Prairie Family Business E-News

Tips from Entrepreneur Ron Holland: Power of the Mind in Creating a Family Business

Whether the family business is a start-up or a mature business it will gain substantially by forming a harmonious, mastermind alliance that comes together on a regular basis to brainstorm, solve problems, create ideas, come up with new and innovative products, services and cost effective marketing methods.

Mind Power
The best method is to choose a specific time, preferably each week or every other week if time doesn't’t permit. To make this work properly the mastermind family business group sessions need to separate from family meals and drinking and social activities and time should be put aside specifically for ‘mind power work’ in the board room or if you like, around the kitchen table, which as often as not, is the case.
Having a white board and four colored markers, cardboard, paper, pencils and glue and scissors are good tools to have on hand before getting started. It’s also a good idea to have some drinking water and glasses on hand. The family business mastermind session should be kept to around an hour and can be vibrant and charged with energy and enthusiasm.
Once a problem is tabled all the family members can then feel free to be as creative and as ‘far out’ as they like, putting ideas up on the white board, using mind maps, linear lists, drawings, diagrams, creating three dimensional models from the paper and card and scissors they have on hand.

Weekly Sessions.
Each week you can hone in on specific problems to be addressed in the family business rather than just idle chatter. Topic as such as ‘slash overheads’, ‘collecting money from debtors’, ‘creating a product that has greater demand’, ‘create demand for a specific product’, ‘massively increasing profit margins’ or even ‘problem of the week’ will help to harness the considerable mind power of any family.

The real power of brainstorming and masterminding comes from stimulating each others minds and lifting each other out of the tunnel vision that most of us suffer from. I am a great believer in thinking ‘Inside the Box!’ What do I mean by that? The power of hearing and seeing other people’s ideas only really takes root when you begin to internalize the information inside your very own brain-box.

Seeing ideas and concepts up on a white board is one thing, but once you make that information your own, by impregnating it upon the neurons inside your own brain, then the bio-computer can start using that information as a program. Over a thirty-year period I have created numerous millionaires on many continents. Many of them told me what I did for them was to create a paradigm shift in the way they think! This simple article may do the same for you!

Setting Goals
Goal setting for your family business can also be part of harnessing mind power and you’ll find that once your family comes together in a spirit of harmony and you start driving your business forward by harnessing mind power you’ll find that time frames can be dramatically shortened. That is why I am a great believer in the setting of goals but not a big believer in setting ‘realistic timeframes.’ Once you start really harnessing mind power on a regular basis, you’ll start to realize that the ‘human bio computer’ can operate at a phenomenal speed.

Ron G Holland is British and is the author of 18 business books and manuals including international bestseller Talk & Grow.

Adrian Maxwell Managing Director of Fracino, came from a family run coffee machine manufacturing business based in Birmingham,UK. Adrian claims that when he was growing up, his favorite toys were old coffee machines. His love of all things espresso and cappuccino eventually led him to swap a career as a Rolls Royce engineer for the top job at Fracino - which is the UK’s only manufacturer of espresso and cappuccino machines.

Adrian explains why coffee is 'in the blood' at Fracino.
"I have been dazzled by valves, thermostats and steam for as long as I can remember; perhaps if I hadn’t gone into the coffee business, I would have become a train driver! My father, Frank, founded the business in our garden shed in the 1960s. I spent a good deal of my childhood out in the van with him, on business and service calls. He still likes to joke about the time we responded to a service call in Soho, which turned out to be a strip club. Apparently I was so entranced by the coffee machines on show, I was oblivious to our surroundings! I would have been about two or three at the time. When I finally joined the company in 1986, I knew that I had found my calling. "I enjoyed my work at Rolls-Royce and I learned a terrific amount. I was a production engineer at the Coventry plant. Unfortunately it was the early 1980s and demand for the factory’s products was falling. I’m a hard worker and always have been, so eventually I became frustrated and began searching out new opportunities. "At the same time, the family business was booming. My father was off to a coffee machine stand at a trade show called Hospitality. It was going to be an extremely busy event, so I offered to go down there and help him out for the week. I never looked back! I didn’t come under any pressure to join the family business; quite the opposite, in fact. For much of the first year I lived at home and worked for my father for free. I had to persuade him that my heart was in it; we took it from there."

