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Family Feud-less posted on July 2, 2007

From sibling rivalry to value conflicts, Carmen Bianchi is one family business consultant ready to help through firsthand experience

It’s hard enough to get Greg Jr. to put his clothes in the laundry hamper or keep Aunt Lily from gossiping about her nieces’ love lives, but what if these family members are also key decision-makers in a multigenerational family business?

“Do not bring the dining room table to the boardroom or the boardroom to the dining room table,” advises Carmen Bianchi, founder and director of the Entrepreneurial Management Center (EMC) Business Forum at San Diego State University. Yes, family problems (business-related and otherwise) will always occur, but Bianchi’s goal is to assist San Diego’s family businesses to run smoothly and successfully—without causing family feuds.

At the EMC Business Forum, Bianchi provides resources and hosts events to meet the needs of local family and closely held firms and assists businesses in the $3 million to $500 million range at monthly roundtable meetings. Bianchi is also president-elect and a fellow of the Family Firm Institute (FFI), an international professional organization that assists family businesses in the area of wealth management.

Officially, Bianchi has been consulting with family businesses since 1991, but you could say she’s been in this business since birth. Born in South Africa, she was brought up in her family’s businesses: Bianchi Hotels Inc. and Bianchi Investment Corp. Issues involving gender, sibling rivalry, birth order, enmeshment and succession are a few of the many family business challenges that Bianchi has experienced. Her time spent living within and taking over the family business has helped her become a credible and respected family business consultant.

Bianchi specializes in helping family businesses define and effectively maintain relationships between family members, business ownership and the professional roles within a family firm. “Many people think of family business as being a ‘mom and pop’ type of business,” says Bianchi. “Family business is big business, but it is very different from corporate America.”

She is quick to point out that one-third of Fortune 500 companies are family owned, including Ford, Wrigley’s and Hewlett-Packard. Bianchi also estimates that between 87% and 92% of businesses in San Diego are family owned. So what’s so different about this type of business?

The advantages of owning and running a family business include built-in loyalty and trust. Also, without public shareholders, family businesses are able to take larger risks. Bianchi notes that such advantages have caused many public companies to revert back to a privately held or family-owned model. In contrast, family businesses frequently lack structure. “They have little or no governance,” Bianchi says. She believes each family business should have a council, a creed and a board of advisors or directors, in addition to a written succession plan.

Often, power and control issues also arise. Imagine a family company where one sister is the manager of the bakery, overseeing all day-to-day operations, while another sister is also a part owner of the business, but rarely stops by the shop. Who should have a greater say?

Bianchi also stresses the importance of cultural understanding, which she discovered through her work with families from and in various countries, such as Lebanon, Finland and Australia. Even within one family, contradictory opinions and views may exist.

Instead of following the Golden Rule, Bianchi advocates what she calls the Platinum Rule—do unto others as they would like you to do unto them. Lest we get too overwhelmed by working with siblings, second cousins and great-uncles, among others, Bianchi reminds us that such family interaction is not only key to business, but key to the family. She says, “Family is the backbone of any society, worldwide.”

Fast Facts
Bet you didn’t know that Carmen Bianchi…
• Speaks six languages: English, Afrikaans, Spanish, Italian, German and French
• Was the comptroller of the Victoria Hotel, the largest commercial hotel in Johannesburg, South Africa
• Acted as the regional director of the Metropolitan Regional Auditions Great Lake District and is now on the advisory board of the San Diego Opera
• Is a 2007 nominee for San Diego Magazine’s “Woman of the Year”