Today’s podcast features Amy Bruske from The Kolbe Corporation. I first met Amy over ten years ago when she was presenting at a workshop on how to use the Kolbe Index. This is at a tool that I’ve been using for years to help me focus on what skills I can ask employees to use in my companies.
Today we’re going to be talking about her new book Business is Business: Reality Checks for Family-Owned Companies.
A family business can be one of the most rewarding or disgusting form of business, depending on how you do it. Today Amy and I are going to talk about how to make your family business a rewarding activity and stay away from the activities that can cause you lots of pain.
Some of the things we’ll be covering today are:
- Assess potential family members’ values before you bring them into your business
- Follow the golden rule in FOB: trust your instincts
- Avoid bringing family member work relationships home
- Keep the trust with family members and non-family members
- Prevent marital stress from damaging working relationships
- Empower the next generation to reach its potential
Narrator: Welcome to The Sustainable Business Radio Show podcast where you’ll learn not only how to create a sustainable business but you’ll also learn the secrets of creating extraordinary value within your business and your life. In The Sustainable Business, we focus on what it’s going to take for you to take your successful business and make it economically and personally successful.
Your host, Josh Patrick, is going to help us through finding great thought leaders as well as providing insights he’s learned through his 40 years of owning, running, planning and thinking about what it takes to make a successful business sustainable.
Josh: Hey, how are you today? This is Josh Patrick and you’re at The Sustainable Business. We’re in for a really big treat today.
You know, somewhere around 15 or 20 years ago, I ran across this organization called the Kolbe Organization. And they do—well, it’s not really a personality profile. It’s really strengths analysis on where we have lots of energy to do things and where we may not have so much energy to do things. I became certified. I’ve been using it in my business for years, and years, and years. As it turns out, Kolbe is a family business – meaning a multigenerational family business where the founder Kathy Kolbe is working with her stepdaughter, and her son, and her husband.
So, today, we’re going to talk about their new book Business is Business: Reality Checks for Family-Owned Companies. Today, we have Amy Bruske with us. And I’ve known Amy for quite a while. She is a wonderful person – really smart. And I am sure you’re going to learn some really great take home things today. So, let’s bring Amy in and we’ll start the conversation.
Hey, Amy, how are you today?
Amy: I’m doing well.
Thanks so much for having me, Josh.
Josh: Well, this is my pleasure. I am really excited about this. One of my favorite topics in the whole world is family business.
So, why did you guys decide to write this book?
Amy: Well, as you know, there are lots of family businesses. And even if you don’t think you’re connected somewhere to a family business, most people are. Whether it’s your spouse is in a business or connected to it. You have a friend or you yourself are working. So, anytime you’re working with family, it becomes a family business.
And for years now, we have been consulting with family businesses. And we have seen, when it works, how joyful it can really be because sharing successes together is an amazing thing. But when it doesn’t work, not only do you possibly destroy the business, you destroy all the relationships with it. So, the risks are very high with working with a family business.
But we have learned a lot along the way. We’ve made our own mistakes. We live it every day. And we went through a transition where Kathy Kolbe exited out of the day-to-day part of our business.
So, we went from us coming into it and then working our way up through the business. And then what it takes for an entrepreneur to figure out what else are they going to do when they exit that business. And we learned a lot along the way. So, we want to help minimize the amount of pain for people and really help them find the joy in working together.
Josh: So, when Kathy decided to get out of the day-to-day operations, what was the biggest challenge that you think she faced? And what was the biggest challenge you and your brother faced?
Amy: Well, starting with her – and she writes about this in the book. As you know, when you’re an entrepreneur, the business is your baby. She created something from scratch. And so, getting out of the day-to-day was very difficult. So, even though she was very happy to have the freedom to start working on other projects and things outside of the business, if she would step foot back into the business for any length of time, it was very hard to stay out of basic and low-level decisions. So that was a huge challenge for her.
I tell a story in the book about a time when she came back to the company for a staff meeting and I had ordered pizza for the staff meeting, and she actually started questioning why I had ordered the number of pizzas I had ordered. And there wasn’t enough meat pizza. And it was such an interesting day. And it’s seared into my memory because I took her into the other office and said, “Are we really going to have a conversation about how well I ordered the pizza? Because if that’s the case, I can’t do my job.”
And from that point on, it became this code word that we had when she was coming back and talking about what was going on in the business. And we would say “Is this is a pizza-level decision?” And it kind of brought her back to “Do I really need to be involved in this or not?”
