Even though there are a lot of people who see running a family business as a dream come true, the truth is that this concept is ideal only on paper. In reality, there are so many potential problems and even some things that you may see as advantages, at the moment, might end up hurting you in the long run. Not to mention that, as a family, you’re putting a lot more on the line. So, here are five tips to help you get the most out of this.
Start with basic communication
While you may see the communication as one of the stronger sides of your family, what you need to understand is the fact that, in some cases, these things won’t transfer. You see, sometimes, as a person in charge, you need to delegate unpopular tasks on some of your subordinates. Other than this, you may also have to send them a negative piece of feedback. Needless to say, this gets a lot harder if the person in question is a spouse, a parent or a sibling. This is something that needs to be explained and established from the very start.
The biggest problem with this issue lies in the fact that while you might have entered into the business world with the desire to make it with your family, the truth is that you can’t waste too much consideration to sheer sentimentality. Your business meetings need to resemble business meetings, not family get-together. Also, dispute resolutions need to be handled in the most responsible manner possible. Keep in mind that your personal relationships with both parties and your relationships in the family can’t affect your role as a mediator.
Resort to using contracts
The next thing you need to understand is the fact that while your business is definitely one run with the family spirit, things can get quite nasty even amongst the closest family members. What if there is a divorce or one of the major shareholders passes away. How will the succession impact the business in question? The truth is that all of this needs to be put on paper. Now, due to the fact that the bulk of these issues has roots in family law, rather than anything else, what you may need are some good family lawyers on your team. This way, you can think of some of the solutions to these problems well ahead of time.
Clarify roles and responsibilities
Another thing you need to keep in mind is the fact that clarifying your roles and responsibilities might be one of the first responsibilities of your enterprise. You see, the bulk of conflict in the workplace comes from the fact that people don’t do their job because they expect it’s someone else’s responsibility or that they meddle into other people’s affairs. When this happens in a family business, things can escalate even quicker. You know your family the best so focus on task delegation and try to resolve this as best as possible.
Treat them fairly
Just because you have family members as employees and partners, this doesn’t mean that you can treat them any differently than you would regular employees. Just because your firm is doing poorly at the moment, this doesn’t mean that you can pay them less or not pay them at all. Also, just because they benefit from the prosperity of the business (and are, therefore, working for their own benefit), this doesn’t mean that you shouldn’t give credit (or pay a bonus) where it’s due.
Understand the advantages
So far, we’ve mostly discussed the challenges of family-owned businesses. Stacked against these odds, what would be the chances of your team actually making it? First of all, you get to employ your own family members, spend more time together and the chance of employees leaving/getting poached from you is not quite high. Moreover, while drafting contracts is paramount, chances are that you will be able to agree upon the majority of issues without the need of ones, simply because there’s already a strong personal connection between the shareholders. Not to mention that you already start with the admirable trust level. Use these benefits to your own advantage.
In conclusion
The last thing you need to bear in mind is that, at the end of the day, there’s nothing more important than family. Deteriorating your family relationships, breaking your family apart and hurting the feelings of those who you love the most just in order to make a profit is all sorts of wrong. Remember that an average person changes 10 to 14 jobs in their lifetime but you can only have one family. At the end of the day, these are the people you know best, so, if you make an estimate that this just can’t work on a professional level, avoid entering business with family members. Still, the entire experience can turn out admirably.
Evan Goodman provides services of small business coaching in Sydney.
Executive coaching & mentoring for business owners over 30 years.https://www.evangoodman.com/business-coach/
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