9 elements of family business success

9 ELEMENTS

OFFAMILY

BUSINESS

SUCCESS


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A Proven Formula for Improving Leadership
& Relationships in Family Businesses

9 ELEMENTS

OF FAMILY

BUSINESS
SUCCESS
Allen E. Fishman

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Copyright © 2009 by Allen E. Fishman. All rights reserved. Manufactured in the United States
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DOI: 10.1036/0071548416


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Dedication
To Judi, who understands all too well the challenges of being
married to an entrepreneur. We married young and had to
carefully watch our dollars. Dinners out were rare, and the book
165 Ways to Cook Hamburgers got a lot of use! Judi has understood
and supported the financial risks that business founders often
have to take and the time that needs to be dedicated to both
launch a business and make it successful. It isn’t always easy being
married to someone who, at times, obsessively focuses on creating
something new or solving a challenge. Thank you for your love
and support and the great gift of our two wonderful daughters.

Copyright © 2009 by Allen E. Fishman. Click here for terms of use.


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In Memoriam
Many of us would feel blessed to have trusted relationships in our
lives—people in our camp to support us, defend us, and believe
in us with a depth of passion reserved only for ourselves. I was
lucky to have this relationship with my brother, Jack Fishman.
Jack and I were not only able to share the simple pleasures of life
together such as movies, swimming in New Zealand, and wearing
outlandish outfits in Mexico, but as a family-member employee of
businesses I ran for over 35 years, Jack and I had the dual roles of
being brothers and being in business together.
Yes, balancing familial and business roles can be awkward
at times. But family business relationships can also be greatly
enriching by allowing family members to share something that is
meaningful. Jack shared a sincere enthusiasm for the businesses.
During our frequent phone calls, walks, or workouts together, he
often voiced his concerns over business issues as well his excitement
regarding achievements—his and mine.
When I started TAB, we talked about the many people we knew
who didn’t believe that the business would ever launch successfully.
Jack believed in the idea—and in me—and he was incredibly proud
of TAB’s increasing success. He showed an immense sense of
accomplishment when something he participated in was achieved
and acknowledged. He demonstrated the kind of dedication that is

rarely seen by someone other than a relative in a family business.
He always showed unwavering support of my business vision
for TAB. He generously expressed to me his love for me. I miss
his terrifically harsh slaps on the back and the strength of his bear
hugs as he kissed me goodbye.


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Contents
Foreword by Dr. Stephen R. Covey
Preface
Acknowledgments
List of Abbreviations
Introduction
chapter

1

2 
3

4 
5

113

6

the sixth element

 ligning the Culture of the Family Business
A
with the Company Vision

chapter

87

the fifth element

Grooming the Family-Member Successor
chapter

59

t h e f o u rt h e l e m e n t

Selecting the Family-Member Successor

chapter

31

the third element

Compensating Family-Member Employees

chapter

7

the second element

Hiring and Firing Family-Member Employees

chapter

1

the first element

Creating and Sharing Personal Vision Statements
chapter

xi
xv
xvii
xix

143

7 

the seventh element



Addressing
Spousal Business Partners’
Multiple Role Challenges

173
ix


x

contents

chapter

8

the eighth element

Recruiting, Retaining, and Inspiring
Non-Family-Member Employees in a
Family Business

chapter

9 

199

the ninth element

Transitioning Ownership to Family Members

229

Conclusion

261

Appendix

263

Glossary

271

Index

273


E l e m e n t

Foreword

8

W

hat a powerful, greatly needed, and comprehensive book

on all the issues confronting family businesses!
When we mix emotional and economic criteria, we open a
Pandora’s Box of problems. Few family businesses are spared
these unique challenges. Many of these problems have ultimately
torn their families apart. How sad. But how unnecessary.
Deathbed research shows that those “passing on” don’t wish
they had spent more time at the office or watching TV. They talk
about their loved ones. They realize that no other success can
compensate for failure in the home and that the most important
work we will ever do is in the four walls of our own home.
This marvelous book is so vital and timely in dealing with
the tough issues all family businesses face so as to preserve our
most precious relationships and develop prosperous contributing
businesses.
The book organization covering the nine elements is so wisely
sequenced, starting with sharing Personal Vision Statements.
These are the most important decisions simply because they
govern every other decision. Putting together the family team,
determining compensation, selecting and grooming familymember successors, dealing with spouses and non-family-member
employees—all become so vital in cultivating healthy, positive,
synergistic family business cultures.
xi

