This week, I'll share another extract from our *complimentary booklet,
"The 9 Most Common Mistakes Family (& Non-Family)Businesses Make That Prevent Them From Achieving Their Full Potential... And How YOU Can Avoid Making Them"
Mistake #6: Failure to Clearly Differentiate Business and Family Roles
“ John is frustrated, confused and ready to walk out of his family business to get a job outside despite being paid above market rate by his father. He remembered a time when he just couldn't wait to graduate and join his family business. He was so looking forward to getting a head-start on his peers.
Now he regrets it. Now he understood why his favorite uncle stopped visiting during festivals. Now he found out why his cousins don’t hang out with him anymore. It was the family business. He could not understand why his father is his father at work and instead of his Managing Director; his uncle is his uncle instead of Sales Director; his cousin is his cousin instead of General Manager… it is all so confusing and unproductive, they
are arguing all the time…
If I am confused, John reflected, I wonder how the rest of the employees feel… ”
Not clearly differentiating working and family relationships is one of the most
frustrating and costly mistake family businesses make.
Every member of the family involved in your business has at least 2 roles, one as a family member and the other as an employee or partner of your business. In businesses where the parents are the founders and their children work with them, the parents have 3 roles, as a parent, a spouse and a business owner.
Confusion arises when family members do not know how to assume the correct role in the correct situation.
Let’s look at a couple of examples below involving parents and children in the same business (While these are parent-child examples, the same situation is also common among siblings and extended family like uncles, aunties, nieces and even best friends.):
i) When talking about business over a family dinner at home, are they…
• Having an official business meeting? Or
• Simply gossiping about work over dinner?
ii) When parents discuss their children’s performance, are they…
• Reviewing an employee’s performance objectively? Or
• Are they discussing as concerned parents?
iii) When partners disagree with each other about the business…
• Are they business partners disagreeing? Or
• Are they husband and wife disagreeing, making it personal?
iv) When children raise issues at work or offer their ideas & suggestions …
• Do they get the ‘parents know best’ treatment? Or
• They get the chance to express themselves as a member of the business,
objectively?
Clarify the difference between being a family member and being a member of
your business today. Do it for every member of the family. Come up with your
own rules or rituals on how to ‘switch on’ and ‘switch off’ between the different roles.
For family members who haven’t join the business, get their agreement upfront in writing before they join the business that they will respect and comply with your rules, rituals and expectations.
It is not all bad news though. In cases where family and work roles are clearly
defined and accepted by all, family ties are actually strengthened. Family
members are also more likely to stick with you and support you through rough patches.
Have a profitable week ahead!
The Familybiz Works Team.
ps: If you own a business in Malaysia, register NOW for our FREE Business Optimization Clinic, valued at RM699. We guarantee you will get at least 1-2 ideas you can implement immediately, even if you do not engage our services.
Only 10 sessions every month for qualified business owners. Claim yours today!
*If you are a family business, request for your copy of complimentary booklet when you register for your Business Optimization Clinic, only successful registrants will receive a copy.