“The failure rate of mergers is quite significant,” says Ernesto Poza, author of the just-published book Family Business and professor at Case Western Reserve University in Cleveland, Ohio. “Many times, acquiring firms won’t do due diligence on the culture and don’t realize how important it is. They want to create a new financially driven culture and throw away whatever was of value that was embedded in the old culture.”

This approach, say the experts, has led to failed acquisitions and ruined companies. There are hundreds, if not thousands, of horror stories of family businesses being swallowed by larger corporations and falling victim to gross mismanagement, eventually closing their doors.

But the outlook for family businesses remains hopeful, observes Poza, because a growing number of acquiring companies understand the fiscal value of a strong, dynamic family culture and go to great lengths to keep it functioning. “Berkshire-Hathaway, for one, recognizes the cultural impact on the bottom line of family owned companies, and creates incentives for owners to stay,” he says. “That’s much different than just sending in the shock troops and clearing out top management. It shows respect for the culture.”

Pat Mullen witnessed this more enlightened transition of ownership firsthand when the Grand Rapids, Mich., TV station he had managed for 18 years, WXMI, was sold to Tribune Broadcasting six years ago. “Dudley Communications, a privately held family company, owned the station then,” he says. “They pretty much gave me free rein to run the station since our monthly numbers were good. Their philosophy was to hire strong managers and hold them accountable for local markets, but not micromanage.”