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xii

f or e w or d

Chapter 6 on building and maintaining a happy family culture
in a family business is worth the entire book by itself! The 11
Cultural Potholes are so common and so realistic, and the
prescriptive analyses and recommendations are brilliant, wise,
practical, and very doable.
And, finally, one of the most challenging issues: how do you
transition the business ownership to family members?
Seriously, this book goes into depth on almost every conceivable,
relevant issue. This book is a “must read” for all those transversing
the emotional-economic chasms in the perilous journey to the
family business Mount Everest, the top of the world.
But just think of the powerful lessons taught and the character
growth that flow throughout the entire family on such a
magnificent journey. Primary greatness is character. Secondary
greatness is worldly success. Character is destiny. Also, think of
the transcendent contribution the business makes—such as The
Alternative Board does—and how children and grandchildren
learn that contribution is ever more important than achievement,
that they can be happy for the success of others rather than so
pretending but eating their hearts out, that integrity to principles
is the essence of loyalty rather than loyalty being greater than
integrity. Unbelievable character growth!
Family members, business involved or not, don’t grow up in a
comparison-based culture where the true identity theft happens.
The cultural DNA is aligned with the immortal spiritual DNA,
unleashing the greatest potential of each family member and
reaffirming his or her true worth and identity, unconnected to
net worth.
Few family businesses achieve such heights. Sadly so. But by
following these wisely sequenced nine principles, this can happen

for your family.


f or e w or d    

xiii

How I’ve wished I had these materials in so many situations
over the years with family businesses who struggled profoundly
with such unusual challenges. I commend Allen E. Fishman on
such a marvelous contribution, and I know you will profit from the
reading and from applying these principles as much as I have.
Dr. Stephen R. Covey


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E l e m e n t

Preface

8

T

he greatest gift in my life is family. Thoughts of my family
guide me through the tough times, and those same thoughts
bring me deep contentment when I’m sitting on the porch, gazing
out at the Rockies while my horses graze nearby, just thinking

about all the good stuff life has brought my way.
Some fortunate turns and a hearty dose of hard work afforded
me a level of business success that allows both my family and me
to enjoy life fully. Every day I am thankful for all we have. Knowing
I created something that right now, and in the future, will support
and nourish future generations of my family, both financially and
emotionally, is for me a great honor—as a business owner, a
father, and a grandfather.
The nine elements of family business success that I describe in
this book have not only helped TAB bring financial benefit to our
family; they have also become a wonderful part of our family
relationship dynamics. The meaningful relationship I have with
my son-in-law, Jason, and the opportunity to watch him grow
to become an outstanding president and COO of TAB bring
immeasurable enjoyment to my life. I can only hope my mentoring
brings equal enjoyment to Jason’s life.
My succession planning has me secure in the knowledge that
TAB will stay in the family at least into the next generation. I’m
often asked if TAB will go on to a third-generation family business
xv
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xvi

p r e fa c e

leader. The truth is that I don’t know if any of my grandchildren—
Daniela, Jake, or Pierce—will grow into adults who want to
become a part of TAB. If they do, that would be wonderful, but if

not, that would be okay too.
I just want my grandchildren to find their passions and enjoy
life doing work that is meaningful to them: work that provides
happiness and fulfillment. My hope is that each of my grandchildren
embarks full force on the journey to their respective dreams. In
my mind, this is the best that can be wished for anyone.
Allen E. Fishman


