The Complex Role of Culture Inside the Families of Family Businesses

Grazing the surface of the importance of healthy relationships in family business––Jim Grubman and Dennis Jaffe speak upon the roles that adaptation and communication play in family enterprises around the world.

This is five questions in five minutes, in partnership with Tharawat Magazine and Family Firm Institute, Inc.

What Is Your Topic About?

Jim: We have looked at the role of culture in families. We’ve looked at how the role of several different aspects of culture play in a family business. And we’ve looked at how navigating the changes across time in those cultures is a big impact on how a family adapts to wealth.

Dennis: These families are incredibly complex systems and we’re adding even more complexity to it because every generation, a family enterprise has to reinvent itself with a new cast of characters and a new set of challenges. We’re using the cultural perspective to help a family see how to bring them all together and move them across the generations with many generations, sometimes living and working side-by-side.

Why Are You Passionate About This Topic?

Dennis: As a grandparent and as a parent and as a son of a family, the challenge is to be a mentor to people in the next generation and to help them see that they don’t have to sit back and just do what they’re told. That there really is a point where they can discover something that they can do that’s very special in their family and how each generation has a different role to play.

Jim: What’s really exciting about the work that we’re doing is framing it through the lens of culture in these various sorts of ways. This really helps the elder generation understand that they can be balancing tradition and adaptation in a way that works out respectfully for the family, for the heritage of where the family comes from. And yet, at the same time, prepares the family for the future.

Why Is This Relevant to Family Businesses? 

Dennis: It’s such a complicated process for families to go through. One family member in the 15th generation of a family business said, “You know, we’ve gone through more change in the past 20 years than we did in the other 14 generations.”

There are so many things that are different and new n family businesses. And I think what we’re trying to do is to help the families see that the role of the transition. Adaption and change is not just to do all the right things, but to take an opportunity to rethink and redefine their business in ways that they probably didn’t even think about before.

Jim: We find that there’s a process of becoming very successful for families. Nobody ever tells them the things that they’re going to need to know once they become successful. And when we try and help families navigate this, it’s what we call the land of wealth.

How Can Families Apply This to Their Own Businesses?

Dennis: Once they get there in a way that they were not prepared for, it’s amazing. Those who work with families find that they somehow, even though they’ve been together their whole lives, are afraid to sit down and talk to one another. They’re afraid things will get out of hand. They’re afraid that people will make the wrong assumptions when they’re actually already making them. And they’re just not talking about them. Families need a lot of help and handholding to feel comfortable doing what you know should be natural.

Jim: There needs to be a vehicle for working on any of those. And there has to be a process for family communication. The very first place that families must start is to just take the step of talking to each other openly.

What Do You Like Most About Family Businesses?

Dennis: For me, it’s about the future that the world has some immense problems and you have the majority of the world’s wealth and families and families care about the future and they care about each other. I find it really exciting that families can take the resources they have which are sometimes immense and say, “We’re going to do this. This is what’s important. This is what we think has to happen.”

And then they could make it happen.

Jim: We are living in an exciting time for family businesses, family enterprises in the modern global world. Now we are living and helping families during an era in which huge change is occurring, including the knowledge about family businesses. And so we are living in a time that’s just innovative and exciting to be part of the field.