The impact of COVID-19 on Family Business, with Greg Griffith, CEO of FBA – Podcast Episode 17

In this Podcast, Partner Nadine Udorovic and Senior Associate Kate Bell are joined by CEO of Family Business Australia to explore the implications of COVID-19 on family business. In this insightful podcast, Greg, Nadine and Kate discuss the response of Family Business Australia to the current climate, the valuable assistance Family Business Australia offers its diverse membership and share stories of how businesses are adapting in these challenging times.

 

Nadine:

Welcome everyone to the Nicholes Family Lawyer podcast.  I’m Nadine Udorovic, a Partner at Nicholes Family Lawyers.

Kate:

I’m Kate Bell, a Senior Associate.

Nadine:

Today we are speaking with Greg Griffith, the CEO of FBA, which stands for Family Business Australia, a member organisation dedicated to assisting family businesses harness, strengthen and develop their unique competitive advantage, which is the family at the core of these businesses. FBA has been helping family business for 22 years.  FBA is a national organisation enabling members to be immersed in a family business community and offers support to the family business members by way of education programs and special events designed to generate opportunities for family business to learn and grow by networking and sharing with their peers.

FBA provides access to specialist family, business and technical services. The FBA Forum program is the only professionally-facilitated executive discussion group for family business leaders, executives and CEO’s in Australia.  Forum groups are made up of 10 family business leaders and meetings held 10 times per year.

FBA hosts numerous events each throughout Australia including Meet the Owner, Networking events, the Family Business Conference, Asia Pacific, Family Business Insights, being state conferences, Chairman’s Lunches, workshops, webinars and professional development programs.

Kate:

That’s quite an impressive introduction, Nadine!  Hi Greg and thanks for joining us for our podcast.  How are you?

Greg:

Good thank you.  First off, thanks for inviting me along and yes, I’m healthy which is important, and virus-free which is really important and I’ve been in isolation now for nearly two months and going a bit stir-crazy, but we are all good, thank you.

Kate:

Completely understand!  Nadine and I have been adviser members with FBA for just under a year now, and have been extremely impressed by the professionalism and scope of the organisation.  We assume it just didn’t develop overnight, so can you tell us a bit more about the history of FBA?

Greg:

Yes I mentioned in the opening that we are 22 years young.  I’ve been on board now for just on three years now.  Originally, there were family business independent units scattered around Australia, South Australia independent to Victoria.  About 22 years ago, David Smorgan actually brought the groups together and we became a federated enterprise 22 years ago, with a view of bringing a collective value proposition to the family business community around….family businesses represent about 70% of all businesses in Australia, employing 50% of the workforce.  So this association plays a big role, we want to be the key player representing the family business sector.

So yes, it has a proud history. We are currently sitting on around 3,100 members of which that represents about 2,000 and a bit family businesses and on top of that we have about 330-odd advisers.  Our advisers are made up of lawyers, succession planners, governance experts, marketing people, who have come to us with a view of  wanting to build the network and more importantly learn about the nuanced team…I think one of the backbones of what we are about is that we help families with the idea of transition in members and how they come into the family business from how they potentially transfer operations, transfer ownership, transfer wealth from one generation to the next.

Our membership base is from a family business perspective is really made up of that medium to large-sized family enterprise.  We really do have smaller business, but we also have the larger ones and the reason why we have that is that I think in the family…the more wealth attached, the more complex the discussion around succession is had and for a family business to come into an organisation and be around like-minded people is a really powerful thing.  You see these wonderful relationships build and more importantly, you see wonderful relationships build, but more importantly you see wonderful relationships build amongst family members who might have been fighting, or conflicted, or confused about the transition within a family.  We see them come together based on the back of some of the things we do, but also based on other members’ experience and their willingness to share that with others.

Kate:

Well, I’m gathering that there is a diversity of industries – what kind of industries are these businesses involved in, Greg?

