Nearly two thirds (64 per cent) of SMEs are finding it increasingly difficult to retain valued staff in the current economic climate. Chief Executives and Managing Directors are feeling this most acutely, with three quarters (75 per cent) of the C-Suite finding valuable staff members harder to hold on to. This is according to the latest Opinium survey of 500 SME decision makers, conducted in August 2023 on behalf of Direct Line Group. Key Findings: Almost two thirds of Small and Medium Sized Enterprises (64 per cent) are finding it difficult to retain valued staff in the current economic climate Hybrid/flexible working options are almost as important as salary and benefits when it comes to retaining or attracting talent Current economic uncertainty is stopping 39 per cent of SMEs from growing their business operations through recruitment When it comes to retaining key members of staff competitive salaries and benefits packages are still the most widely used method to keep employees satisfied, with 44 per cent of SME employers using this as their main tool in their armoury. However, this is closely followed by hybrid & flexible working with 41 per cent offering these working patterns, as it is widely considered a key factor when employees decide whether to stay with a firm or move. A positive and inclusive culture is also cited by 40 per cent as being key to retaining staff. Providing professional development opportunities, such as training and upskilling, is another mechanism SMEs use to keep employees engaged, with 39 per cent offering this as a form of talent retention. However, nearly half (48 per cent) of SME employers are finding it harder to allocate budget to upskilling and training the workforce in the current economic environment. It is not just retention that is a challenge. On average, 16 per cent of SMEs are finding it difficult to recruit the right people with this number rising to almost one in five (18 per cent) for firms between 10 and 249 people. The current economic uncertainty is prohibiting SMEs from growing their business operations, through hiring more staff, with 39 per cent citing this as being harder. Alison Traboulsi, Product Manager at Direct Line business insurance commented: “Attracting and retaining skilled employees can be challenging no matter what size your business is." "Competition for highly skilled talent is fierce and aligning to the needs and demands of a constantly evolving workforce can be tricky. Employers need to balance their recruitment strategy to enable them to attract the top talent alongside their retention strategy to ensure they keep their best employees. To do this they need to make sure their staff are engaged, motivated and committed to the organisation." "The areas to focus on that have the most employee appeal are salary and benefits packages, flexible working, a positive work culture, career development opportunities and a desirable work environment.” Further information about Direct Line business insurance's SME cover can be found here

In the realm of entrepreneurship, family businesses stand as a testament to both tradition and innovation. However, a persistent issue that often surfaces in conversations in such businesses is the delicate balance between meritocracy and nepotism. Nepotism, the practice of favouring family members in employment and advancement, can be a double-edged sword for family businesses. On one hand, it provides a sense of continuity and loyalty, fostering a unique corporate culture. On the other hand, it can hinder diversity, stifle fresh perspectives, and potentially compromise the overall success of the business. One key challenge is distinguishing between justified succession planning and nepotistic tendencies. When family members are appointed based on competence and skills, it can lead to a seamless transition of leadership. However, when positions are granted solely due to familial ties, it may undermine the principles of fair competition within the company. Interviews with experts in the field shed light on the importance of clear corporate governance structures within family businesses. Establishing transparent criteria for hiring, promotions, and leadership roles helps mitigate accusations of favouritism. Striking a balance between family values and professional merit becomes crucial for fostering a healthy work environment. Moreover, successful family businesses often implement measures such as professional development programmes, mentorship initiatives, and external hires to inject fresh perspectives. This not only helps in breaking the potential nepotistic cycle but also brings in a diverse range of skills that can contribute to the business's growth. Much has been written about roles within leadership teams and family businesses with Jim Collins, author of 'Good to Great' clearly demonstrating the need not just to have 'the right people on the bus' but also to have them 'in the right seats' and of course, every bus needs a driver to help get them where they are trying to go. Family businesses are no exception and successful family firms provide clear, robust frameworks when recruiting for senior positions with some next generation family members feeling they have to be 'over qualified' to secure a role on merit. This is a big area and topic of conversation for the family business community requiring open and honest conversations between different generations. One has to handle the emotional wrangles around passing on the business and the leadership roles to someone new, family or non-family, and the next generation need to be honest about whether or not they want to have a senior role and career in the family firm first and foremost. Then comes the challenge around merit and competency and giving the roles to suitably qualified and able individuals. In conclusion, the intricate dance between family ties and professional merit is a challenge faced by many family businesses. Navigating nepotism requires a delicate touch, emphasising the need for transparent governance, objective decision-making, and a commitment to fostering a dynamic, inclusive workplace culture. Transparent recruitment practices, written guidelines that are adhered to and open and honest communication certainly aid the process. Balancing tradition with the demands of a competitive market is the key to sustaining the legacy of family businesses for generations to come, and to ensuring the best people are in the right positions with the requisite skills to drive the business forward.

