ALL IN THE FAMILY: DOES GIVING MAKE YOU RICHER?
Iread what you advised the father who could not tell his son he couldn’t be CEO (May 27, 2021),” says my friend Wes (not his real name), in his mid50s. “We also have a problem. Not with the telling, but with the qualifications. My father bluntly told my brother Joe that he could not be the successor, and I agree.”
“Why not?” I ask. “Clients like Joe, and he is a good face for your company. Do you want to be the successor, so you found fault with Joe?”
“No,” Wes says. “My dad is prepping my other brother Ted to take over in five years. I will stay in finance, and once we professionalize, my title will be CFO (chief financial officer). Joe will continue as sales vice president. In this pandemic, we have more time to talk to each other, so we are trying to restructure better.”
“It’s wise of your family to prepare for succession now,” I say. “But why do you feel that Joe cannot lead?”
Wes sighs. “He is popular with his team and with clients. But he is too nice. He gives in to client and supplier requests to extend payments, and he is a sucker when his people ask for loans.”
“Do clients default on payments? Do his people default on loans?”
“Clients and suppliers pay even if it takes longer than what we want,” Wes says. “No problem there. But one employee left us before paying back his loan. It’s too much trouble to go after him, but my dad blamed Joe.”
“Ask Human Resources (HR) to create guidelines for employees for loans so you don’t set a bad precedent,” I say. “But in this pandemic, if the loan is necessary, say for health, be merciful if you can. Your business is doing fine, you can afford to be kind to your people.”
“Mabait naman kami (we are kind),” says Wes. “But Joe is too nice, even as a child, and people take advantage. Look, he is good in business, his team did well in the pandemic, he is the natural successor to my dad. But if he is the head, malulugi kami (we will go bankrupt).”
“Nalulugi ba talaga kayo?” I ask. “What do your figures say?”
“We are not yet professionalized, we still have to digitize sales and financial figures. But some employees complain to Joe and instead of telling them to deal with things, he wastes time helping them out. Others have a sob story and he excuses them. He is also too generous with money. He does so many things, it’s a miracle he is not burnt out!”
I tell Wes that giver burnout is often a myth. “By consistently overriding their selfish impulses … to help others, givers had strengthened their psychological muscles,” says Wharton professor Adam Grant in his book “Give and Take.”
“Givers accrue an advantage in controlling their thoughts, emotions and behaviors. Over time, giving may build willpower like weightlifting builds muscles,” Grant adds.
“If employees perceive that you, your dad, your brother treat people differently, they will turn to the more sympathetic one,” I say. “Strengthen HR so your people don’t try to play him off against the rest of you. As a family, present a united front to employees, the same way that parents need to be consistent in treating their children—or else kids will play the mother against the father, etc.”
“You see why Joe has to be reined in,” Wes says. “He is too soft.”
“But Joe should not stop giving,” I say. “He just has to be wiser in doing so.”
In 2000, Harvard economist Arthur Brooks surveyed income and charitable giving in 30,000 Americans. The richer they got, the more amounts they gave.
“Something much more interesting happened,” says Grant. “For every $1 in extra charitable giving, income was $3.75 higher. Giving actually seemed to make people richer … Imagine you and I are both earning $80,000 a year. I give $1,600 to charity; you give $2,500 … According to the evidence, you’ll be on track to earn $3,375 more … in the coming year. Surprising as it seems, people who give more go on to earn more.”
“We are a business, not a charity,” says Wes. “Tit for tat.”
“According to Grant, no.” INQ
To be continued: Why givers win
Queena N. Lee-Chua is with the board of directors of Ateneo’s Family Business Center. Get her book “All in the Family Business” via Lazada, or the ebook version Amazon, Google Play, Apple iBooks. Contact the author at blessbook.chua@gmail.com.