Harmonizing Heart & Strategy: The Secret To Successful Family Business In 2024
By Mike C. Young
The ever-evolving corporate environment of 2024 presents both uncommon obstacles and prospects for family-run businesses.
Whereas traditional business competencies such as financial literacy and strategic foresight continue to be vital, the role of intangible skills like affection, empathy, and efficient communication are just as important. Emotional intelligence attributes, along with solid business strategies, can enhance the prosperity of any family business.
The influence of empathy and retention
In any successful family business, love and empathy stand as the foundation. They encapsulate the capacity to comprehend and reciprocate the emotions of both family and employees. This emotional connection fosters a supportive work environment, which in turn enhances employee satisfaction and loyalty. Ernst and Young recently conducted a study that substantiated that corporations with empathic leadership retain more quality employees compared to their competitors.
Workers want to feel that their personal and professional needs are being met, which requires being listened to and understood by leadership. As was seen during the Great Resignation, the pandemic magnified those expectations among employees. Empathy also is instrumental in conflict resolution – often prevalent in family businesses – by endorsing a corporate culture rich in transparent communication and mutual respect.
Love: The invisible corporate equity
Love, frequently undervalued in conventional business structures, plays a significant role in family business. It fosters unity and allegiance that could potentially propel the business to greater heights. Author of the book The Soul of Family Business, Tom Hubler, underscored how family-run businesses bolstered by love often thrive over an extended period; these connections lead to profound dedication towards achieving entrepreneurial success.
Hard Skills: The backbone of Family business success
Soft skills – which are behavioral and include communication, teamwork, adaptability, problem solving, and
conflict resolution – are essential to business success. But they
must be complemented by hard business skills to truly optimize success. Hard skills, unlike soft skills, can be quantified and are technical skills required to perform a job.
Financial literacy, for instance, is critical in making informed decisions that affect the business’s bottom line. Family business leaders should be adept at understanding financial statements, budgeting, and capital allocation. If they are not, they need to have staff that have the right competencies.
Strategic planning is another key hard skill. It involves setting long-term goals and devising a roadmap to achieve them. This is particularly important in family businesses, where balancing family goals with business objectives can be challenging. A well-defined strategy can help align these goals and ensure long-term sustainability.
Combining soft and hard skills
The integration of soft and hard skills can create a harmonious and productive business environment. For instance, empathy can enhance leadership effectiveness, making strategic decisions more inclusive and considerate of different perspectives within the family business. Similarly, love and passion for business can fuel the perseverance needed to overcome challenges and achieve strategic objectives.
Education and training
Investing in education and training is essential for developing both sets of skills. Many universities and institutions offer specialized courses and workshops for family businesses. For example, the Kellogg School of Management offers a Family Enterprise program focusing on both the interpersonal dynamics and the strategic complexities of family businesses.
Running a family business can be very rewarding, creating a lasting legacy and strengthening the bonds of love and loyalty. The success of family businesses in 2024 hinges on a balanced approach that values both hard and soft skills. Empathy and love are not just familial bonds but strategic assets that, when combined with strong business acumen, can lead to sustainable growth and success. As family businesses continue to evolve, those who embrace this holistic approach will be well-positioned to thrive in the competitive business world of tomorrow.
About The Author
Mike C. Young (https://mikecyoung.com), author of The Farmer’s Code: How Legacies Are Built, is the leader of the fourth-generation family enterprise Wegis & Young. The business, with deep roots in agriculture and real estate, benefits from his guidance across three generations of shareholders. Young’s leadership philosophy is anchored in nurturing values like love, respect and integrity, while creating a culture of profitable and ethical businesses. As an accredited iEq9 Enneagram practitioner, Young leverages this expertise in his role as a leader, mentor and coach, focusing on the development of emerging leaders. His goal is to empower them in creating enduring legacies. Additionally, Young is an active member of the Young President’s Organization (YPO) and a member with Alder (Alder.co.).