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The benefits of working with family include mutual trust, a shared long-term outlook, and quick decision making. However, your inner family business relationships can also cause chaos for the company and family.
What can you do?
Join us as we explore chaos proofing your family business so you can build a great company with a strong family around it.
21clear.com
Adam Hatcher: Hey there.
Welcome to the 21 Clear Podcast
where we talk about anything to
help you chaos proof your inner
family business so you can build a
great company with a strong family.
I am your host, Adam Hatcher, and I
founded 21 Clear after a successful
career scaling my family's company
to work with other families who want
to get their company somewhere and.
Keep their family together.
Today we are gonna build on the
last three episodes of the podcast.
In episode four, I outlined
the chaos proof framework.
This is the idea that we organize
this podcast and all of our
different resources around.
And that includes the book
that I'm publishing next year,
the Chaos Proof Framework.
What do you work on as a family to
help you manage the tension that
is inevitable when family works
in and owns a company together?
In episodes five and six, we explored
one part of the chaos proof framework,
and that is how do you hire family
members well or not hire them?
What are some processes, exercises,
and rules or guidance around hiring?
Well, what we didn't really talk about
across those three episodes is when you
join the family company, what is it like?
Sometimes it's helpful just to hear
someone else's perspective so we can
help shape your experience or the
experience you create for your family.
You might be considering
joining your family company.
You may be considering hiring another
family member soon, or it might be on
the horizon, or you may have started
in the family company recently or
in the last year or two, and you're
trying to figure out what is it
exactly that you're experiencing.
I was recently a guest with Andrea
Carpenter on her podcast Next Gen Friend.
Andrea is the president of Transition
Strategists, and they specialize in
working with family companies who are
leaning into transition and transitioning
the company, whatever that may be.
One thing I like about Andrea's approach
is that she specifically focuses
on the next, the rising generation.
What are their experiences?
And helping them ask the question, how
do I want to interact with this business?
Do I want to be in it
around it adjacent to it?
And then how do I go about that?
Andrea and I.
Did two podcasts together and
had a wide ranging conversation.
I have the link to that conversation
in the show notes and in our
conversation there was a part of
it that dovetailed nicely with
these last three episodes, Andrea.
Asked me about my own experience
joining my family company.
We're gonna pick up in the interview.
She and I have talked about the idea
of hiring family well, having family
hiring criteria, something we talked
about here in episodes five and six.
You'll hear a little bit of that in our
conversation, but I wanna jump right
in to where she asked me about my own
experience joining the family company.
We're gonna take an
excerpt from the podcast.
I hope you enjoy it.
And with that, here is Andrea and me.
Obviously there was ultimately
this general counsel position.
You decided that that was a good fit, you
met the qualifications and um, felt ready
to come in, and then what did it feel like
once you kind of landed into the business?
What was that?
Growth, like what was the relationship
like with your dad and your grandpa?
You said you worked with him for
a couple years, so walk us through
like that first two, three years
inside of the family business.
Let me go back and answer the
question I accidentally skipped.
'cause it comes into that.
Mm-hmm.
How, how old am I?
So 2000, I joined in 2010, so
I'm 29 years old, so I would've
gotten the letter at about 25.
So it was around four years when I
got the letter, four or five years.
When I got the letter in school,
worked for three years outta
school and then ended up joining.
The step I skipped over was after
I told my father no, what changed?
I, I went and I don't remember why.
I don't remember if it was his
suggestion or I thought to do
it or if it was a discussion.
I don't remember why.
I went and had lunch with three
other family business members, people
that were working with their family.
They were third or fourth gens.
They had about a 15 year age
range between them and their
tenure in their family companies.
They were all at least 10.
One was.
At the time, over 20 years,
these were not people that had
just started in their families.
And so I went to and had a long
lunch one-on-one with all three
of 'em over a period of time.
And if I were to roll up the
advice that they gave me, it
would synthesize this way.
Adam, you are 29 years old.
You're not 50.
Your son is six months old.
Your wife has a job, you have a law degree
and have proven that you can practice law.
There is an opportunity to join the
family company and it is not chief
waiting for dad to retire officer.
It is a real job that requires
a professional certification
that you hold and have shown
you are capable of performing.
Mm-hmm.
You don't know what it's going to be like.
You might've interned
there a couple years.
You might've been around these people
for a long time, but you don't know what
they're gonna be like when you get there.
You don't know what
they're like to work with.
