Aligning family office expectations and assumptions among family members impacted by varying cultures

Speaker A: Foreign. This is Family Office Intel. I'm your host, Edward Marshall, and I have the pleasure of Nikki Anani joining us today. So Nikki, thank you for joining us again. This is your second time around.

Speaker B: It is. Thank you so much for having me, Edward.

Speaker A: Nikki is an accomplished family business strategist and is also a published author of a new book in the space, which I'm sure we're going to have a chance to talk about, uh, as part of it. But Nikki, for fun folks that don't know you, uh, how did you get into the family business space?

Speaker B: Right, um, how I got into the family business space was very much inspired by my personal experience. So I was born into an enterprising family. My father particularly is the founder of Art, uh, Enterprise, which consists of three operating businesses and a whole bunch of investments. And I started off my professional career in tax planning, the world of international tax planning in London, very much on the technical side. And three years into my career when I qualified as a cpa, the equivalent of in the uk, I decided to, um, I was itching for change. I was itching for something more exciting. And it seemed like entrepreneurship was calling me. I decided to work in my family enterprise with my dad. And it was a real slam dunk and a huge transition. I was based in the uk, our family enterprises in Lagos and Nigeria, very different environments. I was pivoting from a very professional deloitte, um, environment to a more entrepreneurial, informal environment. Um, and there was also moving from corporate to now a family enterprise. But I quite, I struggled a bit with integrating because of the lack of formality. I also struggled a bit with finding my feet and finding my fit, where my best fit would be in the enterprise. And so my firsthand experience in that really inspired me to think, where are the sherpas, the guides, the um, advisors to help families like myself dealing with intergenerational transition and integration, um, how to help the rising generation deal with the complexities of ownership, leadership and, and partnership. And that really then sparked a light within me, a fire within me to really train up as a professional in this space. Not just as a family business owner, but as a practitioner. And I started working with rising gens in these areas. So for the past four years I've been a coach, a trusted advisor, a consultant to rising gens. I work one on one. I also do peer groups, um, of rising gens that are, ah, navigating similar transitions around usually integrating into the business or thinking about leaving the family enterprise, grappling with what's my purpose as well as how do I help to contribute towards the family legacy, how do I become a meaningful contributor? Um, that's where I get involved.

Speaker A: Excellent. So your focus on uh, family offices and being in the uk. I think we've talked about this before. There are a lot of families that are from the African continent that have some sort of uh, reach into London. Is that still the case today?

Speaker B: Correct. So when we think about the big economies in Africa, a lot of them ah, were British colonized. And as a result you find that uh, families have links to the uk whether it's education or they've got a property or if they're enterprising families, they may have some kind of advisors that are UK based. Um, and that was the case for my family. So at the age of nine, myself and my brothers, my mum, we moved to the UK for our education. Um, so I was there from nine till I moved back to Nigeria. Um, so I was there for about 16 years. Um, and in setting up the family office a number of our advisors were based out of London. Our ah, tax advisers are um, trustees, um, our attorneys were all based out of the UK and that's quite commonplace. Um, you still find that a lot of families do have some kind of nexus in with the uk. Um and particularly with COVID We're seeing a lot of folks moving out of just being um, primarily being located in Africa to now by co locating from London and say Nairobi or London and Lagos, London and Accra and so on and so forth.

Speaker A: Let's talk about your book Lifetime to Legacy. What inspired you uh, to write this book and what's kind of the focus of it in general?

Speaker B: Right. I was really inspired by like I mentioned my personal experience and my experience with working with clients. I found that a lot of the time in this space, the discourse on building generational wealth and wealth, um, intergenerational businesses was very much about the technical side of things. So thinking about the tax and estate planning, thinking about the financial planning and the strategic business planning. But in my personal experience and with Sherpa ing my clients, I found that frankly where they got stuck was not on the quantitative side but it was on the qualitative side. It was issues around the relational. How do we bring up difficult conversations with the elder General death? What's next? The meaning of money, should we get a prenuptial agreement and things like that. Um, how do we deal with conflict? How do we resolve conflicts amongst each other and really align on this rallying common shared vision and purpose? How do we Define this galvanizing vision and purpose that unites us all with respect to not just the business, but just broadly speaking, even wealth planning. And I thought it was very important to educate families not just on the quantitative. There's a lot of education that happens with respect to um, financial literacy, understanding trusts and beneficiaries, but really getting them to be fluent in the language of the qualitative. The relational issues around healthy, um, communication across generations, issues around forming a common vision, a common um, purpose, issues around having um, good policies and procedures in place to ensure that we are able to draw strength from each family member's resources and move towards legacy rather than just building a business for a lifetime. And then it all dissipates.

