Ombudsmanship and The Family Business

15 May 2011

In my “other practice” I just completed an 8 month-long “turnaround” of a small family owned manufacturing and distribution business.  Key to the final success was the smoothing out of a bumpy road at the beginning of the project by utilizing ombudsmanship with stakeholders by the owners. I’ve written in previous articles and defined “ombudsmanship”. Ombudsmanship is being asked for more and more in job descriptions and is similar to “sportsmanship” in that it’s a “soft skill” or quality that the individual brings with them and is aware of at all times in their functional responsibilities of their role or position.  Ombudsmanship is usually delivered “incognito” by the individual utilizing ADR style skills with individuals, teams, groups both intra or inter organization in terms of the individual and group dynamics.  In this business “case” I’ll go over some of the key methods and techniques where ombudsmanship was utilized as part of the engagement and was the “key difference” to success versus the absolute collapse and loss of a three decades old family heritage.

My role was as a business coach, consultant, ownership advisor and conflict management coach to owners. I’m also very aware, from mistakes I made in my “apprentice” years that focused only on the financial bottom line, that changing any business culture is more about conflict management than just business “metrics” and that focusing on conflict management as a priority in all “engagements” will get the metrics or results needed “indirectly”.  It’s a “given” that in any organization there is a culture with regards to the dynamics of intra and inter personal relationships that employees have based on their personality characteristics.  This is even more so for a family business operating for three decades.  So the balance to be struck is to use the inherent culture of the business and resulting conflict as the OPPORTUNITY to “shift the paradigm” towards a consistent “in the black” financial outcome while PRESERVING stakeholder relationships critical to function and revenue.

My point of contact was the oldest son with some ownership meetings with the mother and father who also worked day to day in the business.  The son had worked the business for many years and had an accounting degree, but now, parents had declared they wanted to “retire someday” and make the transition.  Unfortunately they made this declaration one full year AFTER the “economic collapse” began and the books started going “red” in gross revenue.  They tried for one year, all of 2009 to get back in the black, but couldn’t and turned to their son.  This “set the stage” for some real conflict and drama on a daily basis and is most likely the same for thousands of businesses today.  Armed with a business case history interview we began.  Some, not all, of the concise steps below:

  1. Put it on the table that there is going to be a shift in the culture of the company to “survive” and that there will be conflict in the chaos that will result in profitability IF “management” can apply new methods in functional systems CONSISTENTLY day to day.
  2. Map the organizational “dynamics” and structure for purposes of awareness in an informal internal family operating environment.  Recognizing that there are functional business structure as well as informal familial, age and gender dynamics evident where older employees and newer younger staff conflict (generations) where employees are treated as family; and where formal education is replacing informal apprentice style training and applying of skills, knowledge and wisdom.
  3. The map had intra-organizational structure of: son and both parents core administration, manufacturing and distribution department, marketing and sales with external road warriors and internal sales staff.  This map was typical in that manufacturing and sales rarely socialized or communicated “intra-department”.  Each employee was subjectively “assessed” for personality characteristics at the beginning and during ongoing changes so as to provide situational awareness and decision support regarding “status” and needed outcomes.
  4. The map had inter-organizational structure with partners, vendors, suppliers, stakeholders in the immediate community.  The “linkage” or nexus was identified again for purposes of situational awareness on identified potential conflict as changes unfolded.
  5. Provide conflict management information and coaching of the son as the new President and General Manager including keeping a journal of conflict events as they arise.
  6. Discussion of “applied” techniques and emotional support for management including identification of incremental successes, though they may appear to have a “negative” outcome.  This included KNOWING when to let events play out with employees, immediate intervention versus “sleeping on it” daily cycles and then observing over two week increments the decision results.
  7. A very favorable “ad hoc” look at results where several staff simply left the company in the exact departments and slots where the “next generation” of educated employees could fill gaps and form new “blended teams” with long established family business “members”.
  8. Key was incremental success with recognizing conflict is in the moment, to let it play out, identify employees who cannot adapt and work with them on “what they wish to do”. Identifying employees as “champions of change” and giving them influence roles. Adopt formal communication, cooperation and coordination cycles in the form of projects and monitor individuals behavior.  Getting confirmation from “parents” that the chaos has turned out well at various stages and the company is evolving while the bottom line returns to profitability again.  This provides “confidence” in the son to lead and was directly discussed and kept in focus with relation to “desire to retire someday” as a goal while demonstrating “real life” favorable bottom line outcomes.

In conclusion it’s important to note that the business related methods and solutions were not discussed here, but that the constant awareness for the potential for conflict in key functional positions would “trigger” emotional events.  We also gave owners the message to constantly motivate employees is that, “we have to do this or there won’t be a company anymore and thus a job either”.  I’m certain “variations” of this message were constantly given, including recommended “memos” with each employee signing off that they acknowledge the gravity of the situation in today’s economy.  Keeping this as the ‘prime goal’ for employees to focus on at all times, while monitoring conflict related to implementation of solutions that forever changed the organization resulted in 13 jobs saved, 2 new jobs (one in each department), 1 outsourced function, restoration of 4 figures “in the black” net profit monthly within 2 months of launch and new-found “confidence” for EVERYONE in the company as to what they achieved is a favorable end result… is it not?


