The 10 attributes of a successful family agribusiness

Multi-generational business families remain a powerful economic force in numerous industries worldwide. Trevor Dickinson looks at the lessons that family-run farms can learn from these success stories.

- Trevor Dickinson

Most companies face competition, unpredictable market changes, and the vulnerabilities of globalising industries. In addition to these challenges, family agribusinesses may have to address family rivalry, later generations’ indifference, variable family member competence, and a possibly rocky succession. Older, successful business families have to deal with estate taxes, growing membership, and the need to teach younger generations about responsible wealth management.

There are three well-documented fundamentals of a profitable, long-lasting family business:

• An active, independent board of directors;
• Regular family meetings for engagement, education and bonding;
• A constitution articulating the family’s purpose, values and polices. This must regulate family practices and expected roles and responsibilities.

In addition to this foundation, a successful family business has 10 key attributes:

 Skill at resolving paradoxes

Negotiating complex family business issues presents many contradictions, such as balancing individual freedom with collective commitment, embracing both tradition and change, celebrating the past while focusing on the future, and respecting individual differences while forging shared values and vision.

The overarching dilemma is how to balance the interests of the business with those of the family. Successful families don’t hide from these problems; they discuss them fully and seek compromises. But they also go beyond compromises to develop true win-win resolutions.

For example, they may conclude that individual creativity is cultivated best by communal support, and loyalty to a group is most genuine when one has freedom of choice.