As families evolve from a first generation of parents, through the second generation of siblings to later groups of cousins and on, the way in which the family makes decisions must also evolve. The single dominating voice must by necessity cede ground to collective decision-making.
Families need to be aware of this evolution and focus on creating the processes by which joint decisions can be made. Learning how to communicate and advocate and compromise are all skills that can be taught and most effectively through living them. By creating places where these can be practiced, families hone the skills of collaboration – empowering them to make the joint decisions required when wealth is owned collectively.
These processes are tailored to each family’s stage in the family, wealth and business cycles and the types of shared decisions that are likely to be needed in the coming years.
A broad array of governance structures can be used including the family meetings, family business boards, family councils, family offices, and philanthropic, entrepreneurial and other experiential initiatives.
These are the living laboratories where the practices and behaviors develop to help bridge transitions of wealth from generation to generation.