Experience in the family business
25 February, 2020
"Second-generation or first second"
When my parents opened our first clinic, I was 14 years old.
"Klinika Zablotsʹkoho" was opened in 1998 in the centre of Lviv and was named "Titanic" because many believed that the clinic with the world's most expensive dental equipment and such an approach was premature not only for Lviv but for Ukraine in general.
My father visited not many places before 1998, so he opened the clinic based on photos from the dental catalogues of manufacturers, it seemed to him that just as in the exhibitions in magazines - so it is in life, so it is somewhere in America or Europe. However, even today, visiting world-renowned dentists, I can proudly say that our clinic, despite 21 years of operation, remains one of the most thoughtful and equipped with expensive and safe equipment clinics.
When the clinic opened, my parents literally moved to work and spent almost all their time there, and since we lived outside the city, so did my time. All my summer vacations, starting at the age of 14, I spent at work, assisting doctors or washing instruments in the sterilization room, and tried to improve the work of the clinic even as a child.
Then there was graduating from a specialized music school (by the way, I was supposed to enter the conservatory and become a pianist, but this is a separate long story), studying at the Medical University of Vienna (Austria) and graduating from the Jagiellonian University in Krakow (Poland) with a high score and return to Lviv, as it seemed to me, already a cool specialist, with a cool European diploma…
Today I am 35 and 11 years old since the day I returned to Ukraine and work in the family business every day. And only now, in 11 years, it seems to be getting easier.
Most people think, as I am lucky, big business is a gift. On the one hand, that's right, because you don't have to think about what to do; I am a dentist, we have 6 clinics and more than 120 employees, for 21 years a file of patients more than 15 thousand. There will be enough work for everyone to have the desire to work. It would seem that everything is like in a dream. In fact, from the side, everything looks like in a fairy tale. Did my father think in 1998 that he was building a family business? - I think not. Did hi think that both children would follow medical paths? - I think hardly.
I returned, everyone was happy, however, the staff still saw in me little Olenka, not a doctor with a European diploma with distinction, but a girl who has been in the clinic since childhood. I came back with new knowledge, with new ideas. I wanted to bring something new, something better, something more logical to the clinic, however, any of my ideas were perceived badly from both parents and employees, any thoughts ended with the words "You have no experience." Such words were very demotivating and over time I lost the desire to prove something to someone.
If you think about it for a moment, the business of parents is undoubtedly their third child, they created one of the coolest clinics in the world, raised many generations of doctors, they created a brand, created a company with a service uncharacteristic of dental clinics, they have something to be proud of. My parents are well-known, we are the Zablocki Clinic. The time has come when the parents' business has well-established processes, the clinic has just upgraded its dental facilities (worth 80,000 euros each), the team is well-coordinated and all standards are set and it will always be so, but wise people say this is the best time to pass the business on to children. How are the children? They do not have such experience as we do.
Transfer or not?
They can't handle it!
Last year, several publications interviewed me as a member of a family company, or rather as the heir to a family company. To prepare for one of them, I decided to look for examples of family companies. I never thought about it, but it turned out that there are not so many family companies in Ukraine, because our Ukraine is still young, almost 30 years old, respectively, all Ukrainian businesses are at most its peers. And given the fact that our parents started a business when they were 25-30 years old, then 30 years later, we, their children, the same number of years (when they started the business) and right now, when our parents are 60-70 years old. they ask the question, what to do next? Of course, there are many world examples of family companies that are more than 100 years old (Zara, BMW, IKEA, Hilton, Auchan, Toyota...). However, the mentality of people in the world and our country is completely different. For example, in the world after the age of 18, a child is allowed to "swim" freely and parents do not worry about where the child will study, or for what money, much less worry about whether they will buy the child an apartment and a car.
In Ukraine it is normal that parents should buy their child a car, an apartment and pay for tuition, and then help their children when they get married. A foreigner will never understand us. In Europe, parents owe nothing to their children. There are many nuances and differences, so it is usually possible and necessary to take examples from global family companies, but know that not everything that will work in Europe or America will work in Ukraine. Even the average life expectancy of Ukrainian and foreign businessmen differs significantly. The average life expectancy of Ukrainian men is 66 years, and in Western Europe, it is 11 years higher. That is why Ukrainian businessmen should think earlier about what to do with their company.
On the one hand, the founders know better how to run their company, they have lived all its formation from birth, on the other hand - the age at which they begin to wonder what will happen to their company? One way or another, someone has to continue to manage it, even if not in a year or five, then in ten. To whom to transfer control? Who to teach? Your own or someone else's? For some reason, there is always more trust in "strangers". However, no stranger will have so many sentiments about this case, so much responsibility. If there are difficult times for your company - a stranger will simply move to another company, with a completely calm heart. If you compare your heirs, even those who graduated from Harvard or other prestigious universities, even though their parents are proud of them (us), they always trust strangers more.
