by Dan Beenken
The title says it all: Long Live the Family Business! I couldn't agree more.
If you are involved in a family owned company and are wondering how to create a business that will last from generation to generation, I highly recommend Les Banwart’s book. It’s a great read about the 2 two requirements for all family business: Planning and Communication.
Banwart has spent more than 40 years consulting with family owned firms and over time a few things have stood out to him as success indicators. He shares those ideas in this book from a practical standpoint to provide you with a road map for your own family.
Lesson #1 - Know when to let go. It’s the most difficult thing you will go through as a business owner. Giving the keys to the next generation may sound simple, but the realities mentally and emotionally are far more complex. Banwart’s advice? “You must retire TO something, not FROM something” How true that is. What could that be for you?
Lesson #2 - Keep ownership within the active family. Too often, families spread stock to everyone in the family. This can work for the largest firms out there. But for smaller companies, you need to concentrate the stock to those that are working there every day.
Lesson #3 - Get your family house in order first. Your tax and legal advisors are excellent at helping you through your tax and estate planning issues. But they can’t do anything until you have your own house in order. Too often families start with tax and estate work only to find out that their family assumptions were way off.
One thing I have come to learn as a family business consultant – “if you have heard one family’s succession planning story, you have heard one family’s succession planning story” “Long Live the Family Business” does a great job of showcasing enough examples to give all business families some ideas. It provides ideas for all family members, regardless of their status in the business or their generation. And most important to me, it’s written as a practical guide.