Layoffs in Family-Owned Companies Pose Unique Challenges, says SDL

DENVER – DECEMBER 17, 2008 – Layoff news seems to dampen holiday cheer almost daily within major corporations. Yet family-owned businesses—employing the majority of U.S. workers—are also being affected, says Strategic Designs for Learning (SDL).

One resource family firms has to deal with such major decisions is “family councils,” a group of family members that can provide valuable input to chief executive officers and boards facing potential downsizing. They can provide strategic and value-based input to assist in decision-making, and help smooth out transitions for affected employees, the business and the community.

“Family-owned companies with active family councils have a significant advantage in facing such critical decisions,” said Renée Montoya Lado, founder of SDL, a Denver strategic leadership development and consulting firm with extensive experience as family business consultants and coaches. “The councils and corporate management can have quality conversations regarding their options, how their values will inform their decisions, and if layoffs are absolutely necessary, how they ensure full disclosure with the company and community stakeholders.”

Those companies without involved family business councils can make the misstep of implementing a layoff without full communications to family business owners not involved in day-to-day management. Those family members then call to complain to the chief executive officer regarding the decisions and process, and even community groups like charities can be caught off-guard when the expected corporate donation is reduced or withheld.

Family councils can vary broadly, Lado explained, from forums for information and advisory to tightly structured and instilled with specific authority. Their purpose is to provide the non-managing family stakeholders a forum for participating in the company’s strategy and policy.

When councils are created earlier in the evolution of the business, the more valuable and creditable it becomes. And in difficult business decisions such as a layoff, respected and informed family councils can provide needed perspective, reflecting their owners’ values of fairness, open communication and commitment to employees as well as the broader community.

About SDL

Strategic Designs For Learning (SDL) assists organizations in assessing, aligning and developing talent. Specific capabilities include leadership development, executive coaching, team development, and succession - with particular expertise in working with family-owned businesses. SDL provides a unique integration of leadership assessment, organizational development, coaching expertise, and business knowledge to effectively bridge the gap between business strategy and organizational effectiveness. More information is available at

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Media Contact: Renée Montoya Lado