Distrust of your child and humiliation in the team will never make the child in the future a leader who will listen to the team (there is usually an option to replace the whole team). Conversely, if we love our child too much and allow her to make decisions in the company so that she can study - I think this is also not the best option and will not be perceived so well in the team. What can be done to make everyone feel good? Good question.
World statistics 100%-33%-15%-3% is about the survival rate of family companies, ie with 100% of companies, only 33% remain in the second generation. This means that I have only 33% that the company will remain under my leadership. The chances that our company will still exist during the time of my children are 15%, and my grandchildren are only 3%. And the further I and my parents go to business transfer, the more I understand these statistics. The most dangerous is the period of transmission, it is during this period, most often there are the most misunderstandings between parents and children. The whole problem is communication and expectations. We children have our expectations and we see this world differently than our parents. All people perceive the world differently. We are all different. And if you do not discuss your positions at all, if you do not express your expectations from both parents and children - it threatens a misunderstanding that will not end well.
At the parents' clinic, I work as a surgeon and creative director of the company. For the time being, I am not a shareholder of the company and we have no distributed shares in the company and I consider it absolutely honest. However, there was a case when I was at the annual DYB business training and represented our company there as a representative of a family company, where I was asked: “What is your share in the company?” - "None, I get paid as a doctor and creative director." "Then your company is not a family company." Now, my parents and I are discussing the status of the family company, often talking about our visions and expectations, but there are still many topics for conversation that are painful for both parties. This summer we have to write a family constitution and I hope that it will open all of us to each other's expectations and reduce the risks of future conflicts, it's like the prescribed rules of the game "in advance" before the problem arises. If I know what my father would or would not like to happen to his company, it will be much easier for me. Once upon a time, I had a great desire to earn enough money and politely buy a share or a whole company from my parents, and I thought it would be fair because I did not create this company, I did not borrow money for its equipment. However, after completing business training for business owners, I began to assess the chances a little more realistically. Even though I perform extremely complex operations and operate every day - my salary is enough to live fully in society, travel, educate my children and not enough to buy a business. But now when I have more knowledge, I understand that with this clinic, this business, these promises we make to our patients, no one else ("foreign") will ever care as much as I do. And if I leave my parents, go and create my own clinic or some other business (such thoughts arise after every conflict with my parents, after underestimation), then what should my parents do? They are lucky to have a son (my brother) who is still studying and not yet very well versed in the "drama" of family companies, but what if he refuses to manage?
In principle, there are no hopeless situations, we can sell “Klinika Zablotsʹkoho” and enjoy life, but will it be calm if the new-foreign leaders will not do your business completely differently than you saw it, taking into account other people's values and seeing in the clinic primarily business and the opportunity to make money? But will the “Klinika Zablotsʹkoho” work without any family representative?
I must admit that I have a very smart father because I am his daughter, he sees my intentions or worries in the distance. As soon as I considered "running away" from the family business and dreamed of a quiet life (for some reason it always seems to me that it will be calmer) my Father overwhelmed me with "affairs" in which I had a "main party" and responsibility, gave pleasure to do something, that I began to feel that this was my company and that the decisions I made got better. This taste of small victories of my own extinguished my desire to go and look for new adventures. Every year, I understand more and more that it will be more and more difficult to open a successful business every year because the competition today is not the same as it was 21 years ago. Yes, I can take my own loans, build my own dental business, hire my employees, teach them company values, look for my patients, give credit and spend about 15 years on it, as soon as I give loans - my children will be 30-35 and I will also have to hand over my own business to my children. Or, I can go the other way, continue the work of parents, work according to the constitution that we will create with parents, teach the finished team better skills, create more systematic processes, scale our business and increase its value. In each variant, there is a lot of pros and cons. Everyone chooses what will be easier for him.
“The last test of a leader's greatness is how well he chose a successor and whether he was able to leave the stage by handing over control," Peter Drucker once wrote.
It is not easy to leave the stage when your company is 21 years old and it has just gained fame and strong brand strength. This is me about my father. But today I am 35, my father is 60. Every year I want less and less to make changes in the clinic, come up with something new and defend their vision and interests. Another 10 years and probably I'll just go with the flow because I'll get used to the fact that there is always a father who takes all the decisions. It is believed that 25 years is a period of effective management of the head, then he goes with the flow, and for the company, it does not just stop in developing, but even moving in the opposite direction. If you do not pass on your company to your children before they turn 40, it is believed that it will be a lost generation that will not be able to make their own decisions and do something incredible for own company.