Navigating the complexities of a family business can be challenging. With the mingling of familial ties and professional responsibilities, finding the right balance is crucial. Over the years, I have worked with several UHNW family businesses and observed how the intersection of family and business dynamics can shape their success or failure. Here, I will share some insights into achieving equilibrium between being a family and running a business together. Separation Of Roles One of the first steps towards achieving balance is to distinctly separate familial roles from business roles. Each family member involved in the business must have a defined role and clear responsibilities. These roles should be based on skills and competencies rather than favouritism or seniority. Additionally, create separate spaces for family and business discussions. For example, family gatherings should not become business meetings, and likewise, business boardrooms should not be the place for family disagreements. This clear demarcation helps maintain professional integrity while preserving family harmony. Effective Communication For A Family Working In Business Together In a family business, effective communication plays a pivotal role. Emphasize transparency in business dealings and open dialogue about the family’s goals and visions for the company. Set regular family business meetings where all stakeholders can discuss business matters. However, be mindful to keep the communication respectful and professional. Personal issues and emotions should not seep into business discussions. And equally, business differences should not influence personal relationships. Conflict Resolution Conflicts are inevitable in any business and even more so in a family business due to the intertwined personal relationships. It’s crucial to have a pre-agreed upon conflict resolution mechanism. It can involve a neutral third party, a family council, or a family business advisor like myself who understands the nuances of family dynamics and business. When conflicts arise, focus on the issue at hand rather than personal attacks. Remember, the objective is to find a solution that benefits the business and maintains family unity. Succession Planning One of the most critical areas where family and business overlap is succession planning. It’s essential to start this process early and involve all relevant family members. It should be based on merit and capability rather than entitlement. As part of succession planning, consider how to prepare the next generation for leadership. This preparation involves not just business education but also wealth psychology education. It’s crucial for them to understand the responsibilities and emotional challenges that come with wealth and leadership. Shared Vision & Values A shared vision for the business and shared family values can serve as the glue that keeps the family and business together. Develop these together, involve all family members in the process, and revisit these regularly. These shared goals and values can help guide business decisions and also strengthen family bonds. Balancing the dual identity of being a family and business partners is no easy feat. However, by separating roles, enhancing communication, establishing a conflict resolution process, planning succession early, and rallying around a shared vision and values, you can strike a balance that fosters both business success and family harmony. About the Author - Dr Lami comes from a family business background and has experienced first-hand the impact that money has on our emotional and mental wellbeing and the quality of our relationships. Working through her own challenges, her experience and qualifications have given her both a personal and professional understanding of the challenges faced by her clients. Her Wealth Consultancy provides Non-Financial Solutions for UHNW Individuals, Couples, Families, Family Offices & Family Businesses. Her approach to her work focuses on finding creative and relevant solutions to the non-financial challenges of wealth which is done by facilitating, advising, educating and coaching clients to develop a deeper understanding of their respective mind-sets and the impact that emotional intelligence has on matters relating to wealth, relationships, parenting, family, planning and succession. Find out more about the work she does by visiting her website here

News stories in the media about poor leadership and a toxic culture at well-known organisations are becoming increasingly commonplace. Some standout more than others due to the nature of the allegations. Today’s volatile, competitive world has little tolerance for the impact of ineffective boards and the resultant poor board performance. The negative impacts of an ineffective board on reputation, employees, customers and the value of the company in the mind of wider stakeholders has spread beyond the boardroom. A significant contributing factor to a substandard board is the absence of an effective board review process. Assessments of their boards and individual directors is good governance practice but this critical process needs to be approached in a professional and serious way that addresses the context of the board, the organisation and the sector. Too many directors view the evaluation of the board and directors as a “tick box” exercise, and yet another task to strike off from the governance to do list. This “quick fix” approach, rather than a long term journey of performance improvement, will not drive board effectiveness – something which is even more important in today’s challenging business climate. What Does A Good Board Evaluation Look Like? A good board