Key Ideas for Family Businesses
Brought to You by Jane Hilburt-Davis & Key
Did you know what two competencies have the most to do with longevity
and success in family owned businesses? Well, if you guessed strategic
planning as one of them, you're correct.
In this issue of Key Ideas, we'll discuss the importance of strategic
planning, and how to create an effective plan for your business.
In coming issues, we'll discuss other key factors for family business
success, so stay tuned!
In this issue
- Strategic Planning for Family Businesses
- January Breakfast Meeting
- Family Businesses Facts
- Question of the Month
Strategic Planning for Family Businesses
Simply put, strategic planning is creating a plan of action. Originally
from the Greek roots, STER, to spread out, usually in a military
sense, and AG to drive or to lead, the word strategy conjures up
images of preparing for battle, or competition.
'Strategic planning' is different from 'vision' which is a future
imagined, a hope of how things can be in the farther into future,
10-20 years from now. Rather, a strategic plan describes how you
can get there. It's about making decisions in the present for the
future and usually involves a 3-5 year time frame...
the Full Article >
Meeting in January
January 14, 2004
TOPIC: Family Business Succession
(For family business clients and prospective clients; reservations
7:30 AM - 9:30 AM
Join us for an interesting and informative breakfast meeting. The
program will include a role-play of a family business, followed
by a lively discussion. If you are going through, planning, or just
wanting to know more about succession issues in your family business,
please join us on January 14th!
Jane Hilburt-Davis, Key Resources
Andre Pelletier, Private Clients Group, FleetBoston
Carrie Seligman, Northwestern Mutual
Ed Tarlow, Tarlow, Breed, Hart, Murphy, & Rodgers, P.C.
Call 781-861-0586 for more
information and reservations
Did you Know ...
- 8 out of every 10 businesses are family businesses
- They produce 50% gross domestic product
- Family firms comprise 37% of the Fortune 500 and 78% of jobs.
- They comprise 60% of publicly traded companies
- 88% of family businesses plan to stay in family
- There is predicted a leadership change
- In 39% of the family owned businesses in 5 years
- And 56% 10 years
- This will mean that an estimated .4 trillion $ of net worth
will be transferred by 2004 (.8 trillion in next 20 years)
Yet- only 1/3 of family businesses make it to the second generation!
- Some of the reasons for failure:
- 55% of CEOs over 61 have not chosen successor
- 19% have only written a will, no other estate plan
- 73% have not written strategic plans
Source: Mass Mutual Survey (2003) and FFI.org
of the Month
A family business owner recently wrote us with the following question:
What should I look for in a consultant
that I wish to hire?
A: Surprisingly, many family businesses often don't ask the right
questions before they hire an advisor or consultant and end up with
advisors not equipped to deal with the complexities they face. As
one business owner (family business, by the way) claims, an 'educated
consumer is our best customer'. What do family businesses need to
know about this developing profession?
The number of professionals entering this new and 'hot' specialty
come from a variety of fields, such as accounting, insurance, law,
family therapy, and organization development, and each of these
professions has technical expertise and skills that are critical
to helping family businesses. However, not one single profession
can answer all of the complex challenges of families in business.
Family businesses need to expect that their advisors are also trained
and experienced in the evolving 'body of knowledge' about family
business best practices, not just in their own field. They need
to ask the right questions of potential advisors.
Key Questions to Ask:
- Have you received special training in working with family businesses?
If so, where and what?
- What issues to you see in the family, business and ownership
- How would you help us deal with them? Where would you start?
- What is the scope of the work? What will it cost?
- Do you belong to a professional society or group that delivers
continuing education focused on the special challenges of family
businesses? Do you participate in these?
- Do you have a network of professionals who you can call on to
help you with the complexities?
- Are you willing to work with my advisors?
By asking the right questions from the beginning, family businesses
of all types can ensure that they are making informed choices to
help them achieve their goals.
If you have a question for us, please feel free to email us at
or call 781-861-0586
"The art of prophecy
is very difficult-especially with respect to the future."
- Mark Twain
Until next time,
40 Middleby Road
Lexington, MA 02421
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