5 Tips for Family Business Owners

5 Tips for Family Business Owners


According to a Family Enterprises survey, 75 percent of family business owners expect to grow their business in 2013, yet only 45 percent of family businesses expected to hire additional workers despite business growth. When family business owners put in the extra hours to delay hiring additional hands, they then spend less time with their families. Next year, commit to a healthier work-life balance with these five tips for family business owners:

1. No Freeloaders in the Family Business

Your second cousin Dave wants a job while working his way through college, or your sister Lisa expects to pick up holiday shifts because she is a single mom. Yet Dave can’t get to work on time and Lisa often calls out because she can’t get a babysitter.

John Timpson of The Telegraph recommends not hiring family members to work in the business unless they are able to succeed in the roles. Family members who can’t perform will not gain respect of other employees and can leave you with more work on your plate.

If you’re pressured to hire a family member, offer them ample training to succeed and try to place them in a department where they can succeed.

2. Keep all Family Members Informed, but Draw the Line at Interference

Just because you’re the CEO of the family enterprise does not mean that you need to entertain Aunt Jenny’s idea for a hot new product or give your brother the marketing manager control over hiring the new office staff.

Find a balance between keeping family members apprised and allowing them to interfere. Consider scheduling one-hour Skype calls to update all family members each quarter.

End with a Q&A, but avoid promising that any requests will be binding. The time you spend trying to fulfill Aunt Jenny’s pet project is time away from your tasks.

3. Seek an Outside Perspective When Needed

An outside perspective can offer new insight and prevent family discord. Consider hiring a manager from outside the family, so family members won’t develop hurt feelings on the job.

Alternatively, you can have outsiders on the executive board to prevent the board from making emotional decisions that aren’t in line with business mission, as the SBA and NY Times recommend.

4. Automate With Time-Saving Technology

Small family business employees can wear many different hats throughout the day. Invest in time-saving technology to automate data management, billing and invoices, business mailings and more. One package to consider on the finance end is QuickBooks invoicing, which offers print and online invoices, and estimate templates.

For data storage, consider a cloud solution that allows far-flung family members to read annual reports and business cash flow charts before the next big Skype conference.

Of course, there are a multitude of options for website development, from Quartsoft mobile and cloud services to Microsoft’s own platform and tools. Just be sure to choose an option with great support, so you can spend less time fixing issues yourself.

5. Plan for Succession

By planning for succession early, you can retire with peace of mind and your replacement can acquire skills and insights needed to succeed with minimal disruption to the family business. If there are several contenders from the younger generation, evaluate each to see who is best fit to lead.

Prepare to keep a part-time role so that you can mentor the new leader during the transition. On the other hand, if none of the younger generation want to inherit the family business, prepare to look outside for a leader or to close the business.

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