A recent white paper by Deloitte explores strengths intrinsic to family business that may give these enterprises a relative advantage during this unusual year. Interestingly, the subject of business culture is once again comes into focus. “Alongside the millions of healthcare professionals and volunteers, some family businesses are being branded as ‘heroes’ by their local and national communities in the current crisis,” the paper states. “This often comes down to the family values that have been instilled for generations across the business, in family members and employees, and then ultimately imparted to customers. It is these inherent values and solid organizational purpose that can secure loyalty far beyond the crisis.”
The paper also points out that this may be the perfect time to elevate the involvement of the next generation in your business’ succession plan. The up-and-coming entrepreneurs of the family may be “readily available “extra pair of hands” in a time when resources are either scarce or not available, as well as a valuable sounding board or source of fresh ideas.” Digital natives, they might also be poised to lead new and innovative efforts during a time when digital interfacing with clients and vendors is increasingly vital. “Not only does this give the next generation a chance to prove themselves, but their active engagement in the business at this time could be the difference between success or failure.
While resilience and core values are often inherent in family businesses, family tensions may also be built in. Generational differences in vision or priorities can be tricky to navigate. The current crisis has led many older business owners to weigh risks to their health and safety alongside normal cost-benefit considerations of doing business. If you find yourself in this position, it may well be that now is the right time to officially pass the baton to your next-in-line.
Even when the sale is to a trusted family member who has grown up with the business, selling a family business can amplify all of the tensions that go along with running one. You may discover that the sale could be very disruptive for you personally. All too often, people fail to recognize the emotional and mental stress that comes along with selling a business. Many owners begin the selling process only to discover that they are not emotionally ready to do so. While everyone wants to be unemotional in making their business decisions, this is not always the case.
For help navigating the challenges that come with this opportunity, contact us!
See the Deloitte infographic below for insights. Deloitte will be publishing a series of articles on this subject in the coming weeks. If this feels close to home, stay tuned!