Post on 16-Apr-2017
Nurturing Talent in Family Business
Welcome
Mr Bryan BourkeWilliam Fry
Dr Eric ClintonDCU CFB
Welcome
Guest Facilitator
Ms Amy SchumanFBCG, USA
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Nurturing Talent in the Family BusinessDCU Centre for Family Business Amy SchumanThe Family Business Consulting GroupSeptember 27, 2016
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Family Business Utmost Challenge – Tremendous Opportunity
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I think old man McGuffy went a little too far trying to be fair to his boys.
9Why Me? Series, John L. Ward et. al.©
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Research Shows Family Businesses Out-Perform• Return on Assets• Return on Investment• Profitability• Best Places to Work• And….
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Sources of FB Success•Purpose•Strategy•Culture•Paradox Mastery
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US Best Places to Work – Fortune, 2014
1. Google Public2. SAS Private3. Boston Consulting Group Private4. Edward Jones Private5. Quicken Loans Private6. Genentech Private7. Salesforce.com Public8. Intuit Public9. Robert W. Baird & Co. Private10. DPR Construction Private11. Camden Property Trust Private12. Wegmans Food Markets Private13. David Weekley Homes Private
14. Burns & McDonnell Private15. Hilcorp Private16. CHG Healthcare Services Private17. USA Private18. Southern Ohio Medical Center Non-profit19. Baptist Health South Florida Non-profit20. Ultimate Software
Public21. Kimpton Hotels/Restaurants Private22. W.L. Gore & Associates Private23. Plante Moran Private24. Scripps Health Non-profit25. Atlantic Health System Non-profit
(17 Private, 4 Non-Profit, 4 Public)
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HR and your Business Today?
• No dedicated HR Dept.
• Small HR Dept. focused on salary, benefits, hiring, compliance, etc.
• HR as one important staff function along with Finance, Legal, IT, etc.
• HR as strategic partner functioning at highest level of the organization.
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HR and your Family Today? • No contact between HR and owning family.
• Rarely, HR provides support/input to family.
• Frequently, HR helps the family with matters related to their careers and to family relationships.
• HR is an essential participant in discussions and problem resolution regarding the family.
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Stages of Growth for HR
STAGES
OF
G R O W T H
FOR
HR
1 1000+
Founders/Managers take care of HR function
HR administrator Focused on Transactional HR
tasks Some recruiting support
Small HR Group Focused on transactional
HR functions Basic organizational
development functions
HR Strategic Partner HR Department Focus shifted to
Organizational Development
Strong HR infrastructure
Number of Employees
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Size & Complexity of Family Business
HR Development Path Drivers
Small, uncomplicated family business
Large, complex multi-location, multi-generational family enterprise
HR done by Management No HR group per se May have HR admin clerk
Entrepreneurial stage – start-up and early growth
Single location
Single HR professional Focus on Transactional HR tasks Some recruiting support
Strong growth over short period of time Location expansion
Small HR Department Growing need for standard HR systems
and structures Focus on transactional HR functions Basic organizational development functions
Multiple locations Geographic expansion Acquisitions At least 2 generations involved in business Initial focus on building culture
HR Strategic Partner Large HR Department Strong HR infrastructure Strong focus on organizational
development
Regional, national, and global presence Multiple locations Multiple business units Global expansion Multiple shareholders and across multiple
generations
Source: Ransburg, Sage-Hayward and Schuman (2015) HR in Family Business: Harnessing the Power of Your People.
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Your Goals for the Conference• What are your greatest HR-related strengths?
• What are your greatest HR-related improvement opportunities?
• What are the strengths and vulnerabilities of your family and business culture?
• How do you recognize and manage the HR paradoxes of your family business?
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Human Resources in the Family Business: Our Model
Source: Ransburg, Sage-Hayward and Schuman (2015) HR in Family Business: Harnessing the Power of Your People.
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Are Family Businesses Different?
• Are HR functions different in a family business? How?
• What are common challenges, and how to address?
• How can HR help with sticky issues and be a strategic partner?
