Perpetuating The Family Business: 50 Lessons Learned From Long-lasting, Successful Families In Business

Perpetuating the Family Business Perpetuating the Family Business 50 Lessons Learned from Long-Lasting, Successful Families in Business John L. Ward © John L. Ward 2004 All rights reserved. No reproduction, copy or transmission of this publication may be made without written permission. No paragraph of this publication may be reproduced, copied or transmitted save with written permission or in accordance with the provisions of the Copyright, Designs and Patents Act 1988, or under the terms of any licence permitting limited copying issued by the Copyright Licensing Agency, 90 Tottenham Court Road, London W1T 4LP. Any person who does any unauthorized act in relation to this publication may be liable to criminal prosecution and civil claims for damages. The author has asserted his right to be identified as the author of this work in accordance with the Copyright, Designs and Patents Act 1988. First published 2004 by PALGRAVE MACMILLAN Houndmills, Basingstoke, Hampshire RG21 6XS and 175 Fifth Avenue, New York, N.Y. 10010 Companies and representatives throughout the world PALGRAVE MACMILLAN is the global academic imprint of the Palgrave Macmillan division of St. Martin’s Press, LLC and of Palgrave Macmillan Ltd. Macmillan® is a registered trademark in the United States, United Kingdom and other countries. Palgrave is a registered trademark in the European Union and other countries. ISBN 978-1-349-51698-8 ISBN 978-0-230-50599-5 (eBook) DOI 10.1057/9780230505995 This book is printed on paper suitable for recycling and made from fully managed and sustained forest sources. A catalogue record for this book is available from the British Library. A catalog record for this book is available from the Library of Congress. 10 9 8 7 6 5 4 3 2 1 13 12 11 10 09 08 07 06 05 04 To the many, many families who have so generously shared their experiences with me and inspired me to find the field of family business fascinating, fulfilling, and important. Thank you for what you have given me and offered to others. Contents List of Figures viii List of Tables ix Acknowledgments x Author’s Note xi PART I Frameworks for Family Businesses that Last 1 1 The Ultimate Management Challenge 3 2 The Five Insights and The Four P’s 10 3 A Vision for the Future 31 PART II The Lessons 41 4 Stage I: The Owner-Managed Business 43 5 Stage II: The Sibling Partnership 66 6 Stage III: The Cousin Collaboration 102 7 Taking the Longest View 144 Appendix A: The Lessons at a Glance 156 Appendix B: Integrating the Lessons 161 Appendix C: A Family Business Checklist 165 Notes 168 Bibliography 173 Index 175 vii List of Figures 1.1 2.1 2.2 2.3 3.1 6.1 6.2 6.3 There’ nobbut three generations atween clog and clog The three-circle model of family business Continuity Planning Triangle Advantages and disadvantages of owning a family business Three-stage model of family business The Suarez family mission statement Johansson family mission Reinforcing values between family and business viii 4 14 18 22 31 134 134 137 List of Tables 3.1 5.1 5.2 A.B1 A.B2 How family assumptions shape ownership plans and business strategy The 6C’s: a family code Family values statement The Five Insights The Four P’s ix 36 86 94 161 163 Acknowledgments This book is a reflection on more than 25 years as a student of family business. There are so many people to acknowledge