“Who should be our next CEO?” “Can we trust non-family directors to make decisions?” “Should our cousin be bought out?” Family businesses face difficult decisions daily. Decisions that can have significant implications on the success of the business and the health of the family. But who makes which decisions? Can family members pressure management on operational choices? Can a CEO dictate a family member’s education?
This is where the four-room model comes into play. According to Josh Baron and Rob Lachenauer, the four-room model establishes four distinct decision-making areas within a family business. Each room has its own power structure and addresses specific issues. This model creates boundaries that allow each section of the business to operate at its full potential.
Read “Making Better Decisions in Your Family Business” to learn about the four decision-making areas of a family business. Be sure to read until the end. You’ll learn about the common decision-making challenges family businesses encounter.
Read about the four decision-making areas of a family business here.
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