evaluation considers the role clarity, composition, processes, culture, behaviours and dynamics of the board. Ideally, it should be carried out by a suitably qualified external consultant every three years with the intervening years providing an opportunity to track progress. To be objective and of value those that lead the review process should be independent and impartial. If the evaluation is led by a serving member of the board, someone conflicted by recruitment interests, or with a perceived agenda of selling consultancy or training services, there is a risk that they will bring their own agenda and beliefs. This risks the board hearing what they “want to hear” not what they “need to hear” and the assessment may not add as much value or be credible, perpetuating a poor board performance. The independent assessor who’s selected needs to be qualified and experienced in understanding the construct of the board, the dynamics of the board and how to spot opportunities to improve its effectiveness. Importantly, it will ensure that the person who evaluates the board or a director is credible and therefore trusted and respected. Effectively implemented board reviews are about far more than compliance. They provide the opportunity for reflection, assessment and questioning of whether the board and its performance are fit for purpose. An experienced third-party assessor understands this and helps to deliver a culture which is performance focused, and supplies data to support improvements in their performance, enabling them to refine their approach. The starting point for a good board review is to have clarity about the objectives. Then the board needs to decide who is going to be assessed (board, individual directors, committees, chairs), and what will be assessed, and who will contribute to the evaluation (e.g. board, executives, shareholders?). Stage One: Gather Data The first stage of data gathering is to review documents to analyse the way the board works, to gain a better understanding of the history of the board and assess how the board has handled decision making, board processes and recommendations from previous evaluations. The next step is to create and forward online surveys to all participants in the evaluation. These will be tailored by the independent reviewer, reflecting what is being assessed, the purpose and strategic objectives of the business, and the behaviours, skills, knowledge and impact of the board. It’s important to point out that too many board reviews consist solely of a survey delivered over a board portal or on a survey platform. These “tick and flick” exercises provide data but no clarity about the reasons for the results. Surveys provide detail on how participants have answered questions, but interviews are a critical quality control to gain insight into “why” participants have a particular view and to discuss board performance and development opportunities that are poorly communicated in a survey. The critical element of an interview by a suitably qualified, independent interviewer with relevant board experience to add “flesh on the bones” of the survey and gain insight on the reasons behind a particular response is a crucial part of effective board reviews. The best approach is to obtain a comprehensive collection of qualitative and quantitative data to deliver a 360-degree performance review. Importantly, it also enables the board to evaluate behaviours, dynamics and ways of working, and move beyond specifically assessing performance against key performance indicators. Stage Two: Present Findings To The Board Once the survey and interviews are complete the report produced will identify any divergence between the director’s views on the board’s performance and in meeting their broader objectives. This way the board can spot strengths and opportunities to enhance performance and personal development. Crucially, the report will ensure that there is no ambiguity and confusion over the roles of directors, which can have a negative impact on board effectiveness and decision making. An independent, third-party expert with a good, consistent process of data gathering and reporting can add significant value to board evaluations. Too many internal board evaluations lack the discipline of a board workshop and a written report. Stage Three: Follow-Up And Implement The Required Changes The most common failure in a board evaluation is the lack of follow up with the actions to improve performance. Post review, credible actions with clear ownership should be regularly revisited to monitor progress and a strong performance, whether this is for an individual or the entire board. If these don’t happen the work of the assessor and the board will have been in vain. In these volatile times it’s vital to source an experienced, independent third-party assessor to manage the entire board review process and help deliver an effective, high performing board that avoids the pitfalls that poor leadership can bring. About the author - John Harte is the Managing Partner at Integrity Governance where he leads a global team that is focused on making boards more effective. A boardroom expert working with multinationals and SME’s, he provides practical, impartial advice to directors, business owners and CEO’s to help improve performance. He is a regular speaker and thought leader on board effectiveness, practical governance and business disruption. John grew up in a family business and his extended family run fifth generation businesses and he has also served as a board member, chairman and adviser to many family firms. He also worked within Mars, a globally recognised family business for the best part of a decade.

