Friday, November 18, 2022

The Allure of a Family Business

I recently attended an event where the former CEO of a well-known company discussed what it is like to run a family business. The first thought that went through my head was “wow, if all the members of my extended family owned a business together it would be an absolute disaster!”

While I still whole-heartly agree with that statement, I also got to thinking about many of the benefits that would come from being part of a family business. Of the people I know who are actively involved in a family business, which is surprisingly a lot when I stop to think about it, almost all of them have commented on the sense of purpose that they get from their work.

This sense of purpose is something I rarely hear about in a normal employment context. Knowing that the work you do today will benefit those you care for and allow you to “pass it on” seems to be a key driver of success for family businesses. That is not to say that I have not heard plenty about sibling/cousin rivalries that sound like they were taken straight from a bad made-for-tv movie, but those appear to be the exception when succession is a core component of the company’s strategic planning process.

Succession planning can come in many forms, but two of the most important pieces seem to be communication and contingencies.

First and foremost, the family founder may want to leave the business to the next generation, but maybe only part of that next generation has any interest in joining the business. Having that conversation early—and encouraging open communication in a way that genuinely addresses the goals of all the parties involved—can be a game-changer.

Even if there is good communication and the family seems to be on the same page, building in contingencies up-front when everyone is still getting along can save the business and family relationships if something such as a divorce or illness gets thrown into the mix. I guess the moral of my story is plan, plan, plan.

And kudos to all those individuals out there that are not only brave enough to make the leap to become an entrepreneur, but also bring their family along for the ride. To any members of my family that may see this and become slightly offended by my earlier statements, if you think about it, you will realize that “disaster” is probably putting it mildly.

No comments :

Post a Comment