There's a lot you, I would tell
anyone that there's a lot good
and hard that you don't know about
your family until you step into the
company with 'em for a little while.
Hmm.
Go through a recession together.
Go through growth together.
Go through a lean year.
A major capital allocation, you'll
learn new things about each other.
I said, you don't know what it's
gonna be like, but at 29 you're
stepping into an actual job.
Two years later, if you don't
like it, you're only 31.
Mm-hmm.
And you find a successor and you leave.
And the story is, I never thought I was
gonna work in the family company truth.
They called me.
There was a need I was
uniquely capable of filling.
I stood the legal office up.
It wasn't the right thing for me.
I found a really good person,
backfilled myself and left
him better than I found him.
Hmm.
I said, that's a good story.
And your son's only two by that
time, two or three years old.
Mm-hmm.
If you don't do it, you will
always regret that you didn't try,
and if you wait till
you're 50, it has to work.
Yep.
At 29 or 30, it doesn't have to work.
Mm-hmm.
And that combination or synthesized
advice led to my dad and I.
We took an, we went away for one or two
nights together, had a couple of dinners,
a couple of conversations, and decided
that we would take the chance together and
that I would start as the general counsel.
One thing I didn't realize about
the five part hiring criteria
he gave me, and I don't remember
when he explained this to me.
Hmm, but why did he require graduating
from college, graduate school
work experience somewhere else?
None of that is unique, by
the way, in family companies.
I've seen lots of companies that do that.
Writing.
It's a different thing,
but lots that do that.
And why did he require getting promoted?
He told me either before he, he hired
me or sometime in my time there, he
said, Adam, the only person who ever
promoted me was my dad, or because
I purchased something from him.
I graduated from the University
of Georgia on a Friday.
I went to work for my.
Father with my brother on a Monday,
and that's the only person who ever
moved me up in the professional world.
He told me, son, I want you to know
you have value and skill outside of
my eyes worth, outside of what your
dad thinks, and that you have value
and options outside of this company
looking back.
That made joining easier and more
independent and freer, and I could
have never put words on it back then.
Mm-hmm.
Mm.
I there's a lot of, a lot of
freedom in that and a lot of wisdom.
And I'm also wondering, like a lot of
that comes from his second generation.
Experience having actually lived it.
I don't know if he would've
been able to craft that type of
scenario or those reasons for
the exact example that you gave.
Right.
Of him.
Not only ever being promoted or only
ever working inside of the family
business, you don't have to come from
a great story to create a better story.
I was just reading, there's
a Swiss chocolate f.
Company later act.
They're a third gen family company.
The succession story is so good.
Hmm.
It was 2021.
The second generation
leader finally steps away, turns
it over to his three sons after
a three year transition period.
You go back, that's 20, 21.
You go back to.
2006, he hires a managing director of
the family company and says, your job
is to increase the brand until the
third generation's ready to take over.
Then all three of the sons go to
university and they have different
experiences, and then they rotate
through the company and then he
turns it over and the board is now
non-family with some family and
the executives or non-family with.
Some, and it's just, it's the kind
of thing you look at and it's kind
of intimidating as a family company.
Like, wow, that's great.
Well, you wanna know where he started?
His name's, uh, rg, JURG, uh, RG
the sec, the second generation.
He is a missionary in India
with his three young children.
His father calls him this, this,
this is not a family action meeting.
If dad calls him out of nowhere and
says in 1994 and says the company.
Is going to fail.
Um, I would like you if you
would come back to help, try to
save it, but you don't have to.
I know you're in India and
you're a missionary and I'm,
you know, I respect you.
Um, that's how he started and then
he did something much different.
Yeah.
And my father, likewise, Friday to Monday,
did something fundamentally different.
Yeah, for me.
Yeah.
So it doesn't matter what the
previous generation has done, you
can build on the platform, you, you
can steal the good things they did
and then build on top of the chaos.
Mm-hmm.
And I think I hear this a lot.
So let's, like, let's shift a little
bit into like actually working in
the business and actually scaling it.
'cause there's that tension of being
a rising gen and you start to get more
responsibility and you're stepping
more into leadership and it's like.
Do I actually have authority to do this?
The, the people who did this before are
still around, they're still leaders.
Like did you have any of that
tension and what did that, what
did that look like for you?
How did you navigate that?
No, we didn't have any tension at all.
I don't know who does that.
Probably just the weak ones, right.
I wish.
