ONSIDE / OPINION
O
ver 70 per cent of UK businesses are family owned
but research indicates that only a fraction – some
13 per cent – survive beyond the third generation.
The turnaround and restructuring of a family owned
business can present some particular challenges if the
enterprise has been handed down through the generations
as if it was merely a legacy project.
The passion, hunger and drive that fuelled the first – and
possibly second – generation business can be seriously
diluted by succession planning that places inheritance,
family loyalty and emotion ahead of profitability.
Companies have to be agile and nimble to stay ahead and
the ability to adapt, change and – in some cases – accept
failure, can often be a source of conflict when the owners
and managers are also relatives.
If a family business is worth saving, I recommend bringing
in outside professional experience and expertise to add a
fresh dynamic and objective eye to preserve the family asset.
When family loyalties lead to a company being in a state
of paralysis, no one is necessarily prepared to think the
unthinkable.
Turnaround professionals are relentless in drilling down
to where the problems lie. Often there are serious issues
around the personnel and it needs an outsider to ask the
awkward questions. In throwing a lifeline to a family
business in distress, experienced external advisers will put
the existing management team under extreme scrutiny and
inevitably some brutal decisions may have to be made.
« Every thriving firm needs a ‘dream
maker’ – the one with the passion,
commitment and drive who wants to
be there, through thick and thin,
from 7am-11pm. »
Contact - Melanie Hird
[email protected]
07917 888 880
Advisers’ solutions may not be what you want to hear,
but take them on board and you could transform a failing
business into a robust concern which is ripe for a planned
and highly profitable sale a few years down the line.
All family enterprises, whether struggling or not, would do
well to ask themselves the following:
Would you employ your son or daughter if they
were not related to you? Are they in the right role?
Do they have a talent for what they do – or could
someone else do a better job? Is your son, daughter,
niece or nephew interested and passionate about the
business, or simply there because it is expected of them?
Every thriving firm needs a ‘dream maker’ – the one with
the passion, commitment and drive who wants to be there,
through thick and thin, from 7am-11pm. Who is yours?
Who is holding the business back, treading water and
biding their time? Is it time to face facts and let them go?
In my experience, some of the most successful family
businesses recognise that their nearest and dearest are best
served by gaining valuable experience and skills in the wider
world. At a later stage, and if appropriate, they can return
to the firm equipped with expertise, new ideas – and the
appetite and drive to innovate and challenge the status quo.
For others, maybe it is time they left for good. In the adage that
you can’t choose your relatives, there is no reason to let family
ties determine the success and sustainability of the business
which you – or your parents – have poured commitment,
energy and expertise into over the past years or decades.
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