It's tough enough for one family to keep a business going from one generation to another. What happens when the founding partnership was between two families? Will the future generations of each partner be as in tune with each other as their parents or grandparents were?
Probably not. So when the second generations find themselves in the position of managing or owning the business started by their parents, they need to ask themselves: "Do we agree on the business mission and goals? Do we want the ownership as our parents conceived it to stay intact?"Prepare yourself before the big handover by reading "Bad Blood"
"There's nothing wrong with changing the ownership structure," says Craig Aronoff, family business advisor and director of Kennesaw State University's Family Enterprise Center in Kennesaw, Georgia. In fact, these days-when so many people want to buy (or buy into) a business-selling the business to the other family or to an outsider makes sense "if the two families don't have the same dedication as their parents, or if they have trouble getting along," says Aronoff.
But sometimes, two-family businesses want to remain that way so they can continue their journeys from generation to generation. What can family members with very different ideas do to ensure success? For starters, suggests Aronoff, "you have to measure with a straight measuring stick-the way you would in any family business." Although there are more players when two families are involved, "the issues are similar to any family business and can be anticipated," he says. The important issues include:
Patricia Schiff Estess writes family business histories and is the author of two books: Managing Alternative Work Arrangements (Crisp Publishing) and Money Advice for Your Successful Remarriage (Betterway Press).