West Michigan is filled with strong family ties that connect many generations. This commonly bleeds over into the business world. Family owned businesses are extremely common here. Many businesses are owned by second or third generations and new businesses are being opened by husband and wife teams. Decisions in business are based on business judgment and when family is involved those business judgment decisions can feel personal. So how do you draw a line between dining room table and the board room table?
San Francisco-based family business counselor Karen Calcango says family owned businesses can present some unique entrepreneurial challenges including improper delegation of duties, undefined roles and responsibilities and familial relationships that pull at emotions and can cause bad business decisions.
Calcango first recommends having clearly defined roles in the business. In a non-family owned businesses employees have to fill the roles that family members fill in family owned business. Just like you would not hire an employee and give them a general role in the business, family members need to know their roles defined. Your bookkeeper should not be making sales and your salesman shouldn’t be doing product development. Family members have different strengths and weaknesses too. Giving roles that fit a members strengths will not only avoid potential friction but will also strengthen the business.
With family members you have a personal relationship that has years of history. This is vastly different than most non-family owned businesses. This personal relationship can create an atmosphere that it’s easier to lash out at co-workers. Separating work and personal time can be important. There needs to be a clear understanding that when you are at work you are an employee of the business and when you are at mom and dad’s house you are not working. Separating personal feelings and time from professional decorum and time is vital for not only the businesses success but for a healthy family relationship.
Finally the generational divide needs to be the elephant in the room that you acknowledge. Younger generations need to understand that the older generations have a wealth of experience and usually have been running the family owned business long before they joined the ranks. Older generations need to understand that the younger generations have a lot more energy, innovations and different perspective that can aid the business. Acknowledging what the other generation can bring to the businesses and embracing that and utilizing those strengths can greatly aid the family business.
Family owned businesses are great. They provide means of income, an investment and something of great value to a family while providing the community with a business. Understanding that the business is a business and the family is a family, and acting accordingly in each respective situation is vital to the future of both. Many small businesses lack structure but in a family owned business structure is important. Someone that can help you gain that structure can greatly change the outlook of your family owned business.
Source: “How to Manage the Challenges of a Family Business” by Lisa Evans of Entrepreneur.com