Q: You’ve said numerous times that equal isn’t fair and fair isn’t equal. Can you provide a specific example?
A: Fair versus equal can play out in different ways. One scenario is a mother insisting that all of her children be treated equally. She will not differentiate between them whether or not a difference is warranted based on contribution.
Suppose Mom and her four children are getting ready to make a cake—from scratch, of course. As she gathers the cooking utensils and lays out the ingredients, her oldest son excuses himself to go do a homework project.
As Mom and the other three children begin to dig into the cakemaking exercise, it’s quickly evident that the youngest isn’t much help. Though his intentions are good and he’s learning a lot, he’s just creating a mess.
When the cake is put in the oven, the youngest is busy licking a beater as Mom and the two girls begin to clean up. The timer goes off, and Mom pulls the cake from the oven. After the cake cools, the real fun begins. The two daughters insist they are best suited to put the finishing touches on the cake. One will frost and then the other will decorate as Mom supervises.
That evening, after dinner, the family anticipates the cake. Dad’s in from the fields, oldest brother has finished his homework and they’ve even invited Grandma and Grandpa over. As the cake is presented to the crowd, each of the children eyes what they hope is their piece of the reward. As Mom cuts into the cake, the oldest, Tommy, lobbies for a big piece.
We’ve all witnessed the rest of the story. It plays out daily in households across America. Today it’s cake or ice cream. Tomorrow it’s a truck and prom dresses. Eventually, it’s career choices and the farm. In your household, is fair versus equal a business decision? Is it another form of sibling rivalry, or is it the struggle of trying to match reward with contribution? Life is not fair, and nothing is given or received in equal proportions.
As a parent, can you reconcile the fair versus equal conundrum that will unfold as you exercise your succession planning intentions? Should Tommy receive a big piece of cake, even if he didn’t help with the work? How about the youngest? Just because he’s too small to make a real contribution, should he be penalized for birth order? Don’t forget about the two middle children: They both helped Mom make the cake. Did one of them work harder than the other?
In succession planning, dividing the farm has far bigger consequences than dividing a cake. The scenario is the same, though: Some contribute, some don’t, some do more, some do less, but all may feel a sense of entitlement to a fair and equal share.
Given the cake-making scenario, is it right to quantify the contributions of each child as we dole out their respective slices of the cake? Is there a measurable difference in each child’s contribution to the outcome? Is the recognition meant to reward the participants, punish the nonparticipants and define an equitable distribution?
Can we agree that there may be nonquantifiable benefits that are afforded to the children who remain engaged in the farm operation instead of seeking other opportunities? If nonactive children should receive a slice of the cake (an equitable distribution), how much should they receive? In addition, how do we ensure that their slice is not a controlling interest in the whole?
These are questions that each family must address as they begin the succession planning process. If there is no right answer, then the focus becomes the integrity of the operation, financial security of the family and leadership development for the next generation.