As AI becomes more ingrained in our daily lives, more people are incorporating these automated processes into their work. In fact, 37% of people have already used AI at work, and we can expect more people to start using it daily, too. Caroline Gleeson, CEO at Occupop , says: “AI is advancing rapidly, automating tasks and freeing workers from administrative burdens in the recruitment industry. But it is also essential to recognise that certain aspects of the profession require human intervention. Human professionals excel in assessing cultural fit, interpersonal dynamics, and understanding organisational values—facets that go beyond the capabilities of AI and demand the expertise, judgment and empathy that only a human professional can provide.” Where AI Is Useful In Recruitment AI and automated processes are built to help workers achieve tasks quicker and more efficiently. Whether planning a recruitment schedule or through recruitment tracking software, technology can help businesses cut down on administration time – allowing HR professionals to spend that extra time focusing on their employees. On average, a single online job post can expect to receive 118 applications. Technology can help screen these applicants to find ones that fit specific criteria that suit the job role, saving you time from viewing these individually. Using AI during the working day can also help you write job descriptions, tailored feedback, and even personalised messages when outreaching to potential recruits. But, ensuring there is a human touch in HR is essential for the role, especially in the world of family business. Where Human Intervention Is Needed During Recruitment Screening Resumes While the initial 118 applications can be cut down by software, ensuring that everyone applying has the right level of experience for the role and that you’re screening the remaining applications is essential for your business. Choosing the right candidates for your company could mean looking at more than just their most recent work experience. Having the human touch here can help better determine who you want to reach out to and interview. Networking And Relationships Automating administration processes can ensure you’ve got more time for other HR-related tasks. This can include networking and building relationships with customers, other businesses, and potential recruits. While AI can be used to help you write emails and provide feedback for interviews, you will want the human touch if you’re considering an applicant for a longer period. This person-to-person approach can be more welcoming and helpful if you plan to maintain contact with a candidate for future roles. The human touch is also useful for headhunting. If you know someone who would be the perfect fit for your business, it is best to reach out to them personally rather than through a system. Handling Sensitive Situations The recruitment process isn’t simply hiring someone new. Sometimes, it is handling sensitive situations which require some humanness rather than technology. This can include during layoffs, for employee wellbeing, or during a difficult negotiation. Using technology during these situations can present your company as unfeeling and difficult to work with, and it could even cause a loss in employees if sensitive situations aren’t handled with care. Whether handling the death of a colleague’s family member or long-term sickness, ensuring you’re caring for your employees means adding the human touch to these moments. AI might be used throughout our daily lives, but it cannot replace the human touch. Whether it is concern and care or needing a bit of judgment, the human touch is essential for getting the best results for your business. By balancing automated systems and a human-centric approach to HR, you can get the best results for your family business and your employees.

Business specialists at TelephoneSystems.Cloud have named five ways to keep teams stimulated and working hard throughout 2024. Encouraging development amongst teams by offering incentives such as promotions and pay rises will remind employees of their value. Managers should also allow for open and honest discussions to encourage others to speak about any changes or feedback they may have. Another way to keep employees motivated is to implement new technologies and offer support in the form of training and industry tools to keep creativity flowing. Juliet Moran, founder of TelephoneSystems.Cloud said: “After the festive break there might be a bit of a hurdle to face when it comes to getting your team motivated. It’s important to implement several strategies in the workplace to encourage motivation from the first day back and continue throughout the year." “Offer active support and set annual objectives for teams to optimise workload once they’re back." "Managers should also encourage honest feedback from their employees and actively implement any changes to acknowledge experiences from the past year that can be adapted." “By investing in the latest industry technologies, employees will have the space and ability to embrace creativity whilst working to boost productivity." “And by offering incentives such as promotions and pay rises to reward and recognise good work and valued employees, your team will feel appreciated and motivated to continue contributing the best they can." “Here at Telephonesystems.cloud , our staff get a bonus of 50% of the profits every year, showing our commitment to our team and how hard they work.” Here’s how to motivate your employees in the New Year: Invite honest feedback : Sit down with your team and invite an open and honest discussion about any changes that could be made in the new year, based on experiences from last year. Create a welcoming and casual environment to encourage employees to speak freely about any feedback and new changes they would like to suggest. Take on board these observations and consider implementing them into the workplace. Encourage development : Remind your employees of their value and how their efforts throughout the past year have helped to shape the company. Actively rewarding hard work with promotions and pay rises will help keep your teams motivated throughout the year and encourage them to continue contributing to the bigger picture. Offer active support and resources : After the festive break, it’s important not to set expectations too high for the first few days back. Offer up active support and productive resources such as additional training and industry tools to help others get up to speed. Set annual objectives : Set clear objectives for the upcoming year so employees can optimise their workload throughout each quarter and understand priorities. Setting these expectations and goals will help your team settle back into work in a productive manner whilst staying focused. Implement new technologies : Consider introducing some of the latest technologies into the office to foster an efficient workspace and encourage employees to feel engaged. Bringing in innovation can boost team creativity and motivate them to excel.