The New Ombudsperson and The Quantum Activist

17 April 2011

In my own practice as a “progressive and innovative” Ombuds I listen for and “observe” my clients for opportunities to “transcend” or move their awareness beyond “duality, polarization and ego” so as to create the opportunity for a solution to their issue or conflict.  I don’t always get the opportunity to do this.  Indeed, I have used the “Matrix” movies as examples on occasion with clients so as to open their mind to the reality that “life is a drama” being played out and that we can make choices in a moment outside of societal conditioning and traditional approaches (legal).  I propose to them that when “conflict arises” it signals the opportunity to learn something; and personally and possible “grow and evolve” beyond the given paradigm they are in especially if they are in a repeating pattern.  I may also suggest reading material or other “media” if the client appears to be open to it and it’s fitting.  Thus, The Quantum Activist now also provides insight to the dynamics of life, creation, conflict and mention how a “mediator’ is needed from the “science” side of the mysticism and metaphysical “coin” of life and our existence in the Universe.

Amit Goswami PhD is The Quantum Activist. He discusses the subject of Quantum Mechanics and sprinkles his words of wisdom through out the film on topics relevant to “us” as Ombuds.  He speaks to conflict, need for mediation, duality, cycles of creation and pauses between cycles of conflict that do provide the opportunities for changing oneself and the world at the same time.

It’s my hope that you will view this film and that it will provided a “higher perspective” of awareness so as to keep us from possibly getting caught up in or even becoming “part of the problem” in our work rather than neutral, truly independent and suggesting solutions for both sides of the table with clients.  This is “empowering” of us to “enable” clients in their choices.

Keeping this post short, very busy nowadays as the economy struggles along, but I think this is an insightful and inspiring documentary pointing to the “high ground” our profession can take… above and beyond “man’s laws” and more in line with Universal Laws of Creation that acknowledge the cycles and CHOICES for harmony or chaos.  Enjoy.

On Netflix here:

http://movies.netflix.com/WiMovie/The_Quantum_Activist/70138491?trkid=496624

Website: http://www.QuantumActivist.com

YouTube Trailer here:


International Ombudsmanship: Diplomatic Channels

5 March 2011

Prior to starting my “formal” OO practice a few years back I would practice, what I’ve also blogged here before, “ombudsmanship” in my consulting engagements; most often to preserve financial resources, but in the following case to recover lost revenue.  The term “ombudsmanship” simply means practicing alternative dispute resolution in a functional role or external capacity from “formal” ombuds structure, but between “groups”.  In the following case one of the first “ripples in the matrix” that was telling me there are “serious financial anomalies” building in 2005 was where a client had provided “inbound wholesale travel and event” services to a very prominent UK banking entity and they simply put off payment for almost 8 months.  By December of 2007, the “ripples” had manifest as we all know now, but by the beginning of 2006 we were successful for our client in recovering a 180 days (plus) past due balance on a $100,000 contract for services. Here’s how it works and you can use this method too.

This engagement started while we were on-site with a client in a meeting and our new “inbound wholesale travel” client popped her head in the door of the office to ask a question. I was introduced to her by my current client, with accolades on work completed, and she said, “great! Can you help me with a large contract that I”ve lost a significant amount of money on?”  I said we could look at it with her later and set a tentative time.  It only took about 30 minutes for her to present her “paper trail” of faxes and email, copies of key documents and bank drafts and so we took the “package” with us to begin.  Basically she had delivered the project for “Big UK Bank” with an up front deposit of half the contract so as to provide operating capital to deliver the project.  To add insult to injury after the bankers left the famous San Diego Resort there were unpaid tabs left over too, of which the resort management was holding “wholesale travel” services company responsible for, which was correct, as her company name was on every contract, not “Big UK Bank’s” name.  I sorted out the communications sequentially between both entities to get an idea of what the barriers or issues were for “final payment” and settlement on the account.  My approach was then to simply make another “collections” attempt on behalf of my client, which went on another few weeks without settlement or even acknowledgment that the last invoice was still outstanding and past the net terms of payment on the original contract.

At the time I was a member of several internationally oriented associations and used those connections and contacts to find a “name” inside the British Embassy in Washington DC.  Having been successful I made a single phone call, left a brief message with “references” and a call promptly came back the next day.  I quickly outlined the issue with the “diplomatic relations” officer. He requested a duplicate package of the key documents to the dispute and I “expressed” them to him with signatory receipt terms.

I waited and waited for what seemed like “forever”, anxious myself to hear some positive news or “reciprocal communication” to pass along to my client and nothing happened for approximately 3-4 weeks.  All of a sudden, out of the blue, my “wholesale travel” services client called me with an ecstatic tone saying she’d receive full payment for the balance of the contract and outstanding “bar tabs” left by her clients bank executives.  Apparently the British Embassy “officer” contacted “Big UK Bank” directly and “facilitated” payment so as to prevent further indignity.  I followed up with a formal letter of thanks for their efforts, the dispute is settled and full payment has been received.

If you are facing “cross border” disputes and time simply passes by without any resolution, you may also want to consider diplomatic channels by contacting the closest Consulate or Embassy linked to the offshore entity as a party to a dispute or complaint.  Keeping diplomatic connections via participation in “events” in the international community can prove, if needed, invaluable if dropping the sword on the Gordian Knot of complex or lax communications are not successful and all formal efforts in communicating have failed.  As a resource, EmbassyWorld.com provides a detailed list of Consulates and Embassies with direct linkage to the USA, but also all “country to country” diplomatic posts.  This single “tactic” can expand your practice and make you a true International Ombudsman outside of your domestic USA practice.