Oh, wait, so I, I'm sorry.
It was a joke.
It was a joke, everyone.
Oh, that's right.
Not everybody can see my, that's right.
If you're watching this on
YouTube, you saw my eyes.
No, I didn't have words for
this until about 12 months ago.
Somebody said.
Y you know why family businesses
are hard, why working with family
and a company that you own is hard?
Oh, I don't know.
Tell me.
I did it for 13 years that, because
what you've done is you have mixed
the unconditional nature of family
with the very conditional nature
of a for-profit corporation.
And I thought about that and went, huh,
okay, so think about your wedding photo.
I think about mine, there's a
spot in my wedding photo that is
unconditionally for my father-in-law.
And it doesn't matter what
happens in our relationship.
We have a great relationship,
but even if we didn't, if it were
strained, if it were broken, mm-hmm.
It doesn't change that.
That spot in that picture is
unconditionally for my father-in-law.
Even if he's not in it, like
there's always a spot for it.
Mm-hmm.
That's the unconditional nature of family.
It's set at birth, it's developed
in family systems, but business
is not like that at all.
I don't think business is
the other side of the coin.
It is diametrically opposed and intention.
It is conditioned on competitive
advantage, market forces,
tariffs, leadership capabilities.
The marketplace will decide
conditionally about the company.
And when you work with your
family, you take these two
things and mix them together.
The unconditional nature with the
conditional nature of the business.
Why did my grandmother
walk out on my grandfather?
She was not qualified
to be a receptionist.
It had been over 20 years since
she had taken shorthand, which
was a way people took down.
Dictation back then to
then turn it into a letter.
She did not tell him that she
had forgotten how to do it.
He dictated a letter to her, he
left for lunch, came back, she put,
it was pretty much gibberish on
his desk and then he having very
little tact as a professional said.
Marian, what were you thinking?
The response back?
Uh, would make most HR
professionals blush.
And then she finished it by
saying, and Bill, I quit.
Okay.
What happened there?
I mean, it's funny we've told that story.
He loved her till death did them part.
Mm-hmm.
And the company is at 52 years now.
It's funny, but what happened there?
They brought their unconditional
marriage in and put no formality
in rules around how they work
together, how they resolve conflict.
How they talked to each other,
what the qualifications for
their jobs were or their roles.
And then when an inflection point
came, there's tension there all
the time, and without any sort
of governance rules around it.
It blew up into chaos.
And my grandma walked out.
Mm-hmm.
Yeah.
And that's not a, somebody asked me, they
said, when, when I started 21, clear to
work with families who wanna get their
company somewhere and stay together.
'cause that's what my
experience was with my family.
Are you, do you do succession?
I said, well, I mean, that's
part of it, but that's only
one part of the life lifecycle.
In fact, a succession
event's only gonna happen.
Ever two or three times for a
family company, most of them
will never get to the fourth,
and a lot of times that's okay.
If you wait till succession, you
might never get there because
that tension, just like with my
grandparents, exists on the first day.
Mm-hmm.
Yeah.
And so the, like as you moved up in your
role and you start helping scale the
company, did you ever feel that that
tension moment of like, my ideas or what
I'm bringing, like feels a little bit
bigger or they're not moving fast enough?
How do you balance some of, some of
those things in, in the business?
Mm.
I'll tell you a moment.
Let me, let me think.
I'll tell you a moment that was
difficult and one that was great.
Okay.
My belief is when you work with your
family in a company, and that's my
perspective, 'cause that's what I did.
I was a NextGen who chose
to work in the company.
We have not formally
established a family office.
It's not.
There is asset, there are assets in
real estate to manage, but that's not
where the majority of the energy was.
The energy of the family and the family
employees was in the growing of the
core staffing and recruiting business.
Mm-hmm.
I remember once working
with my father to help.
As the head of corporate strategy
create a tighter strategic calendar
to run the company on, uh, calendar
based on the budget cycle and general
client demands nowadays trying to help
our strategy meetings and thus the
board meetings, the family meetings.
All aligned with creating
priorities for the next year.
Worked with a consultant.
Came up with a really great proposal.
My dad and I figured it out together,
and I forgot to go bounce it
one-on-one off of my other non-family
executive peers before the meeting.
Hmm.
So instead we present it to
him in executive meeting.
Well, we had acquired a different
business line by then that ran
on a totally different schedule.
Not a completely different, but
different enough, and had their own
schedule and had been very successful.
