Professional managers are increasingly playing a bigger role within family businesses as families seek to compete in a global marketplace, and realise they have to look outside the family for top talent. The vital role of these managers play in professionalizing family business was discussed at the first meeting of the Family Capital Professional Managers Group in association with KPMG.
At the event held in London on April 14, 20 CEOs and senior managers from family businesses and family offices discussed a range of issues related to the relationship between families and non-family senior managers. The keynote speaker was Patrick Thomas, the ex-non-family CEO of luxury goods company Hermès.
During a spirited discussion, the attendees suggested that several key attributes are useful for non-family senior managers/CEOs if they are to flourish in a family-controlled business.
Values. Although it is the role of any CEO to drive the business forward, attendees reckoned that this was probably easier to do so if CEOs and senior managers shared the same values as those held by the family, which in its most tangible sense means commitment to the long-term.
Patience. Non-family CEOs must realise they are not part of the family and need to have a good ability to listen. Overall, patience is very much a virtue at a family business.
Trust. It goes without saying that a senior manager/CEO needs to be trusted, but this tends to go even deeper at a family business, because trust between family members has often played such a key factor in the success of the business through its growth cycle. Of course, it also works the other way round, and non-family managers need to be able to trust the family as much they themselves need to be trusted.
Loyalty. Some might say this is an old fashioned attribute in today’s fast-paced business world, but loyalty is often rewarded at a family business. Often non-family senior managers/CEOs have been linked to the business for years, in many cases 20 years and more. And of course loyalty helps to foster trust.
Chemistry. It might be intangible, but for a non-family manager to flourish in a family firm there has to be a personal spark between them and family members. Obviously it is desirable between senior people in any organisation, but in a business where the owners care so deeply it is even more vital – and it helps to reinforce all of the other attributes.
“With nearly four in five family businesses welcoming non-family expertise to their management team and a quarter planning to appoint a non-family CEO, according to our research, the role of professional management in the sector is a hot topic,” says Gary Deans, KPMG’s UK head of family business.
“The trade of wisdom and expertise gained from external roles for the trust of the family in running their enterprise’s operations can be a delicate, albeit fulfilling negotiation and this event was a well-received initial opportunity for non-family managers to debate what works well in family business.”
The Family Capital Professional Managers Group in association with KPMG is a new grouping for non-family managers which will meet several times a year. The next meeting will be in October in London.