The Browns, the Steelers, the Cowboys, the Packers, the Patriots; we refer to these football teams as dynasties because they have successfully transitioned through multiple generations of ownership and fans for decades, maybe even a century. How do they do it, and can they be the example for your family? Is your family a team or a group of individuals concerned only about themselves? Recognizing that players, coaches, and management are constantly changing, why do teams last decades and centuries, while families succumb to the historical statistic that 70% of wealth is lost each time it passes to the next generation and completely gone in three generations?
On the Price of Business radio show today I briefly discussed the comparison of a football team to a family. Here is how a family, especially a family with a business, can become a team.
Ownership: Many athletic teams are owned by families. The founding parents can sell the team or keep it in the family. Most keep it in the family. They can set up their estate plan to keep ownership in an entity the entire family owns and controls or distribute ownership to all the children and grandchildren giving them their choice do whatever they want to do with their interest. In the latter case, how are decisions made and who knows who the future owners will be if the heirs decide to sell their interests? The team’s demise is imminent. The entity structure is the better plan.
Organization: This has two meanings; having the right systems and processes in place that can be taught, replicated and easily transferred to the next group responsible for keeping the team growing and going. The second meaning is a legal structure to provide all the resources and protection the team needs to survive and successfully transition to future owners in the family. Families need a structure.
Capital: Teams are for-profit ventures. Their objective is to make money and use that money to keep growing and playing for decades. They need to acquire and utilize the team’s financial, human, social, spiritual, and intellectual capital effectively and efficiently.
Management: Teams have an array of logistical functions. They need uniforms, travel and transportation, they need to acquire players and determine salaries, they hire coaches, determine ticket prices, market ticket sales, sell souvenirs, develop community activities, and handle the accounting and financial responsibilities to name a few requirements. Management makes the important decisions.
Coaches: The head coach is hired, and he hires his team of coaches. There is an offensive coach, a defensive coach, a quarterback coach, a receiver coach, a line coach, etc. Their responsibility is to organize a bunch of individuals with different skills and talents into a team with one purpose—to win games. The coaches develop the strategies and tactics for the team, and teach, train, and develop every player to be the best they can be at their respective positions and roles and rely on their teammates.
Players: These are the people who actually play the game. They are the implementors, warriors, get-it-done guys who make it happen. They play no role in management or deciding how the game will be played strategically, but they do the work, they carry the ball, they score the goals. (Pun intended)
Playbook: The coaches, especially the head coach, have spent hours and months developing the plan for the team. They have tried to anticipate and design every offensive and defensive play they need to win games. It describes each player responsibilities and actions and coordinates those into every play that will advance the ball. Every family needs a written, well designed and defined playbook.
Practice and Training: This is when training and experience are developed. Every play in that playbook is rehearsed over and over until every players’ reactions become automatic. Each player knows exactly what their teammate will do and where they will be at a given moment in time. They trust and rely on each other. They run countless drills and plays, they have mock games, all to gain the experience they need to deal with the reality of what it will be like when the real kickoff and clock starts.
Rules, Regulations, and Referees: Rules and regulations protect the players and eliminate chaos. Without rules, 300-pound warriors would turn the stadium into the Roman Colosseum with gladiators trying to kill each other. Rules define what can and cannot be done so everyone knows how they should take part in the game. If chaos breaks out, the judges and arbitrators (referees) step in to mediate the problem and keep peace.
Super Bowl: Every football team has one aim—to win Super Bowls. To do so, they must win enough games to have the opportunity to play in the Super Bowl. In other words, every team has developed a mission statement, a purpose for its existence and a game plan that accomplishes the mission. Without a clear and shared purpose, a professional team would be no better than a group of guys playing a pick-up game at the local park Sunday afternoons. That purpose, winning Super Bowls, makes all the difference between professionals and amateurs.
So, will your family remain amateurs or become professionals. The latter requires families to become a team with the right organization and structure that is developing and utilizing their five types of capital effectively, that has the right management in place, that hires the right coaches, creates a playbook that fits the family’s team and identifies each players talents and the roles they can and should play, that provides the players the training and experience they need before stepping onto the field and can correct the errors and deficiencies uncovered when the game is being played, that has a solid and workable rule book so everyone knows what is and is not allowed, and there are objective non-family referees that can help the family maintain good communication and build trust in each other and in the family’s purpose. Is there a Super Bowl ring in your family’s future? By the way, every year there is a new Super Bowl. The players on the family team change just like the players on the Steelers or Cowboys. Every generation faces their own Super Bowl, the question is whether they have been properly prepared to effectively implement the game plan with their Time, Talent, Training, and Treasures to win their Super Bowl. The Legacy Family; It’s A Lot Like Football!
Kip Kolson is the president of Family Wealth Leadership, a multi-family office and family coaching firm, and author of You Can Have It All; Wealth, Wisdom, and Purpose—Strategies for Creating a Lasting Legacy and Strong Family. You can order your copy at Amazon or email firstname.lastname@example.org