If you want the best for your family business, you need to think big and search bigger
11th April 2018
Many successful family businesses make use of non-family talent
Some of the biggest and best-known businesses in the world have family at their heart. From the influence of the Walton family on the global retail giant Walmart to the Knight family at sportswear behemoth Nike, family businesses continue to thrive across industries and throughout the world against the backdrop of an ever-changing and challenging twenty first century business landscape.
And although not every family business will become worth hundreds of billions of dollars, the lessons we can learn from these success stories are clear. While 65% of family businesses have non-family members sitting on their boards according to PwC’s 2016 Family Business Survey, it is no surprise to find that larger and older family firms are more likely to have non-family non-executives: 79% of companies turning over more than $100m have such directors, as do 75% of firms which have reached at least a fourth generation.
In the same report, it is also interesting to note that 73% of family firms looking to scale quickly have non-family non-executives. These non-executives have the potential to add value by bringing in external knowledge and new skills.
Accessing non-family talent successfully is difficult
But getting an outside perspective that’s the right fit for your family business can be a challenge for several reasons.
Firstly, the person you’re hiring needs to share the values, passion and culture of a company that has its roots in a family within which they didn’t grow up.
Secondly, family businesses often have to overcome a perception issue that may put off some of the most talented ambitious candidates – notably, that there is a glass ceiling in a family firm that “outsiders” may find hard to break through.
Thirdly, it’s unlikely that you’re going to simply stumble upon the perfect candidate in your day-to-day dealings or find someone who can offer the world-class skills you need by traditional word of mouth.
To find the best talent requires looking beyond your immediate surrounds
Indeed, if you wanted to find a sprinter who could beat Usain Bolt over 100m you wouldn’t begin and end your search at the local athletics club, you’d have to scour the globe to find the fittest and the fastest athletes to even have a chance at keeping up.
It’s the same reason Manchester United don’t only field players who grew up on the streets of Salford – if you want to be the best at what you do, you need to cast the net wide and find the world-class players who are the right fit for your team.
The same logic applies in family business, where to find the best talent it is advisable to go beyond your immediate network, opening up the funnel to maximise the probability of finding the people best equipped to help. The chances of the very best person (rather than someone who is good enough) happening to be in your network are small.
The business benefits of a broader reach
Opening up the net wider often makes businesses realise they have gaps on their board or senior executive team they didn’t know existed. For example, Glen Dimplex were looking for a single board advisor but ended up hiring four because each added value in unique ways they felt they couldn’t do without but only realised on seeing the candidates.
Earlier stage businesses are finding candidates they never thought would be affordable or interested in working with them. For example, intelligent pipeline manufacturer Syrinix recently brought on board the former CEO of FTSE 250 Interserve as chair of their board while big data marketplace Pivigo hired the former head of digital at DMGT as their new Chief Revenue Officer.
Organisations are surfacing talent from pools they never thought to look. For example, regulated financial services firm Ocorian assumed their new chief commercial officer would come from the professional services sector but ended up finding the perfect person from the vehicle leasing sector which was far more advanced in the areas most relevant to them.
We are also seeing an increase trend towards age diversityon boards asthe focus on navigating digital transformation and understanding the millennial customer intensifies. Most boards have an average age well over fifty leaving them vulnerable to groupthink that ignores the changing interests and motivations of the millennial generation. For example, Eight Roads, which is the investment arm of family owned Fidelity International Limited, recently added the Chief Technology Officer of Expedia Affiliates to its board.
About the author
Oliver Cummings is the COO of Nurole, an innovative technology company disrupting the senior executive and board level talent market through its unique candidate-led recruitment platform. Nurole has helped a number of leading family-owned businesses including the world’s largest manufacturer of electrical heating Glen Dimplex, Europe’s largest catering equipment supplier Nisbets, leading shirt retailer Charles Tyrwhitt and Dyson family office Weybourne, access some of the best candidates globally to augment their board and senior executive talent pool.