In the ever-evolving landscape of the contemporary workplace, the importance of motivating teams cannot be overstated. The success of an organisation is intricately tied to the collective drive and enthusiasm of its teams. Here, we take a brief look at some of the multifaceted strategies to inspire and propel teams toward unparalleled achievements. One foundational element of team motivation is fostering open communication. Establishing a transparent and inclusive communication culture enables team members to share ideas, concerns, and feedback freely. This open dialogue not only enhances collaboration but also fosters a sense of ownership among team members, making them feel valued and engaged in the organisation's mission. Recognition serves as a powerful catalyst for motivation too. Acknowledging individual and team achievements, whether big or small, creates a positive and empowering work environment. This recognition goes beyond mere accolades; it instills a sense of pride and boosts morale, motivating team members to consistently excel in their roles. Furthermore, providing growth opportunities is essential for sustaining team motivation. Investing in professional development and training programmes not only equips team members with new skills but also signals the organisation's commitment to their long-term success. This commitment fosters loyalty and motivation as employees perceive a clear path for personal and professional advancement within the company. Creating a positive work culture is a cornerstone of effective team motivation. Cultivating an environment that values collaboration, innovation, and work-life balance contributes to employee satisfaction. A positive workplace culture fosters a sense of belonging, inspiring team members to go above and beyond in their contributions. When it comes to family firms, motivating teams is a multifaceted endeavor that requires a holistic approach. By fostering open communication, recognising achievements, providing growth opportunities, and cultivating a positive work culture, family businesses can create an environment where teams thrive and contribute significantly to overall success. In prioritising team motivation, organisations not only enhance employee satisfaction but also fortify their foundation for sustained success in a competitive and dynamic business landscape.

As the older generation gracefully steps back from the day-to-day operations of the family business, a new chapter unfolds, emphasising the importance of their ongoing contributions. While relinquishing daily involvement, their wealth of experience and industry knowledge can become a valuable asset to guide the business forward. These seasoned individuals often find themselves in pivotal roles as mentors, offering guidance and imparting invaluable insights to the younger members of the family who are now taking on leadership roles. Their mentorship extends beyond the boardroom, fostering a sense of continuity and shared vision. In addition to mentoring, the older generation can play a key role in strategic decision-making. By serving on advisory boards or participating in periodic consultations, they bring historical context and a long-term perspective to discussions, helping to shape the business's trajectory. They no longer have a desire to be involved in a daily basis but may well have experienced similar situations before and can provide a unique insight which is invaluable too. Moreover, their networks built over years of industry involvement can open doors to new opportunities and partnerships. Leveraging these connections, the older generation continues to contribute to the growth and expansion of the family business, continuing by way of an ambassadorial role. Recognising the evolving landscape of technology and business practices, the older generation can also champion innovation. Encouraging the integration of modern technologies and adaptive strategies ensures the family business remains competitive in a rapidly changing market. Ultimately, the transition from daily involvement to a more strategic and advisory role allows the older generation to pass on the baton while maintaining a vital presence in the family business. This dynamic shift not only secures the legacy of the enterprise but also fosters a harmonious blend of tradition and progress for generations to come.

