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Family retreats: The theory

Tom Davidow outlines why a family retreat is an effective way for families to communicate.

The family retreat is one of many vehicles through which families can come together when it's necessary or helpful to address common interests, writes Tom Davidow. Families can receive or share financial information and can attend meetings that have separate family and business agendas, which can help to reduce some of the tensions that are a consequence of the overlap between family and business/financial interests. It is also important for the family to relax and enjoy each others company through recreational activities.

Although some families can run successful retreats without a professional facilitator, having an independent person on hand is often very helpful. A successful retreat is one where family members leave feeling they have had a positive experience and that they have the capacity to meet again. To ensure that a retreat led by a facilitator is successful, it is essential that families and their facilitator are clear about the goals of the retreat, that they structure the time well and that the facilitator is not only experienced, but, depending upon the retreat's goals, adequately trained to facilitate it.

Retreats can be divided into three categories: low risk/low change, medium risk/medium change and high risk/high change. "Risk" refers to the probability that emotional issues will surface among family members that need to be managed by a clinically trained professional in the field of psychology. "Change" involves the development of a communication process that allows families to address emotional issues and to develop an effective decision making process with which to address business/financial issues.

Low risk/low change

The focus of a low risk/low change retreat is informational and educational. For example, a CFO or an attorney may discuss matters regarding the family business's performance, or returns on their assets. In that case, it is sufficient that the facilitator has substantial experience and expertise in the information field that they are presenting. One positive unintended consequence of sharing information is that individual family members might realise that they need more exposure and training in the issues presented at the retreat.

Medium risk/medium change

A medium risk/medium change retreat has the informational and educational component, but also includes some discussion of family issues. When business-owning families and high net worth families meet, there is an overlap of two systems – family dynamics and either the business or assets, trusts and investments. In this instance tensions, stresses and emotional issues often lie just beneath the surface.

The biggest risk is that those emotions will get out of control and that family members, having had a bad experience, will be reluctant to attend another retreat. Therefore, it's important to state an explicit, agreed upon limitation that the family may discuss family dynamics in general; but when the facilitator is not equipped to manage family members' strong feelings, they will not attempt to work through them.

An accountant, lawyer, wealth manager or family office manager may have taken a course in psychology and be intuitive, charismatic, thoughtful and bright, but lack the clinical capacity to help two angry siblings whose historical dynamic has surfaced. However, when facilitators, as a consequence of their experience, have learned their limitations, they usually know how and when to set appropriate boundaries on the content and intensity of the discussions.

The more structured the retreats are from the outset, the lower the chances are that things will get out of control and the safer the family members will feel. If events are scheduled so that the retreat remains clear in its purpose and agenda and is coherent from beginning to end, and if limits are clearly set, family members in a medium risk/medium change retreat can have a positive experience. The recognition that family members all share the challenge of living in a family business and/or dealing with the family's trusts and assets can create a greater level of understanding among them.

High risk/high change

What distinguishes a high risk/high change retreat is that, in addition to its educational and informational aspects, its goal is to address the emotional issues among family members. This model of retreat can lead to changes in family relationships, dynamics and communication, which then leads to that family being able to make business or financial decisions that were stalled as a consequence of underlying family issues.

In order for positive changes to occur, issues need to be addressed and managed so that that when emotional issues are opened up, the facilitator knows how to provide closure for them. It's essential, therefore, that the facilitator is experienced, clinically trained, has an understanding of family systems theory and holds an advanced degree such as a PhD, EdD, MD, PsyD or a License MSW. The facilitator also has to have exposure to or an understanding of how business and money issues affect family relationships.

Even in a high risk/high change retreat, dealing with emotional issues is so draining that no more than one-third of the weekend should be spent mitigating the strength of emotions inherent in family business situations.

The other two-thirds of the time should be more relaxed and involve less intense, more recreational or informational events.

If it were solely up to me, families would meet, either in whole or part, on a monthly basis. That way changes could occur more slowly over a longer period of time, making it easier for the family to take those changes on board than after a single retreat. However, given that family members have their own busy lives, asking them to meet once a month seems unreasonable. What is reasonable is asking them to gather at least once but no more than four times a year, depending upon what needs to be accomplished.

How to plan a retreat:

  1. Set clear goals and agendas
  2. Analyse the three levels (low, medium and high) and choose the one that best fits your goals
  3. Choose a professional facilitator who is appropriate for the stated goals
  4. The facilitator should then look at the three different levels and decide which one they feel both comfortable with and are adequately trained to facilitate for the family
  5. The facilitator should then organise a retreat that is attached to their skill sets and should create an assessment process through which they can discover not only each family member's interests and goals, but also any potential emotional minefields to avoid
  6. Provide for recreational time
  7. Although retreats can be scheduled according to necessity, they ought to occur at least once a year

Case study: establishing a family council

I once worked with a business owning family that had 32 members over two generations and 40 members over three generations, writes Tom Davidow. The business governance, a board of directors, was in place, but the family needed to create a family governance structure to oversee other matters such as succession, investments and philanthropy.

While this family was extremely close knit, there remained some emotional issues that the family had chosen to ignore because they didn't want to stir up controversy among themselves. I knew, however, that unless those issues were addressed, the possibility of moving forward to establish a family governance structure would be compromised. 

The family also understood, albeit reluctantly, that we were going to have to overcome the emotional hurdles before any meaningful progress could be made. I believe that when a family makes the choice to gather together, that decision comes from their collective unconscious and expresses an agreement among them that their relationships are strong enough to support the weight of their emotional issues.

I also knew that controversy would be generated during the discussions about the family council by some of the questions that would come up, such as: How much impact will the next generation have on the creation of the structures and purpose of the family council? As the group works together, who will be in charge of making decisions about the family council? Does every generation have an equal vote, or is the senior generation going to listen and then decide what it thinks is best?

Since the goal was two-fold – establishing a family council and increasing the quality of communication through addressing historical emotional issues – we created exercises to help the family clarify their values. We put forth hypothetical situations and then asked family members to work together to develop practical solutions for those situations. We also designed exercises that made families aware of their emotional trigger points.

As is usually the case with families, family members fell into habitual roles – those who were used to taking the lead did so, and those who were used to being more passive remained so. 

Once the exercise was over, the family reviewed the process and saw how they were able or unable to make the decision. With that awareness, they then improved how they communicated and how they went about making decisions.

At the end of a number of such retreats, the family had become sensitised to their trigger points and had learned effective communication that allowed for good decision-making. They then translated that awareness and knowledge into the development of a family council.

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