If you’re a small business owner, you know very well how many types of challenges we face on a regular basis. We talk a lot about them on this blog, like being an introvert business owner, email etiquette, business text messaging— all that good stuff. But there’s a type of small business that has its own unique challenges: the family business. Our answering service has been a family-run business since day one, so working with family members is something we know very well. When business and personal lives combine, things can get a little sticky. So how do you navigate working with family? Are there pros to working with your bros?
First off, what makes a family business? If you work in HR and your cousin’s an engineer at the same company, you’re not working in a family business. According to Wikipedia, Whether you’re working for a family business or, in trying to find good employees, you end up hiring your brother-in-law, there are some differentiating factors between working with family versus having a strictly-professional relationship with someone. Working with family members may have a bad rap for being complicated, but family businesses account for 64 percent of U.S. gross domestic product, generate 62 percent of the country’s employment, and account for 78 percent of all new job creation. In addition to family businesses being awesome for the economy, there are some unique advantages of working in a family business.
Advantages of working in a family business
When you’re working with family, the members of your team are more likely to be accommodating when you need to take some time off. Whether it’s for a doctor’s appointment, parenting responsibilities, or just a mental health day, they’re more likely to help out. They have a vested interest in you personally, not just for your work production. So they’re more apt to help you succeed in all avenues of your life. Not just the workplace. Because it affects their quality of life outside of the workplace, too.
Family businesses have longevity. You can depend on having a job as long as the company is doing well and you’re doing your fair share. That can’t be said for all types of business. Sometimes in a non-family business, workplace politics get in the way of your successes, despite your efforts. We live in times when job security can’t always be expected. As corporations get bigger, they often are more focused on their bottom line or shareholders than their employees. Cutting costs sometimes looks like mass layoffs. Ouch. When working in a family business, you know that the guy (or gal) in charge will value you as a human being, not just a cost to the company.
Women in power
In addition to stability, there are opportunities within family businesses that don’t always arise in other types of businesses. According to Family Business Center, 24% of family-run businesses have female CEOs or presidents, while only 4.2% of Fortune 500 companies have women CEOs. Despite the fact that women entrepreneurs have proven their value in the workplace time and time again, it is still difficult for a woman to move up in the ranks in the corporate world.
Usually, with a family business, you’ll see less gender bias. Instead, you’ll see a bias toward those who have a shared vision.
When you grow up with the same values, it’s more likely that you’ll see eye to eye on business matters. In cases where siblings have inherited a family-run business. they learned what was most important from the same set of folks. They were raised in the same metaphorical village. If the co-owners of a company share the same hopes, dreams, goals, and underlying reasons for doing what they believe to be the right thing, they are far more likely to reach their goals.
Ingenuity from the Next Generation
Not all views are always shared when you work with family. But, there are times when this is a positive. A problem that all businesses–no matter how big–can run into as they age is the lack of ingenuity. Look at Kodak and Sears. They were both behemoths of their time, yet they’ve been struggling over the last years. Why? According to Adam Grant’s Originals, it’s because Kodak and companies like it would hire based on commitment, rather than creativity or ingenuity. There was no diversification of age or thought process, so they didn’t innovate enough to keep up with the times.
Companies with leadership that doesn’t change hands for too long is often too slow to pay attention as tech emerges. But when Mom passes leadership of the family business on to her adult children, the kids have the confidence to take the business in the directions of the times. In fact, because of shared vision, there’s less competing agendas. This results in fewer office politics, leaving room for new leaders to follow tech like business text messaging and outsourcing to optimize.
Nurture + Nature
Some people are just born more entrepreneurial. These are the types of kids you find starting lemonade stands in front of their homes at an early age or selling candy for a profit at school. People who come from a line of outside-of-the-box business creators are likely to be more creative when it comes time to innovate. On top of the genetics aspect, the way that entrepreneurs raise their children can differ from someone who prefers climbing the corporate ladder.
For example, a restaurant owner, busy with running the business, is likely to bring their child to the restaurant after school. It becomes where they do their homework, and they help out where they can from time to time. The child thus sees hard work first hand. He better understands the amount of effort it takes to keep a business afloat. So when the time comes when he’s the boss, he’s been primed for many years.
Problems with family run businesses
It’s not all sunshine, rainbows, and mental health days when you’re working with family. Family-run businesses can be a struggle to work for, too.
Work-life Balance is a Struggle
Work-life balance is all about maintaining your personal life and your business without letting the two overlap frequently. If the people you love in your life share a business with you, it’ll be more difficult to do so. When your cousin Larry starts talking about his latest sales numbers when you’re reaching for another slice of pumpkin pie at Thanksgiving, it may feel like your work-life balance is out of whack. You can’t have that!
Emotions Run High
If an issue arises within the business that’s a result of your actions or choices and it’s your mother who needs to tell you what to do differently, you’re going to have a hard time not taking the criticism personally. Because your relationship with her is already personal.
