Will Your Family Business Last 500 Years?


“We don’t do that in this family.”

I spoke those words recently to my oldest son, Remington. My youngest son, Winston, was having trouble feeding the dogs and getting them into the kennel for the night.

It was bitterly cold. And Winston was outside struggling in the darkness. Remington noticed this, but did not offer to help because he had done the dog chores that morning.

While fulfilling one’s assignment is important to me; helping one another in times of need is a Schaefer family core value. My boys needed a reminder.

Values are powerful

Shared values are the glue that hold families, and particularly family businesses, together.

When values are discussed, agreed upon and regularly reaffirmed, then families in business together find it easier to develop a solid business culture.

And, when such values transfer across generations, you gain consistency of purpose, competitive advantage and family harmony. Aligned company values are a powerful force. They serve as a rudder keeping a company on course in stormy seas.

I work with family businesses before and during transitions. Sometimes disagreements, competing agendas, and hurt feelings keep the process from moving forward. Often no one within the business can put their finger on any one issue that is holding the family business from being successful.

Thinking back over these cases, I can’t remember a single time where a difference in family values and business culture wasn’t a reason for the conflict. Often misalignment of Values is THE core reason behind the conflict.

Values: What are they?

I often work with family businesses with high moral and social standards. Discussions about values initially is difficult for these companies, because they tend to assume that a conversation about values questions their morals and integrity.

But, a discussion about values is not passing moral judgment on anyone. Rather, values are desired standards, beliefs, and behaviors.

Values represent a cornerstone or “true north.”

Values should be slow to change, though a businesses’ strategic plans should regularly change and adapt.

Cargill is one of America’s most successful family businesses. Whitney MacMillan, CEO of Cargill, once stated, “As a company, we have believed in the same values for 125 years, even though we have changed the business every five years.”

A discussion can bring family values and business culture into alignment. This, in turn, creates a solid base for decision-making and planning in the family business.

How to align values

Don’t expect family values and business culture to be evident and easily put down on paper. They can be hard to pin down.

  • Get input from as many people as possible.
  • Conduct surveys. Have face-to-face interviews.
  • Organize a family retreat.

It may seem chaotic having many people involved. But, would you rather find out what they think now or later when emotions are high? That would have long-lasting effects.

Many families have found the best option is hiring an outside advisor to run the project, keep it moving and work through obstacles as they arise.

Here is an example of a values statement with a “family” bent:

  • Work hard and take risks
  • Honor and have faith in God, Be Humble
  • Establish strong relationships with employees, family and others
  • Create a profitable & sustainable business for future generations
  • Be a servant leader
  • Treat others with respect

Down the road when you craft a strategic plan, transition plan or family governance, use your values statement as a guiding light. Every action, inaction, agreement or plan should take into account the Values.

Values can atrophy

It is natural as families grow for the values statement to weaken if it is not regularly discussed and reaffirmed.

There is inherent conflict where family values and business culture cross.

Families are based on bloodlines and tradition while inclusion into the business tends to be based on merit. As family businesses grow past the founding generation, it is more important than ever to create clear boundaries between family and business. Family values and business culture is the glue that holds the two parts together.

Time well spent

The Beretta family has been in business since 1525 — nearly 500 years. Take a look at their values:

Beretta Family Values

  • Prudence and audacity
  • Personal freedom: The “Power of One”
  • Invest in new technology every year
  • Quality without compromise
  • Ancient art of craftsmanship with the latest technology
  • A finely tuned organization is crucial to success
  • Believe in and like the product you make
  • Systematic innovation: processes, procedures, and equipment

How hard to you think it was for the Beretta family to craft their vision, strategic plan, and family governance after they thought through their values?

One of my core values is that family helps family when someone is in need. Remington, whom I mentioned at the outset, needed to learn to help his brother. At the same time, Winston needed to learn he could depend on his older brother when times get tough.

Two days later, on another cold Minnesota night, I noticed the boys putting the dogs to bed together.

Clearly, taking time to discuss on values is time well spent.