Preparing the Rising Generation for Succession with Jeremy Lurey

Speaker A: Foreign. Welcome to the Enlightened Family Business podcast. I'm Chris Yonker, advisor Life Journey Sherpa and a guide to families who are ready to build their future from a deeper place in a world we're most focused on structures, documents and money. We go further, we explore what really creates sustainable continuity, clear communication, inner awareness, family alignment and custom fit governance that evolves with your values and your vision. Here we talk about the full spectrum, strategy and spirit, leadership and legacy, conflict and connection, performance and well being. Because the future of your family business is not just about what you build. It's about how you live, love and lead together. Let's begin. Many families look at who might be a successor or a sign finding a successor. In some cases they're more advanced. They're building a developmental plan for a successor to step into a key role. Yet fewer examine the ecosystem around them and the environment around these uprising leaders often shapes their confidence, stewardship, communication, accountability, their ability to emerge as a leader and long term continuity. Um, you know this, we're talking about the emotional climate, the communication patterns and the governance structures. All of these pieces and elements that fit into the ecosystem and the environment that we're building. Yet most of us are not conscious of the environment that we're in because like, what's water to a fish? And exactly this topic that I had, uh, Dr. Jeremy Lurie on, um, our show, he was actually on our Family Business Executive forum, which is a series that we run about every six weeks. Ah, and by the way, I'll plug it F A M B I Z F O-R U um M.com um, it's a free webinar series that we run that we record and we share, uh, with the audience. I just thought this content was so good and give you a taste of the type of things that we cover on the forum. Um, and also if you ever attend a forum, you can attend privately and still, uh, type in questions and interact directly with the speakers. So with that, let's get to the episode.

Speaker B: These are the roles that I call now gems. Right. Giving them an opportunity now, not waiting for them later, but giving them opportunities now to step up into leadership roles. So really looking forward to sharing some stories and getting further into the conversation.

Speaker A: Yeah, um, yeah, we're going to talk specifically about the ecosystem of success. So here's how this is going to go down. Um, we've got about, I don't know, 40 to 50 folks signed up. Uh, probably about, uh, about 30 of you will be here live. The rest of you will be watching this on a recording. Um, we will, uh, open for, uh, Q and A as we go. But if you want to raise your hand and give time, I'll keep an eye out, uh, for anyone with hands raised or questions and comments, because we're here to give. And so we want you to receive what you came here for on this particular topic. And I think the challenge with the succession topic in itself, I think oftentimes it gets, uh, pigeonholed, as in a transition of power and, or ownership, like at an event. And really it's a process. And the more time you can contribute to the process, the more options you have. And that's the bottom line. And it's. It's an ongoing. And if you start. If you basically, uh, I look at as if you've already started to think about it or talk about it, you're in it. I don't give a shit where you're at. You've kind of like, energetically, you're kind of started, you're in it. And there's things that happen, uh, that we're going to talk about that, well, perhaps will help create some level of consciousness, of awareness in relationship to things that you may be experiencing or you're going to be experiencing that you might want to start thinking about. And on, uh, things around best practices, we'll talk about some particular cases perhaps that we've worked with just so that you can learn, learn from others in relationship to how things can work or not work, um, in that regard. So, Jeremy, I'm going to share, uh, some slides and then we'll also go into the meat of our time together is going to be at you and I and dialogue, and some of this will have some dialogue with it also. Um, so let me see if I can maybe if I can share screen here and. All right. Hopefully this is starting to work. Okay.

Speaker B: Um.

Speaker A: All right. Can you see that, Jeremy?

Speaker B: Yep.

Speaker A: If you can see it, everyone else can see it. Great. Okay. So I think, uh, oftentimes when folks look at. I've got a rising generation in my family system, and they're either going to have ownership or they're going to be on a board or they're going to be in the business or maybe they're already in the business and they're going to step into a new role. I mean, anything around any level of transition, it can look different depending on your family holdings and the size of your company and the things that are involved. But there's always this, this piece of education going to go to school. I'm going to go to Harvard, I'm going to go to Yale, I'm going to go to, you know, mit, wherever I'm going to miss kid's going to go to go to school, I'm going to give them a little on the job experience or I'm going to have them come into a boardroom and observe, which is a common for the next two years. You're going to be an observant role. These are things that we do. Um, perhaps I'm going to make sure you have a work ethic and I'm going to hold you accountable. Um, maybe we're going to give you a little bit of leadership here or there. But see, there's some of the common things folks do and these things are all good. Not here to put them down. But the question is, is this enough? Is it enough? And there's more to it because leadership we're going to talk about the ecosystem today does not develop in a vacuum. There's family dynamics, what's said, what's not said, uh, how much level of transparency do we hold, what's our accountability, how much trust is in the system, where's our governance at? How we look at decision making now and how we're going to look at decision making in the future is tied to governance. Right. If there's siblings involved, which oftentimes there are, um, what's the communication system like? Are the developmental opportunities? What do those look like? Do we have expectations? Are we communicating our expectations? And are those expectations bilateral? Is it just the top telling the bot, you know, if the parents are telling the kids, this is the expectations and you need to have them. And then also the influence from the founder. Sometimes there's a, uh, there's a grant, like I just, I just talked to a family this morning. There's three generations in this family system actively and the oldest is 90 and they want me to meet with him. Right? He's, he's got founder influence. They, they today, Jeremy, when they make decisions, one of the things that they do is what would make dad happy. That's part of. But when dad passes away, what's the decision making process look now? Right. And when they go from 5 to 16 in the next generation, then, you know, what do you see about that, Jeremy, in regards to decision making? Going from, you know, think of like a three, you know, three generations in a family system and how each generation actively looks at decision making differently.

