We just got done with the holidays, and, at least for my family, it was a great reminder of how complicated family relationships really are. When you couple a family relationship with business, you can see how there may be some landmines out there just waiting to be triggered. Family based businesses provide legacy, reliable workers and the opportunity to take people who are all similar and get them to work together. When the times are good, they are great. When the times are bad, they are dark. Let me help all the family based agencies out there by outlining the four challenges we see in every agency:
- The Kid’s Perspective
- The Parent/Owner’s Perspective
- The Bystanders (spouses, aunts, uncles and cousins)
- The Team
I’m going to start this blog off similar to a blog we did a few years back. This blog is all about how producers and account managers struggle to get along. We received a lot of feedback saying that it was helpful to see each perspective. We will start by sharing how everyone involved is both partly right and partly wrong, so buckle up.
The Kids
Do you remember being in your twenties and thirties and full of life? You see things very differently, and, quite honestly, you have all the energy in the world to do it! Also, you aren’t jaded from spending money on something that didn’t work or facing monumental resistance from the team once you are finally fully staffed. The reality is that this generation is your target clientele (or will be over the next 5-10 years), so listening may not be a bad thing.
For the kids in the agency, they are automatically judged by the entire team. Are they getting special treatment? Are they working hard enough? What the team is really analyzing is — could I personally see myself working for them? This is why, as the kid of an owner, you need to buckle down and learn how to make friends and influence people. Showing up at 10:30 to start the workday isn’t going to work.
But you are more in tune with new trends, especially when it comes to technology. You embrace technology and change, but sometimes you can’t always communicate that well or get buy in from the team. We need to ride the wave of technology, but some agency leadership team members may need a bit more convincing, and this can leave you feeling frustrated.
The next generation of agency owners are far more connected today than ever. With social media they can see how other agencies are embracing technology or changes and working to market themselves. This can be a consistent reminder of what their family agency is not. Since relationships go farther than young agents’ conventions, they are picking up ideas faster than ever.
The kids always want to know when they will be in charge officially, and this is where the rub often starts. It’s an age old story, right? The old guard feels they are being thrown out, when in reality, it provides an outstanding opportunity for mentorship. The constant challenge I hear is that the kids know they will take over, but there is no plan, no date and no set amount. They feel like they can’t quite get a handle on it, and it provides a lot of family frustration.
The Parent/Owner
Finally, you can kick back a bit. No more working 7:00-7:00 and on weekends. You served your time. You have family in the business that can help make your life a bit easier. While you want to delegate the day-to-day operations, the kids want to talk to you about the idea of the day from an agency 2000 miles away. It’s exhausting! And then one of the agency team members comes in to share how your kid didn’t do something right, and you have to address it. Yippee!
You want your kid to take over the agency, but you have doubts. Maybe you’re questioning whether they can afford it. Maybe they rub the team the wrong way. Maybe there are 2 siblings, and they aren’t getting long. It can feel like you will be at this place forever. Those doubts aside, you’re making good money and have some more flexibility, so why rush your way out the door? If you can vacation more and work a bit less but still make a decent penny, why not? Plus, maybe you aren’t ready to retire just yet.
You know that you need to embrace new concepts, but things are moving so fast now. You may have invested in 1-2 projects per year, but now it’s 1-2 projects a month you are being pitched. They all seem like a lot of heavy lifting, and, well, you are in a different phase of your career.
In your heart you know you need to outline a continuation plan, but maybe your kid hasn’t really been exposed to the finances of the business. And, well, this agency can’t just be a gift. Most important, you aren’t ready to just leave, and you aren’t certain your predecesor is ready. But talking about it starts a family feud which brings spouses and other family members into it. It seems easier to just keep plugging along.
The Bystanders
These are often the people behind the people. Don’t be fooled — the spouse plays a role in this as a quiet, behind-the-scenes player. If you got that chilly response at Christmas, you know what I mean. Remember, the spouses are only hearing one side of the conversation, and then they add their own fuel to the fire. After all, most spouses are firmly in their partner’s court.
What happens is the owner and the son or daughter have an encounter at work. Generally, this opens up a long-standing disagreement. They both go home, march to their respective spouses and exclaim, “look what happened now.” The spouses pour gasoline on the fire, and they go back to work the next day with boxing gloves up. Let’s say they resolve the issue — very rarely does the spouse get notified of the remedy. The kid is looking for a promotion, and it’s one they probably have earned.
In the kid’s spouse’s mind, they are heirs to the American Dream. Maybe this means a dramatic financial change — the ability to change jobs or flexibility that they don’t have now. It’s so close they can taste it. For the parent, they are thinking about their retirement. Can they afford it? What would they do, and most importantly, who would they be if they aren’t running this business? Sit on that for a moment. Their entire life they have been labeled a business owner. Now the label is retired after selling a business. That’s an identity blow for sure.
The Team
The team’s perspective will depend on the kid’s roles and responsibilities. Your best bet is to have your son or daughter work at every job in that agency so they’ll know how it works and how hard it can be. I don’t mean for a week either; I mean for the foreseeable future. When the owner has empathy for each role, they can best lead the team. If your son or daughter goes right into sales and starts bossing the team around, we have trouble from the start.
You will start to hear, “Well, when you retire I’m going to leave; I’m not working for them.” Or they bring every mishap right to the owner’s desk. The child needs to embrace the idea of winning the team over. After all, as the new leader, you may face some interesting challenges.
How To Solve It
We recommend our Agency Assessment. This will help you break down boundaries and communication challenges. In addition, it’s important that you start having conversations, not arguments. One conversation may be with the accountant to get a plan together of what makes sense regarding succession. You’ll also want to discuss getting a valuation of the agency so you know what you are working with. When there are too many feelings, we want agencies to go to facts.
The truth is there is a way to make everyone happy and successful. For the owners, you don’t want to leave your family an outdated, behind-the-curve business, and for the kids, you need to admit you may need some mentorship as well to help you change roles.