Greg:

Yes, well industry-wise, family businesses are in literally every sector, so if we had the diagram of the wagon-wheel with all the members today, we are literally a segment in every industry.  Probably our biggest industry sector that we represent would be the manufacturing but hospitality and tourism would be right up there as well and really just a general surround around the full wagon-wheel that we represent.  The goals for the FBA are to support every family in business ultimately and we do that in a number of ways currently.  You mentioned before our Forum program which is probably the backbone of FBA and our forums are groups of individuals or 10 individuals who tend to have another sibling or a competing industry in those groups, and they come together and they meet 10 times a year.  They talk everything from family through to business and what they find is that we have in supporting the vehicles that they can rely on and they can have support on. But it really helps drive their business forward and their family business- we have about 300 of those groups, sorry about 300 individuals in those groups today around the country.

We also provide education so we offer family governance and directorship and succession planning, emerging leader programs.  I think what FBA does really well is that we become the pathway to families to find the solutions that they are looking for.  And I’ll give you an example: somebody who comes along, realises that succession might be a problem for their business, they come and do a succession education course with us and by doing that course, they are not going to be able to put a succession plan in place but it opens their eyes up to succession, to the complexities around succession, the need to have those conversations, the need to bring experts in to help guide them through the complexities associated with these discussions. A lot of family businesses, they are one, two, three generations and in the second generation they might have started by hammering the nail on the head, but all of a sudden, a generation later, they are turning over multiple millions of dollars, they are employing lots of staff, but really they are very good at hammering the nail on the head but do they understand the responsibilities which come with being a director of a business, and the governance of that business and how they invest their money, or how they dissect their business operation from their family and the governance and the frameworks within that.

So we become the pathway for families to find what they are doing and, I mentioned before,  our adviser network plays a vital role in that and those 300 advisers, of which we have about 160-odd who are accredited, we do an accreditation….our events program, we have about 150 events that we run a year, a lot of events for a little organisation.  They are from the very small to the very large conferences that we run.  The underlying factor around the events that we run, it is all around… family learning

Nadine:

The events are fabulous, Greg.  Kate and I are …

Greg:

Oh good.  We put a lot of emphasis on trying to make sure that it is almost a money-can’t-buy experience, particularly our major conferences so we get them in front of speakers who you would not normally hear from.  The other part we try and help family businesses with is the end and we know that family businesses are more trusted by consumers who are more willing to pay more for their products and services and people wanting to work with them.  We have what we call a family-owned Australian business emblem which is a map of Australia, which is a  family -owned Australian business.  Our members use that on their websites, on their business cards and we also have an advertising nightly campaign to try and position our family businesses to the consumer, for the consumers to come in and find the advice and buy from them their goods and services.

So we are creating a community where people can come together and feel safe and be able to talk openly about their family and the issues which they are facing.

Nadine:

Thank you, Greg, that was really informative.  So you have been FBA’s CEO since 2016, however you did have a long career in business prior to this. In all your years in business, have you ever seen such economic challenges such as those currently being raised by COVID-19?

Greg:

This is quite an extraordinary time.  I don’t think anybody alive today would have seen something like this.  We obviously went through the GFC-side of things but as well-placed through some good recommendations to ….early days government banking to defend the market and support the market in that particular environment.  So through the GFC, there were plenty of people who went through a lot of pain, but this is another level up, where nearly every business in one-way shape or form is affected, even though those who have been doing well have been affected, the need to work at home has just changed the complete dynamic in which we live and work today.  It’s extraordinary times, and it will be fascinating to see how it pans out over the next 6 to 12 months.  We have seen a revolution in the way we need to work and interact and engage, even though when we come out of this there will be a new norm.

Nadine:

And I imagine that there is a huge amount of angst and anxiety among the FBA membership.   What are some of the immediate concerns that you are seeing being  raised by your members?

Greg:

There are some that have done very well out of this and there are others who have certainly felt the pain.  Just going back to the start of the year, the tourism and hospitality industries were smashed by the fires, and then we got hit by the COVID.  I think the pain we are seeing from our members is: where are we, how are we going to do business, will we survive, and how long will this last.  I think this creates anxiety when you don’t know what will happen.  Normally you can plan for the future, strategise for the future, they have their programs in place, well that has been completely disrupted. Talking about disruption, there has been a technical disruption, a virus disruption that no one could have ever foreseen, so just that level of uncertainty has fed through the whole industry sector and we just don’t know when it will stop and when we can get going again.

Nadine:

What are some of the measures that FBA has taken to assist some of your FBA members?

