Family Business Series: The High Stakes of Family Succession Planning
- Mark Herringshaw of Herringshaw Group, President
Host, Jamie Duininck, asks Mark Herringshaw about the added pressure of being in business with family and how to plan for generational transitions. Working with family can be challenging because it adds another layer to an already multi-faceted business relationship. Mark, guest and business coach, discusses the importance of intentional communication and “The High Stakes of Family Succession Planning.”
Episode 39.1 | 6 min
Mark Herringshaw is the President of Herringshaw Group. He believes in a humility-based approach to leadership and is passionate about transformation as a practitioner of the principles that he advocates.
Mark has over 25 years of experience in leadership roles and earned his PhD in Leadership Studies from Regent University in 2001. He works with companies of all sizes to decode individual performance, team chemistry and organizational excellence to lead them to success. Mark is a parent, business coach, teacher and author of three books.
Speaker 1 (00:02):
This is The Water Table.
Speaker 2 (00:05):
The chance to hear the agricultural side of these issues.
Speaker 1 (00:09):
A place for people to go find information and education.
Speaker 3 (00:13):
Water management is just going to become even more critical into the future.
Speaker 1 (00:19):
How misunderstood what we do is.
Speaker 2 (00:22):
I would encourage people to open their minds and listen to this dialogue.
Jamie Duininck (00:31):
Well, welcome back to The Water Table podcast, as we continue our Business Series. Today, I’m really excited to have [Mark Herringshaw 00:00:38] with us.
When it comes to a family and a father and son or cousins or brothers working together, The Water Table happens to be a podcast that’s really about water quality and agriculture and sustainability in agriculture. But it just so happens that so many of the people listening to this are our customers, which are family businesses, small family businesses in the most part, five to 20 employees, and there’s a lot of generational transition that happens. There’s a lot of brothers or siblings working together. And so, interesting that we kind of jump right into that, that way, but I guess I’ll let you speak to that. But wouldn’t you agree that it gets even… The stakes get higher from just a job with somebody else. They see your shortcomings. But when that somebody else is a family member, the stakes are even higher.
Mark Herringshaw (01:38):
It’s just absolutely the case. I think any of us that have worked together with family can see it as, it’s both the highest honor, but also one of the biggest challenges, because the relationships are so multifaceted. We’ve got this longstanding life commitment to the people that are in our family. And we don’t get to choose who our family members are. We’re given that, with the very nature of the family we were born into or adopted into or married into. And those are just realities that we’re given. And you add into that then the contractual relationships of business, which have to be clear. Businesses always need to have a sense of fair play about how we’re arranging things and what’s expected, what the authority, what the responsibility is. And when family is not involved, it’s just easier to kind of divide the relationships and put the hat on to say, “Okay, we’re in the business of business right now.”
But you add the layer of family into that, and you have to be so much more intentional about deciding what hat you have on. Because in the business relationship of family, the business realities are still standing, right? We’re still in that role. But the family relationships are also there. So, what we have to do is help that communication process become clear and really specific, so that we know, “Okay. This conversation is in the domain of our business,” but another conversation over Thanksgiving, or going over for dinner on a Sunday afternoon with family, having certain boundaries around what we do and don’t talk about, and recognize that we have different hats to put on. And it’s important to clarify those.
So, it’s tremendous advantage, in many ways, to have a family business. There’s so much depth and richness, and it’s tremendously rewarding when it works. But it’s also filled with a lot of pitfalls, because of the history in all those relationships. If we work with siblings, we still remember when we were eight years old, even if we’re 48. And we’re working together on projects, but we’re still having these overlays of things that have been with us all of our lives. So, it takes actually a lot of work. We say, “it’s the soft stuff that’s the hard stuff” in a family business. So, you have the business stuff, which is kind of the hard realities of knowing your profit and loss and your strategic plan, and even on the finance side, things like your estate planning, those are all obviously very important to have from a business standpoint.
But the soft stuff, which is the interplay between the business values and the family values and the practices of the business and what it is to live and function in the family, that’s a challenge. And that’s really the niche we’ve carved out. When we work with families in generational businesses, it really is helping on all those rules of engagement that don’t just happen, just because we want them to happen. We really have to work on it. And it can be really positive, but it has to be very intentional.
Well, I’ve been really pleased to have Mark Herringshaw with us. Thanks for joining us, Mark. And if you’d like to hear more, and hear the whole discussion with Mark, you could find it at watertable.ag/business.