So, her advice to business owners was, “You have to get out of the building because it is nearly impossible to really stay out of things.”
So, that was the hardest thing, I think, for her. I think, for us, it was trying to figure out—well, first of all, with the staff, we had already established ourselves. And my brother, David Kolbe and I run the business together, day-to-day. The staff already knew us and we were already leaders in the business but we had to make it really clear when they needed to come to us and when Kathy had to be involved.
She is still involved in creation of some of the conceptual things around our business. So, she is certainly still creating some products. And we had to figure out what was that line between when she would come back and when she wouldn’t. And we can’t forget about her because she’s got some of the most amazing experience. And so, for us, it was, just because she has an office down in another part of town, remembering to tap into her knowledge and not losing that ability to learn from her and use her wisdom.
I find that when the founder needs to get out, they need to stop being tactically excellent and start becoming strategically excellent. And my experience is, if I can get the founder to become strategically excellent, they’re happy to give up the tactical stuff.
Josh: And your story actually reminded me of a story of my father when I bought the business from him. He used to practice what I would call “seagull management” where he would come in, not know anything was going on and then start to – I won’t use the word but we know what it is.
Josh: What seagulls do all over the place and then right out and leave this incredible mess after him.
So, one of the things that I want to ask you is, did work with Kathy to figure out a “what’s next?” strategy for her, so she was willing to let go?
Amy: We worked with her a little bit. But honestly, it became apparent that when we even started talking about her getting out of the day-to-day that it was already in the back of her mind. So, in this case, because Kathy creates and she’s passionate about working with kids and working with healthcare, she had a lot of ideas of exactly some of the things she could’ve done.
I do not see that being the same with some of my other clients. In fact, I was actually coaching a couple of people in a family business yesterday. And they were saying, “Our dad does not know what’s next, so he can’t stay out of the business because he has nothing he’s passionate about.”
I think we lose sight of the fact that creative entrepreneurs and entrepreneurs that thrive on creative problem solving need something else to do. This whole idea that you’re going to go retire, it sounds great in theory but if they don’t find something else to do where they are still striving, I don’t think it works.
Josh: Yeah. In my experience, the main reason seller’s remorse or founder’s leaving remorse happens is because there’s nothing significant for these folks to move to.
Josh: So, if you happen to be a junior generation, work with your parents to find a compelling future or they’re never going to let you alone.
Josh: At least, that’s been my experience.
Amy: Well, great example because I think you can start doing that ahead of time. When you start thinking about transitioning, that needs to happen over a long period of time. And so, having that conversation all the time and helping them dream big and what’s next would be really important.
Josh: Yeah. I think it’s a really important thing.
So, what would you say are the biggest benefits to being in a family business?
Amy: Well, I think, the thing that comes to mind right away is when you share values and you’re all passionate about doing the same thing, there is an incredible joy in solving problems and accomplishing together. And I see that over and over again. And you have almost a different relationship with the people that you’re in business with than the other family members because you’re getting to share those experiences together.
The other thing is you get to make decisions a lot quicker. There’s almost a shorthand in getting things done. I know the family members that we have, we almost have this way of shortcutting all kinds of decision-making and that makes us a really efficient. Because I already know if David Kolbe let’s say, for example, isn’t here and usually I have to check with him. I know so much about – not only the way he thinks but what he cares about, that it’s very easy for me to make decisions without him. So, I would say, those are some of the greatest benefits.
And then, the ability to possibly bring in the next generation. For a lot of companies, that’s a goal. That was never our goal. We just ended up this way. But if you do that well and if it’s the right fit for the next generation coming in, there can be a lot of joy in handing down some of which you’ve created to the next generation.
Josh: Yes, it can.
So, what would you say, on the other side of the ballpark – okay, those are the good things. What are the horrible things that often happen in family businesses that you might want to stay away from?
Amy: The most obvious kinds of things happen when you don’t have boundaries. There are a couple of things that happen. The first one is you’re always working. This happens a lot, as you know, with spouses that work together. So, if you don’t have a boundary – and then this is one of the reasons we called the book Business Is Business because you have to figure out how to separate business and then your personal life, or else it can be all consuming.
So, one of the things that we’ve done with spouses is make sure that they don’t lose the ability maybe to vent about something that happened at work because a lot of times they get upset and say, “But we love our business. And my business is my life. And why would I not share that with my spouse even when we’re at home?”We’ve said, “Draw the line at sharing and venting or sharing a fabulous thing that happened but do not solve problems together in your off time because then you are burning up this mental energy at all times.” That’s a huge challenge.
