SCHEDULE AN APPOINTMENT

Family or Financial:

What interest should go first?

Family Capital is defined as durable family harmony and governance.

Financial Capital is any investable asset – time, treasure, tithe or truths.

I’m not sure which form of capital goes first.

But I am sure that values drive behaviors. We love our children, and we would take a leave from work to care for our children. Right?

Recently one of my clients shared a story of a family that did just that. They rallied around a 2-year old fighting cancer. They re-designed work loads and scheduled care givers. They pooled money to support the healthcare costs. And last week they rang the bell- to celebrate! The nurses lined the hallway. The neighbors lined the street. The grandparents drove the car. The parents waved to neighbors and protected their immune-compromised child from any risks. Values drive our behaviors.

I am also sure that most families share the same values: integrity, asset preservation, legacy stewardship, philanthropy, responsible service to others.

When I directed a non-profit summer camp program at a Quaker School near Washington, DC, I saw those values every day. Parents invested as much as possible to provide more opportunities for their children. That program grew over 800% because of their shared values.

Many of those parents struggled to support their children. They wanted to support their family capital. And they had limited financial capital. Just like you and I.

My experience is that most families struggle with financial literacy because they don’t discuss financial capital enough.  There is an endless need for family meetings to discuss cash flow and investing.

When our children were in Middle School and High School we had Sunday evening meetings after dinner to discuss the week, and financial matters. They were short meetings. The children led parts of them. They learned to live below their means. They learned that what their friends posted on social media was not always true. They learned to invest in compounding assets.

Now I facilitate family meetings for clients. On Tuesday night I facilitated another virtual 90-minute family meeting. The patriarch, matriarch and a sister represented the Elders.  The Next Gens included 3 children aged 28-40 and one spouse.  Three wealth advisors provided content on retirement and investing options.  My role was to encourage the Next Gens to ask questions about Roths, IRAs, compounding, employee matching… everything needed for them to make more informed decisions. 

That was their second educational session and we will have at least two more in the next 4 months.  One breakthrough was when the daughter, newly divorced and single, realized more options from her employee match.  Another breakthrough was when one of the sons realized that as an independent contractor doing work for the family business, he needed to contribute more to his pretax options. 

As the children shared their takeaways the father was glowing with delight.  

Every Elder wants their children to make smarter financial decisions. 

Maybe Family Capital and Financial Capital go hand in hand.

Any thoughts?

Business Conflict Myths

… and Succession Facts

You know the myth: Business succession is difficult and full of conflicts.

The myth is that outrageous Hollywood movies like Succession, The Godfather, Dallas or Dynasty are the norm.  The myth is that tax advisors are never able to minimize taxation, that estate attorneys are well intentioned but haphazard, that more wealth leads to more conflict.

The fact is that most wealth transitions occur quietly when there is shared understanding of decision making.  That’s called governance.

Good governance is the reality for ALL of my clients- or they wouldn’t hire me.

Good governance can be taught and developed.

Let’s start with two definitions. Then I’ll share 4 steps that really work.

There are two types of conflict:  Interpersonal conflict is usually bad, and Task conflict is usually good.  

Interpersonal conflict is based on emotions and should be managed carefully, even if you dislike that cousin who just said something outrageous.  But how do we self-manage? We are emotional animals driven by fears. Threats are everywhere. !Right?! Behavioral psychology research confirms that we think faster or slower depending on the stimulus and the situation. When I’m inclined to speak impulsively, I often massage the back of my head. Why? Because I want to slow down, think, and respond with care. We can all practice self-management. The oldest part of our brain is in the back of our skull. The prefrontal cortex, our executive center, is in the front of our brains. So, on good days, we practice self-managing to avoid interpersonal conflicts. (Or not…)

Task conflict is based on different understandings of information or roles.  When one cousin wants to invest in a new digital marketing program, and another cousin wants to invest in a new building, they will have task conflict. Task conflict is usually good because it may lead to innovations. I define innovation as “new ideas applied.” One reason for agendas and information packets before board meetings or family meetings, is to share information so that the participants can make smarter, more informed decisions. There can still be emotional moments- full of drama- but the focus of the meeting is on decision-making to address the task conflicts.

