Tough love
Try to ignore pull on heartstrings
when it comes to business choices
By Donalee Moulton
om and Pop may be proud to hand over the
reins of their company to Junior—but then
pride does go before a fall. What’s needed is
not a lot of tender, loving care but a cold, hard
look at the best way forward for the family business.
All too often, however, owners lose sight of objectivity —
and the survival rate of family businesses declines accordingly. “Seventy per cent of family businesses will not make
it to the second generation. Ninety per cent will not make
it to the third generation,” says Grant Walsh, director and
founder of the KMPG Enterprise Centre for Family Business
in Ottawa.
“Once you make it to the third generation, you tend to
dominate the market for years.”
Getting to that third generation requires more
preparing for the future of the firm and less tug-
ging of the heart strings. “The first step is [hav-
ing] a plan or a blueprint. It makes life a lot eas-
ier,” says Gary Shiff, a partner with Blake Cassels
& Graydon LLP in Toronto.
