Family relationships are intense and deeply felt. They can tear the company apart or create the glue that makes it a joy to go to work.
Like any small business, a family business must plan, structure and develop strategies for its growth. But internal relationships complicate the dynamics.
Here are 5 basic points to consider in building a family business that you can pass on to future generations:
- Keep everyone informed from an early age onward, whether they're active in the business or not.
- Develop an early pride in the family business - have children write histories, do odd jobs, participate in discussions about current business issues.
- Talk money - don't make it a taboo. Make children understand the value of dollars spent and earned.
- Allow grown children to take on exclusive territories when they are ready.
- Give them a piece of business to run by themselves if possible.
- Encourage them to work elsewhere if they feel they need their own space - they will return when they're ready.
- Consider how to deal fairly with family members who will not participate in the business.
- The business may not support all your children's families, or they may not be interested.
- Don't let jealousies tear the family apart.
- Consult family business experts for possible estate strategies.
- Prepare for your premature departure as leader.
- Protect your legacy from the loss of its only leader.
- Start executing a succession plan in your mid-fifties to early sixties.
- Identify your successor. Don't make it a mystery. Who has the fire in their belly to run a vibrant business?
- Hand over authority slowly and watch how it is handled. Enlist trusted outsiders as mentors or trainers.
- Hold regular family business meetings that include everyone, even non-active participants.
- Everyone has an interest - only their roles are different.