Family-owned businesses: A special heritage


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Family-owned businesses (FOBs) have a unique set of dynamics. As well
as dealing with all the issues that relate to growing a successful business,
there are also important factors relating to the family that need careful
attention such as the transition from one generation to the next

Published in: Business
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Family-owned businesses: A special heritage

  1. 1. Family-owned businesses A special heritageFamily-owned businesses (FOBs) have a unique set of dynamics. As wellas dealing with all the issues that relate to growing a successful business,there are also important factors relating to the family that need carefulattention such as the transition from one generation to the next >>It is the very human and emotional aspect of A special heritagethe family-owned business, which creates the The values of a family-owned business are handed down‘family values’ that influence how the company to each generation and maintaining this heritage and familywill ultimately take decisions. Also, compared to goodwill 1 is key to continuing success. Decisions about risk taking and long-term investment – the structure of thenon-family-owned businesses which tend to be organization – who works where and for whom for examplemore impersonal and driven by short-term returns, and the markets the company chooses to operate in, areFOBs are more focused on long-term value creation. often defined by the family-owned business values. 1 F amily goodwill is the relational, human and social capital that typically contributes to the economic value of the business.©2009 Hay Group. All rights reserved
  2. 2. Family owned businessesA different set of challenges Why Hay Group?Yet ‘working for the family’ presents particular challenges. We understand the practice and philosophy of runningDuring their evolution, our clients have questions that are a family-owned business is different from running anparticular to them as family-owned businesses such as: ‘ordinary’ company. We see getting to know the family as part of our work in supporting a family-owned business h ow should we manage succession from one generation in providing a more personal ‘human’ service. to the next? how do we professionalize our business for growth Our consulting services therefore do more than just look without losing the family spirit and values? at the business to deliver real benefit by: s hould we create a family office to manage the family p roviding an holistic approach: combining an interests? understanding of business, management and the w hat is the best way to share rewards for family and family dynamics non-family members? h elping transform what can be highly emotional c an we attract a CEO who is a non-family member? perspectives on strategy and objectives to a more h ow do we draw the line between ownership and rational one to achieve the right balance between management? ‘family first’ and ‘business first’. Hay Group works in partnership with family businessHelping to find the balance between owners to address their specific needs and focus on practical‘family’ and ‘business’ implementation. We don’t just leave behind a manual of recommendations but work with clients throughout the lifetime of a project and after, if required.Hay Group helps family-owned businesses address thesechallenges, guiding them through the opportunities and By transferring knowledge and capability to family-ownedrisks posed by the business, the family, the ownership of businesses we help them lead and manage change morethe company. We help: effectively. In contrast to other consultancies, we do not bring an army of newly trained consultants to overrun our client’s confirm the company vision so that everyone agrees organization. Instead, we bring a small team of experienced on what the business will look like and achieve in the professionals who provide advice to senior leaders to help future companies achieve their business goals. m ake sure the business strategy is aligned to family aspirations d evelop a family plan and protocols that provide governance structures as well as balance family and business control d evelop a leadership team that focuses on delivering business goals but is also sensitive to the values of the family c reate short and long-term succession plans that meet the aspirations of both family and organization set up the right reward strategy and structure that will allow retention and development of both family and non-family managers About Hay Group t ransfer the goodwill from the founder/family to the business organization through a professionalized Hay Group is a global consulting firm that works operating model and management with leaders to transform strategy into reality. It organizes people and work to be more effective, ensure family-owned businesses actively manage develops talent and motivates them to perform attracting and retaining talent both from within at their best. With 85 offices in 47 countries, it works the family itself and outside. with over 7,000 clients across the world, from the private, public and not-for-profit sectors – across every major industry. Our focus is on making change happen and helping people and organizations realize their potential.©2009 Hay Group. All rights reserved