September Editorial – Top tips for family business

I have run businesses with a family member on more than one occasion. It is not like running an ordinary business. So here are my top 5 tips.

Plan for failure
Not a positive way to start with top tips but we may as well be realistic. When we start a relationship it is all hearts and flowers. Despite all the evidence and statistics to the contrary everyone who gets married thinks that it is going to last forever. Just as some marriages fail, so will some businesses. You need to be sure that you are protected in the event of business failure. Who is liable for the consequences of failure may not be the same as who is responsible for the failure.

And what if the business is going really well but the marriage fails? Again, this isn’t something that we contemplate when starting out in business with a partner, but we should. Will the business continue? Will one partner continue and the other walk away? Will the business be sold? There are many options and some will suit one set of circumstances over another but one thing is certain. If you are in the middle of a personal separation it is not going to be the best time to discuss what will happen to the business! Far better to have this agreed at the very start.

Plan for success
When we start out in any business we expect success. So what if it actually happens? Will you sell? Will you take on a full-time CEO? Will you grow the business for the next generation? Will you both continue to work? Will one person take early retirement and if so on what terms? All are valid options but differences about how to handle success can cause personal arguaments and lead to family difficulties. Far better to know at the start how you will deal with success.

Create Space.
If you run the business with a partner, you cannot leave the business behind when you go home. Even if the business and the home do not share the same location, your partner comes home with you. When times are good this can be a positive. You can both bask in the glow of a job well done, the feel-good factor can feed into the relationship and everything in the garden is rosy. When things are going less well, or going badly, it can be a massive negative as the stress and worries are, like your partner, a constant companion.

It’s at times like these that discipline is required, particularly if there are children in the home. It is easy for a business discussion to continue on the journey home, go on through the preparation of the meal, through dinner and on and on beyond the kids bedtime. And trust me, young children cannot tell the difference between a business disagreement and a family arguament. They see mum and dad at odds and they hear raised voices. They really aren’t concerned whether you are debating the company car policy or who’s turn it is to go to Tesco’s, a fight is a fight.

And everybody needs a break. Sometimes an issue can be resolved by going at it like a dog with a bone until an answer is dragged out. Most often a decision, often a good decision, comes from a rest and from a little bit of distance so try to leave problems at home.

Create difference.
Don’t both do the same things in the business. Or better put, don’t both try to do everything. If you are driving there is nothing worse than someone sitting next to you watching your every move, telling you what you should do, or worse, what you shouldn’t have done. It’s the same in business. Try to create distinct roles so that you both have a part to play but where you can avoid treading on each others toes, so to speak. Not only does this reduce potential conflict, it gives you something to talk about that you both don’t already know and in a purely business context, it’s just perfectly good time management.

It’s just a business.
Particularly at the start of a business it can be all consuming. There never seem enough hours in the day to do what needs to be done. But try and remember that it is just a business. It is a means to an end and not an end in itself. Whether the business fails, the partnership fails or the business and partnership is a fabulous successful, there is still you. There is family and there is business. It is easy to conflate and confuse the two things when you are running a family business but they are separate things. My advice is to try to maintain that distinction and not let business consume family.

1 Comment on September Editorial – Top tips for family business

  1. Karen, I’m really pleased to see you mention the planning aspect of starting up a family business. I’ve seen so many business partners start out not believing that things could ever change or that they could ever want different things from the business – then that all changes somewhere down the road and neither party knows how to get out.

    Plan, plan, plan and keep planning!

    Val

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