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What's Unique About Family Business Consulting? *

We have found family business consulting to be significantly different from working with nonfamily enterprises. The field of organization development, where we both have received our training, has historically focused on action research, where the consultant helps the client generate data about the client's problems that is then fed back to the client. This feedback is then used to develop a plan for change, and the consultant's role is then expanded to serve as a change agent to help the client manage the change process. In this book, we describe how this framework of action research is used to help family businesses. [View a chart outlining the Role of the Family Business Consultant here].

Traditionally, the organization development (OD) consultant has focused on helping the client manage the process of change. In family business consulting, the consultant must not only be versed in managing process, but in providing content information for the client as well. Clients have specific content questions that need to be answered. For example, if a consultant is trying to help the head of a family business plan for ownership and leadership succession, the consultant may need to gather data about the current state of the family business and help the client manage the changes needed as the business moves to a new future where there is new leadership and new owners. While managing the process of such a transition is certainly important, the consultant may also need to help the family change its estate plan, its legal form, and its distribution of firm ownership in order to solve the key problems. Thus, content knowledge and technical expertise are needed as well to make these types of changes. In this regard, we find family business consultants coming to the field from a variety of different professions such as accounting, law, family therapy, and estate planning, for each of these professions has a body of knowledge and technical expertise that can help those in family firms. We have found that most change efforts in family businesses are not likely to succeed unless there is the right combination of both content and process knowledge on the part of the consultant. (Hilburt-Davis & Senturia, 1995) That is why multi-disciplinary consulting teams should often be the rule, rather than the exception, in working with family businesses, since no single person is likely to have all the content and process knowledge needed. As we do our work with family firms, we often have to "hand off' critical aspects of the change process to other consultants or collaborate with them to come up with effective solutions.

For example, in one family business, one of two brothers who started the business died unexpectedly from cancer, leaving his spouse as his brother's partner. The surviving brother and his sister-in-law didn't trust one another, which led to a variety of family and business problems. To resolve this issue, an OD consultant was asked to help mediate between the two. After a day-long series of interviews and emotional meetings, the two antagonists agreed to create a new partnership agreement and develop a buy-sell agreement were one of them to die. Once this agreement was made, the OD consultant contacted the family's attorney whose role it was to work through the legal issues related to the agreement and put the agreement into a legal document. Without this collaboration between the OD consultant and the attorney, an effective change would not have taken place.

This example of conflict between a brother and his sister-in-law highlights another unique feature of consulting with family business--the issue of emotion. While emotions influence individuals in all workplaces, family businesses are particularly emotionally charged. Clients may get angry, scream, cry, and express feelings denoting depression. Entrepreneurs, who often lead family businesses, are noted for being rather volatile and can prove difficult to work with. Changes in a family firm often shakeup previously established patterns of behavior, causing emotions to rise to the surface as power, prestige, role definitions, and self-esteem are altered during a consultation. Thus consultants to family firms, who work with the owners and the family as well as the business, must be prepared to help their clients work through the emotions they experience as they make changes to improve the health of both their families and their businesses. Professionals who consult to the business only, and not other systems (i.e. family and ownership), are not working as family business consultants.

Given the importance of having both content and process knowledge along with the ability to deal with emotions in helping family businesses, one of the arguments of this book is that consultants from various disciplines should work together to help family businesses. Regardless of the consultant's profession, we believe that the action research framework from the field of organization development provides the best approach to help family firms manage the difficult changes they need to make. And armed with content knowledge from the needed disciplines, the consultant (or consulting team) can apply that knowledge to help leaders of family firms understand their options and move forward to make those technical or content changes that are needed.
Through the theories, models, and change strategies presented in this book, we hope that consultants from various disciplines will develop a common frame of reference and a common language with which to collaborate and learn from each other as they work with family firms. Without the development of such a common paradigm for working with family firms, consultants will likely be frustrated in their efforts to help family firms, and their family firm clients will not be well served.

*Excerpted from Consulting to Family Businesses.

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