In hindsight, a family owned and run business is the ideal career for most of us. Running a business you have a genuine passion about, working with your nearest and dearest every day, and a more flexible working pattern.
However, with the stats against them – only around 30% of family businesses succeed past the first generation – the future of a family run business needs to be planned tactically and carefully to ensure positive growth.
So, which areas should you be focussing on in order to successfully grow your family business?
Whilst identifying business interest within your family is often a personal interest when running a family business, be sure to employ non-family members for your business also.
An outside perspective can be more momentous than you realise. As family members, it’s easy to become complacent with each other’s attitudes and the way each other work. As a result of this, it’s easy to turn a blind eye to things that don’t work from a business perspective if it’s what one has always been used to.
Often, employing someone who has never had any involvement with the business before is a real eye opener for most family businesses. Whether they propose a new, efficient way of completing a task, feedback their current wellbeing situation at work and ways to improve this, or they may bring new skills and strengths to the workplace altogether.
Whatever they add to the business, that’s just it, they’re adding something new which could potentially evolve the business.
You don’t always have to keep it in the family.
Rule number one for your family business to succeed would be to escape the mindset of only having family members in management and senior roles. You can’t always expect family members to want to be involved in the business.
First of all, if no family members wish to succeed the role of director, you leave yourself in a sticky situation when retirement comes around. Set up insightful recruitment processes to find the right candidate or start to assess the qualities of your existing staff to see if any of them would fit the role of director. This way, you could end up promoting someone who you already trust that knows the business inside and out.
Secondly, if you still choose family and friends over your hardworking and capable employees, you could be forging a path that ignites nepotism in the workplace. Indeed, this can be detrimental for employers, creating a segregation between employees and management. Furthermore, encouraging staff to leave the company and embark on a new career in a position they’ve worked hard for.
But, most importantly, hiring a non-family member to direct your business after you leave guarantees a higher success rate. With more than 8 out of 10 family businesses failing to survive, it’s absolutely crucial to employ a director with a fresh outset to take the business in a positive direction. Repeatedly, non-related managers help to create an effective strategy plan for family businesses, as well as look into expanding into new markets, working to increase capital, and striving for a strong team.
As an entrepreneur, you never need to think about how to do your job because you live and breathe it every day, so it becomes second nature. As for your employees, you’re also there every day to keep an eye on what they’re doing to ensure it’s done correctly. Be that as it may, what happens when you are no longer there to order everything or do it yourself?
Make it a priority to put together set procedures for each area of your business, even if you’re not aware of when you’ll no longer be working for the company. With this in mind, a new procedure should be created each time the company grows, and a new task is added to the daily list of jobs. Thus, guaranteeing that your successor and employees will be able to run the company efficiently and complete tasks without any hiccups, as intended.
Decide on your company values.
All successful businesses have a clear company ethos that is quickly adopted by employees and visible to customers. If you’re unsure what your company ethos is but know how you would like your company to be perceived, write them down and start incorporating them on a daily basis.
For many companies, strong core values include honesty, driven attitudes, innovative thinking, and fun. Working on your ethos now will ensure it’s deeply rooted and continued even after you’ve left. This is one of the most organic approaches to make certain that your hard work and commitment is heavily embedded within the company forever.
Slow and steady wins the race.
Yes, risk is a persistent factor when running and growing a business. Nonetheless, it is possible to involve your company in too much risk. As an entrepreneur, it’s your duty to tactfully grow the business and secure jobs, as well as financial security, for your employees.
Although, it is necessary to review what the natural next step is for your business. This could be to expand into a new department, employing more senior roles to incorporate a stronger management structure, or to relocate to new premises. By no means are we telling you not to take these steps but do them within reason as opposed to all at once.
There’s nothing wrong with a slower growth than your competitors, you don’t have the insight to know what situation they’re in, they could be excelling on the outside but struggling on the inside. Work at your own pace and only progress when you comfortably can to avoid compromising everything you’ve built.
Planning to grow your family business can be a daunting thought. You have to move towards the mindset of employing strangers that need to earn your trust, think further ahead than the present, and learn to manage other people instead of just yourself. No matter what you come up against, if you can follow some of the points above Science Articles, you should be able to handle any situation with ease.