Advice Offered For Coping With Family-Owned Business Issues

by WOHe

Advice Offered For Coping With Family-Owned Business
Issues

One of the greatest joys of working in the kitchen and bath
industry is that so many businesses are family-owned and operated.
However, that can also be one of the industry’s biggest sources of
headaches and heartaches for both family members and non-family
employees.

Here some scenarios to scrupulously avoid:

  • The owner’s son shows up at odd hours and quizzes workers as to
    what they do and why they do it that way. Is he a supervisor? Is he
    speaking for the owner? Is this an employee performance
    review?
  • A kitchen job goes poorly, with the wrong style cabinets
    ordered and the client unwilling to pay. The job is rehashed at
    home and Thanksgiving dinner is ruined, as even family members who
    are not involved weigh in on who must be at fault and what ought to
    be done to remedy the situation.
  • The owner manages the business, but the owner’s father (who
    used to run the business) likes to pop in when the owner isn’t
    there, to make sure things are “going smoothly.” This usually ends
    with a shouting match between the owner and his father.
  • The company lunchroom is remodeled to become the owner’s
    brother’s private office, which is kept locked when the brother is
    not there (which is more than half the time). Employees now have to
    eat at their desks.
  • The owner’s cousin, assigned to answer phones, responds to
    callers with, “Yeah?” or “It’s your dime.” When the phone isn’t
    ringing, he’s perusing the racing form. 

These scenarios may seem almost comic, but they are all actual
nightmares from family businesses that are no longer in
business. 

One of the chief sources of problems for family members involved
in business is the inability to separate business matters from
personal life. There are some experts who will tell you that
business matters should never be discussed outside of business
hours, and that business matters should be forgotten when outside
of the workplace. 

However, a complete disconnection is not always possible. Still,
if you’re working with a spouse, sibling, parent or child, the best
advice is try to make every effort not to let disagreements linger.
Settle conflicts and problems as quickly as possible and keep them
focused on the area of disagreement.

Comments like “That’s how you are with everything, Mark,” or “No
wonder you’ve always been a failure,” are not only going to make
the issue of the mismeasured countertop worse, but are guaranteed
to keep the resentment and bitterness going long after the new top
has been ordered and installed.

Believe it or not, a family business actually needs to be more
formal in structure than a business where no one is related. You
can come to a verbal agreement with a stranger and negotiate the
details in action. A family member, though, should have his or her
duties, authority and compensation clearly spelled out in writing.
Otherwise, for example, your son may feel pressured to okay a
cabinet delivery when he’s not sure what the order entailed because
“his name is on the business.”

You need to make absolutely sure that everyone in the
organization knows the chain of command, knows what the family
member is expected to be doing, and knows that the family member is
reviewed and treated as much like other employees as humanly
possible.

You may want to put a relative on the payroll because they’re
going through tough times or have been laid off elsewhere. However,
you may be better off to pay them not to come in. After all, having
deadwood lounging around working at half speed, or not working at
all, will slow down your entire business.

Office relations also need to be clearly delineated, especially
between family members and non-family members. Non-family members
in a family business are in a very tough spot. They often feel that
any chance for advancement or promotion is choked off, since the
best positions will automatically go to a family member. They also
often feel that family members spy on them as they go about their
jobs. Maintaining morale can be a ticklish proposition and steady
turnover may be a fact of life.

Succession can be the most difficult part of a family business.
Although it sounds alienating, it’s best to get a third party,
preferably legal counsel, involved in planning transfer and
ownership of business. 

One potential and commonly seen source of trouble for the family
business is confusing obligation with ambition. For instance, just
because your daughter helps out around the showroom does not mean
she necessarily wants to enter the profession or inherit the
business someday. (It doesn’t mean he or she doesn’t either.) Be
sure that you’re not forcing family members to do things that go
against their wishes.

At the same time, if you have more than one child but only one
wants to enter the family business, you’re piling up difficulty for
him or her by leaving equal shares in the business to the children
whose ambitions lie elsewhere. Leave the business to the child who
is interested in it not the ones who aren’t.

Be sure the terms of succession are clearly spelled out. If you
don’t want to die in harness, plan to disengage yourself from the
business at some point when predetermined conditions are met and do
so. When you hand over the business to someone else, it is his or
hers to succeed with or fail. You may offer advice, but meddling
only makes your successor’s job harder.

Lastly, remember, in the end it’s only business. Ultimately,
your family is much more important.

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