Family business is big business: some 30% of the world's billion-dollar companies are family owned, and they deliver 70% to 90% of global GDP.
Those figures come from a report released earlier this year by PwC, called Bridging the Gap, which looked specifically at the issues around handing family businesses on to the next generation. While the potential for generating wealth from family businesses is clear, the report points out that only 12% of family firms make it to a third generation.
This week I've interviewed people in a number of small businesses where different generations of the same family are mucking in together.
For many, the coming together of the different generations within a business is an organic process, particularly for those who have grown up with parents running their own businesses.
Company director and chef Jamie Miller runs Parnell-based Mint Kitchen Catering alongside his wife Giselle Trezevant-Miller and their three children - James, Maurice and Phoebe. However, Miller says he and his wife originally weren't too keen on their children working in hospitality, given it can be a tough industry.
Scroll down to read more about Jamie Miller and Mint Kitchen Catering
"But we've had to learn to accept that they all want to work in the business that they grew up in and around. They have a genuine interest in the business and the hospitality industry and they've chosen this path of their own accord."
Those interviewed this week list a number of benefits to being in an intergenerational business: there's a clear understanding of each other's strengths and weaknesses; a strong sense of trust; flexibility around working arrangements; and the ability to combine experience with new thinking and skills.
But you've got to take the rough with the smooth. In contrast to the stereotype that the younger generation can ride on the coat tails of their parents' success, 88% of the younger-generation respondents in PwC's research said they had to work harder than others in their family businesses to prove themselves.
Succession can be another tough topic to tackle. James MacQueen, a partner at BDO that specialises in family business, says members of the younger generation in family businesses are often eager to take up the reins, but find the pace of change frustratingly slow. For the older generation, the primary challenge is the emotional baggage around letting go.
To prepare for succession, MacQueen talks about the need to progress through the 'four Ls': learning business, learning the family business, learning to lead the family business and learning to leave.
"Learning to leave is the hardest stage," he says. "In my experience, the older generation need a project or an activity to move onto otherwise they will be reluctant to let go."
As with all relationships - in family and business - communication is key.
"Working with family is a big no-no according to many. Personally, I can say it is the best thing for our business, " says Nick Blair, who runs Bay of Plenty-based firm BOP RV with his mum and dad, Joan and John.
"I think you just need to remember everyone has different strengths, to talk all things through and presume nothing. Good communication is the key for us, as is an appreciation of each other. You can't all be chiefs, you can't all be indians but you can all be equal partners that assume different responsibilities."
Intergenerational businesses - Mint Kitchen Catering
The folks behind Mint Kitchen Catering have 30 years' experience in the hospitality industry and now the business, based in Auckland's Parnell, is a second-generation affair.
Father Jamie Miller is the company's director/chef and mother Giselle Trezevant-Miller is head of events, while sons James and Maurice are chef and operations manager respectively, and daughter Phoebe is assistant to Jamie.
What have been the motivating factors for getting the different generations of the family involved in the business?
Jamie: I wouldn't say there were motivating factors. Originally we weren't too keen on our children working in hospitality as it can be a tough industry at times, but we've had to learn to accept that they all want to work in the business that they grew up in and around. They have a genuine interest in the business and the hospitality industry and they've chosen this path of their own accord.
What benefits come from being an intergenerational business?
James: It allows us to have different viewpoints and perspectives. With us being younger, it really helps having the experience of Jamie and Giselle, who are able to advise us on which risks may or may not be worth taking. We definitely all learn from each other. It has also allowed us to be so involved in the company at a relatively young age - for which we're very grateful. It has been beneficial for us to work for a company that has a history, and it's great for us to now be a part of that, and help shape what the business will become.
What are the difficulties?
Maurice: Accommodating the different viewpoints can be hard, as sometimes we don't see eye to eye. The main difficulty for us, though, has been defining our roles, and knowing when to act as an employee, and when to act as a family member.
So have you established rules around keeping work and family business separate?
Giselle: We don't have set rules around talking about work, but since the children have all grown up around the industry, we feel like we are all on the same page. Sometimes everybody feels like talking about work, and sometimes you can't think of anything worse. However, it is inevitable that work and family will cross over at times, which is simply the nature of working in a family business.
For me, it is a benefit not to have too many rules around 'talking shop' after hours. On occasion, it can be useful to be able to communicate with the key personnel after hours, because this is an industry where things are constantly changing.
What's your vision for the future of the business? What about the issue of succession?
James: It's a very exciting time as I think we're getting more and more experienced every day, and that the company is going from strength to strength. There's no issue of succession for us, as I think Jamie and Giselle will always be involved in the company in one way or another. The roles may change and develop over time, but they'll always be a part of it.
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