Running a successful family business can be very challenging because of all the risks involved, and it explains why many such ventures do not last beyond the first generation.
When it comes to in-depth knowledge about family business, very few people can stand shoulder to shoulder with the vastly experienced Anita Brightley-Hodges, who has over two decades of expertise under her belt.
Anita Brightley-Hodges started out as a graphics designer before becoming a teacher and then running a boutique international design agency. However, tragedy struck in 2008 with the economic meltdown, and she lost all her business and was back to ground zero.
During an exclusive interview with Battabox.com, she tells Asukwo Oduo how her never-die attitude helped her to pick herself up and pioneer the Family Business Place to cater for the needs of family businesses who had no one to turn to for advice and direction in the face of difficulties.
According to her, the big guys running family businesses have banks, insurance companies, lawyers, and accountants to cater for them. Still, even the banks and other big financial institutions lack the requisite skills to attend to the ever-present internal ramblings in every family business.
She explained that a banker or lawyer cannot tell you how to run a family business; family is highly influential in your business. Moreover, the corporate guys don’t know much about what goes on in the family but are only interested in wealth and will always be there because wealth has to be managed.
The specialist coach stressed that family businesses remain the backbone of the UK economy. It is also the biggest and oldest business sector in the world, and anyone who wants to introduce something new must have a way of doing things better, faster, or for a cheaper fee.
“I started by building a community of family businesses and I was shocked after 150 family business owners showed up for the first meeting I organized; I discovered that there was an audience that had no community to service them,” she said.
What makes a successful family business?
According to statistics, only about 30% of businesses make it from the first generation to the second, about 12% make it from generation two to three, while only a paltry 4% make it beyond the third generation. This shows that if family businesses are not properly run, the chances of surviving the owner is very slim.
Coach Anita Brightley-Hodges points to two necessary ingredients required to run a successful business and pass it on to the next generation; governance and communication.
Governance involves the structure needed to plan for the future, the values, and clearly-defined roles you want the family to have while also taking into consideration the roles that the family wants to have; it also includes management structures beyond the owner. These provide clarity and a clear direction for where the business is headed.
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Meanwhile, communication/conflict management deals with how money, power, ego, and aspirations can be managed appropriately. Boundaries is a huge problem in any family business, and conflicts in family can be devastating and have severe consequences.
“Remember, you can always get another business but you cannot get another family,” she said.
How to plan for succession
The veteran business advisor stated that succession is more of a journey than an event, adding that it’s important to spot the next generation of managers and identify those with the skill and passion.
She said, “Two things are certain in life; taxes and death. Sit down and make the plan because every new generation always have a new aspiration. So you must consider someone within the family that’s interested in running it; else the business can be sold, merger-managed or employee-owned.”
