This Thanksgiving, the perfect time to focus on family businesses. Working with the people you love is tough. I recently had a chance to speak with Mitzi Purdue. She is the daughter of Sheraton Hotels co-founder and the wife of the late entrepreneur Frank Perdue. She is also the author the of the book “How To Make Your Family Business Last” and “How to Communicate Values to Children—So They’ll Love it.” It’s a practical guide to keep families and business together through the predictable issues all businesses face. For the holidays, Misti has discounted her book to $10 at http://mitziperdue.com/discount.
- What do family businesses need to focus on legacy building early?
I’ve seen so many family businesses ruined. When I learned that only 30 percent of family businesses endure beyond one generation, I wasn’t surprised: How can family businesses last when there isn’t a strong family culture to sustain them? I wanted to use my experiences to help families avoid court battles and family strife when its time for the next generation to take over the business.
- Why did you structure the book as you did?
Everyone loves a good story – but those stories only matter if we can bring their lessons to life. Throughout the book, I combine anecdotes from my personal experience with checklists, tips and tricks so that readers have clear-cut applications and advice for their own families and businesses.
- You place tremendous value on the power of story. Why is that?
Quite simply because we are the stories we tell ourselves. It is stories – not principles, statistics or arguments – that shape the way we live our lives. Telling the family story acts as a sort of relational glue: It reminds members of how deeply their identity is founded in the family, and it gives everyone a shared sense of “what it means to be us.”
- How can families come to understand their own stories better?
There are dozens of ways! One of them is family traditions – another kind of relational glue. In the Perdue family, we have all kinds of traditions. Some fall on holidays, like our Thanksgiving gathering when we wrap presents for disaster victims. Some center on major events, like weddings, when we give the bride a coin from a sunken treasure ship whose finding Frank backed financially. And some of them don’t have any particular purpose at all, like our annual talent show and annual vacation, when we just get together and enjoy one another’s skills and gifts.
Another is just simply asking good questions. Do you know what your parents’ first jobs were? Do you know about any major injuries, challenge, or struggles in your grandparents’ lives were? Do you know the origin of your name?
Telling these kinds of stories can itself be a bonding experience – and if you record them, either via a coffee table book, as we do, or with a video, you’ll be able to remember and reflect on the answers for years to come.
- What are the most common issues you’ve seen among family businesses?
Oh, there are just so many! But I would say fortune hunters are a big problem, especially if you’re a high profile business. Learning to trust yourself and your intuition on these matters is crucial. Legal trouble is a big problem as well. Too often, family members are too quick to move a dispute to the courtroom rather than settling it privately – a decision that is incredibly costly, both monetarily and emotionally.
- You insist that both philanthropy and frugality are important. Tell us more about this.
Yes, it does seem contradictory, doesn’t it? Frugality means holding onto your money; philanthropy means giving it away. But both these things are a way to combat selfishness, showiness, and the temptation to a “the world revolves around me” attitude. Frank always impressed me with his frugality: He absolutely refused to live beyond his means, and constantly was looking for smart ways to save, whether flying economy or living in a home far less expensive than he could afford.
- How can leaders expand the family culture beyond the family and into the company itself?
This is another thing Frank was a master at. For him, running a family business meant not just treating family members like employees, but treating employees like family. He knew the names of countless individuals – even the hourly workers – and made a point of attending weddings and funerals and visiting people in the hospital. He also wrote hundreds of handwritten notes to supervisors, using this as a way to ensure that the company’s values were always being realized in every aspect of its operations.
- What can business leaders do ensure the family culture continues after they pass away?
I highly recommend creating an ethical will. It binds family members to one another and to the memory of the deceased, and it reminds them that their inheritance is far more than dollars and assets – it’s an attitude and an approach to doing things.
- What is the best thing young people who want to continue the family business can do?
Shut up and listen! You will learn far more by observing than by talking. Make a point of listening 90 percent of the time and not ten. There’s a reason your relatives are where they are. Listen to them, and take notes – literally. The more information you can glean to inform your decisions – business, career, or personal – the better.
- Should a family business ever get outside perspective on a family quarrel? If so, when and how?
Ah, this is a tricky one! My answer is yes and no. On the one hand, as I’ve said, make it a rule to solve family problems within the family, as opposed to bringing in lawyers. Hiring someone whose MO is litigation, in my observation, regularly leads to family disaster. However, if a conflict is intractable and you need outside help to help you sort through the mess, there are many resources to turn to including family business therapists, and professional mediators. By all means get the help you need. It’s a worthwhile investment, and can prevent you from spending thousands on legal fees, not to mention extraordinary emotional anguish.
- What is the best advice you can give family businesses?
It’s so easy to get caught up in practical matters like growth, operations and product development and skimp on subtler things, like family get-togethers and trust. But this is a mistake that can have devastating consequences, both personally and professionally. Develop a supportive culture that can sustain your family business for generations. Always remember: You were family before you were in business, and acting in the best interest of your family is ultimately acting in the best interest of your family business. After all, what good does it do to succeed financially and fail as a family? The deepest joys and worst pains in life come through our intimate relationships, so put the time, effort, resources, and love to protect and nurture these relationships.
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