The other thing is that you have to think about the boundaries when you’re in the business and making sure that you can be as professional as possible. And that you don’t affect all the other non-family members. I think the forgotten people, in a lot of these businesses, is really those non-family members that have to be a big part of your future. And if you’re not able to be very professional at work, call each other by your first names, draw the line at favoritism, you can’t cluster together even where you work together – all of those kinds of things, then you’ve created an environment that doesn’t work for the rest of the organization.
Josh: So, one of the things that I often coach people about – because this is almost 100% true, is that the style of children or child is different than the style of the senior member of the business. And this is true for family businesses and non-family, businesses that we have different personality styles. If you don’t have respect for those differences, you have a challenge that’s just going to blow up on you.
Do you have any thoughts about that?
Amy: I’m so glad you brought this up. This is one of the biggest reasons that it doesn’t work. If the person is not in the business yet and you’re considering bringing a family member in, you have to make sure it’s a right fit for the family member and for the business. And that means, does the business need those skills or talents they’re bringing in? Or are they capable of acquiring those? So, these are the cognitive types of skills.
You then look at desire, personality, passion. Do they even enjoy or love what you do? And then that third piece that we measure and is the foundation of our business is, “How do they execute? How do they problem solve and get things done naturally?” It has to be a fit for that too.
Well, what we know about some of these natural talents are that they’re not passed down from parent to child. So, your natural way of getting things done may look very different – a parent and a child, for example.
And so, just as you described, you’ve got a parent who has all this wisdom. They want to pass it on to their adult child. And yet, they might be the worst mentor for this person because that child cannot emulate that way of getting things done. That alone is a recipe for disaster and failure because the child wants to do things just like the parent. They want to be successful. And so, they start trying to change who they are. And that’s not going to work.
And the frustration of the parent with – “But, you’ve got to do it this way. It works for me. This is what I’ve learned.” It feels like there’s a lack of respect. Or, why can’t you do it this way?”
So the ability for each individual family member to have the complete freedom to be themselves and operate in a way that is unique to them, we call a foundational principle of the book. If you can’t do that, then it’s not a good idea to work together.
Josh: You know, my father and I, who had World War III breakout over styles. And I was young and brash when I went through this with him. I was 24 years old. And I had my own business I was running which was the same as his. But our styles were different, so bombs were going off. And for about eight or nine years, we almost didn’t talk.
Josh: Because neither of us had any respect for what the other brought to the table.
And that’s a really interesting example, Josh, because what happens is, it’s a need that each of you have to get things done a certain way. And yet, people start taking it personally. So it becomes this personal thing which is why it becomes so emotional and affective. And yet, each one of you had a need to get things done in that way.
Josh: Yes. So, what are some common misconceptions about family businesses?
Amy: Well, the thing that I see the most is that they’re always small businesses. And they don’t have the same needs for operating and getting things done. And that’s not necessarily the case. There are a lot of large family businesses.
And sometimes, very small businesses have complex situations. So, oftentimes people think, “I’ll just bring anybody in. We’ll make it work and it’ll be easy because we’re family.” That absolutely is the opposite. It actually is trickier. It requires a lot more being conscious of the decisions that you’re making.
I’ve seen that sometimes people feel like family businesses are not very innovative and small. And yet, some of the most innovative ideas we’re getting are from family businesses. So, the potential to get things done quickly in an innovative way and really, I think, contribute to our society are family businesses who are making a huge difference in what we’re getting done as a nation and in our businesses. So, I don’t think they get the credit they deserve. That’s my personal opinion.
Josh: Well, the truth is family businesses create about 60% of the jobs in the country. They have about 60% of the jobs. And literally, all the new jobs are in what we call lower middle market companies which are companies that have between 25 and 500 employees. And they’re always family businesses because they’re privately held.
Often, they’re multi-generational family businesses which are even a little bit more complicated. But we need to figure out a way of making it easier for these businesses to succeed. There’s my political statement about that today.
Amy: I am in total agreement with that. And that’s what we’re hoping to do because we know we have information, from all of these clients who’ve learned the hard way and what we’ve been through, that can help them succeed because we need that.
Josh: So, let’s talk about values for a little while because I know that what you do is really in connotative which I call “energy units”. But let’s talk about values because how do you do shared values, or how do you figure out what the values are of the different family members, and how do you mesh them because like different cognitive abilities, we have different values we bring to the party also.
