You might be wondering, as a family business, what can I learn from the Pirates? It turns out – A lot!
We often think of pirates as barbaric, dirty, and unorganized. But, it turns out there was a method to their madness and it’s this method that allowed them to govern the Caribbean waters for many years. Keep in mind, the pirates were under constant attack by military frigates carrying 70 – 80 well-armed, well-trained and well-fed men. How is it that the pirate ships with 100 – 150 untrained pirates, from various backgrounds, with different interests were able to succeed?
It turns out, the pirates (including the pirate leaders aboard the 1723 Revenge) knew they needed to manage the crew’s expectations with regards to the management and leadership of their activities as well as the ownership and distribution of the wealth (the ‘booty’ as they called it). On each pirate ship, there was a code of conduct outlining the expectations of each pirate aboard the ship. When each pirate got onboard, they had to sign a document stating they agreed to this code of conduct. Family businesses should do much the same!
Managing family member expectations and providing clarity as to what is expected and why with respect to the family business can go a long way in preventing conflict. In turn, this will greatly facilitate the process of management and ownership succession. If more family businesses developed a set of “Family Business Rules” like the pirates’ Code of Conduct, much of the conflict that often plagues them would be diminished. These Family Business Rules would provide a roadmap for a smooth and effective management and ownership transition to future generations.
Management succession issues as well as ownership succession issues continue to challenge families in business due to the unique characteristics of family enterprise. The unique characteristics of families in business such as: role dichotomy of being business leaders while parenting, sibling rivalries, generational gaps, active and non-active family members, family and non-family employees, entitlement, and wealth distribution to name a few can create an environment of stress, uncertainty and discomfort within the family and the business. The use of “Family Business Rules” (also referred to as “Codes of Conduct” or “Family Charters/Constitutions) has proven to be an effective strategy in this regard.
The pirates knew this and they developed comprehensive “Rules” or codes of conduct to govern their crews which allowed them to successfully rule the Caribbean waters for decades and according to some for centuries.
Over the next few weeks, I will be equating the pirates Code of Conduct (Articles on Board the Revenge 1723), to recommended Family Business Rules. I will start with Rule 1 – Employment Criteria.