Mom and Dad Won't Talk
By Drew S. Mendoza
"I've been working at the company owned by my parents for seven years and every time I try to talk to them about a transition plan for ownership, they put me off. What can I do about it?” This is a question that family business consultants often hear. While there are many different scenarios under which this question is posed, let’s focus on a business with an only child who is working for parents who are the sole owners of the enterprise. More complexities are involved if siblings, aunts, uncles or non-family owners are involved.
The first piece of advice in this situation is: Stop asking Mom and Dad to discuss ownership transfers. As the saying goes, repeating the same action and expecting a different outcome is unrealistic to say the least.
Instead, try posing this question: Mom, Dad: I have tried to gently nudge you both into a discussion of planning for the company’s transfer of ownership. You seem to be uncomfortable having that conversation. So, I would like to ask you this question: Are you uncomfortable, and if so, why do you not want to have this conversation?
They may say, “We’re not ready” or “We don’t think you are ready” or “We don’t think the company’s stakeholders are ready.”
Regardless of their answer, it opens the door to this next question: What do they envision needs to change or be different to be ready for this conversation? What we are looking for is the source of their resistance. That is the lynchpin because until mom and dad can articulate their resistance, all the pushing and prodding in the world isn’t going to change their behavior.
If I were having a conversation with the next generation member, a question I would want to ask is this: What did you and your parents agree to when you took the job? Did you all express any hopes or intentions that you would someday take over ownership of the business? It is not unusual – and I mean no offense – but it is not unusual for a child to accept employment in Mom and Dad’s business because it is the path of least resistance – at least on the surface. Once you’re working there you learn pretty quickly that maybe the job wasn’t all it was cracked up to be; working beneath mom or dad’s critical eye can be very difficult. But, the point is – did they tell you that they plan to give or sell you the business? If not – maybe that is the ideal starting point. I would advise initiating the conversation with this question: Mom, Dad: do you want me to someday own this business? If they say no – ask them this question: Why?
What we are trying to do is identify their motivators. If they are not passionate about their child owning the business, this may be a case where expectations are not aligned and it may make most sense that the child consider looking for employment elsewhere. After all, it is their business. Maybe they’re afraid that you don’t have the production potential to buy the business from them and they haven’t planned aggressively enough for their retirement and will need to sell the business to a cash buyer.
All of this is leads us down a path to this central theme. Change your tactics. Identify mom and dad’s objections. Help them articulate a vision for the company’s ownership. Honestly acknowledge their concerns and objections. Find ways to address their objections. And, if all else fails, do not blame them; you are probably just as guilty as your parents in making assumptions about your employment in the business as they are. It is time to get those assumptions out on the table and address them as business people. You may find that your ownership of the business isn’t in the cards. If so, it may very well be time to start looking for another job.
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