The values are critical. Obviously, that’s your roadmap for how things will get done. And as we know, there’s lots of talk in all kinds of businesses about values. People put a poster on the wall and slap something up and these are our values. And then there’s no consistency in how people behave.
We know decision making is easier if there are clear and shared values. But what makes it difference in a family business is that all of the family members will be heavily scrutinized if they are not acting according to those values. If you don’t practice what you preach, that has a detrimental effect on the other non-family members who are watching that. So, it becomes even more critical.
And what we see sometimes is people assume that just because we share personal values outside of work, or maybe we go to church together, that we absolutely share business values. And that’s not necessarily the case. So, how you’re going to handle just basic decision sometimes and what you value as a business has to be addressed as well. And you may not know those things. So, those conversations need to happen up front. It only takes one family member to really tarnish sometimes the family image when it comes to values. So you don’t get involved if you’re not very clear on what’s expected and ensure that you share those.
Josh: You have in here that you have seven principles, in your book, to ensure success in the family business. Can we talk about a few of those?
Some of the key guidelines are—and we mentioned some of them, that you ensure that there’s that right fit for family and business in all three dimensions of the mind. One of the things that I haven’t mentioned is, as a leader, you have to be able to trust your instincts and figure out what are your talents and then build a business around that. If that’s the case, that you’re able to do that, then you can start bringing family members in that can help them find the freedoms to be themselves too, so that you can build a business around strengths.
And then, lastly, just thinking about creating sustainability by developing the next generation is, “are you all committed to the same kinds of things and building that business around that?”
Josh: And since we’re at The Sustainable Business, that’s a great way to talk about that. You know, the question I like to ask people is, “If your business was to be here 100 years from now, what would you be doing differently than you’re doing today?”
Amy: Boy, 100 years from now.
Amy: What I hope is that technology allows us to spread the word about these instinctive ways that people take action and deliver some great content and information so that people can tap into those because what I know 100 years from now is we’re still going to have mental energy as one of our greatest resources. And it’s this power that you have inside of you to tap into to get things done.
So, I would just hope that 100 years from now, everyone knows about these things. They are valuing it. It was taught in the schools and that somehow technology has made it easier for us to share that information.
So, if somebody reads your book, what do you want them to walk away with? The one big take away from the book that they can go, “Aha! I can do this tomorrow. It is my take home value.”
Amy: I think the one fundamental thing is that if you can have some clear guidelines and boundaries in place, and then be committed to allowing each person the freedom to be themselves, you can absolutely have a successful family business that continues to thrive over many generations.
Josh: So, Amy, if somebody wanted to find you or find Kolbe Corp or find your book, or all of those things, how would they go about doing that?
Amy: Well, our book website is businessisbusinessbook.com. But, of course, you can also find that by going to our corporate website which is kolbe.com K-O-L-B-E.com. And from there, you can have links on to the book where you can find it on Amazon and CEO READ – 800-CEO-READ.
Josh: Amy, we’re out of time. I really appreciate you spending a few minutes with us. This was great stuff.
Here’s something I want you all to think about. If you own a private business and you have family, you are in a family business. If you have multiple generations, or brothers, or sisters in the business, you have the multiple family business. So, we all are in a family business as if you own your own business as yourself.
Pick up this book and read it. I have been so impressed with Amy and Kathy and her family and the business they’ve created and the instruments they use. We use them all the time when we help people hire people and help people figure out where their strengths are and what they should be using energy on. It’s great stuff.
And I also have something for you. It’s that I have a one-hour free audio CD we put together. It’s a free audio CD course. It’s really easy to get. Just take out your smart phone – and don’t do this if you’re driving. But take out your smartphone and text the word SUSTAINABLE to 44222. That’s SUSTAINABLE to 44222. And by doing so, you will get a link. And the link will ask for your address and we’ll mail it out to you.
This is Josh Patrick. You’re at the Sustainable Business. Thanks so much for stopping by today. And I hope to see you back here really soon.
Narrator: You’ve been listening to The Sustainable Business podcast where we ask the question, “What would it take for your business to still be around 100 years from now?” If you like what you’ve heard and want more information, please contact Josh Patrick at 802‑846‑1264 ext 2, or visit us on our website at www.askjoshpatrick.com, or you can send Josh an e-mail at email@example.com.
Thanks for listening. We hope to see you at The Sustainable Business in the near future.