The Ethical Edge
The Art of Integrity
My Journey with Family Business
SUCCESSION STRATEGIES, INC.
“It is not enough to be busy; so are the ants.
The question is: what are we busy about?”
Henry David Thoreau
Then, I heard a presentation by Dr. Craig Aranoff, Professor of Business at Kennesaw State University, on his research into family business dynamics. His research showed that family businesses are unique. They face problems and issues that are more complicated than most because family values and business values are often at odds. Dr. Aranoff commented, “the challenge for a family business is to straddle the needs to preserve the family and to run a profitable business. Being too focused on one side or the other either creates great families and bankrupt businesses or great businesses and bankrupt families!” As a direct result of these conflicts and issues, there is a very low success rate in sustaining a family business over multiple generations.
His research concluded that over 70% of businesses fail to remain in the family after the death of the founder and only 10% remain in the family by the third generation. This is a loss to both the family and the community since family owned businesses are a major source of new jobs and often are vitally active in the communities they serve. Dr. Aranoff’s message was that competent advisors are uniquely positioned to assist family business owners to keep the business within the family. Bingo…it was my moment for mission!
His message inspired me to focus my practice on helping family businesses with their succession planning. As a result, I wrote the business plan to help start the Family Business Council at Cal State Fullerton, which was established in 1994. In 2000 I started Succession Strategies, Inc. with my partner Bill Sornstein. It is a business consulting firm dedicated to helping family businesses take the necessary step to ensure that the next generation is able and willing to step into the shoes of the founders.
This focus has been the guiding force to my business practice since that time. Helping family businesses manage the transfer of management and ownership from one generation to the next has become my fulfilling mission. Because I deeply listened to Dr. Aranoff’s message, my professional work moved from a product-centric practice into a quest to help our clients perpetuate their businesses for the good of both their families, employees and the larger community. It has been an incredibly rewarding 20-year journey.
This week’s article was contributed by Rachel Owens