Running a family business can be very rewarding, but there are caveats that outsiders will need to be aware of. Aside from managing the business partnerships, owners and employees often find themselves dealing with the family relationships.
From neighborhood convenience stores to manufacturing plants, successful family-owned businesses can be found everywhere despite the business model’s unique struggles. Some of the world’s biggest global enterprises, like Walmart, Volkswagen, and Cargill, are still family-owned.
If you are thinking of starting a business with your family or perhaps, working for one, here are some factors you’ll need to consider.
Anyone can start a business, but not everyone can be an entrepreneur. Most owners take a course on management because of many tasks like setting up a business, and closing it involves routine administrative work.
Others will advise you that you don’t need to study because you can hire someone else to do it anyway. However, this leaves you vulnerable to other people who want to take advantage of this knowledge gap.
The good news is that you are not required to have a business degree to succeed in your enterprise. If you are joining a family business as a child, spouse, or relative, the situation will adapt to your background.
But if you are a valued business partner with a different last name, be open to putting in additional effort. With the proper research and expert guidance, rest assured that you will be able to find your place.
Having the right attitude towards owning a business is just as important as having the background for it. Like in any institution or organization, members commonly take personality tests to figure out their natural tendencies.
There are times when family members will fight due to irreconcilable differences, even when they share the same intentions in wanting to have a successful business. You have to learn how to be flexible and understand that there are various approaches to solving a problem.
Accepting that people change is a fact of the job, especially when you also expect the company to grow and transform for the better.
Character Strengths And Weaknesses
Whether it’s the business owners or non-family employees, being aware of the family’s strengths and weaknesses can positively impact its culture. Who is good with sales? Is there an accountant or a lawyer in the family? Who is the best when it comes to strategy and investment?
More often than not, there will be competing goals and power dynamics within the family. It will help you find out which member has the technical skills, financial acumen, and management experience towards leading the business.
Your ambitions and motivations will direct how you address your weaknesses, either through complementing them with other people’s strengths or spending time and money to improve yourself.
However, the formula for a perfect business does not exist. Furthermore, a family-owned business faces higher risks and challenges to succeed. How can you maintain family cohesion while building business relationships?
- Communicate Often About Emerging Issues
The only way to solve any misunderstanding is to talk about it. You should always aim for clarity in giving instructions, making decisions, and reporting problems when talking about topics concerning the business.
However, try to focus on being an effective communicator instead of over-communicating, which is a symptom of poor leadership and can slow things down.
- Agree On A Governance Structure To Reduce Conflict
Owners should establish a company vision that is supported by clear goals to reduce conflict between family members. Ownership and management structure should be under separate evaluation to delineate roles and responsibilities.
- Designate Time And Space For The Family Separate From The Business
It’s normal for some people to have different personas when they are at the workplace and at home. You should consider separating mundane activities like driving to work, arranging meetings, and even office chatter.
For business-owning couples who stay under the same roof, running the business together will likely add stress to an already challenging relationship, balancing the role of intimate and professional partner at the same time.
- Bring In Experts And Counselors
Family-owned businesses will achieve success by having expert advisors and counselors to mediate significant conflicts.
While non-family employees are subject to different standards, the family needs to value their contributions and reward them accordingly. Accepting criticism and feedback from trusted partners will also help resolve issues, especially those within the family.
Balancing the business demands with family-oriented decisions often relies on healthy relationships between spouses, siblings, and parents’ relationship with their children.
The secret to sustaining an entrepreneurial family is more often a product of design rather than destiny. Therefore, learning to adapt with the times will be an essential skill in developing successful family businesses.