Running a family business can be pretty tricky at times. Although it provides family members with many opportunities, there is always a risk of disputes. Family businesses can be successful, but nobody can predict what difficulties they might have to face. Because it is a family business, the interests of the family members and the business are interrelated. Every business has its ups and downs, and they constantly change. Following is a list of tips on how you can avoid problems in your family business:
Tip #1 – Make Sure to Address Ownership and Management Concerns A family business might be professional; however, the family members cannot help but get emotionally involved too. Therefore, it is best to decide the ownership and management structure at present and how it will shape up in the future, so every member has a clear view of who will run the business in the future.
You should discuss and address concerns about who gets control of what, which family members want to have more shares, votes, and dividends. Ensure you involve every member of the family on board and take their wishes into consideration when deciding ownership and management, so nobody feels left out, as it can create problems.
Tip #2 – Do Not Offer the Job to Those Who Are Not Qualified Every family-run business wants to keep the business in the family only. Many times, they reject outsiders even if they are qualified enough for the position. The owners wish to give family members positions, even if they are not capable enough for the job or are not interested in being a part of the family business. No matter how inexperienced and unqualified the offspring of the owner might be, they end up getting executive positions because they belong to that family.
It is unhealthy for the business and should be avoided to ensure the company’s success. The inexperience of these family members can cause your business heavy losses. Therefore, making them go through proper screening and training can ensure the family business maintains its value even after the offspring's employment.
Tip #3 – Learn to Adapt to Changes by the Younger Members
Businesses are constantly evolving. The newer generation always has a different point of view from the previous one. Therefore, the younger family members working in the business may want to make a few changes for the better. To ensure there is no conflict and no problems arise, discussing the change can be beneficial.
You must take the suggestions of the young family members into consideration. Discuss how to implement those changes, when to implement them, and how they will benefit the business. It makes the younger members feel included and could end up being beneficial to the family business.
Conclusion As an owner, you should treat it the same way you would treat non-family members – fairly. Problems amongst family members can result in the failure of the business failing. If you need coaching on how to avoid problems in your family business, contact me now to get professional advice.