The Dos and Don’ts of Managing A Family Business

According to a survey conducted by Ernst and Yang and the Kennesaw state university, family businesses account for 70% of all business in the world.

In all businesses success is important, regardless of your family politics or ties. In the workplace, decisions must be objective, not personal.

While managing a family business it’s important to:-

• Communicate clearly about your business plan, so that everyone on the team is on the same page.
• Establish a clear chain of command and lines of authority for decision making. If a family member does not have a role to play in the decision making make sure they are aware of this and give them a role in the business.

If you manage a family-business not only do you need to be a strong manager you need to be tough enough to make decisions and stick to them.

Whether it’s a difference of opinion or a performance issue, dealing with conflict among family members in a business environment is tough, but also remember that constructive conflict is good for business.

Families always fight, never let that interfere with the business. Try not to take sides with any particular family member, and make it known that you won’t let disagreements affect your business.

If you find yourself stuck with a difficult family employee with whom you can’t reconcile yourself, consider moving them into a new line of work or encourage them to transfer to another branch. Some members of the family will be better in some areas than in others.

Teach each other skills so that each member can help the business in a positive way, and lower the need for hiring extra outside help.

Although it’s always tricky to develop a succession plan within a family business, it must always be done ahead of time. Give members of the same age bracket the same chance to come forward, judge everyone on an equal basis, and don’t force the process.

Many family businesses remain so, for years, but how do you ensure that the next generation continues to grow your business and serve your loyal customers when you come to retire or move-on?

The best time to plan for succession is in advance, in your mind consider:

1. What are the plans of the next generation?
2. Who is interested in staying in business and leading the way?
3. Is there more than one aspiring leader-in-the-works?
4. What role will the other members play?

While setting goals for transferring business ownership, you can provide on-the-job mentoring, without being too much of a manager.