Entrepreneurship is rarely easy but also having family in the mix can add multiple layers of complexity – barriers and challenges that your competitors may not be burdened with. That said, the unique dynamics of a family-run business can also result in extraordinary success as evidenced by Wal-Mart, BMW, Ford and Tyson – all highly accomplished family firms. For this reason and others, the ‘family business’ trend is flourishing. In fact, recent reports reveal that family-owned companies comprise between 80 and 90 percent of businesses worldwide, generating a staggering estimated $6.5 trillion in annual sales – “enough to be the third largest economy in the world (behind the U.S. and China)” as cited in the report.
What’s also fascinating is that The Global Family Business Index, a compilation of the largest 500 family firms around the globe intended to exemplify the economic power and relevance of family firms worldwide, found that 44 percent are owned by fourth generation or older family members. These companies are in it for the long haul and have clearly realized the kind of sustained success needed to withstand the test of
time.
One major component of long term success among family businesses is simply knowing how to navigate and circumvent personal relationships in order to work together effectively, while also maintaining positive perceptions and overall integrity with non-related staffers. Achieving all of this, while tending to “standard” business issues, can be daunting at best and a death knell for far too many.
With this in mind, here’s a list of seven pitfalls to avoid—all of which can cause an assortment of strife: from uncomfortable family friction to completely tearing a family and business apart.
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Brian Greenberg is a multi-faceted entrepreneur who has founded and now spearheads multiple online businesses. He currently co-owns and operates three entrepreneurial companies with his father, Elliott Greenberg, which have each flourished for over 10 years: www.WholesaleJanitorialSupply.com, www.TouchFreeConcepts.com and www.TrueBlueLifeInsurance.com.
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There is certainly no shortage of articles, texts, and resources dedicated to the subject of developing business strategies. I myself am guilty of adding to this information pile, having just released a book on this very topic. But as we all attempt to decode the magic formulas and frameworks behind best-in-class business strategies, we should also take a little time to understand the skills that are required of the people who create those strategies.
The process of developing business strategies is a creative one¬ – not unlike writing music, painting a portrait, or designing a new architectural masterpiece. Creative endeavors produce creative outputs; and the success of those outputs will be driven not only by skills, but also by some level of proficiency in those skills. Using this terminology, it is useful to think in terms of four “strategic proficiencies” that can be mastered in relation to developing successful business strategies. They are:
Analysis Recollection Intuition Artistry
In and of itself, this mnemonic of ARIA may appear to be yet another catchy little arrangement of words to help sell more books! And while there may be just a shred of truth to that statement, there is actually both a rhyme and a reason for my line of thinking behind this approach.
When assessing strategic proficiencies, I like to refer back to the four main questions that have formed the very foundation of strategic theory for centuries:
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One of the major problems faced by business owners all over the world is knowing when to let go. There are plenty of reasons why. As a company owner, you are used to making the decisions and there is a good chance you like to keep things under your control. As much as you like to think you are running a tight ship, if you are lending your hand to every aspect of your business, there is a very good chance you are spreading yourself thin. And at that point, it’s time to give yourself a break.
You are right when you think you are the best person to lead your business, but you just can’t do everything. Delegating to a trusted employee is a perfect fit for the day-to-day running of your company. But what about those times when you have a special project or need help to explore emerging technology? Outsourcing to professional services may be the quickest and easiest way of handing these situations.
Specialist knowledge
Specialist companies will have a much deeper understanding of their industry than you can expect your employees to have. Sure, they know your business inside out but they may not know how to maximize your opportunity in particular areas. Let’s say your current in-house software system is bogging down from a recent influx of customers. In this case, IT outsourcing is likely to be better for you than leaving things to your under-pressure support team who may be challenged by their current workload.
The money
There are financial factors too, and your operational costs may be lower when outsourcing. Let’s say you want a new website designed. The investment required to find, employ, and train staff to do so often outweighs that of the one-off cost you would pay a freelancer or a small web developer company. There are offshore markets to explore too. Many highly skilled developers can be found in emerging markets such as India, where costs are far lower. Making use of modern communications technology makes it easy to share projects and get the same quality of work as you would get from your local town. And all for a lot less money.
Resources
At the end of the day, it’s all about resources: if you don’t have enough of them, you can’t possibly expect to grow. You may get a surge of new customers but if your team isn’t big enough to handle it, the influx could strike a serious blow to your business. Outsourcing at the right times and in the right areas mitigates your risk and opens up new possibilities. If you don’t free up the reins, stagnation – and possible implosion – is likely to be waiting for you at the next corner.