Speaker A: Talk to us about the cultural differences and how do you look at that lens, uh, vis a vis, uh, different families in different parts of the world. How important is culture when you're advising these families? Because I assume that there's a lot of similarities, uh, that you've seen with families and family businesses that you've worked, um, uh, with over the years. But are there nuances that you found either pretty straightforward or some things that you just didn't quite expect because you're not just working with families in North America, you're working with families all around the world.

Speaker B: Right, right. No, this is a great question. And there are cultural nuances. Um, for instance in Africa, um, we're a lot more collectivists and there's, you know, in the west is very much promotion of independence and individual thought, um, you know, um, individual purpose and whatnot. But in Africa there's more a sense of interdependence like what is the collective, um, what is the collective purpose? What is the collective, what are our collective roles within this? What's our ah, responsibility towards also this community to ensure that we have skill sharing, resource sharing and we're uplifting the welfare of the entire community. And this gets quite challenging, particularly where you have with the next generation when folks like myself are educated in the west and they come back to the family enterprise, whether literally or metaphorically, with very Western thinking. And so we tend to see a lot of cultural clashes between the first gen and the next gen, where the first gen may expect, as a result of the cultural inclination towards collectivism, you have a responsibility towards this joint effort. And the next gen, on the other hand, are saying, how is this going to impact me? How is me getting involved in this, addressing my vision, my mission in life and how would I get fulfilled? And it can be a source of tension. I think it's really important when families are navigating these clashes. It can be easy to write these off as generational clashes. Like the first gen are interested in X and the next gen are interested in Y. But quite often at uh, the heart of it is a cultural clash and helping families understand the sources of the clash and gaining empathy for one another across generations to kind of carve out a new normal for themselves. What works best for the family is really important. So that's a theme I'm seeing is folks in the west versus folks that are um, say from Southeast Asia or Latin America or Africa. There's a different disposition towards how the expectations with respect to uh, family, family members, um, and the enterprise.

Speaker A: Well some of those, those clashes are self generated. Right? So people are traveling overseas, they're living, they're living abroad, they're being educated abroad. They're like you, they had a career abroad and they come back. Some of them are to be expected. Uh, one, one would think. How have you seen folks navigate some of those clashes that do come up?

Speaker B: Um, yeah, you would think that some of these are to be expected. But quite often on the part of the founders when they cross over uh, this land of wealth and they become quite affluent, they just want to give their kids the best foundation and as they see it is send them to the best schools in the world. And they don't necessarily think through the cultural societal implications of that. For instance, um, next generation may not come back. Right? I chose to come back, um, but I have friends, colleagues, um, clients within my community who have not chosen to come back. And that can have a huge um, implication for the business when we start thinking about how we're going to engage a rising generation, particularly from afar. Um, so it's really helping the founders to understand the implications of decisions that have been made. Of course we can't go back in the past, but they're now navigating this new normal and aligning on expectations and assumptions. A lot of it there is, there tends to be a lot of assumptions projected on both sides of the table. Um, the next generation are entitled, they've abandoned their responsibilities. They're not as committed to being um, owners or leaders. It all stems from this cultural clash as a result of their um, differing um, experiences. And equally the rising gen may look at the founding gen. They just won't let go. They're so old school, they're not embracing new change and um, they're not professionalizing and institutionalizing. Well they're probably operating in Environments where there's low institutional trust that requires that individuals have very strong relationships with stakeholders and get very, um, involved in operational matters. So the cultural piece is really quite significant.

Speaker A: So when you start working with the family, uh, on those types of issues, let's just talk about the cultural clash. Um, you know, you could see those types of cultural clashes or uh, disagreements in how people view the world. Even if somebody didn't travel far away for a while, how do you get started? Because this can't be something that can be solved overnight. And uh, I've never worked with a principal that wanted, that had patients in their DNA. Uh, how did you get started?

