“We can’t just keep glossing over this.
We need to talk about it…”
“…and figure out what we’re going to do.
Or else we’re going to have a problem.”
– Joan to George Sr. (after the dinner discussion)
The Moore Family holiday conversations have always ebbed and flowed from happy, to funny, to serious and even strained at times, with the family business always being a prominent topic of discussion. This year was no exception. After the family dinner, while the family was still sitting around the dinner table, George Jr. remarked, “When I take over the business we’re going to focus on our highest margin products and get rid of everything else.” To which Peter replied, “Who said you’re taking over the business?” Joan looked over at George Sr., rolling her eyes, as earlier that week Joan and George Sr. were talking about diversifying their product mix to protect the business from a softening economy and cater to a wider clientele base. Nancy stepped in to ease the tension and said, “So, who wants some dessert?”
In last month’s post we introduced you to the Moore Family and gave you Gen 1’s (George Sr. and Nancy) perspective and questions. This month, let’s look at Gen 2’s (George Jr., Joan and Peter) perspective.
George Jr. (50) – Operations Manager at Moore Flooring
As the eldest son, George Jr. is looking forward to taking over the family business. He’s been groomed to take over the business ever since he first started working at the business right out of high school. Very confident in his abilities, George Jr. (and his wife) are frustrated with the fact that he isn’t already running the company. George Jr. (thinks) he has the capabilities to run the business today. He doesn’t understand why his father doesn’t see that he’s capable and just let him run the company already. In his opinion, his sister Joan is a great number two person with her extensive sales experience, but she’s never worked in operations and therefore wouldn’t be able to lead the business. Peter, in his opinion, is just not interested in the family business.
Joan (47) – Sales Manager at Moore Flooring
After completing her MBA, spending time to start a family, and working in the marketing department for a large local business, Joan started working in the sales department of the family business about 5 years ago. Her previous experience gave her great insight and she quickly moved up to Sales Manager. She has a firm understanding of the business and feels confident in her team. George Sr. frequently comes to Joan when he has questions and comments about the future direction of the business. Joan is very confident in her brother’s (George Jr.) abilities as an operations manager, but knows he struggles to see the big picture. And she fears that Peter is too risky and will try to pull money out of the business instead of keeping the money in the business to re-invest in growth or for a rainy-day fund.
Peter (45) – Entrepreneur
Peter was always the one in the family with many great ideas and passions. Peter decided early on that he could not be held back to just do one thing forever and decided not to get involved in the family business. With a few ventures under his belt, some sort of successful, some not so successful, Peter wants to remain the innovative entrepreneur in the family, but feels that as a family they should invest in new ventures together. In his mind George Jr. is too close-minded and doesn’t see all the possibilities and opportunities. And Joan worries too much and won’t ever take a risk.
After the holiday dinner discussion, Joan was venting to George Sr., “We can’t just keep glossing over this. We need to talk about it. And figure out what we’re going to do. Or else we’re going to have a problem.” “I heard about this company that works with family businesses. Maybe we should give them a call.”
George Sr. and Nancy decide that they need some help. They’ve been putting off making some decisions, but they realize that they need to stop pushing the tough decisions aside. They need to make some tough and complex decisions about what to do with the business. Ensure they’ll be okay for retirement. Figure out their estate plan. Make sure the “kids” (Gen 2) can work together and keep the family business running after George Sr. steps away from the day-to-day operations. And, last but not least, the last thing the parents wants is for there to be conflict among their kids.
Next Month: The first meeting with the family business advisor.
BCR has extensive experience in working with many family-owned businesses in all of our areas of services. If you have any questions or need advice regarding your family-owned business, please give us a call at (808)545-4111. Or reach out via our Contact Us page.