What issues typically arise at each stage of the generational cycle, and how can families manage these issues?

In every individual and in each generation, changes in personal goals and interests, financial situations, and investment objectives can change the governance of the company. Business founders must decide on the first ownership succession either by a single heir or by all heirs as a group. Later, ownership may pass by inheritance only to some heirs, such as those who are involved in management. As soon as there are multiple owners of the business, there is the potential for conflicting personal goals and interests. Family members may vie for spots as managers, or may criticize pay awarded to other family members on the payroll. As the group of owners expands beyond siblings to cousins and includes more than one generation, such potential conflicts create a need for communication, education, and collaboration. When majority ownership is no longer represented in management, the board must step up to a fiduciary role and the family must allow the board to fill that role. Both family ...  more