January/February 2013 Toolbox

By Barbara Spector

An online assessment to determine steps your family should be taking

The Family Wealth Sustainability Toolkit
By Fredda Herz Brown, Ph.D., and Fran Lotery, Ph.D.
John Wiley & Sons, 2012
102 pp. plus online access; $125
Also available as an e-book

Fredda Herz Brown and Fran Lotery, the founding principals of consulting firm Relative Solutions LLC, are also Ph.D. researchers in the field of family enterprise. Based on their extensive experience working with families of wealth, they developed The Family Wealth Sustainability Toolkit, an online self-assessment and companion manual. The toolkit helps users to consider, in a comprehensive and systematic way, how their family is progressing toward meeting its long-term goals, and then to compare notes with their family members.

“In our work with families,” the authors explain, “we have heard over and over again the desire to have more information about what they ought to be doing to help their families have long-term success.” They developed the self-assessment, which they call the “Family Wealth Sustainability Index,” in response to those requests.

Brown and Lotery maintain that sustainability describes the challenges of family enterprise transition more fully than continuity or succession does. Their notion of sustainability was inspired by the United Nations World Commission on Environment and Development: “[the ability to meet] the needs of the present without compromising the ability of future generations to meet their own needs.”

Sustainability, in the authors’ view, has four dimensions: family legacy and connection, governance structure and processes, financial accountability and management, and human capital and leadership development. “[T]he better able to manage the business of the family,” Brown and Lotery write, “the more sustainable it will be.” Successful multigenerational enterprising families, they explain, “no longer view themselves simply as the owners of a business, but rather as investors building a portfolio of assets that enhances all those who are stakeholders.”

The four dimensions of sustainability become more difficult to manage in the third generation and beyond, when the family unit grows larger and more diverse. To illustrate the increase in challenges that arise in each generation, Brown and Lotery present a case study—the story of a fictional family, the Samsons, whom readers follow through the decades. At the end of each Samson vignette, the authors provide questions for readers to consider. These questions challenge readers to think hard about family and business dynamics, and could be used to spark family discussions. The authors also weave anecdotes from other anonymous, pseudonymous and composite families throughout their book.

The first chapter of Brown and Lotery’s manual explains the concept of sustainability as well as the challenges and opportunities facing enterprising families. Each of the next four chapters is devoted to explaining one of the four dimensions of sustainability as defined by the authors. The last chapter of the manual describes how to use the online Family Wealth Sustainability Index, including examples drawn from what the fictional Samson family discovered by “using” the assessment tool.

The online assessment is a multiple-choice survey whose four sections correspond to the four dimensions of sustainability; the questions take about 20 minutes to complete. Purchasers of the manual receive a personal identification number (PIN) that gives them access to the online Sustainability Index; PINs for additional users cost $95 each. A key advantage of the index is that it provides instant feedback to its users. Results are presented as graphs as well as in prose; the graphics are interactive, so users have the option of focusing on one data point or seeing the results displayed in various combinations.

Better yet for those who seek instant gratification, the assessment offers customized suggestions on what the family’s next steps should be, based on family members’ responses to the survey questions. As the online tool explains, “The index essentially provides you with an analysis of your starting point and identifies what is getting in your way to reaching your destination.”

The assessment is most effective if multiple family members take the online survey, so that individual evaluations of how the family is doing can be compared. This involves family buy-in—in the literal as well as the figurative sense of the word. Family members must commit to completing the survey, and the family must buy a PIN for each person who uses the assessment tool. The data, in both graphic and text formats, are automatically updated as more family members participate in the assessment.

Families who are willing to make this investment of time and money stand to benefit from Brown and Lotery’s considerable expertise.












Revisiting advice for daughters striving for leadership posts


The Daughter Also Rises: How Women Advance in Family Business, 2012 Revised Edition
By Anne E. Francis, Ph.D.
B&A Books, Lawrence, Kan., 2012
318 pp. • $25.95

Anne Francis originally published The Daughter Also Rises in 1999, when daughters were just beginning to gain recognition as potential leaders in their families’ businesses. Today, more family business leaders are considering women as successor candidates. In the preface to the book’s new edition, Francis cites the 2007 Mass Mutual American Family Business Survey, in which nearly 60% of the family firms that responded have women in management positions, and some 30% said they would consider a daughter for the top job.

Despite this progress, Francis writes, “Women continue to seek my counsel to learn how to get their father or uncle or whoever is in charge of the business to take them seriously, notice the contributions they make, and invest in their leadership potential.” Her advice is geared toward next-generation female readers with leadership aspirations.

Francis, a Kansan who has a consulting practice with her husband, Jack Fitzpatrick, has revised her book to include citations to works published in the past 12 years. Like the previous edition, this version presents ammunition to counter gender-biased myths (e.g., “motherhood is womanhood”). It offers advice on advancing in the family firm as well as on forming a strong partnership at home with a male significant other. Francis’s book also includes self-assessment “question sets,” pseudonymous examples drawn from her consulting clients and a chapter of helpful tips provided in Q&A format.

In a chapter on balancing home and work life, Francis notes that “having it all” is unrealistic. She suggests an alternative: “Decide to have some of it all,” by defining “what you can and cannot reasonably accomplish.”

The author, who is licensed as a clinical social worker and a marital and family therapist, traces daughters’ relationships with their mothers and fathers from girlhood to womanhood and suggests ways to break free of patterns that may be hindering their success in the business.

Francis’s view of opportunities for women in their family firms seems excessively bleak. Her assertion that as of 2011, only one of the 100 oldest family companies has a woman CEO conflicts with Family Business Magazine’s research findings. The “Family Business 100” list of America’s oldest family firms, updated in 2011 (Family Business Agenda 2011), includes at least five companies with female leaders, as well as several others in which women are running the business in partnership with their siblings or husbands, plus a few more in which daughters are their fathers’ likely successors. And there are more such examples in the “FB 100” list of America’s largest family companies.

The Daughter Also Rises does not discuss ways in which women can have significant clout in their family enterprises outside of management. In the past, wives or other female relatives had influence behind the scenes as unsung “chief emotional officers”; today, many women are taking charge as chair of their family council (now widely considered a pivotal role in the family enterprise and, often, one that is compensated). Many daughters who have achieved professional success outside the family firm are contributing to the family enterprise through service on its board of directors.

Although it doesn’t cover the full spectrum of roles a daughter can play in the family business, Francis’s book offers some advice that young women would be wise to heed. “[I]f you want change of the kind that will allow your greatest success in the family business,” she writes, “the change has to begin with you.”











Copyright 2013 by Family Business Magazine. This article may not be posted online or reproduced in any form, including photocopy, without permssion from the publisher. For reprint information, contact bwenger@familybusinessmagazine.com.


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January/February 2013

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