Running a business can feel like navigating a maze blindfolded. One of the toughest hurdles is finding and keeping the right people in the right roles, especially as the business grows and evolves. This challenge is compounded when family members are part of the mix.
Traditionally, family businesses often faced the automatic assumption that the eldest son would inherit the reins. However, this approach has led to numerous pitfalls, including family feuds and business failures.
Enter the Accountability ChartTM, a modern solution to an age-old problem. This practical tool offers family businesses a systematic way to identify the best leaders for the next generation without getting caught up in personal biases. When applied effectively, it becomes a cornerstone for ensuring that succession translates into success.
Example of an Accountability Chart:
But the Accountability ChartTM isn't just about passing the torch; it's about optimizing the entire business structure. It provides a framework to strip away emotions and objectively determine the necessary roles and the right people to fill them. This fosters a 'healthy' environment where decisions are made with the business's best interests at heart.
Here's the breakdown:
Setting the Blueprint: Start with a clean slate and map out what the business needs to achieve its goals in the near future, typically 6-12 months. Outline the key roles required, detailing the accountabilities for each.
Finding the Right Fit: When considering individuals for these roles, two critical factors come into play:
- Alignment with Core Values: Ensure that candidates share the family business's core values.
- GWC Assessment:
Get It: Understand the role and its requirements thoroughly.
Want It: Demonstrate genuine enthusiasm and passion for the role.
Capacity to Do It: Possess the necessary skills, knowledge, experience, and willingness to commit to the role's demands.
Candidates must meet all three criteria for a perfect fit.
By filling the seats with individuals who meet these criteria, you're laying a solid foundation for the business's growth.
Yes, it might involve difficult conversations or disagreements, particularly within the family circle, but this is all part of progress.
Despite the challenges, establishing a fair system for promotions, training, and rewards becomes achievable. This equitable approach extends to all team members, irrespective of their familial ties. It ensures that decisions regarding salaries, promotions, and job roles are based on merit and what's best for the business.
In essence, the focus shifts from personal preferences to the business's genuine needs, paving the way for sustainable success.
You can download a free copy of the Accountability Chart here.
Real-life case study
Imagine this …
You’re a second-generation owner of a family business. When your first son is born, everyone celebrates the next-generation leader’s arrival. For your son’s entire childhood, people keep talking about how someday he will run the business, just like you and your father before you.
In the meantime, he doesn’t seem particularly interested in the business, but your second child loves it. She wants to come to the office with you on Saturdays. She asks questions about the business at the dinner table. She knows the names of most of the crew. She decided it would be fun to take business classes in high school. You start to think she would be great at running the business and your son would be a lot happier being a teacher.
How in the world are you going to explain this to your parents? To the community? To him?
This is a real scenario I saw firsthand, and the Accountability Chart was a powerful tool that helped this second-generation dad manage his fears and concerns about the next generation of the family business.
This family business had a three-person leadership team that included the second-generation owner, his wife, and one other person who ran operations. Together (despite the fact that it didn’t feel natural to them) they built an Accountability Chart for the future of the business. They separated their skills and abilities from what they built. They also separated the skills and abilities of the next-generation family members and simply decided what the business needed. This was hard. It took them several hours and a few time-outs.
When they were done, they realized two hard but important things:
- The role they needed in finance was much bigger than the interest or capability of the wife.
- Neither of the next-generation kids was ready to lead the business despite the fact that the owner wanted to retire.
They ended up elevating the non-family member to run the business. The mom was actually thrilled to stop being so stressed out about her role, and they hired someone part-time to do the higher-level finance work. They started developing the daughter to work her way into the Integrator™ role, and their son became a teacher.
Now the daughter has learned to run operations, the dad is a very part-time Visionary, and the son works for them in the summer doing work he has always enjoyed and makes a little extra money when he isn’t teaching.
Please don’t think this was easy. It took five years from the first session for the second-generation owner to get a clear story to tell when people asked why his son is a teacher and not running the business. His wife enjoys her job a lot more and his daughter is thriving. His golf game isn’t bad these days, either.
Case study from Sara B Stern – Family Business Specialist & EOS Implementer
Written by Debra Chantry-Taylor, FBA Accredited Family Business Advisor, Certified EOS Implementer & Founder of Business Action.
Business Action is focused on helping Entrepreneurs lead better lives, through creating a better business. We have a small team of accredited family business advisors, EOS Implementers & Leadership coaches, as well as access to a huge range of advisors through our Trusted Partners Network - www.businessaction.co.nz
Disclaimer
The views expressed in this content are those of the author, who is also responsible for any errors and omissions. Family Business Association provides this article for your information only. The content of the article should not be taken as advice. If you wish to explore this topic, please consult an advisor who you consider to have the expertise to provide specific advice in relation to your family business.
