How you should start family Businesses
Depending on your circumstances, deciding to go into business with your family can be a tough decision. As a parent, you might dream of working with your kids and building a legacy for your grandkids. But if you’re the child or family member, it can be tricky to navigate especially if you’re not interested in the family business. And depending on your personality, you might love that your career is already waiting for you . . . or you might dread it because you’ve been around the business your whole life.
A family business is only as functional as the family that runs it—and lots of families are becoming dysfunctional these days. So how do you steer clear of crazy and build a strong business and family in that kind of environment?
1. Communicate openly and often.
Open two way communication is key to a successful family business (not to mention many other areas of your life). listening to what they say to you and them listening to what you tell them.
Let's say: If your daughter has been working for you her whole life assuming she’s going to take over the business one day, you need to have a heart-to-heart with her to make sure she knows your plans. You might want to pass it off to her, but you might want to sell. In either case, it’s better she knows now. To be unclear is to be unkind. The best thing you can do for your family and the business is to be open and honest, no matter how tough it might be. Beyond that, you have to give family members space to speak honestly and openly about how the business is run. And sometimes you have to make sure that your kids had seats in the boardroom. At first, they might be just there to listen and learn how to speak into the running of the business like any board members in the future.
2. Steer clear of partnerships.
You may think starting a grocery business with your brother is the dream job you’ve always wanted. That’s great! But think about the business in the long term. What happens if you two get in a fight and things get messy? Or what if he wants to let his son-law to take over his part of the business when he retires?
There’s so much that can go wrong so quickly though it might be okay for now, the best way when it comes to do business with family members is to either have them work for you or vice versa.
3. Set clear boundaries.
Setting clear boundaries between family life and your business is very important—especially if you want to run a successful business and still have a family to come home to. If you’re at work, keep your family issues at home. And if you’re at home, don’t talk about work. After work take off your boss or employee hat and just be family. You shouldn’t have the same conversations at the dinner table that you have at the board room table. Make sure your business will not take off your family life
4. Have a succession plan.
Have you thought about what will happen to the business when you’re gone or retire? If not, you need to start thinking about a succession plan and who will continue your legacy into the next generation.
A good succession plan is gradual. If you want your kids to take over your company, train and mentor them and gradually give them more and more responsibility until they’re ready to lead. When it’s time for you to pass the leadership baton to your kids, the handoff will barely be noticeable. And like we said earlier, make sure your family members know your intentions.
5. Define roles and job description
With clearly defined roles, written job descriptions including yours too and specific expectations. Just as you would with any other role, you need to work out every possible detail of your family member’s role before you go into business together.
6. Get outside advice—often.
Successful businesses seek advice from outside advisors. Maybe you need help seeing your blind spots, setting goals, or working through tough relationship issues. No matter what the problem is, someone else has been through it before. Learn from their experience so you can grow and reach that next level of success.
7. Create a vision and culture.
Having a vision for your company and working toward goals will keep your business growing in the right direction. And when you cast this vision to your employees (family or not), you’ll have something you can all rally behind.
8. Treat everyone fairly
If you’ve hired both family and non-family team members to work at your company, treat everyone fairly. If your culture favours family, it will be impossible for your team to feel like a team. And that will keep you from making progress toward your big goals.
Instead, create a company culture of respect and professionalism. Don’t treat team members like children (even if they are your kids). And your kids should respect your position as a leader. After all, most of us wouldn’t talk to our boss the same way we would talk to our mom or dad at home—and expect to stay employed. Keep things professional at work.
9. Put on the professional hat
It will be easier to set boundaries and keep things professional at work if you think of your business role and your family role as hats you put on and take off. At work, you wear your “leader” hat or your “team member” hat. And at home everyone gets to take off their professional hats and just be family.
10. Make sure family members earn no more or less of the job they do.
If you went out on a limb to hire your nephew, make sure he actually does the work—and does it to the best of his ability. Don’t let him coast on the fact that he’s your favourite nephew. He’s going to have to work hard to prove he’s the guy for the job.
The truth is, other team members will judge the work of family members more harshly. They’ll have to go the extra mile to prove they’re qualified for their job and don’t just have their position because of being relatives.
11. Find the right place for family members
Everyone has different skills and talents. Some people prefer leading people, while others prefer support roles in the background. Just as you would with any other team member, you need to find the right role for your family member that matches their skills and talents. And sometimes, the right place for a family member is at another company. Don’t pressure your children or any relative to join the family business. Let them make their own decision.
12. Remember why you want to have family business
To work with family and run a business, you have to remember why you’re doing it in the first place especially when things get stressful, money gets tight, or relationships get tense. Why did you decide to go into business for yourself? Did you like the idea of being your own boss? Did you always want to be an entrepreneur? Is building a family legacy important to you? Know your why, and remind yourself of it during tough times.
Never Forget You're Family. If done right, running a family business can be very rewarding. A business can create a lasting legacy for your family and strengthen the bonds between family members. But a business can also ruin family relationships if some guidelines and boundaries aren't established from the beginning. Just make sure that expectations are clear, communication is constant, and boundaries are set between family life and business life.
And never forget that you will be always a family whether in business or not .