desired and
future position it helps me think about what conversations to have with which stakeholders to
move forwards and build a unified vision.

In a similar vein, the governance 3-circle model structure outlined in the paper has helped me
set up regular meetings within my family (first one occurred last weekend). We have set up
regular family meetings, with meeting minutes, a centralized place to store documents, and
regular agenda with to do items for members of the family in thinking about how to handle the
family investments and other matters related to family business(es). My family has a history of
running things in a way where there is limited governance, and the family is not tied down to
process. By breaking out governance for owners, management, and family it inspired me to
create governance around our own family investment decision making.

I also found the performance matrix interesting in thinking about the competing goals
inherent within a family business and family investments. I believe my family is currently in
quadrant 4 where we are “muddling through without a clear focus on family or business goals”.
This matrix is interesting to me for two reasons, first as I think about joining the family business
we as a family need to think about where we want to be on this matrix. If we’re more worried
about family that may lead me to join the business in a different way then if we’re more worried
about the business outcomes itself. I’ve spoken with my father about the benefits of a family
business being that I can have the type of job and lifestyle I may want (ex: working part time
when I have kids). This would lead more towards the muddling or family focus segment of the
matrix. However, if we are going to focus on the business performance then this may drive a
decision towards just sitting on the board or towards a more full commitment being in
management. Second, this matrix has important implications for how to move forward with
family investments.

At the family meeting held over the weekend, we started to discuss a family
charter and purpose of future investment. While we discussed the potential purpose of family
funds, I think the success and family harmony discussion is worth having. It will inform what sort
of things we allow and how much we fight for what we think is the right investment thesis. I
think sometimes it’s easy to forget about the family nature of these discussions, but this reading
helped reinforce that the family nature is critical to discuss openly. I do not think I saw family
harmony as a legitimate goal to pursue, more just an ownership structure or nature of the
relationship.

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