Family businesses are great;
They often make some of the best products and perform some of the best services around. They often get overlooked when they compete with bigger franchised stores because by comparison their resources can be limited.
However, that doesn’t mean by opening and running a family business doesn’t mean that you can’t be very successful.
7 Keys to A Successful Family Business
Many people find success through providing a great product or service for their customers. Owning your own business is a highly popular trend nowadays. Family-owned businesses make up a large percentage of small businesses in the world.
It is a risky deal working with family members as relationships can be strained and become complicated. The hard part is learning how to put family emotions aside and leave work at work and home at home.
When you are at work, you have to realize that the business comes first.
So follow a few steps to improve the success rates of your family business:
1. Work with Co-Leaders
Having one person lead the entire family business could lead to conflict. Let everyone share his or her opinion and have a major role in running the company. With co-leaders, you have more agreements and fewer fights that could turn personal.
This also helps create a checks and balances system in your family business.
It is good and healthy for everyone to feel like they have some sort of say within business. It is also a great way to find the good, the better, and the best ideas when it comes to management, expansion, and other aspects of your business.
The less of the hostile work environment you have the better and more successful your business can be. With that said, it does not mean you will not have problems and disagreements with one another.
You will just have to find the best solutions to work through them together in a peaceful and civil matter so that it does not hurt your family relationships and so that it doesn’t hurt your business as well.
2. Make Contracts
Contracts are a great way to help maintain a business relationship with your family members at work. It holds everyone accountable to their role and how they treat each other within the company.
Avoid shaking hands as a way to seal agreements with your family. For every serious business deal you have, create a written contract with terms and conditions. Every contract is legal binding and able to be settled in court.
This will help you to make sure that everyone in your family knows their role and what their contract says. It makes it legally binding and it helps keep everyone in check.
3. Demote Rather Than Fire
Consider demoting your family employees instead of firing them.
Firing a family member is more personal and dramatic than firing a stranger. You could draw major rifts in the family and cause conflicts that last for lifetimes. Consider their skills and choose positions that are better suited to them.
The last thing you want to do is create a rift with that family member outside of work. You don’t want the business to come between you and that family member in your life outside of work.
Do everything you can to avoid firing unless you absolutely have to.
Make sure they understand these conditions when they sign the contract as well. It will help save you some headache and hopefully some heartache down the road.
4. Enroll in Business Courses
Enroll in courses to improve your finance and management skills.
There are certificates, undergraduate and graduate degrees offered in different fields, such as business administration, accounting and marketing. The online MBA degree program is the most popular type of program taken by online students.
5. Offer Valuable Criticism
Criticism is extremely valuable in the workplace.
When working with family members you want to make sure it given in a way that is constructive rather than destructive. Offer helpful criticism to every member of the team. All employees must know where their strengths and weaknesses are.
It is important to know what they do well versus what they do not so well.
It is what will help them build on their strengths and improve upon their weaknesses. You cannot improve the business without placing the most focus on your employees’ needs.
You want to make sure that every family member and other employees are as equipped as possible to succeed in the business. Keep in mind that when your employees succeed and have success, then so will your business.
6. Choose Professionals Only
Avoid placing relatives in high positions just because they ask.
They need to be qualified for the position. Make sure your other employees are thoroughly qualified for the job as well. Compare the education and work experience of all applicants regardless of their relation.
If there is someone else in our even outside of your company that is more qualified for the job, then that is the person you should hire.
The key is to make sure that all positions are filled with the right people making sure everyone is on the “right bus” and in the “right seats” on that bus. This is key to the future of your company and its success especially if you serve customers and clients.
7. Let Each Generation Make Decisions
Your parents’ way of thinking is not the same as your way of thinking or even your children’s. In every new generation, there are significant changes in trends and technology.
Keep an old business new by mixing ideas from different generations.
Being able to adapt to the times you live in will ensure your businesses survival for generations to come and it helps make sure that it is ready to be handed down to whoever in your family will be taking over the business.
Even people who grow up in the same house and attend the same schools will have different business views. Be extra cautious when you turn family members into business partners.
Review the most important ways to ensure that your family business remains a success.
Here’s a quick recap on the 7 keys to running a successful family business:
- Work with co-leaders
- Make contracts
- Demote rather than fire
- Enroll in business courses
- Offer valuable criticism
- Choose professionals only
- Let each generation make decisions