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Executive Interviews: Interview with Kelin E Gersick on Family Business
May 2007
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By Dr. Nagendra V Chowdary
Prof. Kelin E Gersick Co-founder and a Senior Partner of Lansberg Gersick & Associates (LGA), a research and consulting firm. He is a Management Fellow at the Yale School of Organization and Management. 
Congratulations for having coauthored
very successful and
powerful books on managing family
businesses. What was the powerful
trigger that has prompted you to
embark on research in family-run
businesses?
Early in my career, I had experience in
three different parts of psychology: as
an academic researcher and professor,
as a management consultant and as a
family therapist. I thought they would
remain separate streams throughout
my career; but in the early 1980s I met
a few other colleagues who were
beginning to work with and study
family businesses. It was a perfect
integration of my most important
interests and my research; and
consultation with family businesses
began then.
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Can you tell us briefly about two of
your books, Generations of Giving:
Leadership and Continuity in Family
Foundations and Generation to
Generation: Life Cycles of the Family
Business.
The Generation to Generation book
came out of our experience with a
range of family companies in the late
1980s and early 1990s. We were aware
that there was no comprehensive
model for the development of these
businesses that took into account the
ownership, business and family
dimensions. I was a full-time
professor at the time, so I had the
opportunity to write the book as a
statement of our model and our
experience at that point. Even though
we have continued to evolve our
thinking since then, I still believe in
the basic model of development of
family enterprise that the book
presents. As for Generations of Giving,
that research began as a partnership
between our firm, LGA and the
National Center for Family
Philanthropy. They sponsored a
multi year intensive research project
on continuity and inter generational
governance in family foundations.
That was a hard book to write,
because we ended up with a
mountain of very rich qualitative data
on 30 complex family foundations
narrowing it down to the essential
lessons was difficult and took three
years. I am very proud of that work,
because it opens up a new approach to
considering the family and the
organizational challenges of excellent
family philanthropy, with many
lessons for family business as well. -
Can you share with us about your
initial research journey? How could
you get in sights into managing family
businesses? Was there any difficulty
in breaking ice with family run
businesses, for, disclosure and
divulgence must have been
exceptions rather than imperatives.
I am by nature a social scientist, so it
was natural for me to focus in my
career on generating as many ideas
and testing as many hypotheses as I
could. Contrary to what people
expect, we have always found that
business-owning families are eager to
tell their story and to hear the stories
of others, if they trust the objectivity of
the listener. Entrepreneurs are by
nature inquisitive, good observers of
the experience of others and skilled
processors of information. But in all of
our research we have decided to
protect anonymity; unless the subject
specifically authorizes us to tell their
story openly, all of our sources are
confidential. That has often been the
only way we could have heard the
true story. I also believe that all our
consulting work is also a form of
research. Much of what I have learned
about managing family businesses has
come from consulting, not just
formally designed research. There are so many definitions of a
family business. What, according to
you, is a family business? What are the
different typologies of the family
business?
That depends on what you are using the
definition for. In a formal sense, the
consensus definition is that family
businesses are those companies that are
significantly influenced by the
members of a family through ownership
control or concentration, management
control, and/or tradition and informal
authority. In our own database on
family controlled companies, we focus
on the ownership dimension and
include all businesses that are
controlled by a family, either through
outright ownership or ownership
influence. As for typologies, I still find
our initial developmental categories
useful: Controlling owner companies,
sibling partnerships, and cousin
consortiums. But for the last 15 years we
have defined our work as being not just
about family businesses, but about
family enterprise. This reflects the
complex systems that most of the
families we work with have developed,
including operating companies,
holding companies, family offices,
philanthropic foundations and pooled
investments. That kind of family
enterprise and the networks of families
who control them, almost defy typology. What, in a family run business
system, are womens issues and how
should they be addressed?
I have to say that I am surprised that
there have not been more changes in
the role of women in family
enterprises worldwide. Twenty years
ago we would have predicted that by
now a very significant proportion of
family businesses would have been
led by women and while there has
been change, it has not gone as far as
we expected. The most important
womens issue remains how to
harness the human capital of the
women in the family for the benefit of
the enterprise as managers and
executives, as directors and as participants in all aspects of
governance (boards, family councils,
family assemblies, foundations, task
forces and family committees). The
other issue that is sometimes
presented as a womens issue but is
really about parenting and families in
general, is how to raise energetic,
ambitious, well grounded children in
families that are second or third
generation, with more wealth and
opportunity than their parents
experienced until much later in their
lives. In a family run business, how to
foster change management? Are there
any best practices that you would
recommend?
About 10 years ago we spent a lot of
time and effort thinking about the
change process, and I think the model
that we came up with for transitions is
still my best thinking on that topic. It
is summarized in the beginning of the
book Generations of Giving and in
other articles. It is based on five
phases of a transition: preparation,
disengagement from the status quo,
exploration, choice, and commitment.
1.
Sweden's Leading Family Owned Business Case Study
2. ICMR
Case Collection
3.
Case Study Volumes
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