Greg:

Straight away, we wanted to make sure that we provided our members with up-to-date information. As a peak body representing the industry we have an ear within government, so working with the Ombudsman, Kate Carnell’s office, COSBOA, the Council of Small Business, Australia, and getting the information and with our adviser community that are well-connected at getting the information out to members; everything from the Job Keeper through to restrictions and everything else, making sure that our members, as much as possible, were up-to-date with what was going on, and of course there were thousands of bits of information, really being able to get that government information to our members was key for us in the first instance, and supporting them through other programs as well.

Kate:

A lot of it is getting access to information, isn’t it?  There are also a lot of practical changes that have come into play and I notice that as a business, we have seen huge changes in the way we conduct our business: from conducting client conferences by Zoom, attending court hearings by telephone link and Microsoft Teams and conducting mediations virtually.  Nadine and I have attended some great webinars that you have offered recently.  Has FBA otherwise had to adapt its services to members in light of the current pandemic?

Greg:

Well, we had a relatively-older business model, we were a face-to-face events  business; that immediately came to a halt.  We thought very early on that this was coming; we immediately moved our Forum program online, even before these things were talked about, and that was met by a little bit of evidence by our forum facilitator but that has worked really well, that support mechanism of our Forum program has created a lot of surety for those members in that program. You mentioned the webinars, we’ve done the webinar series, recording the COVID-19 webinar series.  We’ve also created a Facebook page for all our family business members, they come in there and start talking about their family business, the b-to-b side of things,    we have created a b-to-b section on our website, where a family business could come in and actually list a product at a discount for our members to buy.  For our adviser community we have created an online for advisers for an invite only, a LinkedIn section so they can come in there and communicate. In a small way that has worked out really well, for where we had the adviser community really state-based, we are actually now been able to make it a national group, so that has worked fantastically.  We have gone hard on emblem-advertising so we have 8 family-owned Australian businesses that have adverts that we have been marketing to the consumer, and we are just about to launch what we call the Global Master Class Series, we have about 9 different global thought leaders who focus on family enterprise and there will be a 3 hour master class series where families can come in there, and learn and take information back which they can apply back in their business.

So we are about to adapt and I think from what I have seen….there have been many things which we have been planning for a long time which have always been hard to get to, because of being run-down with everyday activities, but this is actually proving itself to be quite innovative and clever in our approach to ensure that we continue to add value to our membership.  Like everyone else, we have had to adapt and adapt quickly.

Nadine:

Not dissimilar to every Family Law practice, in the Courts, the Federal Circuit Court, we have all had to rally exceptionally quickly to ensure that we can still service our clients and have all of our staff set up to work remotely.  It certainly was a challenge so I can only imagine some of the things that you have seen.  We understand that a very large number of family businesses would be struggling in this climate, however we see that some are pushing forward positively with strength and that is not dissimilar to some of our clients, in terms of their businesses, a number of them,  particularly with respect to IT and so forth, those businesses have certainly boomed during this period.  Do you have any anecdotes that you could share with us about businesses that have adapted to the new environment which may have been inventive or particularly agile, that you could discuss with us?

Greg:

Yes, sure, there are a couple of examples which I have- the wonderful thing about family businesses versus the corporate is that they can be agile and they can be nimble and they don’t have to go through a layer of decision-making to make changes to the business and there are a few great examples…Detmold Group, Zoe Detmold was a member of our South Australian committee, they were able to manage their operations and won a contract to produce face-masks, and they were able to roll that out within about a week, the entire factory operation being able to roll out these face-masks and they are now being distributed around Australia and overseas which was great.

Trentpack in NSW, a gentleman called Steve Pine, they made packaging but were able to change their business to do hand sanitisers and get them out.  Another long-standing member of ours is A H Beard, Gary Beard, they were actually bed manufacturers, but over a beer, as the story goes, they found out abou an opportunity to change their operation to get involved in making ICU beds.  They won a contract for that and are now producing ICU beds in Australia and also overseas.

Nadine:

That’s extraordinary.

Greg:

So there are some great stories here; you see these nimble organisations who can quickly adapt, see an opportunity, change things and then go forth.  So there are some good stories out there, but whilst we have these good stories, we also have some members who are obviously struggling out there and our thoughts and wishes go out to them as well, and hopefully a speedy recovery for the industry sectors that are struggling.

Kate:

Following on from that, Greg, would you have any advice that you could impart to those family businesses who are struggling at the moment?

