Inside the Multi-Generational Family Business: Nine Symptoms of Generational Stack-Up and How to Cure Them [NOOK Book]

Overview

Inside the Multi-Generational Family Business is an inside look at how familial relationships affect the success or the failure of the family business.  Many family business owners encounter conflict between siblings, children, and other relatives—especially when they're all involved with the business.  The author’s message is simple: family businesses today are saddled with “generational stack-up,” or the convergence of several generations as owners, managers, employees, and shareholders, often ...

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Inside the Multi-Generational Family Business: Nine Symptoms of Generational Stack-Up and How to Cure Them

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Overview

Inside the Multi-Generational Family Business is an inside look at how familial relationships affect the success or the failure of the family business.  Many family business owners encounter conflict between siblings, children, and other relatives—especially when they're all involved with the business.  The author’s message is simple: family businesses today are saddled with “generational stack-up,” or the convergence of several generations as owners, managers, employees, and shareholders, often without even knowing it. Each generation has its own work style, biases, and approach to money and business. Through detailed analysis of the various generations and the characteristics that define them in the family business, a more comprehensive understanding of the dynamics of the family in the family business can move the multi-generational family business from chaos and conflict to true collaboration and improved performance.

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Editorial Reviews

From the Publisher

"Families have no successions only transitions. Mark Green explains why so many of those generational transitions fail because an older generation of a family blocks the natural development of later family generation members; often he explains because of fundamentally different world views. He then artfully and with great experience explains how to diagnose a generational blockage and how, with sensitivity and tact, to dissolve it proactively toward a successful family evolution."  --James [Jay] E. Hughes, Jr,  author of Family Wealth and Family: The Compact Among Generations

"If our 73 year old, third generation family business survives, it will in good measure be due to the sound advice from Inside the Multigenerational Family Business.  It shows us the big picture and in turn helps to improve communication within the family.  I highly recommend Mark Green and his recent book." --John Bradshaw, Portland Transmission Warehouse, Portland, Oregon
 

"Mark Green does a superb job of bringing the generational stack-up to life by pointing to the root causes underlying the inter-generational conflicts and frustrations in family enterprises. Family business research and practice has traditionally looked at the transfer from one generation to another but Inside the Multigenerational Family Business captures today's realities of the multi-generational enterprises where up to five generations are occupying the workplace. This is a must read book for all progressive individuals who care to reap the opportunities of generational stack-up while effectively negotiating the related confusion and frustrations."  --Pramodita Sharma, CIBC Distinguished Professor of Family Business, Concordia University, Montreal; and Editor, Family Business Review

“Mark Green helped set us on a successful path for a generational and leadership transition.  Let him help you arrive at a stronger place for your business and your family.”  — Emily Powell, President, Powell’s Bookstore, Inc./Powells.com

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Product Details

  • ISBN-13: 9781137511089
  • Publisher: Palgrave Macmillan
  • Publication date: 3/15/2011
  • Series: A Family Business Publication
  • Sold by: Barnes & Noble
  • Format: eBook
  • Pages: 208
  • File size: 465 KB

Meet the Author

Mark T. Green is a Senior Associate of The Family Business Consulting Group, Inc., the former Director of the Austin Family Business Program, and was founding Director of the Austin Entrepreneurship Program, College of Business at Oregon State University.  

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Read an Excerpt

Inside the Multi-Generational Family Business

Nine Symptoms of Generational Stack-Up and How to Cure Them


By Mark T. Green

Palgrave Macmillan

Copyright © 2011 Mark T. Green
All rights reserved.
ISBN: 978-0-230-11877-5



CHAPTER 1

The Syndrome of Generational Stack-Up

Less than 10 percent of family businesses make it past a second generation. But some of the 90-plus percent that don't might consider themselves lucky.

Why?

Because multi-generational business families today face unprecedented challenges working together. They're saddled, often without even knowing it, with "generational stack-up," or the convergence of several generations as owners, managers, employees, and shareholders. Not surprisingly, each generation has its own work style, biases, and approach to money and business. And that causes conflict within and across generations. Aging GI generation, born from 1905 to 1924, and Silent generation family members cling to CEO positions and old-fashioned, status quo thinking while their Boomer children deny the very possibility of retirement. Gen X parents "helicopter" around their Gen Y children (also known as Millennials), doing everything for them, then get frustrated when Millennials show little ambition, independence, or skill regarding the family business. And everyone wonders why running a business together causes so many problems—on both professional and personal levels.

