A family business unit is an entity that is created and maintained by people that naturally gravitate towards each other. There’s this organic force that keeps people from leaving the circle of relationships. It’s almost impossible to leave, and there’s a reason for this.
A family has the best possible chance to achieve something that all businesses in the world spend their time seeking and that’s UNITY. A group of people that all share a common goal or vision for the future. Where there’s unity, economic success is inevitable.
Unity however is not something that you just switch on like a light. It’s something that is created by purposefully planning the future for the family as well as the business.
All strong economies are built by family businesses and that’s why it’s important to make sure that they last through multiple generations.
But why do families fail?
Founder generations start out as entrepreneurs and never realise that what they are building is a family business. They have a dream of leaving a business for their children to provide them with financial security.
But their drive, motivation and sweat is soon met with disappointment as they watch how family conflict quickly dismantles that dream.
Family businesses organisation are complex and they require a very specific and specialised design, planning, organisation and governance to function.
Without the knowledge to build a family business, the founder generation inadvertently sets the family business up for failure.
But it can be fixed!
Family business requires a parallel strategic planning process. Not only do we have to plan for the future of the business, but also the future of the family.
Unless we understand what the purpose of our family is, it would be hard to establish why our business exists. If we do not know why we are in business, we have very little reason to continue past the first generation.
If we can agree on a reason for our family to exist, we can agree on what we need to achieve in business.
Only then can we plan a multi-generation business that not only provides for the family, but also for the communities around us.
The family of businesses then becomes an asset to be stewarded over generations, rather than a short-term income source to finance our immediate needs and wants. The stewardship of the asset becomes our reason and purpose for living, and this guides every family member into becoming a selfless member of society, contributing to an economic engine that impacts their family and the community around them.
Imagine an economy built by these businesses. In South Africa, strong family businesses are now needed more than ever.
As family business members, we have a responsibility to ensure our businesses are profitable, but more than anything, we need to ensure they become wealthy multi-generations businesses that can realise the dream of a new prosperous South Africa.