Let's Talk Family Enterprise 12: The "Natural Advantage" of Family Businesses
Introduction
Welcome to Let’s Talk Family Enterprise, a podcast that explores the ideas, concepts and models that best serve Family Enterprise Advisors in supporting their clients.
Description
Guest host Steve Legler speaks with FFI Fellow and family business consultant Ken McCracken about the importance of recognizing what our family business clients are doing right and avoiding jumping in with "best practices" and recommendations that don't fit the family or the business.
Ken offers the idea of beginning any client intervention with "cautious observation" and then offers clients the benefit of those observations as a "reporter of sights" to the family. He then gives them some useful information that you, as an independent outsider, can reveal to them about their family and business systems. He also offers his views on family governance and whether or not everything needs to be formally documented for the family to succeed.
Guest bio
Ken McCracken, FFI Fellow, is a family business consultant and founder of McCracken Family Business Consulting in Edinburgh, Scotland. Ken teaches a Family Business Module on the STEP Professional Postgraduate Diploma in Private Wealth Advising and in 2016, he was named the “Family Business Adviser of the Year” by the Society of Trusts and Estate Practitioners. He is a former member of the Research Applied Board for the Family Business Review and is a current member of the 2020-2021 UK/Europe Regional Advisory Committee. In 2018, Ken chaired the FFI Global Conference in London.
More information about Ken can be found here.
Key Takeaways
[0:16] Steve introduces Ken McCracken, author of the article, “The Natural Advantage of Family Businesses,” and asks him to quickly explain what he means by advantage.
[2:44] For a family business to have existed for a decade, they have to be doing something right, Ken invites advisors not to ‘throw the baby out with the bathwater.’
[4:17] Ken shares a mistake he made in his early days as an advisor. Which led him to humbly realize he had to come into every family with a learning mindset and give them the benefit of the doubt.
[6:20] Ken and Steve touch on the role of advisors in helping families figure out exactly where they want to establish the boundaries between family and business.
[9:04] Ken offers that cautious observation is a basic courtesy that should be extended to any new family an advisor would work with.
[12:32] Steve talks revealing the system to itself and Ken follows with finding what ‘better’ means for each family.
[14:50] Ken touches on adaptive incremental change — helping families get better at what they’re doing already while also keeping the pace of generationally-propelled change manageable.
[20:44] When it comes to natural governance, when do you write things down, if ever?
[25:31] Ken’s book recommendation and his advice as an advisor to another.
[29:14] Steve thanks Ken for coming on to share his expertise and invites listeners to subscribe.
Share your thoughts with us at fea@family-enterprise-change.com
Mentioned in this episode
Let’s Talk Family Enterprise podcast is brought to you by Family Enterprise Xchange.
Books/articles:
“The Natural Advantage of Family Businesses,” by Ken McCracken
Process Consultation: Its role in organization development, by Edgar Shein
More about Family Enterprise Xchange