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Keeping business in the family while keeping the family intact


New certificate program helps prepare family businesses for unexpected trials

Story by Cheryl Hentz

Approximately 80 percent of businesses in the United States are family-owned, and unlike non-family-owned businesses, a family-owned company offers a number of professional and personal advantages to family members who participate in the business.

Freedom, independence, less bureaucracy, and closer control without having to go through layers of administration to get authorization for decisions, are just some of those advantages. Family businesses also have a built-in trust factor with already-established, lifelong relationships, and provide for hands-on training and early exposure of the next generation to the business.

But family-owned and operated businesses also come with a unique set of challenges: Issues surrounding succession, including selecting and preparing the next generation; transferring ownership to that generation; identity development; and communication and conflict involving parents, siblings and/or other family members both inside and outside the company.

Clearly, succession is one of the biggest hurdles family-owned business face, and in many cases the process is either resisted or avoided altogether – sometimes until it’s too late. It can also be an issue if the senior generation doesn’t allow the next generation to have proper room to grow, develop and eventually take over the reins of the business.

But succession can also be an issue where siblings are involved. Which child should assume control of the business and how do you avoid friction between siblings surrounding that decision? Sibling relationships, along with family communication and conflict with other relatives who may work in the business, rank among the top ten concerns for family-owned businesses. These are all things that can negatively impact a family business if not dealt with.

It was because of these very issues that the Family Business Education series, offered by the Wisconsin Family Business Forum at the University of Wisconsin-Oshkosh, was started two years ago. As part of its offerings, the forum presents a seven-part course of study that provides basic learning for the next generation of leaders regarding the dynamics of leading and maintaining a family business. Participants completing the series earn a Certificate in Family Business Education.

“This program was developed because there are a lot of people in family businesses where those businesses are handed down to the next generation that know the business they’re in and have some general knowledge of running a business, but not know so much about the unique issues associated with it being a family business,” explained program coordinator Dale Feinauer, a professor of human resources and management in UW-Oshkosh’s College of Business. “The focus of the Wisconsin Family Business Forum in general is to help family businesses be successful, help them pass from one generation to the next and this (certificate) program is focused particularly on folks who are newer in family businesses or who are advisors to family businesses and helping them think through the issues that are unique to a family business.”

Civility at the dinner table

Professional disagreements can often spill over into family members’ personal lives, Feinauer added.

“So one of the things we talk about is how people can manage their business in such a way that the family can still have Thanksgiving together.  Unfortunately, in some cases they can’t,” he said. “There are some families that own a business that, over debates about who’s going to take over as CEO or how the business will be managed, people end up getting upset with each other and they lose the family relationship.”

When it comes to succession issues, these are often difficult conversations families have to discuss. For example, as a child whose parents intend to eventually turn the business over to him or her, it’s difficult to know when to have that conversation about exactly when the business will change hands.

“How do you do that without saying ‘Hey I’m a greedy kid and I want you to give me the business now?’ But on the other hand, from the next generation’s perspective, if they’re going to dedicate their life to working in the business, they have a right to know that the will is written in such a way that it transfers the business to the next generation,” said Feinauer.

If there are siblings, some of whom work in the business and some who don’t, that can also cause problems if not handled appropriately in the parents’ will.

For the child or children who’ve worked in and helped grow the business, they’ve anticipated a future in the company. But assume something unexpected occurs with the parents and the siblings not involved in the business sell the company out from under those working in the business day to day. That can happen if not addressed correctly in advance, and it can certainly create tension, said Feinauer.

“So how do you manage those transitions from one generation to the next and does ownership pass to family members not working in the business and how can that be done equitably? These are all things we talk about in this program,” he said.

“We want to see family businesses be successful into those next generations,” said Donna Nelson, assistant director of the program. “That’s why we encourage them to attend the class so they can work with their next generation leaders through mentoring and leadership development, and really to identify where they should be placed within the family business – if at all.”

“But every session is based on the family business and different concepts or challenges that they have or are experiencing,” Nelson continued. “Then we try to bring family businesses together so it’s like a community or support group where we’re working with them and to let them know that they’re not alone going through these issues. So they not only learn from our professional advisors, but they learn from each other.”

Family business in action

That networking component has been critical for several of the program’s graduates.

“The networking between other family members in family-owned businesses was huge. We shared ideas and talked about why we each did what we did. It helps in some cases by your not having to reinvent the wheel but also because sometimes someone else is doing something you haven’t thought of,” said Donna Dorn, vice president of Tri-City Glass & Door in Appleton, a second generation family business. “It was just neat to get to know other family business owners and have the opportunity to share ideas, examples and getting to know them a little bit better.”

Anika Conger-Capelle, general manager of Conger ToyotaLift, Inc. in Green Bay, said learning about ouside-the-box approaches to organizational structure stood out to her as a real value of the program, and a lesson she hopes to implement into her family business culture.

“So instead of having managers you might have teams. Nobody is really over anybody else. We haven’t actually gone to that structure, yet, but there were tidbits of information within that discussion that could be beneficial even without adopting that entire structure,” she said. “But I think daily I probably use something that has come out of the class. One of the biggest things is that our management group facilitates more meetings now and is more of a hands-on component to the business than before. But in general the course has been a very good piece to the puzzle to help solidify what we were doing before.”

Badger Mining Corp. of Berlin is in its third generation of leadership and is in the process of involving and educating its fourth generation of family members to get involved in the company.

“When this program was first developed, we thought it would be a great learning opportunity for all interested family members,” said Vicky Wuest, one of the directors of Badger Mining. “I personally did not participate in the program, but three members of our fourth generation did participate in the first program in 2009 and found it to be very educational and worthwhile. They came back with questions from assignments that prompted us to know how much more information and education we can provide internally as we proceed in their development.”

Conger-Capelle believes the program includes at least some nugget of valuable information for anyone involved in a family business, and would encourage such individuals to consider taking it.

“My philosophy in life is no one can ever take away education, so people should go out and learn and hear about what’s out there,” Conger-Capelle said. “You’ll always come back with something. It may be good, it may be bad and you may say ‘You know what, that just isn’t going to work for us and I don’t want to go through those struggles.’ Or you may say ‘That is something that will really work for us so let’s give it a try.’ So I really would encourage people to take the class because no matter what the experience, they’ll be able to take something back with them.”

If you’re in a family business and you either have some issues associated with being a family business or you proactively want to avoid those issues, all agree this is a cost-effective approach to not only learn from the presenters, but also to learn from each other.

Cheryl Hentz is a freelance writer from Oshkosh with more than 25 years experience. Her articles cover topics including business and economic development, minority issues, family pets and animal rights, finance, politics and women’s issues. She can be reached at 920.426.4123 or via email at