The intention of this technology is to make members of Family Businesses, which are disappearing or about to disappear, aware of the existence of a tool that prevents their disappearance and transforms them into successful business families that pass on to the next generation.
HOW WAS THE STRATEGIC MAP OF THE FAMILY BUSINESS CREATED?
We have found that there are family businesses where the partners worked as a team and with great dedication and love in their family business and they had success, well-being in the family, and large increases in profit.
However, there were other family businesses where the family did not get along, did not work as a team and eventually ended up selling the family business or disappearing.
We have also discovered that family businesses had 8 critical areas, which are internal systems similar to the systems of the human body, circulatory systems, digestive system, bone system, nervous system, etc., and that these systems had to evolve according to the cycle of companies and that the lack of transformation of these systems caused their disappearance.
THE HORIZONTAL DIMENSION OF THE STRATEGY MAP
In this dimension of the map are the cycles of family businesses, which are normally 30 years, beginning with the first generation of the company, founded by the parents, continuing with the second generation, the company of the brothers, and the third generation, the cousins' company.
There are long-lived and successful companies that transcend 10 generations, However, unfortunately, 60% of family businesses disappear and do not pass to the second generation.
But when there is a successful succession to the next generation, where the wisdom of the previous generation is integrated with the ideas and drive of the next generation, quantum leaps occur where the initial family business multiplies, creating multiple companies, and growing the welfare, profits, and family wealth.
BLACK HOLES OF THE HORIZONTAL DIMENSION
Each cycle of family businesses has its beginning, its development, its peak, and its decline. At the end of the decline of each cycle, the BLACK HOLE appears, an energetic point, where the company enters a crisis, with great danger of disappearing or with a great opportunity to take a quantum leap, succeed and multiply if the necessary measures are taken.
THE 8 CRITICAL AREAS OF FAMILY BUSINESSES
The Family
The family evolves in the generations in a natural way in number, being two partners in the first generation of the parents, increasing to approximately six with the children, 20 with the grandchildren, and 100 with the great-grandchildren.
The most important thing that the family system brings to the company is love, values , and dedication to the business, this being important for it to become a family of businessmen from the first generation. When love and dedication are lost, the family business disappears.
Government Bodies
This system must be transformed from an authoritarian government of the founder into a participative government with the integration of the children and later the grandchildren, where they work as a team to take care of the family and the business.
In the second generation, the structure of the company must already have an advisory council where the big decisions are directed and made between two or more generations.
Initially, the owner’s company becomes a Family of Entrepreneurs with several successful companies that need a special structure where each business unit must be cared for by a partner or by a professional. When there are many companies, the need arises to create a corporation that orders and applies the best practices in all companies.
Protocol and Policies
The council which several generations participate prepares and approve its Protocol, which contains the history of the company, the intention of the owner when founding it, and the initial values. The protocol is similar to the constitution of a country.
It is also necessary to create a Policy Book for the partners that define the rules that will avoid conflicts in the future, such as the operation of the council, the salaries, and benefits of the partners, distribution of profits, succession of shares, etc.
These policy books are reviewed and updated annually to keep them current and adapt to the frequently changing environment.
Strategic Planning
Originally, in the company, in the first generation, planning is not necessary, since this is the dream of the founder who carried it out in his work every day. After many years of effort, when the company grows, only the dream of the founder is no longer enough, requiring more formal planning.
In the second generation where there are already several owners, including the children, the planning process is transformed, elaborating a shared dream for the future of the two generations, their objectives, their strategies, and their budgets, and the Family of Entrepreneurs begins to function.
Institutionalization of the Company
The institutionalization of the family business consists of a process of transformation of the company, where the organization manuals, the description of the positions, and the objectives for each business unit are necessary.
In the initial Family Business, in its first cycle, the operations, Marketing, Systems, and Human Capital functions are not very developed, since the owner does them personally.
In the Family of Entrepreneurs, with a larger business or several companies, it is necessary to institutionalize each of the functions and this is normally done by hiring external consultants or professionals for each of the functions.
Leadership Succession
In the Families of Entrepreneurs, there are life and career plans for each partner, which are integrated into the future vision of the group. In these plans, partners are trained to be better leaders and entrepreneurs.
In a family of businessmen, not all of the successors work in the company, as some of them may be professionals, artists, doctors, etc., but they, as partners in the company, must participate in the shareholders’ meetings and advisory councils. , for these positions also requires preparation.
Patrimonial succession
In Families of Entrepreneurs, there is a fair and equitable succession for sons and daughters, where the love and dedication that has been had in the business is taken into account for participation, it is important to ensure the future of the founders with income or trusts.
Social Responsibility
The last critical area of family businesses is the responsibility that all companies have to meet the expectations of all interest groups such as shareholders, staff, customers, and suppliers, and their great responsibility to improve their social environment.
In some companies, this is done through foundations that sometimes become larger than the companies themselves.
HOW IS THE STRATEGIC MAP APPLIED TO SAVE FAMILY BUSINESSES AND TRANSFORM THEM INTO FAMILIES OF ENTREPRENEURS?
The strategic map is like a photographic plate of the family business, a photograph is taken, through a diagnosis, where all the systems are analyzed and the critical areas that endanger the company are found, an action plan is prepared for each critical problem area and after six months it is diagnosed again, evaluating progress and new plans to follow.
With the Strategic Map, the partners of the family business make them aware of what is wrong with the company and what needs to be done, done with the support of the consultants, to fix it. This photograph is clear, simple, and understandable by the partners.
THE TRANSFORMATION OF THE FAMILY BUSINESS INTO A FAMILY OF ENTREPRENEURS
This transformation begins by making diagnoses and applying the best practices for each critical area, improvements are seen quickly, achieving, in a cycle of two to three years, amazing results of well-being for the family and growth of their profits and their family wealth.
It's up to you to decide if your family business is going to disappear or if you want to turn it into a successful family of entrepreneurs.