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What makes a family tick? Asking the right questions can be illuminating

These 10 open-ended queries help advisors explore family dynamics, priorities and pain points

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Reporters know that asking the right questions is key to getting the whole story. Vancouver-based family enterprise advisor Gerry Meyer says family office advisors should be versed in the art of the interview too, especially when working with a new family.

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Why? Enterprising families are not like other businesses, says Meyer, who is CEO of Meyer Advisory Group. Interviewing family members – by taking your time and asking broad questions – can reveal family dynamics and values and demonstrate what makes a family business tick.

“I don’t care what anybody says, family businesses are different,” says Meyer. “Especially when you’re into the second generation or third or fourth generations. The group dynamics expand; you go from a sibling partnership into a cousin consortium, possibly even broader than that.”

When establishing a relationship with an enterprising family, advisors should interview as many family members as possible, says Meyer, to understand relationships and tease out family priorities and pain points.

“When family clients ask me to come in to help, what they’re defining as a problem is usually a symptom,” says Meyer. “I try to recognize it as a symptom, and delve a little bit deeper.”

Open-ended questions will get better results, says Richa Arora, senior family advisor at KPMG Family Office in Toronto.

“When you ask, ‘Do you have a succession plan?’ the answer is ‘yes’ or ‘no’ and that’s the end of the conversation,” says Arora. Instead, she suggests asking broader questions such as, “What is your ideal outcome?”

And don’t underestimate the power of these three familiar words: “Tell me more.”

It’s also important to decipher a family’s jargon, says legacy coach and family advisor Danielle Saputo, who is based in Peterborough, Ont.

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“When words are being used, don’t make the assumption that you know what that word means to another person. You need to clarify, because your interpretation of ‘integrity’ or any other values, for example, can mean something very different to someone else,” Saputo says.

We asked all three experts to share key questions that advisors should pose to members of enterprising families.

“What is working?”

This simple, broad question can reveal what family members see as the root of their success, how they measure success and whether there is agreement or alignment among family members, Meyer says. It also illuminates priorities across the family business. Depending on their role, family members may share insights about business operations, shareholder interests or family dynamics.

“What’s not working?”

Meyer says this question shows whether they can recognize problems and how much understanding they have about roadblocks the family business might be facing. Asking different family members this same question shows whether there is alignment or collective agreement on family issues.

“What is holding you back?”

This question builds on the previous question and helps an advisor check whether family members have correctly identified problems – and solutions. Meyer says it can also show how committed a family member is to the future of the company or the family, and how aligned they are with a family’s values.

“What is the purpose of your wealth?”

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This query should shed light on family values and priorities including philanthropy, investment, stewardship and even succession. Arora says you can phrase things slightly differently for rising generation members, asking, “What would you like your family wealth to enable?” to get a sense of whether they see themselves as stewards of family wealth and what they value. You can also see whether family members are aligned in how they view family wealth and legacy.

“Thinking of selling? First, let’s hear more about your business. What excites you about it and what keeps you up at night?”

If an advisor is brought in to discuss selling the family business, other issues may be at play, such as unresolved family tension or difficulty with succession planning, Arora says. Open-ended questions about the family and business history can air some of those frustrations and create an opportunity to present other solutions.

“What conversations are you having with your children about the future and the transition of wealth or the business?”

This question opens the door to insights about a family’s succession plans. If the answer is “none,” then it’s an opportunity to talk about where any hesitation might be coming from, Arora says. It’s also a chance to evaluate whether the family is aligned in its views about the future roles the next generation may play.

“In terms of succession, how do you define ‘readiness’?”

There will likely be a variety of answers to any question about when the rising generation is ready for succession, Arora says. Plenty of follow-up will be needed to explore any hesitation to passing the baton and to identify gaps in planning and where support and education might be needed.

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“What is your purpose or your mission for the future?”

Saputo says this question can reveal where family members may be stuck in roles or relationship dynamics that prevent growth. For example, a business owner who is also a parent may view himself as a steward and protector but may be slow to recognize the abilities of the rising generation. Second-generation family members who are now adults may still view themselves as junior and may be waiting for permission to step forward. Questions about purpose can help.

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“When you think about the next five to 10 years, what concerns you the most?”

This question often spurs rich conversations about family dynamics, extended family and concerns about planning or succession. Saputo says it can also help identify pain points and help families mitigate potential risk.

“What do you mean?”

Follow-up questions are crucial. Saputo recommends doing a deep dive into any jargon to ensure you understand what a family means when they use terms such as “stewardship” or “readiness” or “governance.”

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