Speaker B: Great question. Um, I say that we focus on, um, evolutions, not revolutions. So these are not instant changes, but it's really getting each individual in a safe space to explore their assumptions and expectations and where these expectations are coming from, where these assumptions are coming from and then coming together and moving from a monologue to embracing a dialogue and starting to carve out a new norm for one another. M. Quite often when we do gain understanding of where our, uh, family members are coming from, we develop deep empathy. That's half of the work. And then we're able to then look at forging a new normal. That's all in compassion. That's um, it's mutually beneficial for both parties.

Speaker A: The examples that typically we talk about are best practices and families have of where best practices occur. Uh, but even when they're. When you're trying best practices, sometimes you don't end up with the success because of a couple different pitfalls or, uh, some things that families don't do, um, uh, as efficiently or as well. What are some of the pitfalls that you've seen that get in the way of these families, uh, um, to kind of make that breakthrough where they can, where they can find some of that empathy that you're talking about.

Speaker B: Effy? M. That's a really good question. Quite often what I observe is there's a lot of past hurts, um, and as a result of disappointment and as a result of missed expectations that, ah, lead to family, um, members not being able to communicate as vulnerably. Because this is. We're not just talking about technical matters like I alluded to. We're talking about really emotional matters. Right. Um, how do we have a conversation on mom, dad when you're not here? What's next? Who amongst us siblings would you like to lead? If so, um, this can bring up, you know, um, issues around sibling rivalry, around past conflicts and so on. And so forth. So a uh, common pitfall that I see is families avoiding this difficult conversations in the bid to keep the peace. But frankly there's no peace because everyone senses that there's a huge elephant in the room and we're really not having an important conversation that needs to be had. Um, and then so we have all the trust and the structures in place, the technical structures. But when you approach the rising gen with respect to do you understand your roles and responsibilities towards the uh, family enterprise and they're looking, you know, quite lost or how engaged you really feel with the family enterprise, they're really not. Or you talk to the founding gen, how comfortable do you feel that your children are prepared for the complexities of what's coming their way and they're not. A lot of it stems down to this, uh, inability or unwillingness to have these difficult conversations due to past hurts and so on and so forth.

Speaker A: In your book you talk about a very interesting concept of conversational intelligence. Um, I think, uh, it's an interesting area uh, to explore, um, because it's an area of how people are able to express themselves. What does that look like for you, uh, when you're working with these families and how do you help them get a little bit higher up the scale to have that empathy and really bring out those conversational intelligence skills?

Speaker B: Right. Um, I find that within families and it's natural, we tend to have kind of top down communication due to the extension of the family relationships into the business sphere. By that I mean the patriarch or the matriarch is used to, you know, telling the children what to do or giving directions and you know, essentially giving out orders. But when it comes to legacy planning, we really want a situation where we're able to create sufficient safety, where everyone voices their opinion and we can actually have diversity of thought. So we're moving away from a monologue, so to speak, to actual conversation that's inclusive, where parties are looking about how to co create solutions. And when we think about it within the context of a family enterprise, this intergenerational um, diversity that we have within an enterprise I believe is really, it's a great natural gift that families are endowed with. We have people from different generations, we have people from different genders and we can draw upon the strengths of different generations. The next generation tend to have their pulse on um, technology, they're digitally native, they tend to have their pulse on social issues and this kind of confluence between profit and social change and solutions. Whereas the older gen tend to have their pulse on they have so much grit, so much like historical knowledge, collective wisdom and intelligence that they can bring to the fore. And if we're able to truly collaborate and have a situation where we have intelligence, where we're just not sharing information, but we're actually co creating solutions, we're able to develop a lot of trust and partnership within the family enterprise.

Speaker A: What's kind of the secret sauce that you've seen families that do well in these areas? Is it the ability to be open? Is that just the, that sounds like it's uh, a, it's a, it's an important first step, right? What, what are some of the other things that you see that are common across all families that are able to make these successful leaps and you know, unions between these different generations that you, that you work with.

Speaker B: I think the ability to be open is one step and I think a number of families can get over that hurdle through, you know, planning, estate planning and involving the rising gen. Like this is what we're thinking and so on and so forth. But I think there's, there's more beyond that. I uh, think the ability to be vulnerable and share, share, um, not just the triumphs of the family, but also the trials. Because quite often the rising gen see the founding gen as giants that they just can't compare to. And the uh, expectations, the burdens of stewardship can be very heavy for the rising gen. So being able to share not just positive events that are uh, happening in the business or that have happened, but also negative events and how the founding gen pulled through those events to model out grit, resiliency, um, having a positive mindset. These are key skills that ah, the rising gens will need on their journey of as entrepreneurs, as investors. Um, I also think that um, a key skill that families will need is to create safety. Just creating that safety to come and share difficult conversations and also creating a safety for failure because it's inevitable. Um, entrepreneurs, the journey of every entrepreneur, there's failure on that journey. Quite often founders want to protect the next generation from adversities. But for them to become leaders in their own right and gain their muscle, they also need to learn how to fail. They will make mistakes, but use mistakes failures as a learning opportunity and to use it as a well of information that not just they learn from, but all family members can learn from as well.

