From Dreaming to Doing: Making Change in the Family Business

One of our clients is a rising next-generation leader in her family’s hospitality company. She has big, bold ideas she would like to see the company take on, including pursuing a more active acquisition strategy and new innovations around marketing. Despite her strong commitment to the business, she is having trouble getting others on board. In a recent meeting, we asked her what image came to her mind when she thought about trying to make these changes, and she said, “I picture Sisyphus, someone pushing a huge, heavy boulder that is at least twice their size up a gigantic and never-ending hill.”

Our client isn’t alone here. In our experience, many people (understandably!) tend to view change as something that is:

• Inherently difficult
• The job of one person
• Driven by force; a push
• Top-down

Here, we invite a shift in mindset and approach. What would happen if we viewed any change process as:

• Driven by pull instead of push
• Always possible with a systemic approach
• The job of many; everyone has a role to play
• Holistic; both top/down and bottom/up

How can leaders actually achieve lasting, meaningful changes in family businesses?

Below, we outline four key principles to consider.

Principle 1: The future is already happening

It’s common to think about change as something external—it’s something we have to go outside and look for in a book, a TED talk, a product, etc. Instead, we suggest you “find the future” by looking inside your family and/or business to locate places where things are already beginning to change in the direction you want to go.  We call these “found pilots.”

For instance, a rising leader wanted to shift their family’s packaged food business away from a wholesale model and towards retail. It turned out that there was one smaller product line where this shift was already underway and had been very successful, but it wasn’t getting attention amid the day-to-day hustle. When the COVID-19 pandemic arrived, wholesale customers immediately put their orders on hold. This leader recognized that the small retail success already in process could be built upon and expanded, which is exactly what he did and subsequently helped the business survive and thrive despite the challenges of the pandemic. 

Principle 2: Changing behavior means changing supports

To sustain new behaviors, it’s important to find and strengthen the supports that make the behavior easier—not harder. These can help naturally attract people to the new behavior. For example, we see families crafting new kinds of support, particularly around family engagement:

• Cultivating greater family meeting attendance by offering a Zoom option
• Fostering better communication with different kinds of acceptable participation modes – text, email, phone calls, letters, etc. 
• Sharing information by creating a digital repository for all important documents (family charter, contact sheet, etc.) so everyone can access the same information.

Principle 3: Pull is stronger than push

When was the last time your spouse, child, or friend changed their behavior because you told them to? Rather than push for change, we encourage families to create pull for others. Daniel Kahneman often wrote about Prospect theory and loss aversion—the idea that, when faced with change, potential losses loom much larger than potential gains[1]. Creating pull means conveying what people can gain from the proposed change.

Many families use vacations or other “glue” activities as a type of pull. We have one client who builds the annual family council meeting around a weekend-long trip, with activities for all family members and educational opportunities geared toward members of the next generation. The trip gets people excited about the business and the prospect of joining the family council; it shows them what they stand to gain by doing so — dedicated time and experiences together, stronger relationships with family members, and the chance to learn more about the business.

Principle 4: Change works best when it is both “top-down” and “bottom-up”

Making change in a family business means getting multiple people involved from all parts of the system. If change only happens top-down, there is a lack of resilience and creativity from grass-roots efforts. The bottom-up approach lacks focus, alignment, and the commitment of mainstream leaders who can provide resources.

By tapping resources across the hierarchy, you can tap the strengths of multiple people and areas. Successful change utilizes the resilience, creativity, and commitment of the whole system.

On the family front, consider the relationship between grandparents and next-gens. In our work, we often find that these generations can help ease tensions within the middle generation (the parent group) by working together and strengthening their own bond.

Conclusion

These four principles can help families make changes in their business and maintain ties that bind across generations. While each family situation is different (we like to say, “If you’ve seen one family, you’ve seen one family!”), these principles are useful for change agents within family businesses to consider.

Recall our next-gen client from the hospitality company — she recently pulled together a small working group of seasoned employees and new hires to start testing some of the changes she wants to introduce. She is working diligently to build relationships across the organization and learn about areas of the business that are already moving in the direction she wants to go. While she still has a long road ahead of her, she tells us that she is feeling much less like Sisyphus these days.  

[1] Kahneman, Daniel, 1934-2024, author. Thinking, Fast and Slow. New York: Farrar, Straus and Giroux, 2011.