Speaker B: Right, well, and you started with the keyword founder influence there on that one, right? So typically you've got your 70, 80, 90 year old founder, wealth creator, and I'm going to speak about patriarchs. I apologize, especially for any women joining us today, but I find that the men in that uh, demographic are much harder, uh, and we'll say driven and maybe not such a positive way for the family as our matriarchs who I think have better EQ and just sort of read the tea leaves, the family better. So you're working with that, let's say 80 year old billionaire who's bootstrapped his way to success. No one's ever told him no and he's always been in control. And when it's just him, by the way, maybe with his partner, you know, they make decisions together, but really it's whatever he says goes. You get down to a second generation, two, three, four siblings. Third generation. I've had family systems where they're you know, 18, you're saying 16 and you're third generation. How are they going to make those decisions together? And we talk succession planning. We typically talk about which one is the right successor. Right. Go back to your last slide around leadership and work ethic and such. But we're not talking about how that sibling, cousin group is going to support them. Whether they work in the enterprise or they don't. They likely are going to be shareholders and key stakeholders for the success of that enterprise continuing. So, uh, you know, I don't love the word governance because my father the attorney shows up in the back of my head. But the reality is how are we going to make decisions? How are we going to manage our communications and what priorities are most important for our family, which could include philanthropy and the foundation of the things, not just the core business, but really how do we make decisions together? Because with that first generation, I want to invest a million dollars in more forklifts. I'm just going to do it. It's my business. That's the way I've always done it at that, uh, third generation, I want to invest a million dollars in forklifts, but my cousins want to buy yachts or join country clubs and buy ponies or maybe they don't have the same professional income so they try to borrow from sort of that family business bank. Um, and so we have all kinds of challenges that show up in those scenarios if we don't put the governance in place, if we don't have these conversations that you're talking about to create the right ecosystem for not only that successor, but for the whole family to thrive moving forward.

Speaker A: Right and my dog's whining. So sorry for that. If you hear the dog up here.

Speaker B: Oh, uh, the dog is sad that the children aren't figuring out how to manage their family together.

Speaker A: Yeah, I think one of the things that I'll say on that, I'm going to go into, um, a little, a fun little survey here for folks and then we'll have some more dialogue in that rising generation. And I just, I just talked to this fresh in my mind. So let's say you're going from that five to the 16 in that 16. No one's going to argue of that five in that generation that in, in your trust, most likely you're going to leave shareholdership to folks in that 16. And if you're like most parents, you're probably going to equalize shareholdership in some fashion. You might, might, you might, you may or may not. You might dilute some things and then use cash here or there, but you're trying to. Most parents want to treat their kids equal because it's just how they're wired. Um, and, but few people think that, well, what am I doing to work on the relational structure of that generation now in preparation for later? Because if the cousins have distrust, if they have competing, uh, agendas, which it can totally be true, and they're not working with somebody mindfully through like a family council or some development to work on their development, their education and their relationships, those three things over a period of time, you're just going to, you're putting yourself in a higher of volatility into what's going to happen down the road when we have to decide what we're doing with the family compound, do we sell it, do we keep it? What do we do about this piece of real estate? And if the fractures that are in those relationships are going to be tested, I mean, do you have any, uh, anything you want to comment on that, Jeremy, from your experience?

Speaker B: I'll, uh, give you a really simple one. You and I are talking about complex multi gen, you know, 16, 18, kind of in that sibling, cousin group. The very first time this came up for me and again I written articles around fathers and sons in succession. I believe that patriarch who's grinded their way to success is a very different sort of a, uh, Persona than the wealth creator matriarch or maybe the wealth creator siblings who did it together. But when you have that standalone father, um, and when I first met this person, he was mid-70s, not failing health yet, but he was sort of moving out of the C suite if you will. Junior had been in the office for 15 years, give or take, so in his maybe late 40s, very much positioned to be that president and future CEO. And Junior had one sister who was very much estranged, had never been in the business. Junior had 49% ownership because dad had gifted it to him over time. And we can get into the legality of that. But just on paper, you know, Junior is the up and comer, clearly the successor. He's got 49%. And in my first meeting with dad, dad says to me, well, yeah, when I'm gone, I'm going to give my daughter 50% and I'll give him the other 1% and they can manage this equally. And that's, uh, a frightening thought when you're the child who is running the enterprise with a sibling you basically don't talk to anymore, who doesn't have the, uh, business savvy to run a business. And it's going to be the one who's going to fight you on every strategic decision. I mean, this is where we come up with all kinds of other financial tools like keepers and life insurance. And you can create equalizing payment through real estate or other assets. But to give an equal share of that enterprise, it's going to affect your customers, your employees, not just your family, when those two cannot make decisions together. I love the question of, um, what is fair and equal? I led a keynote, um, to kick off a family business retreat last fall. And after I spoke for 40 some odd minutes about legacy and happiness, resilience and such, one, uh, of the G2 owner generations raised his hand and said, jeremy, can I ask your question? I said, yes, of course. He said, can you help me define the difference between fair and equal? And, you know, that's a loaded question in that room of 75 some odd people from three generations. And I said, well, I'm happy to do that, but tell me more about what's going on. And this was a guy who likely a little bit more machismo in his attitude, but he's more of a head of sales producer and his sister is more of an office assistant manager. And he said, they got paid dollar for dollar, the same thing, equal, and is that fair? And so it really is a struggle in family enterprises to lean into fair and what I'll call equitable, but it's not necessarily equal. And some of our families that are more of a family office with real estate or other assets, you can absolutely keep sort of the wealth, you know, uh, in check. But creating those sort of Leadership dynamics in the family enterprise, um, creates a lot of risk.