This chapter introduces the concept of generational stack-up and discusses how thinking about stack-up as a "syndrome," or cluster of symptoms, that business families face can help you begin to treat this problem in your family and business. My goal is to help you not just survive stack-up, but to thrive in the face of it.

To begin to understand patterns related to stack-up, let's take a look at the Brown family of Brown Industrials, and the multiple stack-up symptoms they face.


The Unhappiest Place on Earth

"Stop, Uncle Ben!" Joey yelled. "Please stop!"

The "happiest place on earth" was far from it. As Uncle Ben gave eight-year-old Joey one of his patented pink bellies—slaps to his bare midsection—and Joey's screams became louder and louder, everyone from Joey's father and mother, George Brown III and Judy, to his aunt Ellen, to his grandfather, George Jr., begged Ben to stop. Unfortunately, the theatrics, which quickly escalated to name-calling and a near-scuffle, happened poolside at a Disneyworld resort in Orlando, Florida, in full view of many of the family's fellow attendees at the 2008 Association of Midwest Manufacturers meeting. The only good thing was that 84-year-old George Brown Sr., the family business founder and patriarch, and his wife, Lucy, missed the excitement because they were at the resort's spa. But George Sr. and Lucy heard all about it that evening when the extended family sat down for a long, heated discussion of the multiple deep grievances—business-related and personal—among members that had helped motivate the pink-belly incident. All the issues were part of the complex dynamics behind the scenes at Brown Industrials, the third-generation business George Sr. had started nearly six decades earlier.

No one could have predicted how challenging family relationships would become—or how successful Brown Industrials would be—when George Sr. started manufacturing farm-machine parts from a small downstate Illinois shop soon after returning from service in World War II. As Brown Industrials grew into a respected regional manufacturer supplying the farming, automotive, and trucking industries, George Sr.'s family expanded as well; he married his high-school sweetheart, Mary, around the time he started the company, and the couple had three children over the next few years.

See figure 1.1 for the full family tree.

By the time their eldest, George Jr., was a teenager, George Sr. and Mary had divorced. Within a year, George Sr. married Lucy, a secretary at Brown Industrials who was closer to George Jr.'s age than to his own. Ben, George Sr. and Lucy's only child, was born when George Jr. was 15 years old. George Jr. showed an immediate knack for the business, helping with finance and operations even while in college. After completing an accounting degree, he became the only one of his three full siblings to join the business, rising quickly from finance manager to vice president of finance to president, marrying Linda and having two children of his own along the way. Linda, who also held an accounting degree, worked for an accounting firm for several years but turned down a faster-than-average promotion to manager to stay home with their children, George III and Ellen, as her husband's responsibilities grew.

George Jr. wasn't George Sr.'s only child to join Brown Industrials, which had become a $50-million-dollar operation by the 1970s. After much cajoling by George Sr.'s second wife, Lucy, the business founder agreed to have their son Ben join the business soon after he dropped out of college during his freshman year to pursue an acting career (which never materialized). Ben started in the sales department, where his sometimes-ribald humor helped him build customer relationships. "Customers love him," George Sr. pointed out as he promoted Ben repeatedly, ultimately to VP of sales. George Jr. pointed out that some customers were put off by Ben's jokes and casual approach, and that his half-sibling's devotion to customers often took the form of luxurious golf trips and other outings around the country—boondoggles that cost the company in terms of both large entertainment bills and Ben's long absences.

George Jr., on the other hand, found himself working increasingly long hours, sometimes to cover for Ben, and always under the watchful eye of George Sr., who even as he moved into his 80s and battled complications from diabetes kept a hand seemingly in everything from the smallest customer contracts to the simplest office-space requests, often pestering George Jr. about these issues through written memos and phone calls—always with the mantra of "got to minimize risk, son." By the time of the pink-belly incident, George Jr. longed for the more flexible life he saw Ben leading; at 60 and with money in the bank, George Jr. could have considered retirement in the near future, and loved the idea of learning to paint, but would have been hard-pressed to convince his father of the value of that. It was also hard for him to imagine not earning money anymore. And George Jr. knew that George Sr. had him in mind to succeed him as CEO, but the elder Brown never brought up succession. As he looked back at his life, George Jr. felt that by giving up so much for work—including time with his kids George III and Ellen—he'd become just like his father. But he couldn't imagine making a near-future break from the company where he'd spent nearly four decades.

