It takes so much commitment and unity to succeed with family businesses. The top priority for every stakeholder should be for their family business to succeed. However, it’s not often easy to succeed in any competitive business terrain. Let’s look at some reasons for starting a sustainable family business.
The Pros of Starting a Business with Your Family
Before learning some basic ‘don’ts’ in a family business, you should know how to set up and run a company. Let’s share a few tips.
Close Family Ties
One of the criteria for starting a family business is the close ties amongst stakeholders. Families can create a high performance team. It’s easy to build trust or settle disputes with family members rather than random strangers. The owners are often people that have lived together and understand each other. Also, family members in the business are not afraid to show their perspectives and ideas to each other.
A Collective Goal
Usually, business stakeholders with family ties are committed to a common goal. They often show unity and passion for their company to succeed. For committed owners, it’s a priority to have a brand with their family name. Unlike employees and co-owners that aren’t family, a family member might offer some hours of free work. Usually, people of close family ties have strong chemistry and are more passionate about a collective vision.
It Promotes Generational Achievement
After spending some moments of quality research on family business, brands like Ford and Levi’s will amaze you. It has taken the founding father’s of these brands hard work to succeed, and achieve with their future generations. When owners of family businesses make great sacrifices to succeed, it could be for a lifetime. If the success of the company is important, generations of unborn family members will also play their roles. Usually, successful family-owned businesses are likely to create a strong market appeal compared to other brands.
What Stakeholders of Family Business Should Avoid
Discussing Family Issues at Work is Not Ideal
In the office, don’t mix work issues with family discussions. It’s better to run your business without bringing family matters and sentiments. Sometimes, business owners tend to show favour to workers that are family members. This abnormal business practice doesn’t guarantee a fair work environment. Also, it might reduce the chances of hiring competent people. Family events like social engagements, births, and deaths shouldn’t stall business operations too. If you must discuss inevitable family issues at work, it’s better to show some professionalism.
Avoid a Flat Organisational Structure
According to the International Institute for Management Development (IMD), everyone in the family business needs to be treated fairly. Roles should be assigned to prevent disorganisation in the company’s affairs. Usually, company restoration documents specify the directors and shareholders. Create a management team to run your family business.
Avoid a flat structure where every family member is the boss. If the relevant stakeholders don’t decide who will be in charge early, there will be problems. Also, every assigned role should have clear job description. Since organisational structures give people a sense of control, family members must accept responsibilities. When they treat employees without respect, your company might suffer from work-related legal suits.
Be Fair To Every Stakeholder
In a family business, employees might take sides with respective stakeholders. Consequently, events will creep in and can create bad feelings and rivalries. However, the CEO should avoid acts that indicate unfair treatment to any family member. A leadership development program can teach useful skills. There should be a work culture of equal treatment when family members need to share bonuses, give incentives, promotions, pay raises.