Taking Over at The Top
Adrian has only recently taken over the role of Managing Director from his father. He explains how this affected the business and how he felt about becoming Managing Director.

Related on A Family Business...
"My new role became “official” in 2008 when my father, the previous Managing Director, became the company chairman. In truth, however, the shuffle was a more gradual process. I had been the company’s technical director for 20 years, helping to take Fracino through bad times and through good times; my job description had expanded and my responsibilities had multiplied. At the same time, my father was hoping to take a step back from the business. So my appointment as Managing Director seemed like a natural progression.

Keeping Business in the Family
As for where Fracino looks for business advice, Adrian is very clear. "We wouldn't’t rule out getting external advice, but we are a self-reliant bunch and we learn from one another. We have had our problems like any other family business. The recession in the late 1980s and early 1990s hit us where it hurt. A number of Fracino customers, some of whom owed us significant sums, went under. We were left about £190,000 out of pocket, which was a body blow in such a difficult climate. "We learned from this experience. These days, we aren’t as trusting as we were back then! It is worth noting that this tough lesson has paid off: the UK economy is in recession once more, and Fracino is in an extremely vulnerable sector – UK manufacturing – but this time round we are going from strength to strength. Production is up by 20 per cent in 2009, and we are now exporting products to South Korea and the Indian subcontinent."
So, how are decisions made in such a close family business? Are there ever disagreements and how do the family deal with any conflicts about the business and where it's headed? "When it comes to business, my father and I are cut from the same cloth. We have never disagreed about the direction of the business. I wouldn’t say that it has all been plain sailing for Fracino – but the company has certainly benefited from having two firm hands on the tiller. My father and I bounce new ideas around, and put them into effect if – and only if – we are both in agreement. This is one of the advantages of being a family business: the decision-making process is delightfully short and simple."

The Next Generation
Now that Adrian's daughter Rebecca has joined the family business, there are three generations of Maxwells in Fracino. How do the younger members of the family fit in, and is there pressure for children to join 'the family firm'? "Rebecca is a Maxwell: she has been coming out in the vans with us since she was a baby, and coffee runs in her blood! We didn’t ask her to join the company, though: that was her idea, and we made her work hard to convince us that the family business is where her future lies! "Here at Fracino, we think it’s important to let the younger ones find their own way first. It’s better for all of us. That way, if they do come on board, they don’t see it as an “easy way out”. Rather, they have already experienced the working world and they are committed to the company 100 per cent. They are also likely to bring additional, relevant skills with them. When I joined, I brought with me the engineering expertise that I had gained at Rolls-Royce. "Likewise, Rebecca has brought a good skill-set with her. Before she became our company trainee, Rebecca was a supervisor at a bustling local coffee shop. She has a bubbly personality, great people skills and she is good at sales, too. Fracino prides itself on its friendly aftersales and customer care, so her abilities will be put to good use here. We expect her to go far – and it’s wonderful to have a third generation on board."

And we have to know - how much coffee does Adrian drink every day?
"I used to drink it by the gallon – or so it seemed! I have cut down, but I still drink around four cups every day!"

One of the big advantages a family business has as it draws new staff from the same pool is that they arrive in their positions with an existing familiarity with the firm. How can you take best advantage of this to increase your competitiveness and make the most of each individual's talents? And how can you use that element of predictability to strengthen your long term business planning?

Preparation
One of the big advantages you have as a family business is that you don't have to wait until your staff are in position - and your business is depending on them - to begin their training. If you know that a family member is interested in becoming part of the business, you can start informing and advising them about it right away.
Most of your family members are likely to have a good background awareness of what the business does and what its aims are, which will make it easier for you to coordinate what you're doing when they become directly involved. You can build on this with discussions aimed at working out where gaps in their knowledge lie, and you can invite them to observe the business more closely before they start participating in it.

A Shared Vision
One of the principal secrets to business success is making sure that every member of your team is pushing in the same direction, working toward the same goals. No matter how carefully you describe your objectives, it can take a while for new outside staff to fully integrate into your business and get the hang of this. Family members, however, should already understand what's important to you about the business and what direction you're trying to take it in.
As well as understanding your major goals, family members new to your business are likely to have a better understanding of lower level, day to day objectives such as how you approach building relationships with your trading contacts. This will help to create consistency within your business so that other people find it easier to interact with.