Speaker A: Hmm. Totally. So I'm going to go through a fun little, uh, survey I have here, uh, for those of you attending. And, um, you can just answer these strong, you know, green, yellow and red. Basically. Okay, so, like, for each statement, score myself. Okay, So I, I'll. So I'll give you an example here. My rising leaders can openly disagree with senior family members. Where's your family fall? Is it green? Is it yellow? Is it red? These are just questions I'm just going to ask for Jeremy and I get into more dialogue here just to kind of check in. These are like, I like to look at as like, what are, um, we're driving out here to Michigan, Jeremy, and, um, we left Buffalo, New York, and we're heading to Pennsylvania. And, uh, our car made a noise, a bing, bing. I'm like, what the hell is that? And I'm like, oh, I have 60 miles until I'm out of gas. I honestly wasn't. I should have looked at it. But when I left Buffalo, I didn't. I was more concerned about getting Starbucks and just making sure we all are properly caffeinated before hitting the road. And, uh, I'm glad that happened because it was. I don't know why, but I just had not honestly thought about my fuel. Um, so needless to say, Carr told us where gas was. We looked it up and got gas. But it's nice to have a dashboard. And we, you know, when these fans were navigating transitions as a family, think of this like these are like that, like dashboard indicators for you, you know, can rising leaders openly disagree with family, uh, senior family members? Can family members receive honest developmental feedback? This is an interesting one. Some of this is not easy. I'm not saying that this is easy, but where can we work on that? Um, can leadership opportunities are earned rather than assumed? Uh, boy, oh boy. I see this one. I see this one. I've worked with families where, well, I'm going to move my son into this role. Now, if it wasn't the son and it was someone else, they had the same work experience, the same qualifications, the same work ethic. No way in hell would that person get the job. So nepotism is real. Uh, and sometimes we don't even see it when we're in it. Perhaps, um, roles and expectations are clearly defined. I think this is a huge one, Jeremy. When people are moving into a role, are we really defining the role? Are we really getting clear on what the outcomes are? How do we Know people are doing good work and whatnot. Uh, it sounds so simple. I think as a company grow, a lot of these companies we work with, you get to enjoy working with are growth directed. And when a growth directed and you've done a lot of change management, we tend to not sit down and re, tighten up roles and responsibilities and expectations and kind of get eroded over time. And then uh, that, that can be an issue. Um, a few more here. Rising leaders have meaningful responsibility and decision making authority. Um, you know, and you know, and it just can be different. But how does, how does that look as you look at that? Um, do, do we give them opportunities to weigh in on decision making? Just to see, well, how would they look at that before they, before we pass everything over? Let's, let's do some trial runs or maybe give them some areas of um, things that they can make decisions on and let them screw up, let them have mistakes.

Speaker B: That's one of the key reasons why I use the term now, Jen, not next gen. And I appreciate rising gen. I mean I use uh, that terminology as well within the context of this conversation. But when I'm describing these next generation, um, young adults, young professionals, they call them kids, but we all call them the kids when they're coming up. This is a perfect example of why they need to be now. Jen, not next gen. Next gen would suggest they have no meaningful responsibility today. We can't trust them. Um, we don't invite them into decision making because they don't know enough, they haven't experienced enough. But if we give them now, general to your point, it's about empowerment and I wouldn't say trust with a long leash. Right. You got to monitor and you got to support them and help them succeed. But the reality is that um, most parent generation leading gens don't recognize them as now gens. They recognize them as next gens and they sort of hold on to control. Again, I'll go back to that sort of successful patriarch because I think that Persona especially is always in control until either the day they die, the day that we can somehow get them to quit and retire, which is a really challenging process of having them let go and embrace that third act in their lives. So I think number five here is really important to pay attention to as we're grooming that next generation to take over these very important roles.

Speaker A: Agreed. Number six, difficult conversations can occur without emotional fallout. To what degree can we share and hold transparent feedback? You know, when you came in and took over that meeting, I'm not sure Everyone in the room felt heard. How did you feel that? It went like, you know, how are we sharing feedback to folks that are, you know, being, you know, you're being a jerk, you know, you're being this or that, like that. That's, you know, probably not the way to have a difficult conversation. But sharing, reflecting, creating awareness. I think oftentimes folks aren't aware of how they're showing up. And how do we, how do we, how do we, how do we approach that and where do we do that and how do we do that? Um, and that can. This can happen on either side. It can be also going to like, hey, dad, you never really give me a chance. I feel like when you're in the room, you don't even let me, you know, you're always taking control. You know, can I say that to my parent? And will they listen? You know, will they, Will they, will. I feel heard when they say that to them. Um, leadership development is intentional rather than accidental. This is, this is a, this is a great one. Uh, are we building development plans for the individual? Jeremy, I know this is something that's, you know, you really, truly believe in bringing in perhaps an executive coach and really mindfully looking at. Because everyone's different. I think this is the other piece too is like, just because someone might be stepping into a role or a future role, a doesn't mean they fit. Just because dad was in that role. Uh, so we really want to think about the strength profile. Each one of us has our own strength profile. Each one of us has our own weaknesses. And also depending, we may need different scaffolding around us than the past leader did because we need to augment different weaknesses than they had.

