Picture this… in a major recession two dealers in a prime boating market independently pondered how to deal with it when the bottom started to fall out of the economy. Dealer A said, “A recession is hitting me hard. Business is getting to be really bad. So I had better pull back almost all of my advertising and promotion and cut other expenses wherever I can.” He did just that and sure enough, his prophecy was spot on… business was really bad.
However, Dealer B in the same market thought, “We are being hit by a big recession, so I need to cut the expenses I can without hurting business and sending customers the wrong signal. And I really need to continue promoting but spend my ad dollars wisely to get the most bang for the buck and keep as much business as I can until it turns around.” And sure enough, he kept as much business as possible…much of it business that used to go to Dealer A who pulled in his horns too far. … [ READ MORE of this article and comment ]
Having come from a family construction business, my own environmental management business working with the marina industry, having worked with numerous businesses in developing team leadership and organizational strategies, and now teaching a course on family business management I am learning a lot about what makes family businesses successful and those that do not.
Family businesses have a lot of competitive advantages, many referenced by others who have responded to your recent article “Family is Everything,” such as a consumers perception of trustworthiness, deep understanding of the business developed across generations, shared values, a long-term perspective and an appreciation for patient money. But rarely do we hear about the 70% of businesses that fail in the transition from founder to second generation.
The lack of planning for succession, of “starting with the end in mind,” from early-on, is probably the number one killer of a family business. … [ READ MORE of this article and comment ]