Strengths And Weaknesses
Because they have personal relationships with those already involved, family members entering the family business for the first time will be able to anticipate their strengths and weaknesses in a business context. They'll know, for instance, that they should be more careful in checking work passed on to them by a relative who is always badly organized, and that they shouldn't worry when a habitually loud relative starts raising his voice. They'll also know who is most likely to be able to help them with particular problems.
To take best advantage of this situation, existing business members need to acknowledge the complexity of the relationship and avoid trying to second guess their interactions with new staff. It's also worth acknowledging that new staff can bring a useful critical perspective to the business, perceiving strengths and weaknesses more clearly than people who have got used to working together.

Knowing Me, Knowing You
In an ordinary small business, hiring new staff is always a bit of a gamble - no matter how good you are at sifting through applications and interviewing, you never know quite what you're going to get. But in a family business, just as your new staff are familiar with you, you're familiar with them. This means that you can undertake your business planning - both long and short term - taking their abilities into account.
All in all, the existing firm-specific knowledge that family members bring to your business can give you a big advantage, even when it comes to the little things you're not consciously aware of. If a business is to grow big, it's often those little things that matter most.

Platinum Quality Author I have had several questions lately about the responsibilities of Boards of Directors and whether there are ways to assess and improve Board effectiveness. In fact, Board effectiveness is one of the most important best practices an organization can undertake; just because a group of people have come together with a common purpose, often with community involvement and altruism in their minds and hearts, does not mean this group call the Board of Directors will automatically run smoothly. In fact, any time you bring human beings together as a team means there will be sticky issues and competing interests and attitudes. Just like the teams working in an organization, Boards of Directors must be nurtured if they are to run smoothly.

What is a Board of Directors?

Boards of Directors have many responsibilities and obligations. They are not typically part of an organization's daily management, but they are the highest management tier of an organization and oversee all activities from a governance standpoint. The chief purpose of a Board is to ensure that activities are conducted in the best interests of stakeholders, including the public and clients.

What does a Board do?

Although Boards can vary widely in their approach and policies around their responsibilities, they typically have 6 main functions, briefly:

1) Finance/Resource Management: Board responsibilities typically include overseeing the organization's financial situation including the budget, in order to ensure stability and viability. This can also include ensuring that the organization has adequate resources and ensuring effective resource management.

2) Organizational Culture and Effectiveness: A Board must ensure the organization is performing as effectively as it can. A Board must also keep a finger on the culture of the organization and ensure that it is kept in line with organizational values and ideals. This includes, but is even more broad than HR, succession planning, and talent management. It is tied to achieving the organization's mission and upholding its core values. Furthermore, Boards of Directors are typically governance-based as opposed to operations-based. This means that while they keep a finger on the culture of the organization, they do not 'interfere' in organizational operations unless it is specifically their mandate to do so (or when their Executive Director/ CEO / President is unfortunately not doing this effectively).

3) Management of the CEO: Boards of Directors typically have an HR responsibility only in terms of the top executive, not other employees. This includes recruiting, hiring, and managing the CEO's performance. The Board of Directors employs the CEO and is responsible for his or her performance and development. The relationship between the Board and CEO is an important one, and the CEO is typically an ex officio member of the Board with slightly different voting privileges.

4) Strategic Planning and Growth: A Board of Directors must participate in, oversee, and to some extent drive strategic organizational development, whether this means growth or something else.

5) Stewardship and Advocacy: The Board is responsible for advocating for the organization and communicating with the public. This responsibility may be shared with others in the organization such as the CEO, but it is a major Board function.

6) Board Effectiveness: Often forgotten in descriptions of Board responsibilities, Boards of Directors must engage in self-management, actively building and maintaining an effective Board of Directors, something that may be implicit in its policies, but can be taken for granted. This means developing and maintaining a Board profile that is suitable to the organization, ensuring that Board members are meeting their obligations effectively, and conducting an annual Board performance evaluation, to name but a few details of this responsibility.

Article by Dr Jessica Sartori-- Dr. Sartori is a Change Management consultant. With a PhD in Applied Social Psychology, she has been consulting for ten years. Other Ezine@ articles by the author

-----------------Event Calendar for PFBA-----------

January

February

March

2012 ~SAVE THE DATE~

March 29-30

20th Annual Conference

Sioux Falls

What is a Board of Directors?

What does a Board do?