Where we start, whether it’s in life or each new day, is a key driver of where and how far we go. “When you ain’t got nothing, you got nothing to lose,” crooned Bob Dylan. It’s a phrase often used to describe sport teams toward the end a terrible season, yet who manage to upset a leading team with plenty on the line. The underdog may be down on talent and seem to have nothing to play for, yet they are able to rise above their level and outplay a superior team. People sometimes need to hit “rock bottom” before they can begin the climb up. The other side of this coin is the team or player who continues to win, and each time the pressure builds to maintain that success. Rare is the player who gives it all up in their prime at the top of their game (Australian tennis player Ash Barty, who battled depression throughout her short career, is a notable exception). There seems to be something liberating about reaching the point when there is nothing left to lose (cue Janis Joplin: “Freedom's just another word for nothin' left to lose”) - where the only direction is up. And the burden to remain at the top is palpable and can lead to all sorts of negative emotions and consequent behaviours. Continuing the sports metaphors, Barry Switzer said “some people are born on third base and go through life thinking they hit a triple”. This succinctly describes unearned advantage, or “privilege”. Further, once on third base, scoring is actually the result of another person’s hit. So even if you acknowledge the contribution of others in giving you a head start, your own progress can be both limited and tainted because they are not the result of your own effort. That’s an awful way to live. The common element in all these cases is one thing we instinctively do as humans: compare ourselves to others. We look at each other’s clothes, possessions, occupations and social media feeds and position ourselves relative to them. While we may be perfectly happy with our car, seeing someone who we’d consider a peer in a better car leads to feelings of inadequacy and jealousy. The fact that we compare based on the superficial and external (and in the case of social media, possibly the fake) aspects of others’ lives doesn’t matter. The driver of the fancy car may be suffering from terminal cancer, clinical depression or be in an awful relationship. We point to rankings in rich lists as a measure of someone’s worth. Our minds are ‘cognitive misers’ - we seek shortcuts and simple ways to explain complex things. That translates to selective comparison with others, rather than viewing life as a package that has both positives and negatives. This leads to one final lesson from the world of sport, and perhaps the most important one: few successful Olympic athletes compare themselves to others. Rather than seeking to run faster than others, they are constantly looking for their next “PB” - their personal best. Every day they aim to be a better version of themselves. The burden of expectation is largely because of a focus on others – our position relative to them, and their expectations of us. But that position is an illusion we create. How we view our starting position (in life or each new day) is entirely up to us. Being our best is about being the best version of ourselves. "Envy is inversely correlated with self-examination. The less you know yourself, the more you look to others to get an idea of your worth. But the more you delve into who you are, the less you seek from others, and the dissolution of envy begins." - Lawrence Yeo Conversation Starters: What are the expectations associated with being part of your family? Are these implicit or explicit? Do they come from the family? the community? What does being part of your family mean (aside from the financial)? About the Author: David Werdiger is director of Nathanson Pearson in Melbourne Australia, an established provider of practical and appropriate solutions specifically for high net worth families. As a published best-selling author of Transition he has assisted many HNW families to navigate the complexities of succession planning, intergenerational wealth transition, and family governance. David is a family enterprise advisor, tech entrepreneur, family office principal, best-selling author on wealth transition, experienced non-exec director, and a dynamic speaker and educator. Find out more here

Family businesses often face moments requiring major decisions—whether it’s passing the baton to the next generation, preparing for a possible sale, or resolving family or shareholder disputes. In such uncertain times, making a permanent leadership appointment can be tricky, if not impractical. That’s where appointing an interim manager can be an effective solution. Why Opt For An Interim Manager? During periods of uncertainty, family businesses need leaders who are both decisive and adaptable. However, finding a permanent executive under these conditions can be tough. The murky future of the business can make the role less appealing to top candidates, who may be wary of stepping into a position with unclear long-term prospects. The added concern of navigating unresolved family dynamics or ongoing shareholder disputes only compounds the difficulty. An interim manager, by contrast, is hired for a specific purpose and a set duration. This temporary arrangement allows the business to benefit from top-notch expertise without the long-term commitment required for a permanent role. Interim managers often come with a wealth of experience from dealing with similar scenarios in other businesses, making them well-suited to handle the challenges at hand. Focusing On The Task At Hand Unlike permanent executives, interim managers don’t have to worry about their long-term future with the company. They are brought in to achieve specific objectives—whether it's stabilising operations, leading a transformation, or preparing the business for sale or succession. Their main focus is on delivering their mandate effectively, without getting caught up in the ‘noise’ of internal conflicts or the uncertainty surrounding the business's future. This focused approach enables interim managers to drive necessary changes, implement best practices, and set the business on a positive trajectory, all while giving the family the time and space needed to address underlying issues. Whether guiding the