New initiative helps family business execs hone leadership skills
A new training initiative wants to develop better leaders for family-owned businesses in West Michigan.
The Family Business Alliance formed Leading Forward: The Institute to Develop and Inspire Family Business Leaders to support and provide mentoring for leaders at family-owned business who have already gone through a leadership succession and have been identified as the next-generation steward.
Family Business Alliance Director Robin Burns
The program is designed to help family business leaders “so they can manage the dynamics of the family-run enterprise,” and navigate the unique aspects of running a family-owned business, said Family Business Alliance Director Robin Burns. That can include the pressure of carrying on the family legacy and sustaining the business for future generations, and balancing what’s best for the business and for the family, Burns said.
“We recognize that being a family business leader is a challenging endeavor and they recently faced market disruptors with the pandemic, the labor and talent issues as well. And, in addition to facing those challenges, they have the challenges of leading the family enterprise,” she said. “They became stewards of the entity. They’re responsible now for more than just the P&L. They’re responsible for creating and leading the entity, and the entity is the business of the family so that it survives.”
The Family Business Alliance partnered in the initiative with the Virginia-based InnerWill Leadership Institute and The Family Business Consulting Group in Chicago. The program was crafted following focus groups with local family business leaders who talked about present challenges, what they wished they had help with, and how getting together with peers can help them understand leadership styles, Burns said.
Set to start in August, the five-month program will include five half-day in-person workshops and one-hour individual coaching and mentorship sessions. Working with groups and an individual coach, participants will identify business, family and personal issues they want to address, “and then develop that plan and that strategy for understanding how to tackle those issues,” Burns said.
The Family Business Alliance, which has more than 160 family-owned business members, accepts applications for the program through March 15. The inaugural cohort will have 12 to 14 participants, Burns said.
The program aims to create alignment across the family’s goals and the business’s goals, said Ted Epperson, president and a facilitator at InnerWill Leadership Institute. The idea is to ensure that the culture within the business and the family are in sync and that the right processes and governance are in place to achieve the long-term goals of both, Epperson said.
“So goes the family, so goes the business. So goes the business, so goes the family,” Epperson said. “Because of those family relationships and you want the family to be healthy and you want harmony, sometimes you make bad business choices.”
In some instances, the goals of an individual family member who has a stake in the business can conflict with the company’s goals, said Betsey Fortlouis, director of development partnerships and an adviser at the nonprofit InnerWill Leadership Institute.
“We want participants to be exploring their role really leading and enabling their family and their family business’ culture in alignment with whatever their business strategy is so that they can continue to thrive and be successful,” Fortlouis said.
Program lessons will focus on leadership styles, team development, effective boards, innovation, and culture. A key element of the leadership program is ensuring that a family-owned business maintains a consistent focus to develop the next generation leader and plan for succession from one generation to the next.
Succession is typically on the minds of all family-owned business leaders, but fewer than one in 10 “are actually having the hard conversations to actually execute,” Fortlouis said.
“They get so stuck. Everybody knows, but thinking about it and keeping that conversation in your head is very different than communicating it and discussing it with the stakeholders that are going to have to help execute,” Fortlouis said.
The InnerWill Leadership Institute was started by Manakin-Sabot, Va.-based Luck Companies, a large fourth-generation family business that’s “incredibly focused” on succession, Epperson said.
The company continually works to develop leaders at all levels, and to identify future leaders and how to vet and assess them, Epperson said.
“It’s a real challenge and an expense, but it’s one that’s an investment because that’s the only way an organization is going to be sustainable over the long term, to make sure that we’re constantly developing our own talent,” he said. “Otherwise, you have to go out on the street and try and buy it, which may or may not fit your culture, and a lot of family businesses have real strong cultures and can reject an outsider like that.”