From the Kitchen Table to the Conference Table: Family Business Communication - Softcover

Michaud, Laura

Softcover

ISBN 10: 0974414948 ISBN 13: 9780974414942

Publisher: Cameo Publications, LLC, 2004

Synopsis

Working with the ones you love can occasionally pose challenges, especially when it comes to communication. Now you can enhance the positive aspects of a family business by learning how to understand and use various communication skills, forums, and techniques to improve business and family relations, as well as the company's success.

In this groundbreaking book, Laura Michaud shows you how to:
* Learn the communication challenges that family businesses face and what to do about them;
* Identify and understand the differences between you and your family members for a healthier work environment;
* Master your biggest communication challenges for success and happiness.
This book is guaranteed to improve family business relationships, whether you're at the kitchen table or the conference table.

About this title

About the Author

Laura Michaud is one of the most sought-after experts in family business. She was the third generation owner of her own family business (Beltone Electronics) for twenty years. Today, as owner of the Michaud Group, she helps family businesses improve performance and communication skills. She specializes in succession planning, creating organizational structure, building relationships between family and non-family employees, board development, increasing the bottom line through better employee and customer management, lowering employee attrition, creating a work/life balance, and increasing referrals and repeat business.

Excerpt. © Reprinted by permission. All rights reserved.

Chapter One: The Good, the Bad, and the Ugly of Working with the Ones You Love

The majority of family business members agree that running a family business can be very rewarding as you share your successes with your loved ones. Additionally, they experience a level of trust in the workplace that only a family business can afford. However, those same people will also reveal that working with the ones you love has the potential to put a strain on both the family relationship and the business, as people s expectations of family members in the work environment are radically different than they would be of others. Whenever a family business has strain, the stress rubs off on all the family members, which can result in a feeling of "doom and gloom," both at the office and at home. Perhaps this is why the average life span of a family business is only twenty-four years.

Before we go any further, let s review some basic facts about family business. As you read these, I challenge you to think about two things: 1) The power that family businesses hold in the United States, and 2) The daunting failure rate associated with family business. The greatest part of America s wealth lies with family-owned businesses.

Approximately ninety percent of all business enterprises in the United States are privately held (family-owned), and nearly thirty-five percent of Fortune 500 companies are family firms.

Family businesses account for seventy-eight percent of all new jobs created, sixty percent of the national employment, and fifty percent of the gross domestic product.

Fifty percent of family-owned businesses have spouses, siblings, or cousins involved in the business.

Nearly seventy percent of all family-owned businesses fail during the second generation. For those that do last, the numbers are not encouraging. Greater than eighty-eight percent close shop during the third generation, and ninety-seven percent are gone by the fourth generation. Twenty-five percent of senior generation family business shareholders have not completed any estate planning other than writing a will, eighty percent want the business to stay in the family, and twenty percent are not confident of the next generation s commitment to the business. Sixty percent of succession breakdowns are attributable to relationship problems among family members.

The facts are bittersweet. While there are many advantages to working in the family business, such as freedom and financial rewards, many problems unique to the family business arena often arise, placing undue strain on many family relationships.

When asked, family business owners and members cite the following items as being the most stressful. What s interesting is that each of the items listed is a small aspect of one larger concern: communication/relationship issues. See how many you can identify with: Financial concern Everyone has different ideas on the business finances and family member compensation. 1. For example, one family shareholder may need more take-home income, so he or she may desire greater dividends paid out to the shareholders. Another family member may prefer to reinvest in the business to see more growth. Since these two people have different financial outlooks, conflict could result.

2. Additionally, who gets paid and how much is another huge issue. Some family members may feel that all siblings, cousins, etc. should be paid the same salary (after all, there should be no preference shown from the parents, right?), whereas others may think that the oldest should get paid the most, with the remaining salaries falling in line with birth order. Still, others may think that they should run the company "like a company" and compensate all employees, family or not, based on the job they are doing and their performance. When beliefs are not shared, tension rises and family members turn against each other.

3. Another issue could be that the controlling generation who is "semi-retired" or fully retired is still receiving compensation from the firm, but not contributing to the daily operations. Some firms can afford this, but others may not, as it adds overhead without the additional needed production they would get from a contributing party.

Concern in Action
A hearing aid dispenser in Florida owned and operated four local offices. The four-store business was very successful in terms of the number of hearing aids they were fitting in the top 2% of the franchise. Working in the business were the owner and his wife, their two sons, and the younger son s wife.

After thirty years of marriage, the owner and his wife, whose marriage always had its ups and downs, decided to get an amicable divorce. However, because the four offices were large and spread out, the family decided to split the offices among themselves and all remain in the business.

Here s what happened:
The owner, his ex-wife, son number one, and son number two and wife were in the business. This means that four separate households were receiving income from the business. Each of these households was accustomed to a certain lifestyle, and they wanted their income to sustain that. They were each pulling a substantial amount of money out of the business. Although they were a sizable business in the hearing aid field, they still had trouble supporting all of the parties. All of the salaries serving the key managers/owners were "fixed expenses" or overhead and created an enormous financial breakeven point. Very quickly, they were no longer able to support themselves and the business, and the business ended up bankrupt.

Edition details

• Publisher: Cameo Publications, LLC
• Publication date: 2004
• Language: English
• ISBN 10: 0974414948
• ISBN 13: 9780974414942
• Binding: Paperback
• Number of pages: 120