Family Enterprise Center - UNC Kenan-Flagler Business School

6 tips for creating a shared vision for your family business

Steve Miller - UNC Kenan-Flagler Business School - Family Enterprise Center - Family Business Forum

Steve Miller speaks at the 3rd Annual UNC Kenan-Flagler Family Enterprise Center’s Family Business Forum.

Lack of a shared vision is one of the most significant threats to the sustainability of a family business through multiple generations of family ownership. Professor Steve Miller’s research has found that in addition to being a critical success factor, having a shared vision is strongly predictive of the presence of effective next-generation family business leaders.

If shared vision is so critical to family business continuity, how does a business-owning family create it? Miller’s research demonstrates that open and transparent communication in the family is one of the keys, as it strongly predicted the presence of a shared vision for the business. On the other hand, a senior generation that exercises unquestioned authority and makes all the rules was even more strongly predictive of the lack of a shared vision. That kind of autocratic leadership style can shut down the open communication that is so necessary to the development of a shared vision for the future of the family firm.

The Family Enterprise Center’s 3rd Annual Family Business Forum was designed to help families increase communication and start the process of creating a shared vision for their family enterprises. Participants began the day by filling out a vision survey – before discussing it with other family members – to determine where there was agreement and where there were different ideas about the future of the business.

The families then took time to reflect together. If they identified a shared vision, they evaluated the progress made toward making that vision a reality. What had enhanced or hindered progress? Did anything need to be done differently to achieve the vision? If there was not a clearly articulated vision, families openly discussed their hopes for the future of the company and assessed market changes and business opportunities that might influence their vision.

All families were encouraged to discuss why they choose to be in business together as a family. Staying in business together from generation to generation is not a given, and it is important for families to assess their ongoing commitment to each other as they craft a vision for the future of the family enterprise.

Each family made specific plans and established timelines to continue working on a shared vision after the Forum, to include identifying family members, company employees and other key constituents who need to be involved in the process.

Tips for conducting a family enterprise vision and strategy workshop:

  • Begin conversations with key family leaders about their long-term goals for the company. Ask yourself why you are in business together.
  • Think about your company’s current strategy and how that strategy might need to change to reflect growth or changes in the industry over the next 10-15 years. Talk to the current leader of your family firm to get his/her perspective.
  • Imagine a future for your business in which all things are possible. Traditional business education teaches us to focus on solving problems. While problem-solving is an important skill, creating an inspiring vision for your family enterprise requires suspending a focus on constraints — at least temporarily.
  • Create a shared vision and overall strategy that is grounded in an understanding of market dynamics. Researching and analyzing market data can be an outstanding assignment for developing next-generation leaders.
  • Identify and develop plans for closing performance gaps. While envisioning a new future for the family firm and developing strategies to capitalize on market opportunities is exciting and motivating, it’s important to close performance gaps in the execution of your current strategies first. It can be tempting to try to correct a performance problem by introducing a new product or service, employing a new strategy or even creating a new business, when the real issue is poor execution of your current strategy.
  • Remember to communicate on a regular basis with the family owners, including those who are not active in the management of the business. The goal is to create commitment to your shared vision of the family firm, and that requires input from all major stakeholders. Owners may modify their goals once the firm’s management has helped them understand what it will take to achieve them. The process tends to be an iterative one, with plenty of back and forth communication between owners and management.