Speaker A: One of the interesting families that I uh, enjoyed working with told they were a multigenerational family. I think they were in gen 5 when I got to know them, they said it took us two to three generations to realize that we don't give birth to private equity professionals or business operators. They just don't magically appear. What, what if, what do you do? When family members or the rising generation are very successful, they have ambitions of their own but they don't want to be necessarily involved with the family enterprise. What have you seen that's been successful in those families that come to that realization when they're working and talking to you?

Speaker B: Right. The families that are most successful I find, focus on the strengths, identifying, helping the rising gen find their strengths and um, encouraging and feeding their strengths, curating for both their careers and also the roles within the family enterprise, if any, um, that really draws upon their strengths and their passions and their interests, um, and just being flexible and adaptable to how the rising gen can be engaged and can be involved in the family enterprise. I think that's something I've seen modeled out quite well. But I think to limit the conversation, to let the rising gen do what they want to do, it may mean that uh, there's so many functions that the family needs to occupy within the enterprise that essentially are not being occupied. And by that I don't mean any particular leadership role you can hire for a non family staff to be this president or of the family business or of the family office. But there's more, the relational elements that need to be looked into like family learning, uh, family bonding, um, educating the rising gens and all family members and so on and so forth. I do think that um, to some extent passion can be learnt um, and it's really exposing the rising gen um, to the foundations, the information on the family business and also encouraging them to get involved in whatever capacity that they're interested in. So it's a bit of a dance in my view. And it's quite difficult for founders to find this happy medium on their own because oftentimes they come with their expectations of how the family members should get involved and that's where a third party is really helpful to help curate and sit um, with the next gen to find what are your strengths. And we seek to deploy and develop those strengths as much as possible, but also we develop your interest and your engagement within the enterprise.

Speaker A: So what was your favorite and least favorite part about writing your book and the research that you did in it? Having, having taken, taken that up in the past myself, I know it, it can be, there can be some fun ups and some interesting downs as part of the process.

Speaker B: Uh, that's a really good question. My favorite part of writing the book Was learning just how important, um, the soft stuff is. For instance, gaining clarity of purpose and just how as human beings, we're so oriented to doing without stopping. Back to take a step back to understand why are we doing what we're doing and the importance of doing that, not just as individuals, but more so when we have more than one player stakeholder involved. Really gaining clarity on that. My least favorite part of the book was having to develop the grit and the discipline to sit down and write it. Because obviously there were days where I was just like, I'm tired. I have writer's block. I want to go. Just find something else to do. But just showing up. I grew leaps and bounds in my personal development with respect to the stories I tell myself and how I'm able to essentially encourage, um, myself, motivate myself to do things that I don't want to do. So it developed my discipline quotient by leaps and bounds.

Speaker A: Some growth with this as well. That's fantastic. Well, listen, my last question to you. Lesson learned, uh, something that you had. Wish you had known, uh, back when you started working with families and family enterprises that you've. That you've come to know very well today. What's your one lesson learned?

Speaker B: My one lesson learned, honestly, is to. Because I'm a rising gen, I can, uh, I did oftentimes come with my, um, assumptions and prejudices of the founding gen to really develop deep empathy for them. And, um, the loneliness, uh, the difficulty of dealing with transition, dealing with questions over the rising gen's ability to integrate, whether they're able to take over, if so, if they want to take over. Um, I wish I'd had a lot more evidence, empathy for founders.

Speaker A: Nikke, if folks want to get in touch with you, what's the. What's the best way to. What's the best way to find you?

Speaker B: Best way to find me would be on LinkedIn. I'm, um, on LinkedIn. Just search for Nika and Annie.

Speaker A: Well, thank you so much for coming on today, Nikki.

Speaker B: Thank you so much, Edward.

Speaker A: All right, well, that's it. Awesome. Bye, everyone. Sam.