business through a transition, managing a crisis, or simply holding the fort until a clear strategy emerges, an interim manager is crucial for maintaining stability and continuity. Providing Breathing Space For The Family For family members and shareholders, having an interim manager in place can offer much-needed relief. Knowing that an experienced professional is temporarily steering the ship can ease some of the pressures associated with leadership uncertainty. This breathing space allows the family to tackle sensitive matters—like succession planning, ownership disputes, or strategic realignment—without the immediate pressure of securing a permanent leader. Furthermore, this interim period can be invaluable for reflection and planning. The family can use this time to refine their vision for the future, resolve conflicts, and make informed decisions about the business's direction. Once a consensus is reached, the search for a permanent leader can continue, now with a clearer understanding of the role and the qualities required in the ideal candidate. The Flexibility Of Interim Management A major advantage of interim management is its flexibility. Interim managers can be brought in at short notice, for precisely the right duration, and with a clear focus on achieving specific results. This flexibility allows the family to adapt to changing circumstances without being tied to long-term commitments. If the business’s needs evolve, the interim manager’s role can be adjusted accordingly, ensuring that the business remains responsive and agile amidst uncertainty. In family businesses where the future is uncertain and internal issues remain unresolved, appointing an interim manager offers a pragmatic solution. It provides the business with the leadership and expertise necessary to navigate challenging times, without the complications of a permanent appointment. By concentrating on immediate needs and allowing the family time to address underlying concerns, an interim manager plays a vital role in guiding the business through periods of uncertainty, paving the way for a more stable and successful future. About the Author: David Twiddle, Managing Partner at TWYD & Co, specialises in recruiting executive and non-executive roles for family businesses and assisting business families in overcoming complex and sensitive people challenges.

Leaders should foster a culture of positive, constructive challenge, which can help mitigate risks and improve decision making, according to experts at Imperial College Business School. In a new white paper, experts from Imperial’s Centre for Responsible Leadership analysed the strategies that leaders can implement to successfully elicit challenge from their teams. The paper contains key lessons and evidence-based recommendations for leaders to encourage challenge, that can be applied to a wide range of organisations. The Centre for Responsible Leadership at Imperial College Business School produces research that helps leaders make decisions with a long-term view, prioritising sustainability and diversity alongside effective delivery. Serious Consequences Professor Celia Moore, Academic Director of the Centre for Responsible Leadership at Imperial and lead author of the white paper, said: “The consequences of a corporate culture where teams are hesitant to challenge leaders can be dire. This can include financial damage and service failure. Despite this, concrete guidance on what leaders can do about this has been lacking. We wrote this paper to offer business leaders evidence-based strategies that can make a real difference in preventing failure within their organisations.” In March 2021, for example, global investment bank and financial service provider Credit Suisse lost $5.5 billion following the collapse of asset manager Archegos Capital, with a report finding that “a cultural unwillingness to engage in challenging discussions” was a major factor. According to Professor Moore, creating challenge is an important part of the workplace experience. “Staff hesitate to offer challenge if they feel vulnerable. Leaders need to be clear that speaking up and disagreeing will not incur risk,” she said. Effective Strategies According to new evidence presented in the report, it’s important for leaders to ask the right questions to generate meaningful challenge from employees. The report found that open-ended questions and general queries were less likely to result in challenge. Instead, leaders should focus on questions that specifically ask for disagreement (e.g. ‘does anyone think there is a better idea?’) or that build an invitation for challenge into the conversation (e.g. ‘what would stop you taking this option?’). The report also revealed that leaders need to acknowledge challenges as legitimate, while focusing on the idea at hand (e.g. ‘that’s a fair challenge, and we could definitely go with that option’). Acknowledgement that was too general or that strayed into gratitude was found to be much less effective. The Imperial team found that individuals are more likely to speak up if others are also participating and the environment is inclusive. Leaders can encourage a more open and inclusive environment by using humour and interacting with team members about unrelated, conversational topics. Adequate time must also be allocated to allow thorough debate and challenge of ideas. Even when challenges emerge early, short meetings risk shutting down discussion before ideas can be properly explored. Finally, the authors recommend making team members more accountable for their views, as this makes them more likely to provide healthy challenge. This could be through forcing them to commit to a specific idea (e.g. ‘which do you prefer, option A or B?’), or asking them to vote on ideas. Key Recommendations For Business Leaders Solicit and specify: Leaders need to ask precise questions that clearly indicate they are seeking challenge. Acknowledge: Legitimately acknowledge team members’ challenges to reinforce that their input is valued. Interaction and humour: Incorporate humour and casual interaction to create a more relaxed and open environment. Time management: Ensure that meetings are long enough to allow for thorough discussion and challenge. Accountability: Hold team members accountable for their contributions and decisions to encourage them to voice their opinions.

