A second-generation family business owner asked us to analyze their combined family business and family office in order to reduce costs. He believed salaries were too high, staffing levels were bloated and processes were inefficient. After several conversations, building on prior interactions, we concluded that while this business has been very successful, the current owners are overly focused on managing costs and maximizing their current dividends, to the detriment of growth for the benefit of future generations.
Is the primary purpose of your business to provide income for the current generation of family owners, or is it to grow wealth for future generations? If asked directly, every family weâve worked with says they are building for future generations. However, sometimes their behavior doesnât match that answer.