Monday, January 26, 2015

The Enigmatic “Most Trusted Advisor” (Part Two of Two)

The study focusses on the processes of advisors as they navigate their way through the complex circumstances ever-present in family firms and how they acquire specific characteristics in order to capture the attention and trust of key family members. Then the study follows the subsequent process as the MTAs facilitate the environment to gain “collective attention” of additional family members - with the second hurdle being based on accomplishment of the first.

Noting that the “proper attunement to family members constitutes the unshakable foundation” on which MTAs either succeed or fail, the MTA must have a strong sense of self in relation to others, as well as a contributor to the whole, along with a strong decision bias to others. Therefore, knowing oneself and one’s position within the family, which Strike identifies as “voice” (the trust in the relationship) and “weight” (the expertise the MTA brings to the relationship) leads to the MTA knowing how and when they can exercise influence, and knowing that they have the long-term trust in the relationship in order to do so. 

The findings of this study do go against the anecdotal evidence which circulates amongst many family business advisors that suggests ‘outsiders’ are able to provide more objective advice: “[a]dvising is often thought of a dispassionate activity that assesses the facts. Getting too closely involved with advisees may mean that objectivity, which is so crucial to the MTA role, is compromised and that they are no longer able to remain emotionally distant. The findings of this study suggest otherwise.”

In fact, to illustrate this point and demonstrate that objectivity is not an important criteria in a MTA, a family business owner is quoted as saying:
“The key component of all of this is one word: trust. Trust. Trust. Trust. If that doesn’t exist, forget everything. MTA could make many mistakes and we would forgive because he’s got a big bank account of trust with us and he can do no wrong to destroy that.”

Among the highly relevant findings in this article are extremely expressive and insightful quotes from a number of enterprising family members, owners and working MTAs which depict the trust within and importance of these otherwise mysterious and secretive relationships.

Strike recommends that advisors looking to develop into a MTA should focus time and effort on developing personal characteristics and self-awareness; gaining experience in advising capacities by working with family firms; expanding one’s expertise beyond a single area; and acquiring the ability to understand and become attuned to family members’ group dynamics, emotions and abilities.

Any professional advisor in any discipline, or any family enterprise professional working in any capacity with a family firm would benefit from reading this easily digestible article. With such interesting and relevant research findings, anyone working in close capacity with a family firm would likely agree that we must work together to advocate for more research in this area of family enterprise and related disciplines.


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