Ironically, after his children graduated from college, George Jr. spent more time with them than ever before—because they joined Brown Industrials. By the time of the Disneyworld trip, George III (35 years old) was the operations manager and Ellen (32 years old) worked as a sales manager. Both enjoyed their work and were good at it. At the same time, both faced significant challenges. George III, who was expected to follow in his father's footsteps and eventually serve as president, found himself increasingly torn between his professional responsibilities and home life. He had promised himself he'd spend more time with eight-year-old Joey, but was letting work meetings and conferences keep him from baseball games, Cub Scout meetings, and parent–teacher conferences. "I need you at home more," his wife Judy, a teacher with her own busy schedule, frequently reminded him, wanting both parents to be present at as many of Joey's activities as possible. George III's father and grandfather weren't much help: George Sr. made clear that "work must come first," and while his father, George Jr., was generally supportive, he tended not to speak up against George Sr. and had set a clear example of living his father's value of work first. Given the circumstances, it was hard for George III to imagine taking any time for himself, though he occasionally managed to sneak away to the gym or to play guitar with his friends. Overall, he seemed to be living the song "Stuck in the Middle."

Ellen, George III's sister, arguably had it even worse. Mother of a two-year-old and married to a management consultant who traveled almost every week for work, Ellen returned from hectic days at Brown Industrials or short out-of-town trips to customers to spend her evenings managing a daughter fully into the terrible twos and then collapsing on the sofa in front of the TV. It didn't help that her boss was Uncle Ben, who often took advantage of her dedication by handing her last-minute work and sending her on sales calls he was supposed to make. It also didn't help that her mother, Linda, went out of her way to remind Ellen that she had given up a promising career to stay home with Ellen and George III, and that "women these days seem to think they can have it all." According to Linda, they couldn't.

Given these family dynamics, many of them revolving around Uncle Ben, it's no surprise that the pink-belly incident quickly deteriorated into name-calling and accusations beside the Disneyworld pool. When the family sat down to talk that evening, they knew they were angry. They also knew, from previous experience, that talking about their problems with one another might smooth things over for weeks or even months, but that the same patterns would remain, with conflict rising again.

What the Brown family probably didn't know is that many of the problems they faced stemmed from "generational stack-up"—or the challenge individuals from multiple generations face when trying to work together, due to their clashing experiences and values. Some of the patterns in the Browns' story fit into stack-up–related "symptoms" I call "Control beyond the Grave," "Boomer Retirement Mirage," "Generation-Straddling Sibs," and "Who's Your Daddy?"

This book aims to help family-business owners like the Browns, and those who work with them, understand the origins of generational stackup, what the symptoms look like, and how to treat them, creating much more harmonious family and professional relationships, as well as enhanced business performance.


Generational Stack-Up: What Is It and How Did We Get Here?

Generational stack-up is behind many of the problems modern family businesses face. To help explain, I'll use an analogy and point to sources of the problem.


Stack-Up and the Tower of Babel

Remember the Tower of Babel from the Book of Genesis? The tower, constructed by descendants of Noah after the flood, was to be a heavenreaching city in which all of human-kind could live in harmony, rather than scattering across the world and living in separate groups. Originally meant to honor God, the structure was to be built by all of earth's people, but, as the story goes, the builders lost sight of their mission partway through, and erected the tower to glorify Man, not God.

Naturally, God didn't appreciate this. As punishment, he made it such that all the tower's builders spoke different languages. Paralyzed by this move from one language to many, the people abandoned the tower project and did exactly what they'd hoped to avoid: they scattered across the globe, forming tribes around different languages and customs, never again to enjoy a truly united humanity.

In many ways, our modern lives mirror the Tower of Babel. This is in part because we speak different languages and have different cultures and customs worldwide, which sometimes leads to clashes. But even in countries where we all speak the same language, we often struggle to communicate. Much of this is due to generational differences—people born in different generations tend to have different values and worldviews, including attitudes toward work and family. As more and more generations get stacked up on top of one another, these discrepant "languages" lead to conflicts in multiple areas.