Speaker B: Right.

Speaker A: Jeremy? I often see it's really important that when someone's stepping into. I'm working on the project right now, it's about three year transition. And the new CEO, she's going to have a drastically different executive team around her than the person who's leaving because she's got different strength profiles, she's going to lead differently. It's not bad. It's just how it is.

Speaker B: Yeah. And baby boomers who are currently in that ownership role and transitioning came up through a time where no news was good news. My father, very successful corporate attorney, um, we joke about his illustrious career. He was a known entity in his field of bankruptcy and corporate restructuring. No news was good news for him. The only news he wanted was the promotion of the pay increase. But we look at current generations in the workforce, that's not the case. They want the feedback. They want to understand what their development opportunities look like. And a lot of the families that I work with, where they don't have number seven as the green, at best, it's yellow, but really it's more red. Um, that's where things get so heated and emotional that I led a family meeting about a week and a half ago, and it was with a longtime client of mine. Mom and dad, who are still owners of the business, were at the table. Um, the middle son, who's really the successor, sort of heir apparent, was at the table. And it's no longer a rational conversation. I mean, I had an agenda, I had topics. I was trying to move them through. Dad and Junior just deflecting and blaming each other and calling each other out for their faults. There's no celebration of strength. We're not talking about Junior superpowers and what he's done phenomenally well in the business the last 10 plus years. We're talking about what he can't do, you know, because Dad's judging him for being a different leader. Um, you know, I did, and I could think of a lot of examples that get colorful. I won't share today and take up time, but I got multiple clients where it's that baby boomer sort of generation, where they did things in a certain way. They don't support their Gen Xers or maybe millennials who do things differently. To your point, I celebrate shared leadership. I have a family right now where juniors, probably young to mid-40s, taking over the law firm from parents who are the co founders. He has four senior partners. He's named his executive leadership team, and he makes decisions with them. And I applaud him because he's not perfect and it really takes a village. Right? But dad judges him every single day for not seeking advice and counsel from dad. You know, the email I got last week, you know, how dare you go to his quote unquote, senior partners and not the person who founded this firm when he was still in kindergarten. And that's the attitude and that's the emotion and the angst that goes into these situations when we don't have those open conversations when we aren't more intentional about people's career paths and their development opportunities.

Speaker A: I'm curious, what's your vantage point on, let's say I'm passing the, you know, the business is we've created a timeline and I'm stepping down in, let's say, whatever, a year and a half. And you're stepping. You're the person stepping up and how much input should I have in what your org chart looks like?

Speaker B: So I come out of management consulting world where I use a model, it's called races. If anybody wants to ping me later, I'll share more about it. But there's a difference between consulting for input before making a decision, taking action and informing. I've already done something but I need to keep you in the loop. Right. So I hear your question and it brings in that distinction of I would offer that leading gen principal business owner should have very little control, very little influence on what the next generation is going to do. I hope that I respect and the years of experience they have. I'm going to consult them and ask them for ideas, I'm going to test my thoughts with them. But I don't want them to have control or influence. Otherwise we're not creating a now gen scenario, we're creating a next gen uh, scenario. We're not empowering that uh, rising gen leader to step up and do things. Like I said, the senior partner shared leadership structure. Uh, and I'll go back to something you alluded to earlier. One of the very first succession planning projects I led about 15 years ago. I gave that rising gen leader an opportunity sitting in front of his CEO and their transition team, arguably their board. And I asked him the question, what's your vision for the future? What is this organization going to look like the next 5, 10, 20 years? What kind of leadership do we need for the next five, 10, 20 years? And that was a really powerful conversation because let's just say that you're my business owner CEO and I'm taking over for you in your scenario. I'm never going to fit in your shoes, but I'm never going to walk your journey either. That was the last 20 or 30 or 40 years. I don't even need to say AI. Just look at the world around us. It is going to be different for the next 20, 30, 40 years. So I need to be a different kind of leader. And that would sort of coming back to your question, be the reason why I would say I don't want you to control, I don't want you to drive what my leadership structure looks like. But I do want to consult you for input and ideas and sort of test it before I get too far down the path.

Speaker A: Mhm. Yeah, you made a really good uh, point there because you know, even from the work that you know, I came from corporate America, you came from corporate America and you're doing consult, change management work Is that, and this is, this is outside of family business. This is very true and relevant is that the leader that got us to where we are now may very well not likely be the leader that we need for where the business is going and or what the business will be facing in the future because of, uh, always unchanged because of the impermanence and changing times and times. I know this sounds, I don't know, cliche, but times are changing faster than they ever have. And in the Next, you know, five to 10 years, we'll see as much change. You know, there's just been numbers thrown out of like 50. In 10 years we'll have as much change as we've seen in the last hundred years. Like if we could just conceptualize these ideas and some of the skill sets, quite frankly are different for leadership for tomorrow than they were in the past. So even that alone in a vacuum is a reason that change is important. And okay, if someone's going to lead and be different. And ah, I think it's hard to hear here, I suppose, um, but it's for some folks, but it's the reality of the circumstance.

