Among the keys Greg shared, he reminded us that we live in a "different world." It's a world where rules change every day.
Are you a member of a family business? Do you feel you've been able to develop the right team and the right mindset to move your business into the future? Do you feel the rules have changed from when the business was first founded? It has been my pleasure to work with a variety of family businesses and I've assembled my own list of the top 7 challenges (with corresponding suggestions) facing family businesses today:
1. Emotions - Any problems within the family will quite naturally flow over to the business. Financial and health problems seem to be at the forefront of day-to-day disruptions.
Suggestion: Try to make sure that any concerns get addressed quickly and in a non-emotional manner.
2. Lack of Planning - How do you balance the family members' hours, responsibilities, work load while trying to determine a fair compensation and benefit package? Communication challenges within the family will also impact the overall planning strategies, both short-term and long-term. Additionally, lack of written strategies is prevalent. Do you have a shared family vision?
Suggestion: Make sure each family member knows their role and be sure to keep them accountable for their responsibilities.
3. Talent - There's an inherent responsibility to hire the family member, while they may not be the best qualified. Do you have a training program in place to help the family member obtain the necessary competence to perform their role and become a part of the work culture? How do you keep a non-performing family member from impacting the morale of your employees? How do you fire them if they're not
working out?
Suggestion: Try to make sure you have a good mix of talent from non-family members. They can also help evaluate challenges from a non-emotional perspective. And also be sure to provide opportunities for advancement for non-employee members.
4. Business Valuation - What's the real worth of the business and how can you make it more valuable? How do you favorably impact the business value?
Suggestion: Consider having a professional business valuation completed.
5. Succession Planning/Exit Strategy - Is the next generation going to take control of the business when you're ready to walk away? Is there a plan in place to do this, so that conflicts are minimized?
Suggestion: Make sure that you've got a written plan for the business to survive even after you have exited.
6. Communication - Relationship problems can lead to role confusion. Coupled with high emotions of fear or anger, family members can become resentful, feeling left out of family decisions.
Suggestion: Do your best to keep the lines of communication open and flowing.
7. Control - How do you manage the business? Do you follow the family traditions or are you utilizing appropriate management practices applicable to today's rules?
Suggestion: Keep your technology current, encourage entrepreneurship and be aware of the global impact on your business.
Greg shared a quote with us and I'd like to share here again with you: "The opposite of success is not failure; it is conformity." What are you doing with your family business...is it successful and thriving, ready to move to the next generation? Or has it just conformed to the current world with no real future in sight?
I'd like to invite you to join us at the next in our Family Business Breakfast Series. Greg will be back and his topic is "Legacy or Lunacy: Why Generational Differences are a Major Strategic Blind Spot in Your Family Enterprise." Mark your calendars for November 19th and let us know if you'd like to reserve a spot. I do hope to see you there!
