Why a Family Business is Good and Bad
A family business sounds like a great idea when you first think about it. What could be better than working with the people you love? Well, before you start looking at new offices to rent in London, there are a couple of things you should know. Firstly, you'd probably be upset to know that most family businesses don't survive very long. In fact, only 12% of family businesses survive past the second generation. If you are thinking about starting a family you have to realise that there's as much emphasis on 'business' as there is on 'family'. So, to help you with your decision, here is a list of pros and cons:
Encourage and teach responsibility to your children
Family businesses done right can help you prepare your children for the working world. By introducing your children to the business from a young age you can teach them about responsibility and hard work as well as the importance of earning rewards. To do this, it's important that you don't coddle them. Allow them to take responsibility for their mistakes and achievements. On the other hand, it's important that, when they're young, you don't force a dynamic of 'boss' and 'employee'. It takes a certain maturity to understand the difference between home and work, so it's okay to still be a parent to them at work as long as you know when it's time to be the boss.
Give your children tools for later life
Whether or not you intend to pass the business down to your children, giving them a place to work will give them great experience to use later in life. When it comes to finding a more permanent job (if they don't intend to stay with the family) they'll have more confidence because they already know what it's like to have a job. Also, if they stumble in the pursuit of a career, a family business is a great way to keep them working and get them quickly back on their feet, preventing them from falling into the trap of unemployment.
Create a good work environment for your employees
Creating a certain dynamic in your family business can often help you find and keep great employees. If you have a good relationship with your family members in your business and an ethos that values teamwork and respect, you're bound to draw in employees that uphold similar values. A lot of employees look for emotional fulfilment as well as financial fulfilment in a job. If you can treat your employees like an extension of your family then you're bound to keep them happy.
Family dynamics get in the way of running the business
If you're the sort of family that believes that the parents are always right then you might want to reconsider running a family business. Family dynamics can often get in the way of sharing ideas and utilising employees. Is the person in charge in that position because they are the most capable or because they're the oldest? Are the ideas of the sons and daughters disregarded because they're bad or because the parents disagree? Dynamics like these can also lead businesses to stagnate when they become 'stuck in their ways'. If you or your partner are the sort of business owners that prefer to stick to tradition rather than adapt then you won't get very far.
Personal attachment can lead to dishonesty
Sometimes, our love for each other can prevent us from saying what we want to say. We don't want to hurt the feelings of the people we love, which can be very damaging in a business. Do you have the courage to tell your children when they're doing a bad job and do they in turn have the courage to say the same thing to you? Honesty is key in business, and in a family business it may come at a cost. The same thing can be said in terms of your business. When you become personally attached to your business you might be less inclined to believe the facts when it's doing badly. Denial is poison for a business and it's important to take note of what is and isn't working. You might have to change things you never wanted to change, but there's no point holding onto a perfect business if it's not making any money.
Deny your child lessons about responsibility
In the same way that a family business can teach children about responsibility it can also do the opposite. When a child grows up knowing that their future career is already secured they might not learn the value of hard work. They might come into the job with a sense of entitlement and squander their opportunities. A certain amount of independence is necessary when children learn how to survive in the working world. Without it, they might continue to rely on you to plan their lives for them.
It takes a certain type of family to run a business together. Sometimes you have to be mean to the ones you love and sometimes you have to step back and give the spotlight to someone else. Important things to remember when running a family business include not taking work decisions personally and thoroughly preparing your children to work.
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