Do you own a family business? Small businesses are often owned and managed by two or more family members. In my work with systems, I’ve interacted with many combinations of family-owned businesses—brothers, sisters, father & son, husband & wife, etc. I know first-hand the challenges they face.
The main challenge, with family members in constant contact, is how to keep from permanently damaging those relationships, while dealing with the stresses of the business. That is especially magnified in times like these, when conflicts in the economy and in the world run high.
Family-owned business, a two-headed coin
Heads: Everything is great, making a lot of money, we’re the owners—call us in the Bahamas.
Tails: Everything stinks, barely making a living, too many chiefs—call us anytime day or night (we will be right here, stuck in the office).
There’s a workable solution to family-troubled businesses, and it’s not a flip of the coin that determines winners and losers. Winners are always seeking improvement, in themselves and the environment around them. And I’m not talking about trees!
So keep reading. Open your mind and your heart. Seek knowledge about how to build upon an inheritance for those brothers, sisters, sons and daughters coming behind. Remember, it’s not about any ONE member!
A Sad Thing To See In Family Businesses
Many second generation owners (or soon to be owners) don’t always appreciate what they have or are about to inherit. They seem to have missed what their family has actually accomplished. If they’re honest, they will consider how many people in America ever actually own a business. How many people even have the courage to start one; even with little to no resources? Precious few have what it takes to start a business, and even fewer can make it work past the fifth year! If it was easy, everyone would do it; but, not everyone is willing to risk what it takes to own a business.
To the mind of some business heirs, if everything seems to be working, and it feels like they’ve hit the jackpot, it’s “HEADS—WE WIN.” Little thought is given as to what actually made the business possible to begin with. This can be dangerous when would-be heirs haven’t been properly prepared and trained to take the wheel. They’re liable to find the business in a ditch; them leaving the Bahamas sooner than expected and wondering, what in the world happened?!
But, when things are out of sorts and chaotic, and the business isn’t running perfectly, it’s, “TALES—WE LOSE!” They just can’t seem to see the family-owned business as a blessing, or have the VISION to see —THAT IT CAN BE! I suspect some believe in blind luck—that they have no control over circumstances, company environment or outcome. They may be unwilling to go the extra mile that built the “imperfect” business in the first place, and to turn that business into their OWN vision. Maybe from bad to good—then, as one author says, “Good to Great!”
Sadly, when WE lose, others also lose!
The Ugly Side of the Coin:
For Non-Family Employees
— Low morale
— Fear—not knowing who to listen to; who’s the real boss
— Feelings of inferiority, as some family members tend to lord over others
— Little respect for, or trust in, family owners
— Choosing sides with certain family members, causing uncivil war
— Little concern for quality, as some family members don’t seem to “give a rip”
For Family Members/Employees
- “I don’t have to follow company policies—my name’s on the sign!”
[If YOU can’t follow company policies, then change the name on the sign!]
- “If my sister comes in late, why should I be different?”
[YOU should care no matter how irresponsible anyone else is!]
- “I hate this business—it’s all I ever heard about growing up!”
[This business afforded those growing up years, and can raise YOUR family!]
- “My mom and I just can’t seem to agree on anything, so I don’t care anymore!”
[I’m sure Mom would be thrilled to go to the Bahamas and let YOU carry the burden for a change!]
- “I’ve been working here since I was twelve and I’m sick of it!
[Take two aspirins and decide what you want to be when you grow up—your family business is a rare opportunity!]
- Too much expectation of them
[Employees take their cue from an owner—YOU decide how you want that to go!]
- Envy between family members, causing resentment and lack of unity
[Leadership calls for maturity, cooperation, and the ability to recognize the value and contribution of another!]
- Superiority complex
[Such a leader discourages willing followers who will enjoy seeing them eat humble pie, at some point!]
- Power struggles due to pride
[How can I put it any better—someone once said, “Pride goes before a fall!”]
What’s the answer?
Several things come to my mind. Surprise? Systems!
A written Chain of Command should to be established, even for family members, or many of the negatives listed above will hang around until someone in the family expires, retires or is excommunicated.
A Chain of Command is similar to an Organizational Chart, as they both establish the WHO in a company. However, the Chain of Command also establishes the WHAT, WHEN, WHERE, and WHY. This gives the WHO the authority to operate and delegate in an agreed-upon set of boundaries.
The great tool for organizing daily responsibilities and establishing authority—the WHEN and WHERE—is a Daily Routine Checklist for each member of the family. With this system you will be able to see, not ASSUME, what each person in the company does. And even, approximately, when they do it. This also helps equalize the work load.
“But, Philip,” you say, “you don’t know my father and you really don’t know my sister. They won’t follow a system!”
You’re right, I don’t know them! However, I believe when most people clearly see policies, procedures, daily routine checklists and other systems WRITTEN down, it brings about a sense of order and professionalism no one can deny. To take proper ownership, all family members need to play a part in building these systems.
Stepping Up to the Plate
If you, as a family member, will step up to the plate, become that leader, and begin the process of systemizing the company, you WILL see results. A leader is someone who serves others before serving themselves. When others see you have the heart to serve, they will begin to follow, and become more involved in your improvement efforts. They will finally become your witnesses to the success of the business.
I suggest that, FIRST, you clean up the messes and disorganization in YOUR areas, as much as possible, before attempting to interject yourself into OTHER family member areas.
Be patient, be committed, give grace where needed, and give LOTS of encouragement. Most importantly—stay the course! It’s not just a flip of the coin—it’s choosing HEADS, by using yours.
Did I mention? Great systems work!