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The biggest source of growth and increased opportunities in today’s business climate lie in the way that individuals and companies work together. This article is a follow-up to my last column, “Collaborations, Partnering and Joint-Venturing.”
Situations Which Call for Teams to Collaborate
Business Characteristics. Most industries and core business segments cannot be effectively served by one specialty. It is imperative that multiple disciplines within the core business muster their resources.
Circumstances. People get thrown together by necessity and sometimes by accident. They are not visualized as a team and often start at cross-purposes. Few participants are taught how to best utilize each other’s respective expertise. Through osmosis, a working relationship evolves.
Economics. In today’s downsized business environment, outsourcing, privatization and consortiums are fulfilling the work. Larger percentages of contracts are awarded each year to those who exemplify and justify their team approaches. Those who solve business problems and predict future challenges will be retained. Numerically, collaboration contracts are more likely to be renewed.
Demands of the Marketplace. Savvy business owners know that no one supplier can “do it all.” Accomplished managers want teams that give value-added, create new ideas and work effectively. Consortiums must continually improve, in order to justify investments.
Desire to Create New Products and Services. There are only four ways to grow one’s business: (1) sell more products-services, (2) cross-sell existing customers, (3) create new products-services and (4) joint-venture to create new opportunities. #3 and 4 cannot be accomplished without teaming with others.
Opportunities to Be Created. Once one makes the commitment to collaborate, circumstances will define the exact teaming structures. The best opportunities are created.
Strong Commitment Toward Partnering. Those of us who have collaborated with other professionals and organizations know the value. Once one sees the profitability and creative injections, then one aggressively advocates the teaming processes. It is difficult to work in a vacuum thereafter. Creative partnerships don’t just happen…they are creatively pursued.
What Collaborations, Partnering and Joint-Venturing Are NOT:
Shrouds to get business, where subcontractors may later be found to do the work.
Where one partner presents the work of others as their own.
Where one party misrepresents his-her capabilities… in such a way as to overshadow the promised team approach.
Where one partner treats others more like subcontractors or vendors.
Where one participant keeps other collaborators away from the client’s view.
Ego fiefdoms, where one participant assumes a demeanor that harms the project.
Where cost considerations preclude all partners from being utilized.
Where one partner steals business from another.
Where non-partners are given advantageous position over ground-floor members who paid the dues.
Where one or more parties are knowingly used for their knowledge and then dismissed.
Who Wants to Collaborate:
Those who have not stopped learning and continue to acquire knowledge.
Those who are good and wanting to get progressively better.
Those who have captained other teams and, thus, know the value of being a good member of someone else’s team.
Those who do their best work in collaboration with others.
Those who appreciate creativity and new challenges.
Those who have been mentored and who mentor others.
Those who don’t want to rest upon their laurels.
Those who appreciate fresh ideas, especially from unexpected sources.
Who Does NOT Want to Collaborate:
Those who have never had to collaborate, partner or joint-venture before.
Those who don’t believe in the concept… and usually give nebulous reasons why.
Those who think they’re sufficiently trained and learned to conduct business.
Those who want only to be the center of attention.
Those who fear being compared to others of stature in their own right.
Those who think that the marketplace may not buy the team approach.
Those who are afraid that their process or expertise will not stand the test when compared with others.
Those who had one or two bad experiences with partnering in the past… usually because they were on the periphery or really weren’t equal partners in the first place.
7 Stages of Relationship Building… Customers, Business Partners
Want to Get Business. Seeking rub-off effect, success by association. Sounds good to the marketplace. Nothing ventured, nothing gained. Why not try!
Want to Garner Ideas. Learn more about the customer. Each team member must commit to professional development…taking the program to a higher level. Making sales calls (mandated or voluntarily) does not constitute relationship building.
First Attempts. Conduct programs that get results, praise, requests for more. To succeed, it needs to be more than an advertising and direct marketing campaign.
Mistakes, Successes & Lessons. Competition, marketplace changes or urgent need led the initiative to begin. Customer retention and enhancement program requires a cohesive team approach and multiple talents.
Continued Collaborations. Collaborators truly understand teamwork and had prior successful experiences at customer service. The sophisticated ones are skilled at building and utilizing colleagues and outside experts.