E l e m e n t

8

Acknowledgments

I

want to thank my daughter, Michele Fishman, for the
many hours she spent asking me questions and shaping my
responses—bringing life to so many of the stories in this book.
Michele has been involved in a number of our family businesses,
and she is currently the executive vice president of one of them,
Direct Communications Services, Inc. Because she has been
exposed to family business discussions since she was a child, her
insights came naturally and are an invaluable part of this book. It
is fitting that my daughter was involved with me in writing this
book on family business. I so enjoyed being able to work on this
book with her.
Thanks to Lyn Adler for assisting me with the editing.
Heartfelt gratitude also goes to Dana Besbris for handling the

administrative challenges of putting this book together, as well
as coordinating the resources we have used, taking dictation, and
keeping me on track.
After I identified the easy-to-use “Nine Elements” formula
for those who want family business success along with enjoyable
family dynamics, I wrote out my techniques and stories for
addressing the challenges. I then sent chapters to Larry Amon,
Kevin Armstrong, Barry Arnold, Sharon Bolton, Carol Crawford,
David Cunningham, Steve Davies, John Dini, Jan E. Drzewiecki,
Bruce Gernaey, Jackie Gernaey, Bruce Healy, John Keener,
xvii
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xviii

acknowledgments

Blair Koch, John Lybarger, Harlan Oelklaus, Don Schlueter,
Cheryl Swanson, Ben Sweeney, Oswald Viva, Bill Vrettos, Stevan
Wolf, Sheelah Yawitz, Joe Zente, and Jason Zickerman. These
outstanding professionals were generous with sharing their
powerful insights into solving the special challenges of family
businesses and helping to create a book that is right on target
on how to handle these needs. Without their contributions this
book would be missing so much of the power it has to help family
business leaders, family business employees, and non-familymember employees. Sincere thanks to these family business
experts who shared their experience and advice.
In this book the actual names of business owners are used only
where I have been granted permission to do so. Otherwise, in

order to respect and ensure the confidentiality of the families
and their businesses, I have used fictional names, companies, and
business fields for the stories and examples provided in the book.


E l e m e n t

8

List of Abbreviations

FBL (Family Business Leader)  The leader of a family business.
FME (Family Member Employee)  A family business employee
who is usually related to the FBL.
Non-FME (Non-Family Member Employee)  A family
business employee who is not related to the FBL or FMEs.
PAVE  Passion, Aptitude to be the future business leader,
Vision of the Big Picture Potential, and Empathetic personality
match with the leadership personality needed.
SWOT Strengths, Weaknesses, Opportunities, and Threats.
TAB (The Alternative Board)  The world’s largest business
peer board and coaching franchise system.

xix
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E l e m e n t

8

Introduction

T

he joys and the challenges of family business are in my
blood; they drew me in with great fascination as far back as
I can remember. My father, Herman, and my uncle Willy (who
was my father’s brother-in-law) were equal partners in a couple
of successful businesses. One of the earlier businesses involved
fabric recycling. I remember when, as early as five years old, my
mother would drive me to visit with my dad at work; he worked
long hours, and we would visit him during the day. I would walk
in with a big grin on my face because I was absolutely mesmerized
by the whole, loud process of the roaring conveyor belts that
loaded the materials from the docking stations. How I enjoyed
being allowed to manually manipulate the elevator levers to go
up and down the different floors. I felt such pride! This was my
family’s business!
Years later, my father and uncle owned a pillow manufacturing
business, which was located down on the Mississippi River in the
Laclede’s Landing warehouse district in St. Louis. My strongest
memories of that manufacturing plant are the acrid smells of the

chemicals that were used to dry out the feathers for the pillows.
When I was 15, my father and uncle worked out a deal with me to
sell some of the low-end pillows door-to-door. A friend of mine
had a car so he and I worked out a partnership. Over time, one of
my cousins and my brother joined the family pillow business as
1
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