One reason for a facilitator with expertise in behavioral psychology (like me) is to minimize the interpersonal conflict and maximize the task conflicts.

As a species we all want to create order out of chaos. That’s why we construct processes, and (occasionally) organize our closets. That’s why we ask experts for advice. When we require a healthcare assessment we expect nurses to collect data, so that physicians using AI can diagnose and treat our evolving needs. Right? When we require a transfer of assets we expect attorneys and wealth advisors to assess needs in a deep discovery process, then recommend next steps. Right?

I organize teams of advisors to serve families because I know what works. Holistic advising is here to stay. And my clients deserve a team of experts. They also deserve a cleanly defined process. Something useful.

Here are the 4 steps in my Family Capital Discovery Process (based on my research and decades of consulting).  Think of these as 4 phases in any engagement together. Notice the verbs in bold font. Perhaps you can adopt these?

a.        Assess the current and future Family Enterprise ecosystem. I call these states the Now and the Next. Each ecosystem has unique history, values, legacy, stages, visions, and risks. A Family Business may generate assets, like a golden egg or a core business. And there may be multiple businesses over time, called a Family Enterprise. Think of Cargill or Walmart. Or think of the nearby franchise owner or car dealership in your city. Perhaps you know that over 60% of our GDP and job growth is driven by Family-Owned Businesses. How do you assess those unique strengths and weaknesses? Lately I’ve been using AI tools to accelerate that assessment process.

b.        Develop a Family Manifesto that describes the Family Purpose and reasons for working with multiple advisors. Most families have a verbal understanding of what the founder, Elder or owners want. When that verbal understanding is written and shared, teams can evolve. For example, in a recent series of meetings, I conducted interviews with the Elders, took detailed notes, and shared their asset map with the Next Gens. They had never seen one list of their capital and financial assets- and there were plenty of rumors! Finally, they were able to draft a manifesto that accelerated succession planning. After decades of avoidance and mystery, they were finally able to make crucial investment decisions. Four branches – over 50 people- were relieved. When verbal or unstated assumptions become written and shared, family businesses can evolve. That’s called organizational maturity. And that process is not too difficult. Perhaps you know a family that can benefit from a Family Manifesto? Perhaps you can accelerate that process?

c.        Define the four Family Focus Pillars. These are 4 critical questions used by families with over $50M in investable assets, who may have a Family Office to organize their legacy. (With credit to my friend Peter Vogel and his team at IMD). My experience is that these 4 questions can be useful for any family, with any amount of wealth. Perhaps you can answer them this weekend when you sit down for your next family dinner. Who we are? What do we own? How do we function? What is our impact on society and the environments and legacy? Yes, I’ve had these discussions with our nuclear family. Yes, you can do so also!

d.        Organize more effective work guidelines with a team of advisors. We all need a little structure at times. We can’t play football without yard lines and goal posts. We can’t have a swim meet without lanes and a timing system. I recommend the least amount of structure in the moment. Families need to evolve. The reason I wrote the Success Playbook for Next Gen Family Business Leaders (2024) is because clients asked me to do so. It’s a playbook of books, structures, and great resources. Perhaps you know someone who needs a little structure or a loving nudge?

Bottom line: Now you know what works. Please share this post with those who would appreciate knowing what works.

  1. One fact is that succession usually happens quietly, without conflicts.
  2. Another fact is that good governance can be taught and developed.
  3. Another fact is that we can each minimize interpersonal conflicts and maximize task conflicts.

Any thoughts or comments?

Schedule your 1:1 session now here.

My Interdisciplinary Knowledge Stories

… for better consulting

Recently I read Wealth 3.0. and the authors state that interdisciplinary knowledge is one of the key predictors of success for consultants. I agree.

After a recent client engagement, my colleague said, “I never would have asked about the topics you brought up– increasing 1:1 time with each child, and family meetings to discuss charitable giving. How did you become so damned smart about so many different topics?”

I stuttered and paused with embarrassment.

I do read daily, and study new topics on YouTube, I listen carefully to what people say, and I watch what they do. But those are skills.

The deeper questions are “How did I develop my interdisciplinary knowledge?” and “How can I encourage others to do the same?

Here are some loosely chronological stories about how I developed interdisciplinary knowledge. Perhaps they will trigger similar stories for you. I encourage you to consider HOW you develop interdisciplinary knowledge.

