According to an American Management Service Inc. survey compilation, family businesses comprise 80 percent to 90 percent of all business enterprises in North America.
Only 40 percent of family owned businesses survive to the second generation, 12 percent to the third and 3 percent to the fourth, the survey showed. And of the CEOs due to retire within five years, 55 percent have not yet chosen their replacement, according to
Amserv.com/familystatistics.html.
In my experience, the best companies I know are family businesses, and the worst companies are family businesses. When it works, you have aligned team members building on solid, functional and trusting relationships. Communication is streamlined. And there is the pride of creating a legacy of opportunity and wealth.
When a family business doesn’t work, it’s awful. Unresolved family issues (“Dad always liked you best!”) sabotage communication and production. Unqualified offspring are hired and are given a pass when it comes to policies and procedures.
Here are tips for putting the “fun” in dysfunctional family business.
- Have the conversation. Could you gather the family/business members together for a day, or a half-day, and each ask yourself, “What do I want to be and do and have?” Answer individually, then share your answers. If you don’t trust that you could meet peacefully as suggested above, invite a counselor to facilitate the meeting, and keep things civil.
- Commit to an organizational chart. Clarify who reports to whom and who is in charge. Map it out. Then, create a short, bulleted list of responsibilities for each position on the chart. There can be only one person at the top. Someone must make the call and set the sail. Is it you? Lay claim to your position. Be the leader. Is it someone else? Embrace that person as the leader. There are advantages to being the captain as well as the lieutenant.
- Put a business plan together. The tips above will help you get started. Gather the family members together again. Write down what you want as a family and as a business. Who does what? Why? Who wants what you have to offer? How much to charge? How will you market and sell it? How will you make good on your promises? What actions will help you do this? Put the pages in a binder. Now, you have moved your ideas from thought-form to physical-form. That’s a powerful step. You can do this in a weekend.
- Choose to stay or go. You don’t have to work in the family business. Really, you could go elsewhere. After the initial upset, you will probably still get invited to Thanksgiving dinner. If you choose to stay, be there. Be all in. No more sitting on the fence, whining, complaining or wishing.
- Put “buy-sells” together and get “key man” insurance. At some point, someone is going to want out or need an exit. Plan so that family members can leave without collapsing the business or the bank account.
- Let go of the worst and move toward the best. You could just set the baggage down. You could let the old wounds heal.
Don’t wait for her to change. Don’t wait for him to die. Decide now that you are going to live your best life, and perhaps create your best family business.
Ellen Rohr is an author and business consultant who offers systems for getting focused and organized, making money and having fun in business. Her latest book is “The Bare Bones Biz Plan.” She can be reached at ellen@barebonesbiz.com.[[In-content Ad]]
