Tips for Running a Family Business

Running a family business can be both a rewarding and challenging experience, no matter what industry you may be in. Family-owned businesses are a huge part of today’s economy. In fact, according to sba.gov, 90% of all businesses in the United States today are family run. The idea of running a family-run business does have some allure.

You have a feeling of trust between the people you own the business with, and you get to work with people you know instead of strangers. However, there are also many challenges that come with the day-to-day operations of running one of these companies. Relationships can be complicated when business and family are intertwined. Some families feel obligated to hire members for certain jobs even if they are under qualified, and growth is often compromised by feelings of loyalty and needing to staff family members.

If you are running or planning on running a family business, there are some tips to consider that can help the entire process run more smoothly for you and everyone involved.

When You Are At Work, Business Comes First

Family issues are meant for family time and work issues are meant for work time. When you are at work, business always comes first and you need to set clear boundaries on that. You need to have a clear business plan, a clear chain of command and put clear communication channels in place. No matter what role a person has in the family, when they are at work, they need to focus only on their work role. This can be difficult, but it is an essential practice.

A great way to implement this strategy is to try to never talk about family issues at work and never talk about work issues during family time. There need to be boundaries for the business to thrive.

Handling Unqualified Family Employees

One of the biggest challenges to running a successful family business comes from finding yourself stuck with a family employee who simply isn’t qualified for the job. If you hold on to that employee, your business can suffer. On the other hand, firing that person can negatively impact your entire family dynamic.

Before you hire a family member, try them out in several different roles until you find one that fits for them. If you already have someone in a role that doesn’t work, then consider sitting down and honestly talking to them about a new position that they could have in the company. It is never easy to tell someone that they are not qualified for a certain position, but moving them around in the company is often better than firing them or letting them drag you down.

Select a Leader and Stick to It

There should be one leader in the family business and this is the person who should always have final say. There should be no confusion over who the leader is. Some family businesses choose the matriarch or patriarch of the family as a clear leader, while others will try to hire an outside person to be a manager and diffuse potential family conflicts.

Don’t Be Afraid to Fill In The Blanks

Many family-run businesses struggle to grow because they feel as though they can only hire family members. While it can be overwhelming to have a business that is 99% family and 1% outsiders, it is important that you do not let your family ties prevent you from getting the staff members your company needs to succeed. If your company has a hole in it or a blind spot and there is no family member that can fill the role, do not be afraid to look outside for the right person. Balancing between family and outsiders can create a stronger business.

Keep these tips in mind during the long-term planning and day-to-day operations of your family run business. They can help make certain that your business thrives and that your family relationships stay strong.