www.horwath.com.ar cannexus 2009 national career development conference april 6-8 marriott eaton...

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Cannexus 2009

National Career Development Conference

April 6-8

Marriott Eaton Centre Hotel

Toronto, Ontario

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“Keeping the Family and the Business” Multi-generational career counseling

1. Evolutive stages, personal, familiar and entrepreneurial

2. Directive skills required for each stage

3. Total planning for success and continuity

4. Lab-workshop

Lic. Alicia Stivelberg

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Family Business

•F.B. are alike•F.B. are unique

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Continuity

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Continuity

70%disappears in the second generation

87%disappears in the third generation

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Two logicsConflict Zone

FS

Agreement Zone

Society of Feelings Society of Interests

Permanent Membership Temporary Membership

Subconscious Behavior Conscious Behavior

Introvert System Extrovert System

Minimize Changes Promote Changes

BS

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Case studiesCase A Family

2 school-age children

Case B Family 2 children at universityParents work together

Case C FamilyParents work with their son and son-in-law

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Three Dimensional Model

property

family

2

1- Family Owner Manager2- Family Owner3- Owner Manager4- Family Manager

business

31

4

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Individual goals Financial security

Family goals Better lifestyle

Company goals Capital

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Building a successful business demands a lot of

energy, trust, talent, hard work and ... luck.

Each successful Family Business is, in a way,

... a little miracle.

Family Business

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Family and Family Business Life Cycles

Founder

Brothers/Sisters Association

Cousins Confederation

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Example 3 rs

R

R

R

•Rivalry•Resentment•Revenge

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•Respect for self •Respect for others •Responsibility for all our actions

Example 3 rs

R

R

R

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Family and Family Business Life Cycles

Founder

Brothers/Sisters Association

Cousins Confederation

Young Families

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Some day, my son, all of

these will be yours!!!”

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Family and Family Business Life Cycles

Founder

Brothers/Sisters Association

Cousins Confederation

Young Families

Incorporation FB

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Family and Family Business Life Cycles

Founder

Brothers/Sisters Association

Cousins Confederation

Young Families

IncorporationFB

Working together

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Family and Family Business Life Cycles

Founder

Brothers/Sisters Association

Cousins Confederation

Young Families

IncorporationFB

Working together

Handing over the

baton

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Parents age

Children age

Work Quality between Parents and Children

55

50

45

40

35

30

25

20

15

35 40 45 50 55 60 65 70 75 80 85

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Family and Family Business Life Cycles

Founder

Brothers/Sisters Association

Cousins Confederation

Young Families

IncorporationFB

Working together

Handing over the baton

Initial stage

Intermediate stage

Maturity stage

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- Initial stage

Evolutive stages

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- Intermediate stage

Evolutive stages

- Initial stage

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- Initial stage

- Intermediate stage

- Maturity Stage

Evolutive stages

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3 Questions

1. In which stage would you say your company is?2. How difficult would it be to promote the growth?3. Do you want your company to continue in the family and pass

to the next generation?

PPP

Evolutive stages of FB

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Management

Creativity

Decentralization

Change to grow

Coordination

Collaboration Crisis?

BureaucracyCrisis

Autonomy Crisis

Leadership Crisis

Control Crisis

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Change to grow Evolutive stages of a Company

MATURITYYOUNG

SMALL

BIG

Stage 1 Stage 2 Stage 3 Stage 4 Stage 5

Leadership Crisis

Autonomy Crisis

Control Crisis

BureaucracyCrisis

Crisis?

Creativity

Management

Delegation

Coordination

Collaboration

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MATURITYYOUNG

SMALL

BIG

Stage 1 Stage 2 Stage 3 Stage 4 Stage 5

Leadership Crisis

Autonomy Crisis

Control Crisis

BureaucracyCrisis

Crisis?

