Does your “family business” have the potential to be your “family business legacy” by using a Family Business Advisory Council? Are YOU, as a family business leader ready to lead your own family in the process?
Once explained, the undeniable merit of a Family Business Advisory Council usually jumps to the top of the strategic planning initiatives of every mid-sized, forward looking company. An Advisory Council – although critical to the sustainment of success and a generational carry over of shared values – is not just a program or product that your family controlled enterprise can purchase or readily set up on your own however.
We’ll admit that it does sound pretty easy to simply call a family meeting and: I) Establish a Code of Conduct, II) Clarify the Family Values, and finally, III) Shape a Shared Vision for the Future of the Family Business. However, before you reserve the big private dining area at your family’s favourite restaurant for the first Advisory Council meeting, we would urge you to take the next reflective step yourself.
Considering Extended Family Dynamics
A Family Business Advisory Council is a true ‘look into the future while appreciating your company’s past’, so family business leaders must start by answering for themselves some direct questions about their extended family dynamics as they relate to the family business. These are tough, personal questions such as:
- Whose overall, long-term interests take priority? Those of the family business or those of our family?
- How does our family currently communicate, plan and make decisions together?
- Are there already unwritten (but understood) family communication ‘norms’ as it relates to discussing our family business?
- What do I want our family business to become in the future, and how should family members contribute?
Your honest, personal answers to these questions may scare you, however your individual perspective is important in determining if you are personally ready to make the Advisory Council journey!
Structuring a Family Business Advisory Council
The goal for dynamic, growing family businesses should be to establish fair, well understood agreements (aka: family protocols, charters or constitutions), that address most of the factors that connect the family to the business. These will be such potentially contentious topics as values, employment policies, dividend policy, roles, responsibilities and ownership as they relate to most family members.
Membership in a Family Business Advisory Council should be voluntary and representative of the interests of the extended family. All family members do not have to participate for a council to be effective. Representation of non-family executives is important, and including a trusted professional family advisor is useful.
So, are you ready to take the first step?
This article was published more than 1 year ago. Some information may no longer be current.