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ALL IN THE FAMILY

Help! My children are not committed to the business, Part 1

/ 01:31 AM September 18, 2015

A READER says: My husband and I started our retail business 50 years ago, and we wanted our children to take over. They are now in their 30s and they are working with us. Sad to say, we are not satisfied with their performance. They come in late and they do not work hard, but they depend financially on our business. My husband and I worked very hard to establish the business, but given the attitude of our children, we are afraid that the business will not last long. We already have grandchildren, whom we love very much. Our grandchildren are still young, but we don’t think that the business will survive the next generation. We already invested in a family constitution, but our children are not following it. What can we do?

First generation

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The founders start the business, so more often than not, they are extremely hard-working and persistent. You and your husband clearly are typical founders, and your desire for your children to be as committed as you is shared by founders worldwide.

However, this is easier said than done. Your children are reaping the benefits of your diligence, and for whatever reason (perhaps you were too busy at work, perhaps you ensured that they never had to truly work for anything), they have not formed the values and habits that you know are essential for business survival.

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Start by telling them that every generation of a family is the first generation. Yes, you read it right. Even if technically they are not the founders, they definitely possess similar skills to maintain and grow your business.

“[Every generation] has the same power of creativity as whichever generation was biologically the first,” says US family business consultant James E. Hughes Jr. in his book “Family Wealth.” “It is only when a family fails to perceive itself as the first generation that it begins to risk resembling the status quo of a second generation or the decay of a third.”

Unfortunately, since your children have inherited wealth, they may tend to take it for granted. They may have been used to the good life, so even coming in early is something they find hard to do. They may be waiting for each other to be the natural leader, someone they can depend on to do the hard work.

“These later-generation family members are rarely motivated by the same emotions that fueled the productivity of the originator of the initial family wealth,” says Hughes. “A family that imagines or, worse, assumes that every member of the family will be a wealth creator, or even that in every generation someone will have the creative instinct to be a great financial wealth creator, is fooling itself. Such a family is in entropy and will swiftly go out of business.”

Family stories

What can you do? As founders, you have to exert utmost effort to get your three children mentally and emotionally involved in the business. They need to have an emotional stake, not just a financial one. You have already done a constitution, but they are not following it.

Why not? Perhaps they do not find it meaningful. Have you told them family stories about the business while they were growing up? Have you discussed what makes your family and business unique? Have you ensured that they grow up proud of what you have achieved, and motivated so that they can grow their legacy?

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“Stories are the glue that binds together the individual members of the family,” says Hughes. “Family stories give members a sense of the unique history and values they share, their ‘differentness.’ A family that does not inoculate its young against childhood diseases would be risking its most precious assets. Failure to inoculate the family’s young against entropy with the vaccine of its history and the values that are contained in its stories is similarly risky.”

Pick good stories. Your business provides employment; narrate how your employees depend on the growth of your company. You were able to make a fair deal; narrate your pride and joy at utilizing resources well. You and your husband have strengthened your bonds because you work well together; narrate how a family business can be an ideal way for members to make decisions together.

Once you have caught your children’s attention, you have to guide them. I suspect they are not committed because they may not know how best to deal with problems. It is easier for them to let you handle major decisions, but you have to guide them and then step back. (To be continued next week)

Queena N. Lee-Chua is on the Board of Directors of Ateneo de Manila University’s Family Business Development Center. Get her book “Successful Family Businesses” at the University Press (email [email protected]) Email the author at [email protected]

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