Ms Catherine O’FlynnWilliam Fry
Guest Adviser
DCU Centre for Family Business Workshop
Catherine O’Flynn - Employment Partner
27 September 2016
Overview
Introduction
Policies
Procedural Pitfalls
Case Study
Employment updates 2016
Essential Policies
Essential Policies
1.Grievance
2.Disciplinary
3. Anti-Bullying
4. Harassment
5. Equality
Grievance and Disciplinary
Refer to relevant policies and procedure
Ensure compliance with LRC Code of Practice on Grievance and Disciplinary Procedures
Recommended Policies
IT Social Media Data Protection
Procedural Pitfalls
Follow fair procedures Inadequate investigation is a frequent cause of legal challenge The majority of successful UD claims tend to involve
procedural flaws
Unfair Dismissal Close Relative Exception
Protection does not extend to:
“a person who is employed by his spouse, civil partner, father, mother, grandfather, grandmother, step-father, step-mother, son, daughter, grandson, granddaughter, step-son, step-daughter, brother, sister, half-brother or half-sister, is a member of his employer’s household and whose place of employment is a private dwelling-house or a farm in or on which both the employee and the employer reside”
Case Study
Conducting an investigation in a family business
Difficulties – “nepotism” accusations
Independent investigator
Employment Law Updates
Retirement Age Adoptive Leave
Paternity Leave
Nurturing Talent in Family Business
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Case Example: Kwik Trip
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Case Example: CrisisCO
• Recruitment woes threaten new plant opening
• Confused roles & reporting relationships• Traditions weakening – culture shifting• Family members advocating for their
children• Turnover rising• HR not seen as making a positive
contribution
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Human Resources in the Family Business: Our Model
Source: Ransburg, Sage-Hayward and Schuman (2015) HR in Family Business: Harnessing the Power of Your People.
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Stakeholder Vision/Values“Yes, of course we have heard of shareholder value. But that does not change the fact that we put customers first, then workers, then business partners, suppliers and dealers, and then shareholders.”
Wendelin Wiedeking,CEO PorscheFT 10/8/05
“Our purpose and goal is to create maximum wealth possible. Anything else would be socially unacceptable and unfair to our owners.”
French Second Generation Firm
“To crush my enemy. To see him driven before me and to hear the lamentations of his clan.”
Conan the Barbarian
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Recruiting:A Reverse Funnel Approach
Success Factors in Family Hiring• Clarity on whether
family employees are wanted or not
• Guidelines for family employment
• Boundaries regarding contact and interaction
• Access to information for all
• Transparency – being open and honest about decisions
• Balance between formality-informality in recruiting process
Success Factors in Non-Family Hiring• Experience working
in a family business or appreciation of values
• A self-confident team player focused on development of others
• A genuine caring for the family
• Superb communication skills
• An ability to visualize and share what they want as their own legacy
Source: Ransburg, Sage-Hayward and Schuman (2015) HR in Family Business: Harnessing the Power of Your People.
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Selection Processes
Pitfalls• Letting fear drive
selection
• Putting candidates on a pedestal
• Over relying on your gut
• Blurring the boundaries
• Forgetting to communicate selection decisions to the wider family
Source: Ransburg, Sage-Hayward and Schuman (2015) HR in Family Business: Harnessing the Power of Your People.
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37Source: Ransburg, Sage-Hayward and Schuman (2015) HR in Family Business: Harnessing the Power of Your People.
Onboarding Process
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Performance
Evaluation & Gap
Analysis
Coaching and
Feedback
Learning
Development
Planning
Job Description
Continuous Cycle of Development and Learning
Key Principles:
• Mutually Beneficial
• Intentional and purposeful approach
• Focused on capability and culture
• Understanding and appreciation for family business challenges
Source: Ransburg, Sage-Hayward and Schuman (2015) HR in Family Business: Harnessing the Power of Your People.
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3939Why Me? Series, John L. Ward et. al.©
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Exits as a Transition not an Event
Involuntary ExitsVoluntary Exits
Source: Ransburg, Sage-Hayward and Schuman (2015) HR in Family Business: Harnessing the Power of Your People.
