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Family-owned businesses are the backbone of our local economy. My experiences are that their culture and family values give them an advantage over their non-family run competitors. The key to family-owned business success is being able to set rules to keep personal issues aside. It is common but not necessarily most productive when family-owned business decisions get made around the breakfast table!
It might be worth considering the following 10 points to ensure the success of your family-owned business
- Don’t always consider dealing with the family first to ensure business success. My experiences suggest that if you don’t take care of the business, the business can’t take care of the family
- Set boundaries to limit business discussions outside of work. Mixing business, personal and home life can lead to conflict that is detrimental to business success.
- Establish weekly meetings where personal and family matters are set aside. This helps to focus the attention on the core business objectives. A strict agenda is important in facilitating productive meetings
- Don’t provide ‘sympathy’ jobs for family members. It is important that each family member adds value to the business and works at a level that is aligned with their current skill base
- Understanding the advantages of family ownership is key to success. Customers are very often drawn to using family-owned businesses because of their culture and togetherness
- Define clear management reporting lines in the business. I see many instances were family members feel that they can reprimand employees who do not report to them
- Clearly define each family member’s role and put this in writing. This should be dealt with like any other business relationship
- Seek to ensure that family members that are looking to join the business have suitable outside experience first. This helps them to gain valuable experience on how business works outside of the family-owned business environment
- Be open-minded to seeking outside advice. Family-owned businesses at times can be too closed and seeking outside advice can help to facilitate fresh ideas and creative thinking. Outside facilitators can also help to make the working relationships of family members more productive
- Treat family members fairly. Many experts advise against hiring family members. I have the opposite view to this. Family members tend to have an affiliation and affection for the business. This means that they have an energy and enthusiasm for the success of the business that previous generations have spent years building. It is important though to ensure that there is not favouritism. Pay levels, progression, expectation, criticism and praise should be even-handed between family and non-family employees. Remember to not set standards higher or lower for family members than others
Family-owned businesses are the bedrock of our local economy and community. They must understand that they have an advantage of family workforce that is dedicated to ensuring the future success that previous generations have put their blood, sweat and tears into developing.
If you would like to discuss your family-owned business please contact Giles Hutchings.