The impact of narcissistic behaviour in family businesses is a complex and often destructive force that can affect both the operational success of the enterprise and the very nature of family relationships. Narcissism, characterised by an inflated sense of self-importance and an insatiable need for admiration, can wreak havoc when present in a family business leader and affect relationships not just with other family members but also the broader stakeholders in the business too. In terms of business operations, narcissistic leadership can often lead to the creation of numerous problems over time. Decision-making processes can become skewed, or non-existent as the narcissistic leader tends to ignore input from others, relying instead on their own judgment, which they believe to be superior. This can result in impulsive and ill-considered choices that prioritise the leader's desires over the company's best interests. Moreover, narcissists are typically reluctant to engage in debate around significant decisions and on key family business areas such as succession planning, as the idea of relinquishing control threatens their sense of importance. This short-sightedness can seriously jeopardise the long-term sustainability of the family business and create enduring issues that cause problems for many of those involved on a daily basis. The need for constant admiration may drive narcissistic leaders to engage in risky or unethical practices to boost short-term performance, potentially compromising the company's reputation and financial stability. Their focus on personal glory often comes at the expense of sustainable growth and ethical business practices, and is very much detrimental to the creation of a positive, aligned and clear purpose for all staff involved. Beyond the boardroom, the effects of narcissism seep into family dynamics, often with devastating consequences. Favouritism becomes a tool for the narcissistic parent to manipulate and control, as they show preferential treatment to children who best stroke their ego. This can create a toxic environment of competition and resentment among siblings, fracturing family bonds that should be the foundation of a family business, some of which may never be repaired. Children in these environments learn that love and approval are conditional, tied not to their personal growth and achievements, but to how well they meet the narcissist's needs for admiration and control. This dysfunctional dynamic can lead to a generation of family members who struggle with self-esteem and have difficulty forming healthy relationships both within and outside the family, affecting all manner of aspects of life from mental health and wellbeing to longer term career choices and success too. Furthermore, the overwhelming presence of a narcissistic leader often stifles the individuality of other family members. Spouses, children, and extended family involved in the business may find themselves suppressing their own personalities, goals, and ambitions in an effort to please the narcissistic figure and avoid conflict. This not only hampers personal development but also deprives the business of diverse perspectives and talents that could drive innovation and growth. Breaking the cycle of narcissism in family businesses is challenging but crucial for the health of both the business and the family. Implementing strong governance structures can help distribute power more evenly and provide checks on the narcissist's authority. Encouraging open communication, though difficult, is essential in creating an environment where all voices are heard and valued. Seeking external perspectives through the inclusion of non-family advisors or board members can bring objectivity and balance to decision-making processes. Additionally, providing leadership training and coaching for all family members involved in the business can help develop a more collaborative and emotionally intelligent leadership style. Addressing narcissistic behaviour in a family business often requires professional help to navigate the complex dynamics at play. Family therapy, in conjunction with business consultancy input, can be invaluable in untangling the knots of dysfunction that narcissism creates. While the process is often painful and met with resistance, confronting these issues is essential for the long-term success of the business and the well-being of the family. The impact of narcissistic behaviour in family businesses can be far-reaching and potentially devastating. It affects not just the bottom line, but the emotional health and future prospects of entire families. Recognising and addressing these issues is a crucial step in ensuring that family businesses can thrive across generations, fostering both professional success and familial harmony.