What makes a successful family business?
For plenty of business owners, running the business like a family is their dream scenario. But there’s a tricky balancing act to be performed if you don’t want to also end up running your family like a business! After all, working with family makes it all the more important to think about things like your work-life balance, and maintaining good relationships with your colleagues becomes even more critical when those same colleagues are also close relatives.
Those without the experience of owning or working in a family business might wonder what the benefits are. Believe us, they’re many and exciting. Do you know how they say if you pick a job you love, you’ll never have to work a day in your life? That goes double when you’re also working with the ones you love. A friendly business environment makes the working day much more pleasant, encouraging everyone to work together for their mutual benefit. Many prospective customers, partners, and employees will also be attracted to this kind of environment, thanks to the reputation that family companies have for a warmer, more personal touch. Family businesses can also have strong ties to their local area, boosting the local economy and improving the lives of those nearby even as they grow and expand.
Of course, it’s not always sunshine and roses. Every business has its rough spots, and the same is true of any relationship. That’s why, once you’ve thought about the benefits, it’s also important to be aware of the potential risks before going into business with family. Remember that starting a business is a big venture, and always something of a gamble. Be sure that your relationships are strong enough to survive the potential stresses of failure (or even success) and that everyone involved is willing to put in the effort required to make the business really work. Otherwise, you might find your relationships under more strain than you expected, while your business also struggles: a horrible situation to end up in.
Of course, it’s also important not to overstate these risks – many family businesses around the world work just fine together, achieving financial success and enjoying every minute of it. So how do they do it? Every family is different, of course, as is every business, but we’ve found that some general guidance seems to help.
Be open and honest with each other
Every good relationship is founded on clear communication, right? Everybody knows that. And yet it can be easy to forget this when you take the plunge into the world of business together. Communicate! Before you take the decision to launch the business, talk about it as much as you possibly can. What’s your plan? What are your expectations? What are the risks? What’s your Plan B – and for that matter, what’s your Plan C? Make sure everyone involved is completely comfortable with the basic concept. Talk, talk, talk.
Then, while you’re going through the setup process, work together to find out what everyone needs. Working space? Hardware? Software? Who’s responsible for what aspects of the business, and how will you monitor and assess yourselves and each other? All of this is part and parcel of setting up any business, but with family, it’s doubly important. Small tensions now can grow and grow over time, so if anyone is at all unhappy, try to resolve it before it becomes a bigger problem.
Later on, once the business is up and running, keep those lines of communication open. Look after each other. Find out where you can help each other out. This leads us on to our next point…
Cooperate, don’t compete
The business world can be fast-paced and competitive. It’s easy to get swept up in that atmosphere and forget that you and your family are working for everyone’s benefit. Find ways to help rather than hinder one another, to share the workload and improve each others’ working lives. Putting the family and the business ahead of individual success will benefit you all much more in the long run. Once you start working together, the fortunes of the family are tied to the fortunes of the business, so the better you can work together, the happier and more successful you’ll be. With that being said…
Know when to take a firm line
“Familiarity breeds contempt”, or so they say. We think that’s putting it a bit too strongly, but it’s certainly possible for a family working environment to get a little more easy-going than is strictly advisable. A little too much time socialising rather than working, not quite enough pressure, a desire to avoid conflict… all of this combined can lead to a drop in productivity as one or more members of the business gradually stop pulling their weight.
In other words, one of the strengths of a family business – its relaxed, friendly environment – can also potentially be one of its weaknesses. The good news is that a healthy family relationship already offers the perfect solution: families can say things to one another that other people can’t. (Of course, if you’ve ever experienced sibling rivalry then you’ll also know the drawbacks of this!) But the long and short of it is, if someone needs to do more work, tell them so. As a family in business together, you already know and respect one another, so don’t be afraid to speak up if something’s wrong. It’s for the good of the business and it’s just another way of helping each other out.
We should add, of course, that keeping an eye on each other doesn’t require any kind of paranoid constant surveillance of everybody’s work. Trust is also an important part of a good relationship. It’s all about finding a balance. And speaking of balance…
Don’t let your work be your entire life
Yes, it’s all about the work-life balance. This is important no matter your job, but when your colleagues are your friends and family, it can be harder to ‘switch off’ in the evenings when you’re still spending time with the same people. Don’t be afraid to call time on work-related conversations after the end of the working day, and make an effort to do something special now and then to clear your head and take your mind off the job. And if you occasionally need some space away from your colleagues and relatives, feel free to say so. Who’d have guessed it – once again, it’s all about communication.
We hope these tips have helped. Running a family business can be hard work sometimes, but it can also be one of the most enjoyable, rewarding careers imaginable. There are many other handy resources out there for family businesses – two of our favorites are Family Business United and the Family Business Awards. If you have any other interesting resources, we’d love to hear about them in the comments.
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