Family Business Management: Applied Frameworks

Sep 5, 2024

Keep your family business strong and your family strong too!

1. Understand the 3 Overlapping Worlds (Three-Circle Model)

Family: Who is part of the family?
Ownership: Who owns shares?
Business: Who works in the business?
Action: Draw your family’s three circles. Where do people overlap? This is where role confusion can happen!

2. Map Your Family Tree (Genogram)

Draw out your family tree, including key relationships and patterns.
Action: Identify historical family dynamics that might play out in the business.

3. Set Clear Rules (Governance)

Family Council: [ ] Do you have a dedicated forum to discuss family issues related to the business, separate from business operations?
Board of Directors: [ ] Do you have a professional board, ideally with independent directors?
Family Constitution: [ ] Do you have a written document outlining rules for:
- Employment of family members?
- Succession planning?
- Ownership transfer (e.g., selling shares)?
- Conflict resolution?

4. Communicate, Communicate, Communicate

Have regular, structured meetings for each circle (family, ownership, business).
Encourage open and honest dialogue.

Golden Rule: Professionalize your family business without losing the unique strengths that come from being a family.