Want and advocate teamwork. Team members want to learn from each other. All share risks equally. Early successes inspire deeper activity. Business relationship building is considered an ongoing process, not a “once in awhile” action or marketing gimmick.
Commitment to the concept and each other. Each team member realizes something of value. Customers recommend and freely refer business to the institution. What benefits one partner benefits all.
Successes with Collaborations and Joint-Ventures…
Crisis or urgent need forced the client to hire a consortium.
Time deadlines and nature of the project required a cohesive team approach.
The work required multiple professional skills.
Consortium members were tops in their fields.
Consortium members truly understood teamwork and had prior successful experiences in joint-venturing.
Consortium members wanted to learn from each other.
Early successes spurred future collaborations.
Joint-venturing was considered an ongoing process, not a “once in awhile” action.
Each team member realized something of value.
The client recommended the consortium to others.
Truisms of Collaborations…
Whatever measure you give will be the measure that you get back.
There are no free lunches in life.
The joy is in the journey, not in the final destination.
The best destinations are not pre-determined in the beginning, but they evolve out of circumstances.
Circumstances can be strategized, for maximum effectiveness.
You gotta give to get.
Getting and having are not the same thing.
One cannot live entirely through work.
One doesn’t just work to live.
As an integrated process of life skills, career has its place.
A body of work doesn’t just happen. It’s the culmination of a thoughtful, dedicated process… carefully strategized from some point forward.
The objective is to begin that strategizing point sooner rather than later.
My Own Disappointments with Previous Collaborations…
Failure to understand – and thus utilize – each other’s talents.
One or more participants have had one or a few bad experiences and tend to over-generalize about the worth of consortiums.
One partner puts another down on the basis of academic credentials or some professional designation that sets themselves apart from other team members.
Participants exhibit the ‘Lone Ranger’ syndrome… preferring the comfort of trusting the one person they have counted upon.
Participants exhibit the “I can do that” syndrome… thinking that they do the same exact things that other consortium members do and, thus, see no value in working together, sharing projects and referring business.
Junior associates of consortium members want to hoard the billing dollars in-house, to look good to their superiors, enhance their billable quotas or fulfill other objectives that they are not sophisticated enough to identify.
Junior associates of consortium members refuse to recognize seniority and wisdom of other associates… utilizing the power of the budget to control creative thoughts and strategic thinking of subcontractors.
My Suggested Reasons to Give the Concept a Chance…
Think of the “ones that got away”… the business opportunities that a team could have created.
Think of contracts that were awarded to others who exhibited a team approach.
Learn from industries where consortiums are the rule, rather than the exception (space, energy, construction, high-tech, etc.).
The marketplace is continually changing.
Subcontractor, supplier, support talent and vendor information can be shared.
Consortiums are inevitable. If we don’t do it early, others will beat us to it.
About the Author
Power Stars to Light the Business Flame, by Hank Moore, encompasses a full-scope business perspective, invaluable for the corporate and small business markets. It is a compendium book, containing quotes and extrapolations into business culture, arranged in 76 business categories.
Hank’s latest book functions as a ‘PDR of business,’ a view of Big Picture strategies, methodologies and recommendations. This is a creative way of re-treading old knowledge to enable executives to master change rather than feel as they’re victims of it.
Power Stars to Light the Business Flame is now out in all three e-book formats: iTunes, Kindle, and Nook.
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The biggest source of growth and increased opportunities in today’s business climate lie in the way that individuals and companies work together.
It is becoming increasingly rare to find an individual or organization that has not yet been required to team with others. Lone rangers and sole-source providers simply cannot succeed in competitive environments and global economies. Those who benefit from collaborations, rather than become the victim of them, will log the biggest successes in business years ahead.
Just as empowerment, team building and other processes apply to formal organizational structures, then teamings of independents can likewise benefit from the concepts. There are rules of protocol that support and protect partnerships…having a direct relationship to those who profit most from teamings.
Definitions of these three terms will help to differentiate their intended objectives:
Collaborations – Parties willingly cooperating together. Working jointly with others, especially in an intellectual pursuit. Cooperation with an instrumentality with which one is not immediately connected.
Partnering – A formal relationship between two or more associates. Involves close cooperation among parties, with each having specified and joint rights and responsibilities.
Joint-Venturing – Partners come together for specific purposes or projects that may be beyond the scope of individual members. Each retains individual identity. The joint-venture itself has its own identity… reflecting favorably upon work to be done and upon the partners.