Greg:

Look, as I mentioned before, one of the things that FBA does well is we create a community and I would encourage all our members to stay connected, that they are not alone out there, and the FBA has some programs….and to back up, we are also in New Zealand as well, we launched in New Zealand in June so it also goes out to our New Zealand members.  They are not alone out there, we have these programs such as the Forum system that they can come into and talk to others and more importantly, we have our advisers, our 300-plus advisers and forum facilitators who are there to help and support and guide family businesses during these difficult times and who are there really to lend an ear, If they need help, we are only a phone-call away and nearly every adviser would be willing to give up their time to help and support a family business during these difficult times.  So my advice is to stay connected, stay involved, ring and talk to somebody if you need to talk to somebody, because there are plenty of people who are looking to help.

Kate:

Well, I hope if we have any people who are members of family businesses listening to this that they might take you up on that and get in contact.

Nadine:

So in the months to follow as we emerge from the restrictions, Greg, what do you anticipate will be some of the challenges which will be faced by family business members and how do you see FBA being of assistance?

Greg:

Well yes, I think the challenge is re-booting, I think FBA faces that challenge; I’m sure you are facing that challenge as well, you know: how long is a piece of string. When do things start re-booting, when do you start bringing your team back in and accelerating the activities.  I think some of the challenges will be how much do you go back to what you were doing versus some of the new opportunities that you have developed as a result of this COVID and try and blend those together for your service offerance.  So I think what we can do is, as soon as we can we will be launching a series of programs which will bring people back together in a face-to-face sense as well, we are going to be having a coming-out party, perhaps not the right word, but coming-together parties, chairman’s functions around Australia, really bringing people back together again so they can re-connect. We have all been in isolation and working out of our homes for a long, long time and I think everyone is just about ready to get out there and start re-connecting and start doing business together again.  So FBA can help, I think, in bringing that community back together again, allowing people to re-connect. That is first and foremost and then allowing them to get on with their business in a forum-like program.

Nadine:

I couldn’t agree more, Greg, thank you so much, this has been so informative to have had some time with you today.  And in conclusion, what would be your key message that you would have for any of your FBA members or members of family businesses listening to this podcast today?

Greg:

My key message is that you are part of a community, that you are supported by that community, and not just by FBA, it’s really the people that are the whole environment that we bring together that will help support them and guide them through these difficult times.  So I think the key message is that they are not alone, and come together and seek advice from our adviser community and experts who will help guide them and help them re-boot if they move forward.  So yes, that would be my message to them.

Nadine:

Thank you so much, Greg.  As I said, it has been wonderful to speak to you and I think that for everyone listening, they would have learnt so much; I certainly have and a lot of what you said was not particular to some of the practices that we have put in place in our businesses and some of the assistance that we are also trying to offer and provide to our clients as well during this period.

Greg:

Good, well thank you for being a member too, it is great that you are on board and I’m glad you are getting lots out of it, too.

Nadine:

We love it, Kate and I absolutely love it and we have met some wonderful people and we look forward to being able to do some more things face-to-face in time, but otherwise the online program that is being offered at the moment is exceptional as well.  So it’s been really great, so thank you.

Kate:

And we do look forward to catching up with you actually in the same room next time!

Greg:

That would be great, wouldn’t it?  Looking forward to it as well, a glass of wine and maybe a drink or two!

Nadine:

Absolutely, thank you so much, Greg.

 

Useful Links:

Kids Helpline: A free, private and confidential telephone counselling service – 1800 55 1800 or kidshelpline.com.au/

Parent line: A state-wide counselling and support service for all Victorian parents – 13 22 89 or 1300 272 736

Safe Steps: A domestic violence hotline service for women and children – 1800 015 188

WIRE Helpline: A free support, referral, and information for all Victorian women (non-binary and gender diverse inclusive) – 1300 134 130

Relationship Space: An online program to help parents manage divorce – www.relationshipspace.com.au

Online Family Violence Intervention Order Applicationfvio.mcv.vic.gov.au/

Relationships Australia: www.relationships.org.au/

 

Disclaimer: Nicholes Family Lawyers intends the information provided in this podcast as general information only, please contact Nicholes Family lawyers if you require specific information and advise in relation to any family law matter.

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