It’s All Relative: Running a Thriving Family Business Without Ruining Your Priceless Relationships

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Family businesses can be successful and fun, but they can also put a strain on relationships. Here are some tips to keep the stress at bay and the worries at work without bringing problems home with you.

Choose A Leader For The Business

Family businesses that are run by a committee of family members almost always end with someone being angry at someone else. Rather than have no one in charge, appoint a leader for the business.

Everyone has their strengths, and this is no exception in a family-run business. Maybe your brother has better accounting skills than you do. Fine. Let him run the department. But, maybe your dad is a better leader than you (even if you really want the position).

You have to be honest with yourself about your own natural abilities. Everyone does. By picking a leader for the business, you will be drawing a line in the sand. It provides clear direction for the company, and allows one person to make decisions, reducing bickering or arguments which can slow down the operation or bring it to a grinding halt.

Another related area to choosing a CEO and permanent or defined leader is to establish the person’s authority. Everyone has to agree that this person is the best family member to run the company, and has to be willing to take orders, regardless of their relationship to one another.
So, if it just so happens that a younger sibling runs the company, the father, and older siblings need to respect his or her authority on the job.

Do Everything By Contract

Don’t do business by handshake. This is the number one mistake family businesses make. Companies, like Midlake Custom Hinges exist and have endured because they’re friendly but also run like a normal business.

By using contracts to establish employment, you are minimizing the risk of hurt feelings when someone gets promoted over someone else or if the unthinkable happens: someone from the family gets fired.

Set Clear Standards and Keep Business And Family Separate

Standards need to be maintained at all times. The business should be kept separate from the family. In other words, when you’re at work, you should maintain a business and professional attitude. When you’re home, you’re “family.” Things can be more relaxed.

Many family businesses that are run this way are successful and there’s little or no argument outside of the business.

Make Constructive Criticism

Constructive criticism is generally more useful in business, but it’s especially important in a family operation.

Just because you separate family and business life doesn’t mean you can erase or forget what’s said on the job. Constructive criticism helps reframe problems and challenges so that family members are encouraged to improve their performance at work, rather than being told negative statements about their job or performance.

Constructive criticism is also highly practical, since it focuses on solutions, rather than problems. And, it makes the family business much more efficient and friendly.

Julie Shrum has worked at Midlake since her father decided to retire way back in 1996. She has accumulated a vast knowledge of hinges and metalworking during her time as sales manager. Julie works closely with the sales team to create the best customer experience possible. She continues to learn daily about new applications for sheet metal fabrication.

About Mohit Tater

Mohit is the co-founder and editor of Entrepreneurship Life, a place where entrepreneurs, start-ups, and business owners can find wide ranging information, advice, resources, and tools for starting, running, and growing their businesses.

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