THEFLB.COM BLOG, MAY 14, 2018

Welcome to this month’s blog on Family-Owned Businesses.  When a company thrives into 
 

second, third or even fourth generations, the success can have a wonderful impact on family members, clients, and an ever widening circle.  This is especially true when the business becomes more active in the community.  Surviving beyond the first generation, however, does not happen very often.  

 

The ability of a family business to survive depends upon the effective management of paradoxes.  Often shaped by culture, which includes values, customers, traditions, and norms, paradox has been defined by A Chuman, S Stutz, and J Ward.  In their book, Family Business as a Paradox, the word refers to a “special kind of problem that emerges from naturally occurring conflicts and contradictions in family enterprises.”  

 

A family business that survives and continues into future generations recognizes the value of family first AND business first.  Being financially strong enough to last into the next generation requires maintaining healthy relationships between family members through education, communication, and a willingness to think outside of the box.

 

My dad was part owner of a food brokerage firm he purchased with two partners from the founder’s widow.  While the business did not start as family-owned, the president and my dad planned to continue the firm into their second generations. Later, my brother joined the business as an accountant, while the President’s two sons joined the firm

 

Over time, transitioning the business to the owners’ children became complicated and my brother lost his job shortly after my dad left the firm.  My brother’s exit and eventual closing of the business adversely impacted the relationship between my father and brother.  The conflict hurt our family in many ways - a problem that became even worse after our parent’s passing. 

 

During summers and through college, I worked for my dad and started my path to become a CPA, commercial banker, technology advocate, and profitability coach.  As a result of the experience, I have a special interest in helping businesses avoid that kind of financial and family harm.   

Please return next month as we turn to creating a blueprint to profitability for S Corporations, Partnerships, and LLCs.  

If you are seeking to grow or pass your business onto the next generation, Financial Legacy Builders can help.  Contact me at 847-340-9487 or via email at This email address is being protected from spambots. You need JavaScript enabled to view it. .  

                                                                                                                   
                                                                                                                         Kay Bogolin