Speaker B: One of the best books out there to sort of make that point. Marshall Goldsmith, what got you here won't get you there. And without disrespecting Marshall Goldsmith, who any of us in this executive coaching world, Chris, know and hold in the highest regard what he's accomplished in his career. It's not the content within the covers that resonates with me that really speaks to different leadership behaviors and skills you might need over time. But just that, uh, title alone, you look at the COVID of that book, what got you here won't get you there. And I think a lot of founder, sort of wealth creators, current leading gens, forget, we're not going in reverse. Right. We're not looking in the rearview mirror. We're looking ahead through the windshield. And so we do need a different type of leadership, which could be a shared leadership model or it could just be, you know, a rising gen leader with a different approach that's more participative rather than directive. You know, we could talk a lot about leadership, um, but I think that one book alone really encapsulates what you just said. What got you here won't get you there.

Speaker A: I'm going to go to point 8 here. The next the next gen or the rising generation of the now gen understands stewardship, not just ownership. And there's, you know, when we're in a stewardship mindset, it's like it's caretaking. We're thinking of generations beyond where we are. Whole different framework. And do you have any comments on that, Jeremy?

Speaker B: I do and this is why I really believe in legacy and I'm m proud of the work I get to do with families these days. It's not just family business succession planning. Chris is getting old. Jeremy's going to take over. That's a linear process and I can lead that for any leadership group. But this last point eight around stewardship and legacy really speaks to me that our family is not the widget making company that was the bank for our family and that's how we made money and that's how we supported our community and our customers. Great. But our legacy is the impact we have in our community and that could be having a foundation and community impact. That could be maybe we actually did innovate and create something new that others are using. We set a new standard. Um, but you know, we really focus on succession planning in the enterprise. When we say family business succession planning. And this point's a great one, that stewardship is about that broader family, um, footprint where you may have a distant cousin who has no interest in the widget making you do, or maybe you're a professional services firm, your accountant or lawyer. So no disrespect to our professional services, whatever it is that you do do, you may have a lot of family members who don't work in that enterprise and stewardship matters to them. How do we support our community? How do we support our family with this incredible wealth we've created? To your point, we typically are going to pass down, um, shares, right? We're going to create shareholders who just may not work in the business. And if I come in thinking, oh, I'm going to be the CEO because Chris is getting old and I just focus on the business, boy, do I have blinders on and do I miss opportunities. And that's where you and I get involved, where we no longer have family harmony between generations. We have sort of fiefdoms and turf wars that kick in. We'll go back to your first point about family dynamics, right? That's where those get raw and emotional when we forget about the stewardship and the legacy of what we stand for.

Speaker A: So, um, for those listening in on those points, just some thoughts. What surprised you? What concerns you? Which area gets ignored most often in your and you know, in your. So Jeremy and I are here. What we're talking about is, is really things that are happening in the greater ecosystem because we could all go I say, well, I could go on to Claude and say, here's my company and, uh, here's my family and here's who we are and here's our shareholder structure. I want to do succession. How do I do this? And it would tell me, it would tell me what to do and then I could just go about doing it, but it wouldn't look at the nuances of the family relationships, the dynamics, the communication structure. Jeremy, can you think through some cases that you've worked through in regards to, um, lessons learned in relationship to. Why is it important to look at this process in a holistic vantage point as opposed into, um, an event or just moving m someone here and then getting them ready and then that's that. Um, you know, because there's. I, I find that even when we come in and we always do a discovery in the front side and people, uh, are always like, well, why don't we, why don't you just start helping us? I'm like, well, I don't know where you're at. You're going to tell me where you are. But I don't know because all I know is what you tell me is your reality based upon your perception of reality, which includes your blind spots. And, and then I'm just going to see reality through your reality, and that's not reality. And I cannot tell you the amount of times folks told me we talk about succession or everyone knows here what's going to happen, um, or we've communicated this and then you start talking to key stakeholders, non family people or spouses. And then, boy, what you were told is reality and what other people think reality is. It's, it's a constant mismatch. And I think I, I see, I see this more times than not that what we feel is what's happening and where we are isn't quite exactly where we are.

Speaker B: Yeah. Through my life experience, I've learned life happens through our communication. Communication of one inside our heads, the chatter that we have going on, um, communication with others. Whether it's, you know, just you and me or it's full family. And the families that you and I work with tend not to have the real communications that they need to. I get to share a lot of success stories of families who do succession. Well, um, my longest standing family in the Midwest, three siblings, brother, two sisters, are sort of majority shareholders. Their five children own like 1% because grandpa, you know, generation, uh, skipped, uh, down to them when he passed. But they really are not, not impactful as the three siblings. And they have roles and responsibilities defined. We've created a professional board. We even do annual family retreats to help the family understand what's going on in the business. That's all great, but the reality is they're still not really having the communications they need to. As we're about to bring two of those fourth gens into the business this next year, what are we going to pay them? What is their actual job title and function? We've talked about this sort of broad management development and training program for 12, 18, 24 months and give them broad exposure. But at some point, rubber is going to meet the road. We're going to have two cousins side by side. Who is the future CEO? Is one of them maybe going to be head of sales or cfo? And if I'm going to be coo, I don't have to worry about tomorrow's problems today. But if I put the right governance in place, if we have the right conversations now, they actually won't become problems in the future. And generally speaking, I'd offer, it's not that rising gen I need to worry about. It's the current leading gen. Right? Because they're either holding on, they won't let go. Uh, they're afraid to have those conversations, they're more emotional. They've already had some stressful dynamics in the family. So they don't want to impact the golden goose of the enterprise by bringing the drama into the business. And you and I both have really great tools to address that. Uh, there's a linear process of how you get old and you retire and you pass the baton to me. And now I'm groomed to take over a strong leadership. But until we start looking at that broader ecosystem, until we start having those broader communications with all of the stakeholders, all of the impacted family members, uh, we're really falling short and creating risk for again, long term legacy and continuity. Maybe not so much the business, but for that family to stay connected. Which is why you and I are in this. We're not in this to have junior take over a company. We're in this to have legacy continue, uh, and be preserved generation to generation to generation. It's a very unique family. I was talking to two brothers or g2 about a week ago. They're not talking about their g3s were in the business. They're not talking about their G4s were just being born. They're talking about their G5, 6 and 7. They're really thinking generationally, 50, 100 years out. You and I are not likely ever going to meet our great, great grandchildren. We're just not, I don't think you and I are going to live to 150 years old. But to be thinking about that from a wealth preservation and a continuity perspective, it's just so powerful when we can get our families to go there instead of worry about is my son going to be it or is it my niece. Right. That black and white question really misses the opportunities within the family system.