  1. As a child I was expected to research answers from the set of books on the shelf, called Encyclopedia Brittanica. Long before wikipedia and digital tools, that was the preferred way to answer questions or settle disputes. My siblings were often more correct than me! We all learned to seek answers.
  2. Multiple Elders challenged me to think for myself. The Boy Scout volunteers used merit badge content to reinforce new skills, and values like honesty and loyalty. Faculty members, who worked with my father, spent holidays with us and quizzed me on any topic- the power of compounding assets at TIAA-CREF, or the wisdom of building a private campground as a long term investment. I learned that adults may share their wisdom, and I may not agree with them.
  3. That saying, “Never let schooling get in the way of a good education” is attributed to Mark Twain. It could have been a family motto above our doorframe. We were expected to attend schools.
  4. At a large public high school in Clifton Park, NY, I was expected to take honors and New York State regents classes. I elected to take AP Psychology and Sociology classes. And as a senior I left school at 1:00 each day to work at a nearby food warehouse to save money for college. I didn’t have a car, so my mother drove me there and back for a year. From her I learned to work hard and save my earnings. From those workers I learned that education could create opportunities.
  5. When I enrolled at Hamilton College, in Clinton, NY, I learned that it was one of the Top 10 Preppiest Colleges in the country. In my ignorance, I created a survey for all the incoming freshmen and stuck it in their mailboxes to ask “how well prepared are you?” and “where did you attend high school?” I learned that a 40% response rate was strong, and that there was no significant difference between self-confidence and high school preparation.

The class size at Hamilton was about 10 students. We were expected to ask questions and respectfully challenge one another. In one mid-January class, 5 of us sat in the professor’s office while he smoked his pipe and we discussed the explosive power of humanism in the Middle Ages. When a different professor shared that she studied with the author of one of our books, I learned that authors are accessible. And that they often disagree! Academics of any age can and should challenge one another. Later I learned that there was no mandatory course of study at Hamilton. Students there are expected to be interdisciplinary.

  1. After two years there, amid a family relocation and financial stress, I went to the University of Minnesota in Minneapolis. Some of my class sizes were now hundreds of students! I learned that any undergraduate could substitute graduate level courses, so that’s what I did. My classmates were expert administrators or teachers. They all had strong opinions. I recall doing a project on creativity with a student who was also a professional videographer. Somehow we gained access and conducted interviews inside the public schools. Interdisciplinary skills were tolerated for entrepreneurial students.
  2. My next few years were spent in applied leadership sessions, as an instructor in wilderness Outward Bound courses, backpacking expeditions in Wyoming and Montana, canoeing in Minnesota, trekking in England… Those seasons were great opportunities to observe how people experience stress, resilience, endurance, conflict. Then I spent years teaching English at four independent day and boarding schools. One prevailing lesson is that financial wealth does not protect people from stress or challenges.
  3. My next formal schooling lessons were at Dartmouth College, in a program called the Master of Arts in Liberal Studies. We could study anything! So I explored the influence of landscape art in New Hampshire, educational pedagogy, feminism, equality, and social psychology. My thesis was a longitudinal study on Adolescent Risk Taking Behavior, because I wondered what led some people to embrace risks, and others to avoid risks. Perhaps I’m still collecting data on that topic!
  4. My last example of formal schooling is called a terminal degree for good reason. After years of managing executive coaches, leading a nonprofit, and some time working in colleges, I knew I wanted to focus on applied psychology. And I needed to continue generating revenue through my consulting! The Chicago School of Professional Psychology was a good fit for online content, with two onsite events to validate our identity and assess our knowledge. I loved the structure of weekly reading, writing, commenting. In the three decades since I had studied psychology, there was a sea change in research away from what is wrong with people (anxiety, depression, violence) and toward what enables people to flourish (meaning, engagement, relationships, achievements). My dissertation focused on Positive Psychology Coaching protocols that accelerate leader development. Yes, I’m still collecting data on that topic too!

That’s my listed attempt to answer the first question: “How did I develop my interdisciplinary knowledge?” In short, by observing and reinforcing the strengths of others.

The second question was “How can I encourage others to do the same?

