Nigel Nicholson teaches organisational behaviour at London Business School, and is director of the Leadership in Family Business Research Initiative (LIFBRI). www.london.edu/family_business/.
Did you ever hear a family business leader complaining that there are not enough committees to cover the firm's issues, or that meetings are too infrequent or too short?
Impatience with time-wasting is one of the admirable traits of family firms, helping them to avoid the sclerosis that clogs the arteries of so many corporations. Instead you can get a wonderfully dynamic free-flow of exchange on a need-to-know and want-to-tell basis. Teamwork between key players is often close and passionate, and easily traverses the space between the leadership and the front line.
Nice, but sometimes risky. Who gets to know or becomes involved in decision-making can be haphazard. The business can turn out to be run by networks of insiders, leaving some outsiders in the dark. How things get done may clear and transparent for some issues but at other times be horribly opaque. Decisions might be made swiftly, but accidents happen – people get left out, or screw up because they were not in the right place at the right time.
Love them or loathe them, but good groups are essential to the effective running of the family firm. What is a good group? People get fed up with meetings for several reasons. So-called teams are not always really teams. They are unwieldy in their construction. The wrong people are doing the wrong things. The way they handle business is lousy.
Boards often suffer from all of these problems, and in so doing give corporate governance a bad name. Does this have to be the case? Let's look at big areas of success and failure in turn.
Not really a team.
It has been said that often boards are not teams. To truly be a team something has to pass from hand to hand and be changed in the process – there have to be people supporting, modifying or building on each other's contributions. Boards need not always be like this, but they should decide when they want to be true teams, and when they can be content with their institutional role.
Set up to fail.
Some groups just cannot function because they are too large, internally divided, unclear about what they're up to, and have people in them who shouldn't be there. Once you're above eight to 10 members, you're getting out of true teamwork territory. Big status differences – where one voice (typically the dominant dad chairman) outguns and out-shouts all others – make free flow of ideas and opinions hard to achieve.
Failing to make explicit what a meeting is seeking to achieve creates lack of clarity. The wrong people means members attending by virtue of their status rather than their contribution, such as being a family member or the long standing buddy of one.
Doing the wrong things.
People complain because they see many teams wasting time on stuff they're no good at, and not enough attention being given to the really important stuff. All groups should stop and think about what things they do well and what they do badly. What are these? Groups are often poor at making decisions, and even worse at implementing them, but they're good at exploring issues prior to a decision and at pooling information afterwards about consequences. They can also be good at dividing their labour and allocating responsibility.
They're lousy at creativity and design, but great at encouraging the innovative processes and helping to solve problems. How often have you found yourself on a board or in a team and caught yourself wondering, why the hell are we trying to this here when one or two people could do this better and faster somewhere else?
The recipe for the most powerful and effective teams is to have members who have a common value frame, yet who are truly diverse in their talents, interests and perspectives, with contributions integrated by great group process. People often mistakenly assume that this integration means "leadership". It does and it doesn't.
It doesn't in the sense that you don't need a designated boss to be the ringmaster. In fact you're better off without such a looming presence. It is not the person of leadership but the practice that is needed in groups, and this can be distributed among all members. Three types are needed. You want people to take the lead in driving the work of the group forward. Usually no shortage of those. You want people to lead the interaction process, and ensure that not just the loudest voices get heard, people with positive attitudes and good humour to help conflicts to be constructively resolved.
You need people to keep the group in order, schedule the proceedings and pull the group up if it is drifting away from its task. Of these three roles, the last is the one that is often best enacted by a designated leader. If this is performed well then the group will justly feel it has done great work. In the words of the Taoist philosopher, Lao-Tzu: "when the best leader's work is done, the people say, 'We did it ourselves'."