Speaker A: Yeah, it's, it's, it's, it's, it's elevating from like a me to we scenario in relationship. Look at this field of how do I look at this so much further beyond where we are right now? One of the, I think one of the hurdles, you know, you look part of our job is to find the unsaid conversations that are occurring in, in the room. Like they're, they're there but they're just no one's elevated them or surfaced them and talk, talking about them. And that's a big part of our role to do that in a safe way so that we can work, work through them. And I think one of a very common unsaid conversation is with my rising generation now, whether they're, you know, I've had some families where some people, you know, as you like, for their shareholders, our spiritual are in and or out of the company. Right. And maybe there's class B and class A differential differentiations there, but there's still this still question of when mom and dad and or aunt, uncles are in the ecosystem. Decision making looks a certain way because the fabric of the system works with them, um, weighing in. But if we took them and just poof, they're all gone and now this, that rising generation, the now generation, that that's all that's left. What happens when the others aren't there to hold direct to guide to correct whatever it is? I mean how, what's the work that you feel is necessary in order to help assure the best viable outcome for that family system?

Speaker B: You and I both have the vision for what they need. It's sort of obvious to us as outsiders as we get to know these families, the dynamics we see parent, child could be uncle, nephew, you know, niece, aunt, whatever. Um, it's so clear getting them to embrace that and actually move forward is where the real work happens. We had a family in New York and again sort of that 80 plus year old billionaire and this was a real estate family, but he's still in the corner office, he's still making decisions. We're trying to help him pass the baton to his children's generation and his nieces and nephews who are now sort of in power, if you will, as now gentlemen, he couldn't do it. And I've got another 80 plus year old billionaire who literally bootstrapped from one gas station to an empire of 300, sold them off. And now you've got some diversified assets. And his response to me, if we tried to engage in this work and he had six children, by the way, um, Jeremy, what do I care? I'll be six feet under. Okay, that's one way to look at it. You're not going to do anything now because you're going to be dead. Uh, probably not the most helpful for your children. And so then I go a step further. Well, do we want to get them involved in philanthropy because they had a foundation and no, philanthropies aren't run effectively. I don't want to give them my money. So, okay, living in the state of California, you're saying you want the United States government to be your primary beneficiary upon your death because they're going to get called 50%. Your six children are splitting 50%, you know, and then his response is, sure, they're going to have more than I ever had and more than love or need. And granted, you know, I'd be happy to take $100 million if my parents passed away and live a happy, healthy life. But is that really what we want the message to be to our children? We don't care about their future. We don't want to do this hard work now and again. I'll go back to communication. You mentioned family councils. I could talk about family retreats. It takes that cohort, sibling, cousin group to come together and say, that's not good enough for us. Mom, dad, grandma, grandpa, like we want to figure this out now because we're terrified about how we're going to make decisions together when you're gone. And it's typically those now gents who try to engage me. I don't know about your practice, your direct clients, but it's not the matriarch patriarchs who are saying, I'm, um, worried about what happens when I die. They don't want to face mortality. It's their children and grandchildren who are saying, we are afraid we're going to end up in court suing each other because we don't have guidelines. No one's created, you know, for those boundaries for us yet. We need governance and the family constitution and all of those tools that you and I have in our toolkit. Um, but really, that's the work that these families need to do. Otherwise, you know, the attorneys among us get very busy trying to help these families unravel those really challenging, tenuous situations when we don't have the governance in place. That's why I draft a family business charter or a constitution. I want the leading judge, while they're alive, to be able to say, chris, I don't care if you keep the business or sell it. I want you all to be happy and healthy and do whatever your calling might bring you to do versus Kris. I hope you'll do everything in your power to keep the family enterprise going, because grandpa started it, and we want to honor his memory. Those are the kinds of things that families don't talk about until it's too late. You started with, we need to do this sooner rather than later, because the longer you wait, you know, the opportunities disappear. Whether it's the diagnosis or the death or in some cases, less tragic. It's just the divorce. But still you get these factions and splintering where families are no longer communicating about priorities and they're no longer staying together.

