Family Business: Tips for Success
Family businesses often happen by accident. The entrepreneur drives the start-up while the spouse and family chip in. Underpaid and overworked, these people are often willing to sacrifice to make the dream come true.Serendipity may bring success to a family business; however, the heads-up business owner builds practical solutions for potential family friction into the business plan.
Identify the members of the family with potential to perform successfully within a structure. "Family" can mean a married couple, parents and children, or siblings and their spouses. In short, there are family members, and, then, there are family business members. Share that picture with the family.
Separate family issues from business issues. Share an understanding at the very start about what you bring to the worksite and what stays at home. It may take some practice, but everyone needs to know where to discuss family baggage. Everyone needs to know what the process is to solve issues.
Budget vacation, holiday, and personal time with the family. Keep business out of those moments. However, remember that children are competitive; the best families suffer some dysfunction. So, clarify an understanding for the handling of dependency issues, hostile behavior, and divisiveness.
Pay fair competitive wages. If early revenues do not permit this, clarify the value of their sweat equity. Create a compensation plan that will reward their effort later - proportionate to their contribution and talent. Seek advice on framing the plan and communicate it clearly.
Hold regular "tailgate" meetings, family retreats, or key member meetings. Let members vent simmering complaints- within reason. Approach these as learning opportunities. Collaborate and incorporate fairly offered ideas.
Plan for succession when it makes sense and you are ready. Build cautions into the plan to discourage challenge to the plan. Communicate it well. A well-structured plan should reduce infighting.
Finally, enlist a third party coach - not a crony or other family member. Retain the advice of a specialist in family business matters to get things right from the start and to bounce things off as you succeed at your goals. by Steven Schlagel