Innocent reasons

By SOCH Business Mentors LLP Posted April 11, 2023 in Leadership

Innocent reasons

that wash away great efforts & large investments of hope

ultimately making the process of family constitution fail.

Before I share the reasons for why the constitution process fails, sabotaging all hopes and invested efforts, there are certain fears I had been privileged to be trusted by the family members that I would like you to know.

I am categorising these fears in the category of unaligned and hidden motivations among the family members for making the constitution. Seldom but there are instances when the family constitution is spearheaded by individuals of the family who would create a forum to gain control of the business or to create an opportunity to sell their ownership.

Perhaps someone wants to create legal rules quickly to protect the business, in their view, from the owner’s influence or involvement.

Such motives may lead to an agreement created under false pretences but are eventually doomed to fail. There is a way, though. When such a situation occurs, and if there is any doubt about the family member’s intentions, the process of making a family constitution must begin by using family business experts, advisors, and family business consultants.

These experts must bend backwards for not any individual but the collective good of the family. This would come out when all heads, hearts, and souls are at least learned and known. These trusted experts, with great impartiality and non-judgmentally, explore with individuals their interests and fears in complete confidentiality.

The development of the process begins if there is a strong, sincere commitment to family unity and business ownership continuity. However, if some family members desire to exit ownership or have a conditional commitment to the ownership, those wishes can surface and be integrated into the development process.

Now, most unsuccessful family constitution-related agreements fail not for the lack of skills or the above-described unaligned and hidden motivations but due to few innocent reasons that make the process fail.

If there is one over-ruling and overriding piece of advice to a family beginning to develop a family constitution, it is to pay sincere attention to the process. As mentioned in previous articles, the process is more important than the content of the family constitution.

So, the most common and easily ignored innocent yet fatal mistakes:

So, true that results matter. But with a process that embodies your company’s core character and core competence. The possibilities of repeatable results can be amazing for outcomes every day, every time.

  1. Too business driven
  2. Lack of self-reflection, collective reflection, digestion and achieving comfortable breaths throughout
  3. The myth that I have too much time
  4. Weak support for family or family leaders
  5. Resigned leadership

The process most often goes sideways when the family business’s leader drives the process in a very directive, narcissistic, and top-down manner. Family members then sense that the constitution protects the business rather than strengthens the family.

Further, some family members will likely feel that the hard-driving business style of the process leadership is uncomfortable or inappropriate in a family setting.

Even if all the direct descendants of the owning family are in business, such an approach can raise anxiety among some spouses.

If the process design does not respect and hence incorporate dedicated time and system for reflection, digestion and getting comfortable from all brain faculties of emotions, reasoning, creative, survival and forward onlooking – it gets side-tracked long before, but we learn when it’s too late to repair and recover from. Hence, parallel reflection and deep digestion help slow the sure movement of collective heads, hearts, and souls.

When the process moves too fast, family members have little opportunity to feel ownership of its results. Sometime they may feel that the rush violates a sense of fairness. They may ask themselves, why go so fast? Is someone trying to do something we don’t understand?

Experience with successful processes suggests that each meeting should review and reaffirm or revise the previous meeting’s conclusion before they are voted upon and endorsed.

We help our clients to build prior to the process simple yet sophisticated sub-processes that are private to family and teach them how best they can leverage them to become completely aligned with comfort and genuine advocacy for content in every meeting. Thus, the time between the two meets is critical for overall success that gets built slowly but only to be sure and complete.

The above is but the tip of the iceberg of the real process, but I hope that you may be able to draw certain observations and insights and do a quality deliberation in your specific context.