Speaker A: Yeah. Um, a friend, um, Jay Hughes, one of the things that he talks quite a bit about is the aspect of. For families that are able to navigate through generations of time are very good at focusing on the individual's ability to flourish, uh, as part of a member of the family system. And that might mean, hey, I'm going to flourish through doing something totally unrelated to what the family business does in holdings or whatever that is. But in order for that person to flourish, in order for us to get there, there, there needs to be some level of, to me, some self. Self actualization. Um, it could be some coaching, maybe even be therapy. I mean, it could be a combination of any of these things. That's. I've brought therapists into family systems many times where we just. And I've worked with therapists because it's just what was needed in order for that person to really get beyond things that have happened in the past or experiences those people have had. Or it could be multigenerational trauma, could be any of these things so that we can at least liberate ourselves to the degree to step into our. Our own empowerment and then get. Get clarity. And who am I? Why am I here? What do I want? And also, that's me. But then also, how does this fit into the greater realm of what I'm stewarding? And because I think if we're not investing in the education and development and self actualized actualization of these individuals. What can happen is what's passed down can become a burden and there's a weight. And if that person's not prepared adequately, it's another thing that can work against what we're trying to accomplish. David, does that raise anything on you? Jeremy, When I said it, it does.

Speaker B: Uh, and it brings me back to your word ecosystem. So I know we've called this the family business executive form and I know we typically talk about the business enterprise because that is the bank for the family. That is sort of what's most front and center in our communities. It's the business itself. Um, but as I'm listening to you and thinking about that ecosystem of supporting our rising gen so they can be successful and whatever they want to do, many won't come into the family enterprise. They'll have a different calling in life and pursue different avenues. Uh, one of my favorite current examples of this, a long time client of mine in the Midwest, um, pretty significant family, significant enterprise. One of the children. So at the fourth generation level, um, he got through high school, didn't love it, but he got to walk through graduation. Absolutely no interest in college or a trade school or any more education. Like at 18 he was good. Took a couple years for him to get a slow start and now he's actually working in a car dealership in what you and I would call a job. But he really treats it as much more of his calling of being in service with others and um, has incredible integrity and work ethic. The reason I bring him up is for years we could have said, I will give him a job in the family business, he'll be fine. But he didn't want the handout and he really didn't care about the widget making that this family does. He appreciated the legacy and the wealth it created, the opportunity it created for him. But he didn't really want to work with dad. He ends up in a car dealership working with others. Great. Well, they have a foundation and their foundation donates a lot of money every year to different causes. Um, one in particular was asking for money for a few different projects. Basically a retreat center to provide more opportunity for youth. It was this young 22 year old, I think he is now, who drove out to the retreat center, walked the property with the executive director, listened to all the things they wanted to do from a maintenance perspective and program enhancement. He's the one bringing back to the family. I think we should donate a dollar, whatever that dollar is to do this. Let's fund the food program, let's fund rebuilding of the cabins, whatever it was. So I absolutely honor him as a now gen stepping into a role of responsibility, creating that broader ecosystem for our family that uh, is just going to enrich their lives. Right? We talk about their family dynamics, they're going to become more connected through their philanthropy. So you and I get brought into the business. Typically that's what pays the billable hour for us to do work to sustain it. But there's so much more in that family system, especially when we're dealing with philanthropic families that are more motivated by community impact than ebitda, uh, and bottom line, net, uh, profits. So it's just really cool to see now gens who are not in the enterprise necessarily, but getting this whole new level of respect and appreciation. They're finding their own way in life. They're doing different things, whether they're gardeners or doctors or teachers or lawyers or anything. But they still get to contribute to the legacy of our family in really meaningful ways when we give them of opportunities and we empower them.

Speaker A: Excellent. Really, really good. Um, I'm going to share a couple, two slides real quick here and then we're going to go to any Q and A. Um, because we've only got less than 10 minutes left now. I'm watching. Yep, I'm here. Um, so question for you all. Uh, this is just more of a, of a pondering if you're, if your successor step into leadership tomorrow, would your ecosystem help them thrive or make them job harder? It's an interesting question because I've seen maybe not intentionally make their job harder either. Um, so a couple invitations here, uh, and then we'll uh, go to some Q and A and our additional conversation one, uh, our next family visit executive forum. Uh, I don't have a date. It's going to be in August. Uh, so you're signed up for this. You'll get an email about it if you want to attend that. I don't have the date set up yet, but we do these ongoingly about every six months or so or, sorry, six weeks or so. Number two, if you uh, are watching Jeremy and I and you're saying, you know, I really wish Uncle Jack were here. I really wish my mom were here. I really wish my siblings were here to listen to this and know you could send them the recording, Jeremy and I would be happy. Either one of us or both of us or both. If you wanted to invite us on, zoom into your family system to like read, to basically do a revited version of this conversation with your family. We would do that for you as our investment into our relationship with you and your family system. So that's an open invitation. Uh, and my email here is the bottom. Chris@chris yonker.com you can email me, you can get a hold of Dr. Uh, Jeremy also. He's on, uh, LinkedIn. He's got a web. Jeremy, what's your website? Can you share your website too?

Speaker B: Family? Sure. Thank you. Family Legacy first.com F A M M I, L Y L E G A C y. The number one s t dot com. Or if Chris said I'm all over LinkedIn, you can find me pretty easily there.

