Family Business

Questions to ask when hiring a family business consultant

June 22, 2013 

As a consultant to family businesses I am frequently asked, “What is a family business consultant?” While the simple answer is that when you need one, you will know it, allow me to shed more light on the topic.

A consultant is brought in to help you solve a particular problem that you either don’t have the time or expertise to solve yourself. There are basically two kinds of consultants.

Expert consultants give you solutions to particular problems and/or implement those solutions. Process consultants help you define the problems and assist you in reaching your own conclusion. A marriage counselor is a good example.

So what should you be looking for in a good consultant? The first and most important factor is straight-forward – can they solve your problem.

Here is the five-step litmus test: How much experience do they have solving this type of problem? How broad and deep is their training? How long have they been in business? Do they actively demonstrate subject matter expertise and thought leadership? Have they successfully helped other businesses with this problem?

Solving issue should be priority

Some people get hung up on understanding the approach or process. I put this as a secondary consideration. Business history is littered with poor implementations of good models. If you can solve my problem, I don’t particularly care how.

Two other basic criteria are cost and time. Can you afford it, and if there is a time constraint, can the consultant complete the project on time? No doubt, these are important factors, but you should first be sure they can solve your issue. A quick and cheap solution that doesn’t solve your problem is not very useful!

Family business consultants are a unique breed as they help clients work through a broad range of intertwined issues, with the consequence of failure being the loss of not only the business, but also the love found in family relationships. While the multifaceted issue of succession is foremost, there are ownership concerns, communication and conflict issues, and ongoing governance needs.

Cultivating harmony

Moreover, family businesses are incredibly complex entities as they inherently combine three non-related elements: a family with a business with ownership. The success factors of each are completely different but must all co-exist in harmony.

Thus, there are many skills sets that come into play in assisting a family business, the two critical ones being the ability to deal with the “family” element and the “business” element. It is a combination of the Expert consultant and the Process consultant. Other areas include knowledge of law, tax, insurance, finance, etc.

Just as an attorney must pass the bar or an accountant must become certified, family business consultants become certified through the global governing body FFI, the Family Firm Institute, as Certified Family Business Advisors (CFBA).

Running a business is hard, especially these days. Trying to run a profitable business with your family and maintain family harmony is extra difficult. Fortunately there is help available for all of it.

Henry Hutcheson is a nationally recognized family business speaker, author and consultant in Raleigh. He can be reached at

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