Nowhere are the effects of stack-up more apparent than in family businesses, as demonstrated by the embattled Browns of Brown Industrials. When George Jr. and others struggle against George Sr.'s over-controlling management style, that's largely because of generational differences: George Sr., who grew up during the post-Depression era, believed he had to wring out all risk from the business, and thus tried to keep a hand in even the smallest details. When George III and his sister Ellen wrestle with maintaining a work-life balance—including dealing with parents who don't understand this challenge and even dismiss it—it's largely because of generational differences: the third-generation Browns, now in their 30s, belong to an era of unprecedented choices and flexibility regarding careers and home lives, a mixed blessing leading to much heartache and intergenerational conflict.

Thus family businesses resemble mini Towers of Babel in many ways. Each family has built its "tower" with the hope that it will last for generation after generation, stretching to eternity. But because each generation of family business members speaks a different language—based on discrepant values and approaches to work, money, and family—they struggle to collaborate, often clashing, until parts of the tower crumble or the whole thing tumbles. To be sure, such conflicts happen in nonfamily firms as well, but the stakes are highest for family firms, where stack-up-related problems affect almost every aspect of members' lives, rather than being limited primarily to the workplace.

What's more, stack-up is a problem in family businesses worldwide, across industries. The specific generation-based values and patterns may differ from country to country, but the core issue is the same. I've seen stack-up symptoms from Montana to Mumbai, from small family farms to giant publishing houses. The bottom line is that unless members of different generations learn to speak the same language and try to understand one another, they're destined to clash repeatedly, and diminish the firm's value, along with their relationships and quality of life.


How Did We Get Here?

So how did stack-up become such a big problem in general and for family businesses specifically?

Among the reasons are:

We're living longer. It's no surprise that we live much longer today than in the past. The median age of individuals in the United States more than doubled (from 16 years to 35 years) from 1820 to 2000. The average life expectancy for U.S. residents is now just under 78 years, an increase of nearly 30 years over that figure for the developed world in 1950. But what may be most surprising is how many people are living longer than ever before: the United States has the greatest number of centenarians (the over-100 crowd), an estimated 96,548 in late 2008, one of the country's fastest-growing demographics. Longer lives mean more space for generations to stack up on each other.

We're working to an older age. Positive and negative trends have contributed to our working to a much later average age than before. Enhanced medical technologies are allowing us to maintain a higher quality of life well into our 70s and 80s, which means we can continue showing up at the office later in life. At the same time, trends in retirement plans and savings are forcing many to work past historically typical retirement ages. Although the typical American still retires at 63, many will have to work until closer to 70 to enjoy sufficient retirement income, partly because of decreasing Social Security benefits. So it's no surprise these days to see articles like "Six Ways for Older Workers to Impress Hiring Managers" and "Finding a New Job after 50." Moreover, many people who don't have to continue working, especially in family businesses, choose to do so for a variety of reasons, which we'll get into a bit later.

We're building more family businesses. In the United States, there are an estimated 24 million family firms. These vary from regional companies to multibillion-dollar giants, from true mom-and-pops to household names like Levi Strauss, S.C. Johnson, and the New York Times. Family-owned businesses tend to perform better than nonfamily firms on key indicators, including profitability, as suggested by multiple U.S.-based and international studies. There isn't much research yet, but this trend of superior performance seems to be continuing amidst the current economic slump, as family businesses tend to be more focused on long-term growth and strategies.


(Continues...)

Excerpted from Inside the Multi-Generational Family Business by Mark T. Green. Copyright © 2011 Mark T. Green. Excerpted by permission of Palgrave Macmillan.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.

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Table of Contents


Chapter 1: The Syndrome of Generational Stack-up * Chapter 2: Control Beyond the Grave * Chapter 3: Who’s (or What’s) Your Daddy? * Chapter 4: Battle of the Alpha Women * Chapter 5: Meet the MEOWs—Mommy Executive Officer Women * Chapter 6: Boomer Retirement Mirage * Chapter 7: My Child, My Boss * Chapter 8: Generation-straddling Siblings * Chapter 9: Comfortable Gen X * Chapter 10: WimpY Gen Y * Chapter 11: Surviving Generational Stack-up Now and Later


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