Creativity

Management

Delegation

Coordination

Collaboration

Change to grow Evolutive stages of a Company

At each stage of evolution,Follows a revolution stage

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Family Business Evolution

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It is a family concern in several aspects

Mother

Outlines Owner´s Role

Father´ssister

HarmonyIn theFamily

Father

Fairness and Equity

DaughterSon-in-

low RelationshipFamily

members

Partner and Minoritary Owner

Familycouncil

Eldestson

FamilyCompensation

Family Real State

Board of Directors

Owner´srol

NewSubsidiary

SUCCESSION

SUCCESSION

Planning for success

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Components of F.B. planning

1. The owner´s plan

2. The family´s plan

3. The company´s plan

4. The succession´s plan

Planning for success

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Planning Process

OWNER PLAN

“Hard”

FAMILYPLAN

COMPANYPLAN

“Soft”

SUCCESSIONPLAN

• Board of Directors.• Family Council.• Compensations.• Contract of shareholders.• Job position Profiles.• Roles.• Governability.• Equity.• Mission of the Family.• Rules of Employment.• Transfer of leadership.• Communication.• Conflict Management.• Personal Goals.

• Economic and Tax Planning.• Preserve of wealth.• Transfer of wealth.• Donations.• Life Insurance.• Valuation of the business.• Structure of the business.• Portfolio of investments

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THE PROCESS

FamilyPlan

CompanyPlan

What does the owner want?

Feasibility of the intention

The Succession Plan

Financial Security

Contracts of Shareholders

Future Leadership

Legal Aspects

Equity

Net worth

Execution

Planning for success

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PLANNING TEAM

Banco

Deño yEsposa

AsesorLegal

Planning for success

Bank

Owner and

Spouse

Board of Directors

Family Business

Consultant

LegalConsultant

Investment Consultant

PsychologistFamily

InsuranceConsultant

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Planning for successThe process of planning for succession

1st.Step1st.Step

2nd.Step2nd.Step

3rd.Step3rd.Step

4th. Step4th. Step

5th. Step5th. Step

Planning objectives to confirm

and achieve feasibility

and compatibilit

y

Developing a Preliminary

plan

Comunicating and sharing the

preliminary plan, creating consensus and

reviewing

Defining what the owner,

family and company

want

ImplementingThe plan for the

Owner, the familyAnd the company

Modelling the Financial results of the succession

Providing the Owner´s financialneeds

Defining the redistribution of the present and future net worth

Identifying and planning the future leadership

Developing a shareholder´s agreement, fairness, capital transparency and control of votes.

Talking to the owner (Peter)

Talking to his wife (Joan)

Talking to the family

Reviewing, assessing, modifying and bringing together personal goals

Analizing the company circunstancies, finacial stability, valuation and business plan

Defining theOwner´s finantialNeed

Clarifyingleadership needs and capabilities

Developing alternativesTo achieve the concept of Fairness by the ownerAnd the family

Protecting and Preserving the company for theNext generation

Retirement fundsWealth preservationManagement teamOportunitiesRules for the practice of Power and shareholdersAgreement

Involves theOwner and The spouse

Family meetingsEstablish a FamilyCouncil

Involving the consultantTeam, directors, lowyer,Accountant, insuranceConsultant, investment, Bank, and so on

Modeling a financial plan with the owner, family, and company perspective

Reviewing until finding the best plan

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Governance

PropertyBoard of Directors

FamilyFamily Council

2

BusinessManagement

31

4

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Genogram Dublin Family, Owners of Arlington Machinery, Inc.

Succession Plan

Housewife. Her

husband is

Headmaster of a

College.

She is starting her

Business career in

NYC after her MBA

To be employed

soon by

Arlington

Arlington employee

during 18 years

Peter Joan

Phill Ariane

Jack Susan RandyArlington employee

during 10 years

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Score of the team members

Thinking Styles

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TEAM MAPThinking stylesLocation of the team members in the structure of four styles of Value Drivers

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Values structure

Choosen Values: First to Third

Scores Value TotalTheoretical

Materialistic

Humanitarian

Theoretical

Power

Materialistic

Ritualistic

Spiritual

Humanitarian

Individualistic

Aesthetic

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Planning for success

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Thank you!!!My e-mail is : astivelberg@horwath.com.ar