I think each of us can say and do a better job of practicing interdisciplinary knowledge.

  1. I encourage you to make your list of influences- formal schooling or informal lessons.
  2. I encourage you to share that list with your loved ones. They need to know what you think and value.
  3. I encourage you to share some of your examples in the comments below. Action leads to learning.

I suspect that when we are vulnerable about our interdisciplinary knowledge, then we are better practitioners.

What do you think?

This can become a discussion if you share any thoughts or comments below.

Or schedule a 1:1 here NOW. I’d love to hear your examples!

A Positive Psychologist walked into a bar…

… to savor the possibilities.

He stood there for so long that a gigantic security guard said, “You can’t just stand here.”

No response.

Then the guard said, ” If you don’t move along then I’ll have to fine you $100.”

Still no response.

Then the guard said, “What are you doing here? Where are you going?”

The positive psychologist smiled and said, “How about if I pay you the $100 and come back next week? I want you to ask me those two questions week after week.”

And so began the history of professional coaching…   

Yes, you can define a meaningful outcome for yourself!

Based on my research, here are the top outcomes for business coaching. Pick one or two.

Top business coaching outcomes:

o   Banking and financing

o   Board of directors/advisors

o   Branding

o   Change management

o   Communication skills

o   Compensation and benefits

o   Computer security

o   Conflict resolution

o   Customer service

o   Ethics

o   Insurance / risk management

o   Leadership assessments

o   Managing growth

o   Managing others

o   Marketing

o   Net profit

o   Operations

o   Personal finances

o   Personal health and well-being

o   Presentation skills

o   Safety/ workers compensation

o   Sales

o   Talent development

o   Time/energy management

Now what?

Find someone who can ask you those two questions: “What are you doing here? Where are you going?”

Any thoughts or comments?

Schedule a 1:1 session now! I’d love to discuss your answers!

It’s Time for YOUR Annual Self- Assessment

Here is Annual Self-Assessment Form. Copy this. Print this. Post your notes with YOUR coach or accountability partner.

Date: _________

Step 1:

List the top 5 people who are most important in my life today.

Instructions:

For each statement below, imagine how those who know you well would score you. Use a scale of 1 (low) to 10 (high). After scoring yourself, add comments for additional insights or actions to improve.

  1. Hope:
    “I have the “will and the way” to achieve my goals.
    Score: ____

Comments: ________________________________________________________

  1. Efficacy:
    “I feel confident in my ability to take on challenges and achieve desired outcomes.”
    Score: ____
    Comments: ________________________________________________________
  2. Resilience:
    “I can bounce back from setbacks and adapt to changes.”
    Score: ____
    Comments: ________________________________________________________
  3. Optimism:
    “I focus on the positive aspects of situations and believe in the best possible outcomes.”
    Score: ____
    Comments: ________________________________________________________
  4. Humility:
    “I value the contributions of others and admit my mistakes.”

Score: ____
Comments: ________________________________________________________

  1. Curiosity:
    “I actively seek new knowledge, ask questions, and explore diverse perspectives.”
    Score: ____
    Comments: ________________________________________________________
  2. Collaboration:
    “I work effectively with others, fostering trust, and contributing to collective goals.”
    Score: ____
    Comments: ________________________________________________________
  3. Accountability:
    “I take responsibility for my actions and follow through on commitments.”
    Score: ____
    Comments: ________________________________________________________
  4. Empathy:
    “I show understanding and compassion toward others’ experiences and emotions.”
    Score: ____
    Comments: ________________________________________________________
  5. Vision:
    “I communicate a clear and compelling vision that inspires others to act.”
    Score: ____
    Comments: ________________________________________________________

Reflection Questions:

  • What do these scores and comments suggest about your current leadership strengths?
  • Which area(s) do you most want to improve over the next year?
  • How can you leverage your relationships with the five most important people in your life to support your personal and professional growth?
  • 12 months from now, what are 1-2 important aspects of your life that you would regret losing? (These are the 1-2 aspects to focus on ahead).

Naturally, this self-assessment can be repeated at any time to track your growth and identify areas for continued development.

If you have advice on how to improve this self assessment, please comment or reply directly.

Schedule a free 1:1 with Doug here.

Or CONTACT us today!