Difficult to implement change
Whether it was you or your great-grandparents who started the business, it was once someone’s baby. Starting a business takes a lot of energy and it takes a lot of work to keep it running. You invest so much time, money and effort. But, once the leadership changes hands and changes are needed in order to keep up with changes in society and technologies, it’s more difficult to get that ball rolling. Why? It’s all about that personal relationship again. While you may think your store needs an app to keep up with the changing times, Granny might think that what worked then should work perfectly fine. And who wants to pick a fight with Granny? Didn’t think so.
Nepotism is a no-no
A term for family members working together that gets thrown around a lot is nepotism.
Working with family means that people who aren’t a part of the family but are a part of the business will generally assume that favor is granted to those who are a part of that family. If they feel like the distribution of power and opportunities is built on relation rather than merit, it could lead to a low employee moral and a high turnover rate.
If the passing of the leadership torch will always be toward the next generation, the next in succession doesn’t always have the preparation needed to lead. Though some, as I mentioned earlier, learn by example how to become a business leader, this doesn’t happen every time. Some children, knowing that they’ll have a job regardless as they grow up, slack off. They feel forced into a business they didn’t create, and as a means of rebelling, they refuse to pay attention to what those around them are doing as business leaders. They don’t acquire the knowledge that would benefit the business, nor do they go the extra mile when it is their time to lead.
Overall, this person, who is the next in succession to lead, doesn’t become qualified for the job. Your staff will note this, and they’re likely to start looking for a position in a different company if they know their soon-to-be boss isn’t qualified to lead.
Tips for working with family members
Though not all cases of working with family are family businesses, they generally have the same potential for emotional mishaps. People get upset over the distribution of responsibilities and feel like things are unfair, there are clashes with non-family members, and your work-life balance can quickly go out-of-whack. How do you avoid some of those issues?
1. Make Boundaries Clear
It’s important to set clear boundaries with all new employees. They need to know what is acceptable and what is not, after all. When working with family, however, it’s even more important. Most familial relationships don’t have very clear lines that cannot be crossed. Or, family members like to push one another’s buttons. It’s a very different dynamic. Because of this, it’s crucial that you make it clear that your personal relationship is separate from your work relationship.
Try to distribute the workload so that family members don’t work on the same projects together. Rather, pair up family with non-family. You’re less likely to run into personal relationship problems interfering with work productivity.
2. Be Fair
As mentioned above, one of the biggest problems with family run businesses occurs when non-family members feel like they are not compensated or promoted based on their efforts or merit. It’s important that all of the members on your team feel valued, and the only way to do this is to be fair. Don’t automatically give the best projects to those who you favor more on a personal level. Don’t give too little work to your family member, either. Sometimes, in our efforts to seem fair to non-family members, we end up cheating the family member out of opportunities. Remember to keep your personal life out of your work decisions, and no one will assume the worst.
3. Leave your Emotions at the Door
I can’t emphasize this enough! When you’re working with family, you go into a business knowing a lot of their personal business. Because the relationship is long routed, there’s no doubt that you’ve gotten into arguments at one time or another. Everyone disagrees at one point or another. You can’t let old baggage get in the way of work. It’s not healthy for the relationship, work flow, or the other, non-biased employees.
Just because you know someone’s hot and cold buttons, doesn’t mean you should press them. And the same goes for that person toward you. You should come to a mutual agreement that neither of you will let personal matters interfere with your work relations. Of course, this is easier said than done. But if you put the boundaries out there from the get-go and consistently follow through to make sure you’re not talking about familial issues at work and vice versa, you should be able to better maintain that balance.
4. Have a Contract
Boundaries, fairness, and leaving emotions out of work all sound great. But it’s not concrete unless it’s in a contract. Few people would do a business deal that would be equivalent to somewhere around $40,000 a year without getting the expectations in contract. You have to protect yourself in situations like that! But time and time again, people allow the trust they’ve shared with family and friends in the past to cloud their judgement upon hiring. When expectations aren’t met, it can mean more than a severance of a business relationship. It could be awkward family gatherings for the rest of your lives!
Most of the time, it’s not even a matter of the family member who is working for you intentionally being lazy. People generally want to please the people in their lives, whether they are a boss, spouse, or sister. Setting up a contract with the expectations set in stone will not only protect you. It will set you up for working with family with success.
5. Clear Communication
Remember when I said you need to consistently check in to make sure you’re following through with your intentions to keep your business life separate from your personal? The only way to do this is to keep the communication open and honest. If you get upset with them, tell them politely and tell them soon. Don’t let things fester, because that’s how something small slowly turns into something large. Uncomfortable conversations are short-term and easy compared to the suffering you’ll endure if something frustrates you long enough to blow up in anger.
Apply this to your small business…
Family members are not automatically the best people for the job, as we’ve described above. But, they are also often the people you enjoy being around the most. Tread with caution, communicate openly, make expectations clear, and be fair, and you can end up extending all the fun you’ve had at home to your place of work. Not all people can say that they love their work team, so give it a go if you trust your family member and know their work ethic.
Now try this:
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