Family business is more about family than about business

The business and family love are
two different, mutually exclusive issues.
When the two mix, both self-destruct.”
Current Existence & Growth: Who has the power and why?
Performance versus identity: Who are you versus what did you do?
Succession: Family or business: Which comes first?          
Competence versus connection: Which is more important?
Families that understand these two questions and are able to address them succeed in perpetuating their growth, influence and wealth. Others disintegrate in internal strife and are relegated to the pages of PhD thesis on the subject of ‘Family Business.’ I have called this ability to deal with these questions, ‘The Critical Transition from being Person-led to becoming Process-driven’.
In my experience many business families spend far too little time on the upbringing of their children especially in inculcating the value of contribution. Of each generation creating its own legacy and not being content to ride on the back of the earlier generation. They give their children the same education that is given to the children of ordinary people who they employ. They don’t prepare their children for the distinctly different responsibility that they will have to shoulder. This is not about arrogance or about creating a new caste system. It is about merely recognizing the fact that the scions of business families are going to inherit power and wealth entirely out of context of their own effort. It is therefore essential for them to understand the distinctly different responsibility that comes with such wealth and power and for which they will be answerable to their families, their descendants and society at large.
I’ve met many founders who struggled very hard to set up and grow their business and who say to themselves (and to everyone else) with great feeling and tears in their eyes, “I will never allow my children to face the hardship that I had to go through.” When I hear this statement I say to them, “Please change the wording. Say, ‘I will never allow my children to build resilience, character and strength. I will never allow them to have the power that I have, to succeed.’ Say this because in effect that is what you are really saying.” For many of them this statement of mine is a shock. They had never thought about their view on upbringing of children in that light.
They equate expense with quality. They give their children the most expensive education which insulates them from the realities of life and so they never learn to fight the real battles. They give them the most expensive toys which in reality teach them to define human value in terms of material worth (the ‘best’ kids are those who have the best toys). They insulate them from poverty, deprivation, lack of resources and thereby they ‘protect’ them from being exposed to the power of drive, ambition, single minded focus on achieving big, ambitious, scary goals. They build walls between their children and the people who they must in the end, deal with. People who will one day, work in their organizations and decide their fate. People who need to be inspired, led, cared for and supported. And therefore people who must be understood. Not simply in order to do good and be charitable but because the success of the business and family depends on the development of these people; the great multitude. The fond parents forget or ignore the fact that one day the time will come for the soft little molly coddled pussy cat to enter the jungle of the real world without any of the tools it needs to survive, much less to lead others.
Possessions add cost, not value.
Children must be taught that humans have more intrinsic value than anything material which can be bought, sold or junked. That cars, branded clothing, watches, gadgets, material possessions, expensive houses don’t add value to the people who use them. Possessions add cost, not value. Anyone sensible will seek to add value to himself, not cost. People who believe that possessions add value or seek to convince others of this, have no value for themselves. They have low self-esteem and are seeking to lower the value of the human being. Children must be taught that a car, no matter how expensive, is transportation, not a symbol. Except of bad judgment which makes someone put huge amounts of money into a depreciating asset. A shirt is clothing, a watch is meant to tell the time and shoes are meant to walk in. None of these define you, are not statements, nor indicators of what kind of human being you are. It is your character, your actions, what you stand for, your principles and your values, which define you. Not what you possess. What you possess can be stolen or taken away from you. Your character, your values, your principles are the stuff of memories that you leave behind. By these you will be remembered, honorably or otherwise. Live a life such that you will be remembered with honor. Teach children these things by personal example. Because that is the only way to teach them.
Family is Family
There is always a difference between ‘insiders’ who are family members and ‘outsiders’ who are not related. Some of these differences may be overt as in rules applied differently. Some may be covert and under the surface but still clearly visible to everyone, as in forms of address, precedence, who can go to the Chairman’s home uninvited. In many families the business is treated as an extension of the family home and the same roles of elder and younger apply.
Guaranteed career progress and no door marked ‘Exit’
Like employment, career progress is also guaranteed. After all the family rarely promotes an ‘outsider’ over the head of an ‘insider’. So the family member will always get his promotion, even if it means that someone else actually does the work. I have seen many examples of this in the Middle East where the professional manager actually does the work while the family member is busy fulfilling decorative purposes. Needless to say the same logic extends to family members leaving the organization. After all, just as you can’t steal from yourself, you also can’t leave yourself. So no exits for any of the reasons that are guaranteed to send ‘outsiders’ into orbit. Needless to say this encourages complacency. In some families the incompetent member is shifted to some other part of the business where he proceeds to spread his negative influence, only to be moved elsewhere when he has done sufficient damage. The power of the bad apple must never be underestimated.
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JazakAllah Khair for the nice article. I love the paragraph on possessions add cost not value. So true and practical.


Aatif Nasim

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