Several other executives with far
more tenure than me who were caught
off guard by this presentation, a
new calendar they had to follow.
And so they all pushed back,
which is pretty normal.
Mm-hmm.
And it ended up getting
pushed to the side for.
Further discussion and debate, and I think
for most executives that's pretty normal.
You think you have something, maybe
you even had a deal with the CEO.
You get in there and it goes
different than you thought
and you just check and adjust.
Mm-hmm.
Well, in a family.
It feels like, come on Dan.
We had this, what?
What was that?
I thought you had my back.
Mm-hmm.
We both know this is the right thing.
What happened?
Like that's not something.
That is as pers like there's,
it's just not as personal.
I've had a lot of bosses
that weren't my dad.
Mm-hmm.
You might get miffed or annoyed,
but there's not that personal.
Ooh, do we, do we have
each other's back here?
What are we doing?
Mm-hmm.
That's one of the, that mixing
of conditional and unconditional.
Yeah.
That's one of the hard moments.
I'll tell you one of the good ones.
The company was around.
We were probably around 200
employees, still a regional company.
I was new into human resources, so at
that time I had corporate strategy,
hr, and, I'm sorry, corporate strategy,
legal, and then added human resources.
And in my annual review, 'cause my
father and I did all the normal rhythms
of the company, one-on-one meetings
and reviews, we got to the question.
Do you have what you need
to do your best work?
And I said, no.
I said, take that moment in.
Both the executive in those three combined
roles has said, I don't have what I need
to do, and your son has just said, I
don't have what I need to do my best work.
He said, well, what do you mean?
Trying to think?
What have I not given you?
And I think this is a question
a family member.
In my position would've been quicker
to ask than a non-family member.
I'm not certain.
Hmm.
But what next gens can do when it's going
really well, I said, are you and MaryLee?
'cause we used first names at work.
So my mother is MaryLee
Are you and MaryLee happy?
He said, what do you mean?
Are you and MaryLee happy at the company?
Was about 200, 200 million.
Are you and Mary-Lee
happy at 200 top line?
I said, well, why do you ask?
For the three roles I'm in.
If you're content here with, again,
incremental growth year over year, but
not an aggressive growth target, if you're
happy here, my job needs to go one way.
But if you wanna take this and try
to march it to a billion dollars top
line, if you wanna break into the top
15 or 20 in the industry nationally,
that's a totally different job and
you're the one who makes the call.
But I need to know.
Hmm.
And the conversations that came
after that were interesting.
And one of the advantages of a family
business, because what we uncovered
is this went all the way back to some
of my father's deep seated religious
beliefs about where you put your
identity and if you grow a company
too fast, how you can become absorbed.
It's hard enough in a family
company not to let it absorb your
identity, but if you start to have.
Mar a march of success, how it
can double down on that difficulty
and border on idolatry of a
company and what it provides.
Hmm.
That's where his lack of setting that
call it a big, hairy, audacious goal.
Thematic goal, one big thing.
Where his desire to not set one of those
came from, and he and I were able to work
through that and balance both the humility
that he wanted to see in the company.
And the organization's need to have
a steady, repeatable forward march.
I thought back on that
example a few years later.
I didn't realize it in the moment what
had happened, but I thought, woo, I
don't know how many people can talk to
their CEO boss, push on their religious
beliefs and find a compromise that
that incorporates all of that and moves
that organization forward in a way
that is consistent with what they want.
Yeah.
Yeah.
So that's the, the difficult part.
The man, I thought you had my back.
Like that's the hard
side of family business.
And then there's some really good stuff.
And then we, what'd we do?
Quadrupled the company in seven years.
I hope you enjoyed this preview of the
conversation between Andrea and me.
Please use the link in the
show notes to find Andrea.
The Next Gen Friend podcast, and
both the first and second episodes
with our conversation about being
a next gen in a family company.
I founded 21 Clear with a dream of
ending chaos in family businesses.
We're for families who want to take
their company somewhere and keep
their family together in the process.
And we do this two ways through
resources like this podcast.
We have a monthly newsletter.
LinkedIn posts and I'm
publishing a book next year.
The other way we end Family Business
chaos is through consulting services.
You can learn more about
those@twentyoneclear.com.
I hope you enjoyed this preview
of my conversation with Andrea.
I hope it helped you in some way on
your own inner family business journey.
I'll talk to you next time, as
my grandfather would've said.
Thank you so very, very
much for listening.