This
joint research report from STEP and IFB provides insightful context and
information about how advisors see family business clients and vice versa.
While
the sample of individuals was small, the summary of findings and implications
for this research are important to the field of family enterprise and the
further development of advisory services to business families.
The
report is a very realistic snapshot of challenges faced by family enterprise advisors
and family businesses members. In some cases, the report makes valid points which
are rarely seen elsewhere, and includes perspective from all sides on a variety
of issues: owners, advisors, skill sets, governance, advice and the referral
process.
Even
highly educated and emotionally aware advisors should take the key findings of
this report into serious consideration when navigating the complexity of family
business relationships.
Furthermore,
the questions and themes raised in this report are ideal topics of discussion
for advisors and their family business clients, and/or as tools for development
amongst family enterprise advisors.
A few
choice quotes especially relevant for advisors:
“Everybody
said they could help but most people did not understand family businesses”
“There
is ego, arrogance, lack of empathy and a real lack of real credibility in terms
of actually having done [this] before”
“The
difference between being a successful owner and family and an unsuccessful
owner and family is whether or not you’re savvy enough to choose the right
advisors and use them in the right way”
“Family
businesses have very little interest in being talked to about tax, accountancy
or structuring; it is nearly all soft stuff”
“Advisors
need to empower the family to choose who they’re going to work with”
“It
is all about the process; if you haven’t got a process then there’s no way
you’re going to get to the big decisions”
“Advisors
bring two key skills to succession planning: setting objective standards for management
skills and acting as neutral observers of individual family members’ strengths
and weaknesses”
“The
value-add of the outside advisor is to provide insights into the qualities and
calibers of the people and come up with hard truths, to be able to hold up a
mirror to the people and the family psychological system”
“I
think advisors need to get away from the clock ticking”
“It
has to be an outcome-based fee structure, not an hours-based fee structure”
“Advisors
are not solution providers; they are a facilitator of a solution that works for
every individual family”
“Advisors
can’t provide solutions; families have their own problems and need to make
their own solutions.”
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