Speaker A: Yeah. So you get hold of either one of us and we'll, we'd be happy to, to, to co present, uh, this to your family privately to your family system on Zoom. Um, and then also if you wanted to talk, talk to myself or Jeremy or anyone on our team, uh, about kind of just exploring your readiness and want to just do, do a readiness conversation. Uh, we can, we have ways to, we have questionnaires, we have bullet points. Jeremy's created some content. I've created some content on gauging, we've a survey on readiness around succession. So those are open invitations to you, uh, to anyone, uh, out here visiting and watching, or if, um, maybe you're on here and you're representing a family, uh, that you're, um, an advisor and you'd like to introduce us, we're happy to do that for you also. And then you could be part of that, uh, as well. Um, if anyone has any questions, uh, you can raise your hand, drop a message to me. I'll be watching that. We got about five minutes left. Um, Jeremy, what are parting wisdom like? If I'm listening in and I know within 10 years our organization's gonna have a transition. Seven to 10 years and we're gonna have a transition which might feel like a real long time, but let's, I'd say seven years out, we better be actively doing something if we can, if we can do so. What would be, uh, a next thing? Sometimes this could be so overwhelming. What would be like a next step or like one or two things I could start thinking about or questions I could ask myself and, or family members or other owners?

Speaker B: It's a great question. And you and I regularly, when we're leading the longer talks and sharing the whole toolkit, it can be overwhelming, like drinking from a fire hose. Uh, so I always step back to what should my very next step be? Or if this resonates with me. And I'm realizing there's an opportunity here that I just, I didn't know what I didn't know before listening to this today. Um, how do I start? And for me, I'll go back to my message earlier. Life happened through communication. If this is resonating with you and you're thinking, gosh, we need to take some action, who's the one other ally or influencer that you want to share this with? And I don't mean introduce Chris and me, I just mean, you know, say, hey, I attended this really cool program about succession and I think we have an opportunity. Who do you need to get on board to have some buy in? Because this is a flywheel effect. You get a little bit more energy moving in the right direction, it's going to take off. You do not need to carry the weight of your whole family on your shoulders. Bear that bird on your own. I guarantee you there's a parent, a child, a sibling, a cousin, a someone who'd be really excited to get excited with you. And then from there, who else do we need to talk to or how are we going to have that form? Because at that point, you could be talking about your first family retreat. You could be talking about sort of a initial family council meeting. You get three, four, five people together and you don't have to talk about who's going to be our next CEO or maybe you don't have an operating company. More you are a family office who can be managing partner of our real estate portfolio. That's a seven to ten year proposition, as Chris was just alluding to. But, uh, in the next seven to 10 months, what do we want to accomplish together around rising gen, sort of now gen education or maybe around philanthropy to give people an opportunity to contribute to our family legacy and just kind of take one project, take one step beyond that next conversation to let's do something productive together, build some rapport and have a collaborative, energized, um, focus on our family. What does it mean to be a Yonker or a Lurie, to be a Johnson? Right. What are our core values? And again, I sound like I'm overwhelming you with all these different things, but I would start small with that first conversation, that first outlife or some buy in and then just keep rolling from there into one specific thing that you can take sort of a bite out of that apple moving forward.

Speaker A: Yeah. And I, I think I would warn folks in Regards to, you know, they're navigating succession. I find sometimes folks go and talk to other families and I think it's cool to talk to friends and colleagues and getting insight and counsel. But no two family systems are the same. They just aren't, period. And advising one family on what to do based upon the context of another family is not smart. It just really isn't because every family is different. And um, it's part of the reason we have, uh, we're in this field and we have businesses because there's a need. And knowing that like, hey, you've now, uh, I tell people like, hey, you've never done this before. And it's. And maybe you have, maybe you took over for your dad, but you've never passed on to your kids before. Like you've never done that and just you haven't and it's okay. But you can work with a guide who has always guided someone and then that's, you know, and that finding someone to help is, you know, and that can. Maybe sometimes it's in the financial realm or the family office realm or family survivor realm, whatever. But it's really, really helpful to build an advisory team. Team that has your best interest in mind, number one, based upon where it is that you want to go.

Speaker B: So yeah, and let's have that multidisciplinary advisory team. You and I are speaking from one piece of the pie, around the family dynamics and governance. Well, I need my CPA to do some tax planning if I'm going to sell from past sheriff's down. I need my corporate counsel to get involved in papering that. Maybe I need an insurance advisor to do a buy sell agreement or do something to create a key person policy to fund that transfer. There's so many very technical fields that become the full pie. You and I are just a piece of that pie and an important one, but we are truly just a piece of that pie.

Speaker A: Jeremy, thank you so much for taking time out and all of you that are, uh, hung in with us. Thank, uh, you for being here alive. I see all of you. Thank you for being here. And I don't see you physically, but I see your names and um, also. So m. We look forward to seeing you next time and uh, we appreciate it. M so thank you, Jeremy. And thank you.

Speaker B: Thanks Chris. My pleasure. Great to see you all. Thank you.

Speaker A: Blessings everyone. Okay, take care. Bye. Thanks for being here on the Enlightened Family Business podcast. If this conversation opened something for you, an insight, a challenge, a, uh, next step. Don't let it slip by. Family businesses One of the most complex and powerful vehicles for growth, both financial and personal, but only if you're willing to do the work on the systems and on ourselves. If you're ready to explore how custom governance, relational clarity and personal well being can help your family thrive across generations, please visit ChrisYonker.com or reach out directly. Additional Additionally, we run a Family Business Executive Forum about every six to eight weeks. You can get more information on this free webinar series@chrisyonker.com until next time, be well, lead with heart and stay connected.