Member focus: Embracing change
Interrupted Entrepreneurship refers to the moments or actions that cause a change in your business. The way they are handled is key to businesses surviving throughout the generations, says Raméz A Baassari.
My book, Interrupted Entrepreneurship, gives examples of family businesses developing, changing and surviving, and provides lessons for everyone about accepting and mitigating change in our febrile political and economic environment.
Moments or actions can cause a change in your business. It’s how those moments are handled that is the key to the survival of businesses throughout the generations. As a multi-generation family ﬁrm that recently experienced the loss of its patriarch and entrepreneurial force, our family felt a major jolt with my father’s sudden passing.
Along with deep grief, the experience led me to undergo a time of self-reﬂection and introspection, during which I further came to admire my father at every corner – from his leadership to his farsightedness and ability to envision a structure that could survive him.
Recognising that what we experienced was just one of many key powerful interruptions that family businesses experience, I questioned how other enduring family businesses have experienced this and other forms of interrupted entrepreneurship (IE), and how they have handled it. Did they regroup and defend, rebuild and expand, or take a whole new road altogether?
Survive the test of time
For multigenerational family businesses, the most basic and inherently enduring pattern is survival.
In understanding that we have this core knowledge in how to run and invest in businesses that feed and support each other, my father created a corporate structure that could survive him.
It wouldn’t ‘bottleneck’ at one person, but would instead allow us to build on our passions and core knowledge while growing the business. It also ensured that the next generations would learn to engage as members of a larger group while still exercising their independence.
As part of that structure, my parents created the Baassiri Investment Fund so that members of our family would collectively be able to engage in new business ventures of their own interest, allowing for creativity without aﬀecting the core business.
It also meant they would have something to support them, should they fall on hard times. The fund is insulated from the fortunes of the main business, a strategy similar to Steve Jobs isolating his Macintosh team early on, separating it from Apple so that its concept for Mac would be entirely unique and successful in its own right.
Another inevitable IE relates to family. You can’t have a family business without family members (even if a family business is a corporation or is publicly traded)!
Where the challenge lies is in managing these multiple numbers of generational demands and making sure everyone is heard and represented.
Since my father chose to follow a diﬀerent path than his family business at the time, taking up engineering while still making his interests work to the beneﬁt of the family business, he wanted to make sure other family members had the same opportunity.
“Do something else,” he said to me. “Follow your heart. You don’t have to go into engineering because I did.”
This was the beginning of the Baassiri Investment Fund, which allows us to forge our own paths towards a successful company while potentially shifting the core of the family business.
Sometimes the option of starting a smaller business under the family umbrella isn’t an option. The creativity and innovation of the newest generation can be all that stands between success and failure.
Make time for talent
When it comes to family business, you need to understand your own talents, observes Brooke & Sons chairman Mark Brooke.
For the Brooke family’s textile industry, that creative direction led to a reinvention of the family business that played to Mark’s innovative, idea driven talents while also allowing the company to thrive.
The Brooke name still stands for quality, but that quality has moved from top-tier woollen textiles to superior renovations of architecture that ﬁt today’s quality small business needs.
No matter what the course or who is embarking on it – whether it is a company CEO driving in a new, cutting-edge direction or a family member taking a chance on a new division – it is vital that he or she has the capability and knowhow to make it work.
Education, whether through experience, higher learning or a combination thereof, is immeasurably important and is the best way to cultivate positive and beneﬁcial growth.
BREWING UP SUCCESS
An example of innovation keeping a family business going can be seen in the German brewery Karlsberg Brauerei.
The company may never have made it into the 21st century as a solely family-owned business if the owner’s son, Christian Weber, hadn’t negotiated a new path and pursued the opportunity to stay in the family business – which he almost didn’t.
Despite being the great-great-grandson of the brewery’s founder, Christian, like many children of family business owners, grew up wanting to get out of his parents’ shadow.
It wasn’t until the company faced an IE – a transition that could strip the company of family ownership – that Christian reached out to his father and proposed a plan in which he succeeded his father’s position. His father ultimately agreed – a transition that I presume took patience, to say the least.
Today, Christian holds the CEO position. Karlsberg Brauerei is now one of the largest breweries in Germany.
In this case, Christian stuck it out, negotiated a new path that was inclusive of the old guard (his father and other family members) and has driven company growth while staying true to the core business.
For instance, by collaborating with international breweries and expanding its artisan and craft beers, offering limited edition and special craft brews through distributors and online, Karlsberg celebrated a successful 2016.
Raméz A Baassiri, author of Interrupted Entrepreneurship – Embracing Change in the Family Business