Challenges of Owning a Family Business
Every kind of business has its share of challenges. There is always the trouble of keeping up with the changing economy, market trends and hiring new employees suitable for the company. Just like other businesses, family-owned businesses have their fair share of problems. However, because of the emotional involvement of the family, there are some added challenges that they must learn to overcome.
Following are the challenges of owning a family business and how to overcome them!
- Generation Gap Multiple generations of the family generally run family businesses. In many cases, we can see the founder/the current president of the companies hesitant to hand the business to the younger generation of their family. It results in conflicts and frustration as the younger generation might feel they are being held back or are not given a fair chance. To overcome this challenge, the older generation needs to sit down with the younger one and discuss this with professionalism. We believe it is great for a business's success when the older generation's experience comes together with the ideas of the new generation. It can improve the business significantly as it allows the company to evolve with the changing trends.
- Mixing Home and Business It is quite common to see personal feelings and emotions become a part of the workplace when families work together. As there is so much personal and emotional investment, business talk can take over family events and holidays. It makes family life less peaceful. To prevent it, ensure the family members involved in the business know that business talk should be confined to work only, and no one brings it home.
- Setting Compensation and Benefits Having the family involved in the business is beneficial. However, just because your son is involved in the business, it does not mean you pay him for doing little work, no work, or even poor work. It can cause the other employees, who aren't members of the family, to feel biased against and invalidated. To ensure it does not hinder the employee’s performance, set the salary and benefits according to the position and not the relationship. Make sure you track the performance of each employee, even if it is a family member, and pay them according to their performance and position.
- We have talked about some of the most commonly found challenges in a family-owned business and how you can overcome them. Do you have a family business that needs the training to avoid such issues successfully? Contact me now for some professional advice.