Here are some examples of Collaborations:
Parties and consultants involved in taking a company public work together as a team.
Niche specialists collectively conduct a research study or performance review.
Company turnaround situation requires a multi-disciplinary approach.
A group of consultants offer their collective talents to clients on a contract basis.
The client is opening new locations in new communities and asks its consultants to formulate a plan of action and oversee operating aspects.
Professional societies and associations.
Teams of health care professionals, as found in clinics and hospitals.
Composers and lyricists to write songs.
Artists of different media creating festivals, shows and museums.
Advocate groups for causes.
Communities rallying around certain causes (crime, education, drug abuse, literacy, youth activities, etc.).
Libraries and other repositories of information and knowledge.
Here are some examples of Partnering:
Non-competing disciplines create a new mousetrap, based upon their unique talents, and collectively pursue new marketplace opportunities.
Widget manufacturing companies team with retail management experts to open a string of widget stores.
A formal roll-up or corporation to provide full-scope professional service to customers.
Non-profit organizations banning resources for programs or fund-raising.
Institutions providing start-up or expansion capital.
Managing mergers, acquisitions and divestitures.
Procurement and purchasing capacities.
Corporations working with public sector and non-profit organizations to achieve mutual goals in the communities.
Private sector companies doing privatized work for public sector entities.
Organ donor banks and associations, in consortium with hospitals.
Vendors, trainers, computer consultants and other consultants who strategically team with clients to do business. Those who don’t help to develop the business on the front end are just vendors and subcontractors.
Here are some examples of Joint-Venturing:
Producers of energy create an independent drilling or marketing entity.
An industry alliance creates a lobbying arm or public awareness campaign.
Multiple companies find that doing business in a new country is easier when a consortium operates.
Hardware, software and component producers revolutionizing the next generation of technology.
Scientists, per research program.
Educators, in the creation and revision of curriculum materials.
Distribution centers and networks for retail products.
Aerospace contractors and subcontractors with NASA.
Telecommunications industry service providers.
Construction industry general contractors, subcontractors and service providers in major building projects.
Group marketing programs, such as auto dealer clusters, municipalities for economic development, travel and tourism destinations, trade association and product image upgrades.
International trade development, including research, marketing, relocation, negotiations and lobbying.
Characteristics of a Good Collaborator:
Already has a sense of self-worth.
Has a bona fide track record on their own.
Have a commitment toward knowledge enhancement.
Walk the Talk by their interactions with others.
Supports collaborators in developing their own businesses, offering referrals.
Have been on other teams in the past… with case studies of actually collaborations.
Have successes and failures to their credit, with an understanding of the causal factors, outcomes and lessons learned.
Benefits for participating principals and firms include…
Ongoing association and professional exchange with the best in respective fields.
Utilize professional synergy to create opportunities that individuals could not.
Serve as a beacon for professionalism.
Provide access to experts otherwise not known to potential clients.
Refer and cross-sell each others’ services.
Through demands uncovered, develop programs and materials to meet markets.
About the Author
Power Stars to Light the Business Flame, by Hank Moore, encompasses a full-scope business perspective, invaluable for the corporate and small business markets. It is a compendium book, containing quotes and extrapolations into business culture, arranged in 76 business categories.
Hank’s latest book functions as a ‘PDR of business,’ a view of Big Picture strategies, methodologies and recommendations. This is a creative way of re-treading old knowledge to enable executives to master change rather than feel as they’re victims of it.
Power Stars to Light the Business Flame is now out in all three e-book formats: iTunes, Kindle, and Nook.
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Brian Greenberg is a multi-faceted entrepreneur who has founded and now spearheads multiple online businesses. He currently co-owns and operates three entrepreneurial companies with his father, Elliott Greenberg, which have each flourished for over 10 years: www.WholesaleJanitorialSupply.com, www.TouchFreeConcepts.com and www.TrueBlueLifeInsurance.com.
Bob Caporale is the author of 
(McGraw-Hill, 2015) and the President of Sequent Learning Networks. His goal is to help business practitioners infuse more passion and creativity into their jobs. You can learn more about his work by visiting 
Power Stars to Light the Business Flame, by Hank Moore, encompasses a full-scope business perspective, invaluable for the corporate and small business markets. It is a compendium book, containing quotes and extrapolations into business culture, arranged in 76 business categories.
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