Advice for CEOs

Previous articles in this series have touched on a number of issues important to family businesses, including goal setting, culture and governance. Let’s now turn to another issue that can be critical to sustaining the legacy of a family business: whether and how to bring in outsiders to the board and to the executive ranks, especially in the role of CEO.

All organizations experience conflict, whether between board members, executives or management. As part of their formal governance processes or as a matter of their operating style and culture, well run companies establish formal processes to address conflicts.

Private companies represent almost all of the businesses in the United States. Hundreds of thousands are born each year and about as many die. They generate more than half of all paychecks and most net new jobs. They employ almost half of high tech workers and account for a high portion of all U.S. exports.

In the first article in this series, I discussed a number of characteristics that make family businesses distinctive. These attributes can impart significant competitive advantage to these companies but also produce some difficult challenges.

Family businesses have potential strengths that many non-family businesses lack. At their best, family bonds can be a powerful force to keep talented entrepreneurs, executives and employees dedicated to the long-term success of the business.

This article was previously published in the All Business section of the Forbes website on August 30, 2013. Michael Evans is a regular contributor offering small business advice to All Business followers. For more great small business articles visit AllBusiness.com, AllBusiness Experts or subscribe to Newport's blog.