Making Sibling Teams Work: The Next Generation PDF
Preview Making Sibling Teams Work: The Next Generation
MMAAKKIINNGG SSIIBBLLIINNGG TTEEAAMMSS WWOORRKK TThhee NNeexxtt GGeenneerraattiioonn CCrraaiigg EE.. AArroonnooffff JJoosseepphh HH.. AAssttrraacchhaann DDrreeww SS.. MMeennddoozzaa JJoohhnn LL.. WWaarrdd Making Sibling Teams Work Family Business Publications are the combined efforts of the Family Business Consulting Group and Palgrave Macmillan. These books provide useful infor- mation on a broad range of topics that concern the family business enter- prise, including succession planning, communication, strategy and growth, family leadership, and more. The books are written by experts with combined experiences of over a century in the field of family enterprise and who have consulted with thousands of enterprising families the world over, giving the reader practical, effective, and time-tested insights to everyone involved in a family business. The Family Business Consulting Group, Inc., founded in 1994, is the leading business consultancy exclusively devoted to helping family enterprises prosper across generations. FAMILY BUSINESS LEADERSHIP SERIES This series of books comprises concise guides and thoughtful compendiums to the most pressing issues that anyone involved in a family firm may face. Each volume covers a different topic area and provides the answers to some of the most common and challenging questions. Titles include: Developing Family Business Policies: Your Guide to the Future Effective Leadership in the Family Business Family Business Compensation Family Business Governance: Maximizing Family and Business Potential Family Business Ownership: How to Be an Effective Shareholder Family Business Succession: The Final Test of Greatness Family Business Values: How to Assure a Legacy of Continuity and Success The Family Constitution: Agreements to Secure and Perpetuate Your Family and Your Business Family Education for Business-Owning Families: Strengthening Bonds by Learning Together Family Meetings: How to Build a Stronger Family and a Stronger Business Financing Transitions: Managing Capital and Liquidity in the Family Business From Siblings to Cousins: Prospering in the Third Generation and Beyond How Families Work Together How to Choose and Use Advisors: Getting the Best Professional Family Business Advice Working for a Family Business: A Non-Family Employee’s Guide to Success Letting Go: Preparing Yourself to Relinquish Control of the Family Business Make Change Your Family Business Tradition Making Sibling Teams Work: The Next Generation More than Family: Non-Family Executives in the Family Business Nurturing the Talent to Nurture the Legacy: Career Development in the Family Business Preparing Successors for Leadership: Another Kind of Hero Preparing Your Family Business for Strategic Change All of the books were written by members of the Family Business Consulting Group and are based on both our experiences with thousands of client fami- lies as well as our empirical research at leading research universities the world over. Making Sibling Teams Work The Next Generation Craig E. Aronoff, Joseph H. Astrachan, Drew S. Mendoza, and John L. Ward MAKING SIBLING TEAMS WORK Copyright © Family Business Consulting Group, 1997, 2011. All rights reserved. First published by the Family Business Consulting Group Publications, 1997. This edition first published in 2011 by PALGRAVE MACMILLAN® in the United States—a division of St. Martin’s Press LLC, 175 Fifth Avenue, New York, NY 10010. Where this book is distributed in the UK, Europe and the rest of the world, this is by Palgrave Macmillan, a division of Macmillan Publishers Limited, registered in England, company number 785998, of Houndmills, Basingstoke, Hampshire RG21 6XS. Palgrave Macmillan is the global academic imprint of the above companies and has companies and representatives throughout the world. Palgrave® and Macmillan® are registered trademarks in the United States, the United Kingdom, Europe and other countries. ISBN 978-0-230-11108-0 ISBN 978-0-230-11615-3 (eBook) DOI 10.1057/9780230116153 Library of Congress Cataloging-in-Publication Data Making sibling teams work : the next generation / Craig E. Aronoff . . . [et al.]. p. cm.—(Family business leadership series) Includes index. 1. Family-owned business enterprises—Management. 2. Brothers and sisters. I. Aronoff, Craig E. HD62.25.M328 2011 658(cid:2).045—dc22 2010036087 A catalogue record of the book is available from the British Library. Design by Newgen Imaging Systems (P) Ltd., Chennai, India. First Palgrave Macmillan edition: January 2011 10 9 8 7 6 5 4 3 2 1 Contents EXHIBITS . . . . . . . . . . . . . . . . . . . .vii 1 Introduction: The Crucial Generation . . . . . . . 1 2 The Era of Sibling Partnerships . . . . . . . . . . 5 3 What Makes the Sibling Generation Different . . . . 9 4 The Farsighted Founder . . . . . . . . . . . . .17 5 I n-laws or Outlaws? Making Siblings’ Spouses a Part of the Team . . . . . . . . . . . . . . .29 6 Building a Healthy Team. . . . . . . . . . . . .39 7 Creating the Right Environment. . . . . . . . . .51 8 Choosing a Leader . . . . . . . . . . . . . . .65 9 Communication between Team and Parents . . . . .75 10 Remember, It’s a Family . . . . . . . . . . . . .79 vi CONTENTS 11 Preparing for the Next (Cousin) Generation . . . . .81 12 Summary. . . . . . . . . . . . . . . . . . .85 INDEX. . . . . . . . . . . . . . . . . . . . . . . . . . . . .87 THE AUTHORS . . . . . . . . . . . . . . . . . . . . . . .93 Exhibits Exhibit 1 Goals for Sibling Teams . . . . . . . . . . . . . . .15 Exhibit 2 Ten Tips for Founders . . . . . . . . . . . . . . . .20 Exhibit 3 Premarital Agreements Are More Likely to Hold Up in Court When . . . . . . . . . . . . . . .36 Exhibit 4 Some Key Decisions Sibling Teams Must Make . . . . . .40 Exhibit 5 How to Bring About Creative Solutions . . . . . . . . .43 Exhibit 6 Sample Family Code of Conduct. . . . . . . . . . . .46 Exhibit 7 Pitfalls That Derail a Sibling Team . . . . . . . . . . .49 Exhibit 8 Ways to Make Sibling Owners Not Employed in the Business Feel Included . . . . . . . . . . . . .59 viii EXHIBITS Exhibit 9 Preconditions for Sibling Success. . . . . . . . . . . .62 Exhibit 10 “Musts” for Co-CEOs . . . . . . . . . . . . . . . .66 Exhibit 11 Eight Steps to Better Communication. . . . . . . . . .77 Chapter 1 Introduction The Crucial Generation Welcome to the world of sibling partnerships. When it is the best of all possible worlds, brothers and sisters har- moniously and successfully run their family business for another generation and their family serves as a center of strength, joy, love, and support. In your dreams, you say? For some families, these goals sound impossible. Yet, we have seen many sibling groups perform beau- tifully as teams, and we have also seen the transformation of dysfunctional, disharmonious sibling groups into high-perform- ing partnerships. Our experience has shown us that teamwork consists of a set of skills and attitudes that can be learned, and this book is aimed at helping the siblings in your family business become an effective, cohesive, fully functioning partnership. We have found that it takes the effort of three groups to assure that siblings can evolve into teams and work together successfully: 1. Parents 2. In-laws 3. The siblings themselves
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