Position yourself for growth in 2017—join us live at the Entrepreneur 360™ Conference in Long Beach, Calif. on Nov. 16. Secure Your Seat »
Ten years ago if a family business had family problems, the usual response was to hush it up. Nobody, certainly not senior members of the firm, wanted to talk about embarrassments such as the father and son not getting along, siblings entangled in a Cain-and-Abel succession struggle, or a spouse who wouldn't talk to his in-laws because he thought his wife was being shabbily treated in the business.
Now, confidential forums where people can talk about these problems are available and in vogue, thanks to the 130 or so university-affiliated family business institutes and forums around the country--scores of which have opened in the past few years.
Why the proliferation of programs? Increased media coverage of family businesses (which make up more than 90 percent of all U.S. businesses) has made members of family businesses aware that their concerns are not singular and "not necessarily born of a psychiatric disorder," says Joe Astrachan, associate director of the Kennesaw State University's Family Enterprise Center in Kennesaw, Georgia, one of the first university-affiliated programs in the nation.
Another factor is the painful reality that only one-third of family firms survive the transition to the second generation and fewer than 10 percent survive beyond that. "Succession is a looming issue, especially among the senior generation, many of whom started businesses after World War II and are ready to retire," says Nina Paul, executive director of the year-old Family Business Forum at American University in Washington, DC.
Helping with these concerns are two seemingly divergent sources--universities and business services. For universities (especially public institutions), family business forums are a way to provide better service to their communities. Says Ralph Struzziero, director of the year-old Institute for Family Business at the University of Southern Maine in Portland, "Public education is more than serving the needs of 18- to 21-year-olds and offering a few continuing education courses."
Meanwhile, banks, lawyers, accountants and insurance firms seeking family businesses as clients are eager to sponsor events and programs targeted to those firms. And while university-affiliated institutes are uncompromising about not allowing sponsors to solicit their members, the mere presence of business services as event sponsors gives them a marketing edge.
So far, the link between family businesses needing help, a forum to confidentially share their concerns, program sponsors willing to pick up the lion's share of the tab for an event or institute in hopes it will one day turn into business, and universities wanting to better serve their communities and forge local business ties is working to everyone's advantage.
Every university-affiliated program runs differently, depending in large measure on the needs of its member companies--most of which are in the second or third generation of family ownership. Some limit participation in their programs to members only and, like the Family Enterprise Center at Kennesaw State, hope for a 25 percent turnover in members each year "so the program remains fresh," says Astrachan. Some limit the number of members, usually to between 50 and 60.
Throughout the year, the programs hold events ranging from daylong seminars, half-day programs and breakfast round tables to evening seminars and peer-group forums. They delve into topics of special interest to families: preserving family wealth, mediation as a way of dealing with differences, communication pitfalls when dealing with relatives, how siblings/cousins can work together, what to consider when planning for succession and more. In addition to these events, member businesses usually have access to the universities' libraries and information centers.
Whatever's on the agenda, family business centers offer "a safe environment for family business owners and members to exchange stories on family issues," says Joan Gillman, director of the University of Wisconsin (at Madison) Family Business Center. Talk may not be cheap at these forums (membership can cost upwards of $1,200 a year), but it is candid and useful.
Will university-affiliated family business forums continue sprouting at the breakneck pace of the past two years? Will every state university and private school eventually have one? Perhaps. "[Eventually,] we hope they become more closely connected to universities," says Judy Green, executive director of the Family Firm Institute, an international professional membership association that studies and advises family firms. Her reasoning: Family business needs to be recognized as a discipline worthy of serious study by university business departments. "But that [will] take time to achieve." Green points to three well-established programs that have close ties with universities: the unsponsored Family Business Center at Loyola University in Chicago, the privately endowed Family Business Program at the University of Oregon, and the sponsored Family Enterprise Center at Kennesaw State University.
Exploring issues faced by family businesses is not done solely at the university level, however. Family business councils and forums independent of universities are springing up around the country (Family Firm Institute has a list of family business organizations). Such organizations tend to have a broader membership base and run shorter meetings, but their goals are similar to those of groups with university connections: providing support and top-notch instruction . . . and then giving members plenty of time to talk among themselves.
Family Business Center, Loyola University Chicago, (312) 915-6490, firstname.lastname@example.org;
Family Business Center, University of Wisconsin, Madison, Family Business Center, 975 University Ave., #3260, Madison, WI 53706, (608) 262-9982;
Family Business Forum, American University, 4400 Massachusetts Ave. N.W., Washington, DC 20016-8044, (202) 885-1897;
Family Enterprise Center, Kennesaw State University, 1000 Chastain Rd., Kennesaw, GA 30144-5591, (770) 423-6045;
Family Firm Institute, fax: (617) 738-4883, email@example.com;
Institute for Family Business, University of Southern Maine, (207) 780-5935, fax: (207) 780-5925.