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4141Why Me? Series, John L. Ward et. al.©
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InnovationEmpowermentPerformance
TeamworkChange
LeadershipEfficiency
ProfitabilityQuality
CommunicationCreativityLearning
Continuous ImprovementEntrepreneurship
ExcellenceCustomer Service
CourageDignity
ReputationFairness
Open-mindednessAuthenticityHard Work
StewardshipDependability
EmpathyCuriosityHumility
DisciplinePrudenceSincerity
Do The Right Thing
Family Business Values are Different
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Family Business Culture
What we do
What we say
What we believe
What we value
What we measure
How we are
organized
Conscious Culture
Concept of a conscious culture:• where your culture comes
from
• what you would like your culture to be
• how to build the culture that’s right for your family firm
• when and where to monitor it to ensure it stays on track
Source: Ransburg, Sage-Hayward and Schuman (2015) HR in Family Business: Harnessing the Power of Your People.
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FBCultur
e
Family Characteristics
:-Generation
-Religion-Ethnicity
Ownership Goals and Objectives
INTERNAL INFLUENCES EXTERNAL INFLUENCES
Firm Size and /or Business Direction,
Structure, Processes, Systems, Procedures
Family Values,
Vision, & Mission
Industry
Geography• Country• Regional• Political
climate
Market Opportunity
Customer Demographics
Factors Shaping a FB’s Culture
Source: Ransburg, Sage-Hayward and Schuman (2015) HR in Family Business: Harnessing the Power of Your People.
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Where does culture come from?
Source: Ransburg, Sage-Hayward and Schuman (2015) HR in Family Business: Harnessing the Power of Your People.
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Family employee recruitment
• Establish clear guidelines re: employee qualifications• Create boundaries between business and family
decision-making processes• Inform family members about the business on an
ongoing basis (e.g., internships, rotational programs, dinner table conversations, etc.)
• Remember that family members can play important nonemployee roles (e.g., philanthropy, family council, etc.)
• Successful recruitment requires that employment makes sense for the company and the (potential) family employee
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Family employee selection
• Establish clear job terms (e.g., job description, qualifications, reporting relationships, compensation, and performance assessment approach)
• Assess the fit between candidate and company in terms of job requirements and company culture
• Consider both inclusion and merit when hiring family members
• Create company-wide policies with guidelines for employment terms (e.g., compensation, benefits, professional development, etc.)
• Communicate hiring decisions with the candidate first, followed by the Board, other candidates, the broader organization, and the family (in that order)
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Family employee onboarding
• Provide new family employees with the same onboarding experience as nonfamily employees – don’t assume they already know their way around the company
• Ensure that new family employees have broad exposure to other employees early on – family employees often have a tendency to interact only with other family employees
• Clarify any additional onboarding plans (e.g., family employment guidelines, assignment of family mentor, etc.)
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Family employee development
• Provide family employees with the same evaluation and development as nonfamily employees as a starting point
• Recognizing that family employees may eventually become owners, allow them the opportunity to develop their ownership skills (e.g., observe board meetings, attend family business conferences, etc.)
• Family employees should report to nonfamily managers whenever possible
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Family employee exit
• Take care to ensure that a family employee’s exit from the company does not also result in an exit from the family (e.g., keep in touch with family employees after they leave the business)
• Establish a policy re: the number of times a family employee can depart and then re-enter the business
• Treat family employees the same as nonfamily employees when it comes to the logistics of an exit (e.g., severance, outplacement, etc.)
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Remember…• Every company is unique; your HR function will have to fit your situation.
• Liberate HR from the shackles of policing and monitoring; deploy HR as a strategic partner.
• Face family employment challenges honestly; manage family employees actively and fairly.
• Recognize your greatest HR-related paradoxes; embrace the ‘both/and’ mindset.
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Maharana Shriji Arvind Singh Mewar
76th Generation Trustee of the House of Mewar
“Change rarely invalidates the past and it does not necessarily imply a rejection of the old. I believe in the past, but my feet are firmly rooted in the present and I’m constantly thinking about the future. A great deal can and should be preserved from the past. In particular we should treasure the ancient and selfless values that have stood the test of time.”
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Thank You!
Amy SchumanPrincipal, Family Business Consulting Group
schuman@efamilybusiness.com
Nurturing Talent in Family Business
Q&A
Thank you!!!
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