On a recent episode of How To!, listener Kyle from Texas asked for help with a very specific, very personal task: firing his own daughter. Kyle’s insurance company has been in the family for almost 50 years, and now he’s ready to retire and sell the business to his employees—but he doesn’t think his daughter is up to the challenge. Her work performance has bothered him for years. Charles Duhigg brought in Christina Wing, a Harvard Business School lecturer who specializes in family-owned businesses, to coach Kyle through the decision. An excerpt of their conversation, condensed and edited for clarity, is transcribed below.
Christina Wing: Sometimes the stresses at home become the stresses in the workplace. [Your daughter’s] tendencies that bother you in the workplace—were those the same tendencies at home?
Kyle: Yes. She was pretty rebellious and did not do the things around the house that her mother and I wanted her to do. She couldn’t get to work on time if her life depended on it, and she lives within a hundred feet of my office. So … I’m digging a hole here, aren’t I?
Christina: Well, no. But sometimes parents see their child in the business the same way they saw them as a child at home. They enter kind of “pre-pissed,” is what we call it. And that’s hard. Sometimes people flourish when a parent leaves the business because they feel empowered. Sometimes the parent has protected them, and they get fired from the business. So it could go either way. But you do want to make sure you see both sides of what could be going on.
You said your daughter’s excellent at selling insurance. You need to both sell the insurance and then properly put it on the books and do everything else. It sounds like there’s a role for her—it’s just more external. Are you just frustrated because she doesn’t have your skill set?
Kyle: You could say that. I’m a pleaser, and I do what it takes for people to get along with people and for them to like me. I’m nonconfrontational. So if somebody wants me to put my pen next to my phone every night before I leave the office, I just do it. I don’t think about it. I just do it—and therein lies the rub.
Christina: Yes. You might be underselling and undervaluing what your daughter is really good at. And if you step back, it’s really hard to sell things. So if she’s good at [a] part of the business that’s really hard, then that should be rewarded. Maybe she’s purposely not putting her pen next to the pad of paper the way you want it because you’ve been annoying her about that for so many years. So I wouldn’t give up on having the name of your business continue on with another family member. We just might need to get a little looser about where the pen goes.
This is what I tell my people who are considering families in business: Think about when you’ve possibly planned a vacation with family members and how that goes. If you can’t plan a vacation with family members, you should not go into business with family members.
Kyle: Well, I’ll tell you this: If she wasn’t my daughter, I would have fired her a long time ago. She knows it, and everybody else knows it too. She’s a good insurance salesman. She’s great with people, but she’s just not a very good employee. Now, this is one of the reasons that I’m so tired of dealing with this, especially the last five years, that I really want to remove myself from it, because it is just so difficult.
Christina: It doesn’t matter if your business is worth $800,000 or $25 billion. I have a family right now I’m advising for that’s worth north of that, and—same issues, same issues. The inability to deal with the family question becomes a business question, becomes a business problem. If you think about the stakeholders, we’re talking about employees, customers, and society. You know, 80 percent of the businesses outside the United States are family-owned—they’re conglomerates. So it affects everybody if these businesses don’t get done right.
All right, so Kyle, I’m going to ask you one question: What’s your No. 1 goal to have happen between you and your daughter?
Kyle: The No. 1 goal is I wish we would have a better relationship, a good relationship, a father-daughter relationship, a family relationship, so that we could just talk, whether it’s about the business or whether it’s about our dogs, that we could just talk about it and it wouldn’t be strained. Maybe, if she did go to work for somebody else, then she would understand that all that stuff Dad was saying, it’s real. I have a friend who’s been in the restaurant business for about 40 years, and he’s got a son in the business with him. When the son wanted to come into business with him, he made him go leave town and work for another restaurant for two or three years and then come back. And they have a great relationship. And I look back on that thinking, Boy, maybe I should have done that.
Christina: My most successful families have a policy that no child can enter the business until they’ve worked somewhere else for two years. And so you just answered your own question, because it does make a big difference.
Kyle: Information I could’ve used earlier.
Christina: It teaches them that when you need that extra day at Thanksgiving, you actually have to ask somebody, instead of saying, “Hey, Dad, I’m not coming in on Wednesday.” It puts everything in perspective. And so it’s not too late. If you want to stay in the business, if your goals are to have a relationship with your daughter and still work, then maybe you sit down with her and say: “I don’t want to sell the business to anyone but you, but I can’t sell it to you now. Can you go work somewhere else for a couple of years and see? I’m going to keep this business going, and that way we can find a relationship outside the business, and then maybe you come back to the business and it’s yours.” That might be the better solution for you.
Kyle: OK. That’s a thought.
Christina: I believe that showing her a path where she gets to decide the outcome or have a hand in it is a better way to go. I would be really upset if I were your daughter and found out you were having all these conversations with [another employee] about possibly selling the company, and about me—where’s my role? So if you could sit down with her and say: “I know this is going to be hostile. I hate that I feel that way, but I’m 65. I’m so stressed by working together that I’m considering selling the business. So I see two options. One option is I sell the business to the [other employees], in which case they might not keep you. The second option is maybe you leave, I stay, I continue to increase the value, and we work on our relationship. And then if you and I get on a better footing, you come back and you take over part of the business.”
I have this strange feeling in the back of my head that you want her to suddenly become you and you want her to have the business if she could. And you just don’t see how she can do that. You’re never going to see it while she’s still there. Because she’s never going to learn these skills from you. She hasn’t in the last 10 years. So if she wants to run the business, she needs to go out.