The Cost of Doing (Family) Business: Why Matriarchs are More Willing to Leave Money on the Table
by Chuck Meek
This is an excerpt from an interview with Anthony DiLeonardi,
co-author of "The $14 Trillion Woman" and Managing Partner
of Third Quarter Advisers, LLC.
Chuck Meek: Tony, what do you mean when you say that matriarchs
are more willing to leave money on the table? In what
Tony DiLeonardi: I mean that men and women view money
differently - its intrinsic value, its purpose, and what it can do
(for better or worse). The patriarch generally takes a
narrower view of defining 'success'; he measures it with tangible
things or quantitative goals. The matriarch takes a panoramic
view: there are lots of contributing factors to 'success', and
therefore more opportunities for trade-offs.
CM: How might that affect the Family Owned Business?
TD: She is probably very attuned to her counterbalancing
role as matriarch of the Business Owning Family, and is sensitive
to the impact that owning the business has on everyone in her stake
holding family, not just those family members who work there every
day. The patriarch is more wired to pay attention to what's
going on in the company, and to the extent he pays attention to the
Business/Family dynamic, it's measured primarily in terms of
business results. She looks at it from both sides and is more
likely to abandon one benefit for another she deems more valuable
to the family - and she isn't necessarily using money to measure
value. That's why she may leave money on the table:
it's important, but not necessarily most important.
CM: The title of your book - "The $14 Trillion Woman" - gets its
name from the amount of wealth now controlled by family
matriarchs: what to purchase, where to invest, etc. It's
also clear that demographics will affect who controls wealth
creation, not just wealth management after it's been
accumulated. Why does that matter?
TD: We read the headlines in the media about the increasing
role of female executives in large publicly traded
corporations. That's an effect of a broader trend in our
society at large: women have continued to close almost all of
the gender gaps in education, the military, corporate leadership,
management and other disciplines. Privately owned business is
no exception, it's just less noticed. Private middle market
enterprise has always been the backbone of our economy.
Women's roles have increased significantly in all aspects of Family
Owned Businesses, but the way we view FOBs has not. We
run the risk of fundamentally misunderstanding the motivations and
mindset of those who control a substantial portion of the global
economy, and how it will be sustained across generations.
CM: What prevents us from embracing the new realities of wealth
creation and management?
TD: Nothing but a refusal to acknowledge those realities and to
learn new ways to develop and maintain relationships. For
example, when patriarchs were commonly the decision makers in both
business (wealth creation) and investments (wealth management), it
was equally common for advisors and professional service providers
to gear the relationship primarily to him, and acknowledge the
matriarch in a supporting role - at best. Sounds 'old school'
to us now, doesn't it? And it is. But necessity is the
mother of invention, and those advisors who are faced with this
changing dynamic will either adapt or go extinct. It's no use
arguing or resisting: it's just capitalism,and emotional
intimacy, at work.