How to Challenge Assumptions in a Family Business
“This is how we do things around here” is a frequent refrain in many family-run businesses. Some of these businesses have been around for decades, if not centuries, and have been successful. And it IS how they do things and it works, so why question it? Why change?
When you have a tightly-held family company that has worked well – or at least well enough – for years, it can be hard to challenge the way things are done or how the company competes in the marketplace. Yet being able to challenge assumptions, ask and answer the hard questions, and think about what’s possible is often the difference between companies that thrive and those that just get by. Both new and old employees can find it difficult to raise ideas and have them heard – even if they may be critical to the long-term success of the business.
There are two practices the best family businesses put in place:
1. Create a culture, and an expectation, that employees will ask the hard questions.
The first step is to teach leaders and employees to surface background conversations. Background conversations are what we think, but don’t always say – or say in the meeting. They are the questions, concerns, and thoughts that we have that drive our actions. People often have ideas about the company and what could make it better, but don’t always share them. Why? They don’t want to be seen as a disruptor, or not a team player. They don’t want to slow something down, or they fear saying the wrong thing. Fostering a culture where people freely share what’s on their mind can prevent getting stuck in assumptions that no longer serve the company. Do employees in your organization freely share their background conversations? It may be time to start finding out what you are missing.
The flip side is teaching people how to listen generously. We often listen in black and white. “Do I agree or disagree?” “Is that right or wrong?” Instead, we should intentionally listen FOR new possibilities in what someone is saying. Listen FOR the assumption that is being challenged and what may be possible if it wasn’t true. If you expect leaders and employees to share more background conversations, you need an even greater commitment to listen generously to what they say.
2. Build a myth-busting step into the strategic planning process
By adding this step, you are challenging deeply held assumptions each time you refresh your plan. What are the assumptions you hold about what is “true” about your business, or industry, or competitors? What do you think you “can” and “can’t” do? Then honestly ask yourself what would be possible if you assumed something different.
Many years ago, we worked with a family-owned food company that supplied french fries to McDonald’s and had grown to a $6B business. But as growth at McDonald’s slowed, so did theirs. Their belief that “we are a french fry company” limited their growth. When a new CEO came in, he encouraged senior leaders to entertain different questions. “What if we are not just a french fry company? What would happen if we were a frozen vegetable or a potato company?” Once senior leaders were willing to redefine the company’s identity, many new strategic choices were available to them.
Customers of another family business had been asking them for years to supply a particular product so the customer could add the business to their supplier options. However, every time the family business tried to provide that product they couldn’t make it price competitive – so they lost a multimillion-dollar opportunity. Clearly, the mindset was “we just can’t do it.” But was that true? Could the company source the product from somewhere else? Improve its manufacturing capabilities? Change its priorities? How many millions of dollars are being left on the table in your organization because you are not willing to challenge deeply held assumptions?
It can be difficult to challenge deeply held beliefs, but beliefs are what determine our actions. If you don’t create a culture in your family business that encourages hard questions and challenges beliefs and assumptions, you risk not being adaptive enough to survive for many generations to come.