Family Ties® E-Letter – October 2005 Issue
October 2005 |
|
|
Welcome to the Family Ties© e-letter brought to you by Pervin Family Business Advisors Inc. What's more powerful than a family? Simply, a business family! I am constantly reminded how complex these personalities and relationships are and how many graceful resolutions are achieved [most of the time] that are often misunderstood by those unfamiliar with family business. For example, the latest Globe and Mail scoring of governance ranking [October 17th, 2005, B5] places a family firm that provides investors a five-year total return of 692.5% last in the list because "... mother receives $297,255 a year. ...part of an agreement between the company and the late founder Jack Reitman." Perhaps the governance doesn't match some criteria, but as Paul Demarais has been quoted over the years, "It's not only about ticking the boxes!" My 2001 comments on Family Firm Governance still resonate for me. In this issue, I look at various aspects of business family life, from the players to the organization, and offer fifteen years of data to stimulate the question, "What's changed?" And, the booklet: Power and Resources: Managing Owner Risk, Legacy and Value is almost complete. Also, next February I will be speaking to the Women's Business Network of Peterborough. This event will be open to both men and women – hope to see you there! In upcoming issues, the business family topics will address beneficial aspects of governance, leadership, organization, planning and relationships, to offer a few ideas. If you have a question, a great idea for inclusion in this e-letter, or if you just have some comments you would like to share with us, we want to hear from you Wise and pragmatic habits of successful business families...Habit #5. For your reading pleasure...THE MANY FACES OF CONTROL FREAKS
Thinking about health, as opposed to long-term performance, helps management teams understand how to look after companies today in a way that will ensure that they remain strong in the future. It focuses the mind on what must be done today to deliver the outcome of long-term performance. Companies are not focusing enough on managing the health of their businesses. One major European company, for example, pulled off an impressive turnaround in short-term financial performance. But to its dismay, its financial success was accompanied by a fall in customer service levels and by a huge increase in staff turnover. The share price soared initially but then fell back. The company's management complained that the financial markets didn't understand what it had achieved. But the problem was that the markets did: short-term success at the expense of health. Sources: How to Escape the Short-term Trap – By: Ian Davis, April 2005 – Financial Times and The Mckinsey Quarterly, Web Exclusive (free registration required).
THE PASSIVE-AGGRESSIVE ORGANIZATION
Healthy companies are hard to mistake. Their managers have access to timely information, the authority to make decisions, and the incentives to act on behalf of the organization. The organization, in turn, carries out those decisions. We call these organizations "resilient," because they can react nimbly to challenges and respond quickly to those they can't dodge. Unfortunately, most companies are not resilient: Fewer than 20 percent of the 30,000 individuals who responded to a Booz Allen Hamilton survey describe their organizations that way. By contrast, more than a quarter of the companies in our survey suffer from a cluster of pathologies we place under the label "passive-aggressive." The passive-aggressive organization displays a quiet but tenacious resistance to corporate directives, even when they are aligned with obvious strategic or competitive advantage. People pay those directives lip service but put in only enough effort to appear compliant; and "nothing ever changes around here." Further developing the theory of organizational DNA, introduced two years ago in strategy+business, Gary Neilson, Bruce Pasternack, and Karen Van Nuys examine why such an astonishing number of organizations fall prey to the passive-aggressive pathology. Their article appears in Harvard Business Review and is adapted from the forthcoming book RESULTS: Keep What's Good, Fix What's Wrong, and Unlock Great Performance (Crown Business, 2005). To download a complimentary copy of the full article: And to learn more about RESULTS: Keep What's Good, Fix What's Wrong, and Unlock Great Performance, visit http://orgdna.com/book.cfm. Resilience Report is a monthly update on business complexity and strategy-based transformation. An exclusive service for readers of strategy+business, it offers original research, case studies, and other intellectual capital from s+b and Booz Allen Hamilton. Art Kleiner The above was taken from a recent strategy+business Resilience Report – register on their site, it's quick and easy, and while there be sure to read the Format Invasions article, it's also a good one. Thoughts of the day...Kids who get everything have a false sense of security. – Dan Baker Barbara, anyone who believes money makes you happy doesn't have money. – David Geffen to Barbara Walters Definitions: Waiter Wisher Did you know...Our web site has recently been revamped and is chock full of interesting and compelling articles for the family business. You can send our articles to a friend, family member or colleague, quickly and easily. |
|
|
Pervin Family Business Advisors Inc. |
|
n. 1 A person who waits on a table, as in a restaurant. 2 a. a person who waits. b. often a full time preoccupation by business family members who are waiting for their inheritance 3 waiters are often financially over-extended and hope to cover their debt with parental money.
n. 1 a. A person who desires to be, or feels an impulse toward attainment or possession of something. b. A person who wishes that his or her parents died early.
EMAIL
PRINT
