With Father’s Day upon us, it seems a good time for a family-oriented pop quiz. What do you think was the most popular cable television reality show last year? Was it:
- Swamp People (family members hunting alligators together)
- Pawn Stars (a family-owned pawn shop)
- Storage Wars (families bidding on abandoned storage lockers)
- Deadliest Catch (fathers and sons working on the Bering Sea)
The answer is: B) Pawn Stars.
If you have ever watched the show, it’s easy to see why it’s so popular. For starters, strange things come into the Las Vegas pawnshop, and then there is the mystery to figure out whether they are real and what they are worth.
Beyond that, the family dynamic between father and son, as well as other employees, is entertaining and intriguing.
I bet if you are part of a family-owned business, you would probably say yours is entertaining and interesting too. The fact is, running and working in a family-owned business carries with it both plusses and minuses, as discussed in a previous article of mine.
One of the best parts of bringing family members into the business is that you can teach them the ropes and in the process and prepare them for the day when they may take over. If you watch Pawn Stars, you certainly see this dynamic at play.
The question is whether the younger generation wants to go into the older generation’s business. My dad wanted to pass his carpet store on to me, but I always said that was his dream, not mine. So the first rule of family business is this: clear communication is critical.
Here are six other rules that make running a family owned business easier:
1. Have boundaries: These days it is hard for many of us to keep our business and personal lives separate, but it is vital to do this when you work in a family-run business. The more you can leave work at work, the better it is for family relationships.
2. Have defined roles: The role you play in your family is probably not the same role you play at work. You might be the computer nerd to the family, but the networking genius at the office. It is important for everyone involved to know their role when families work together. Clarify job titles and descriptions, and have clear chains of command and duties. That will hopefully leave less room for mistakes and problems.
3. Don’t play favorites: Easier said than done, but when family and non-family work in the same business, the possibilities are ripe for non-family members to feel slighted, whether it is real or imagined. The more you can keep things fair, the better.
4. Don’t discriminate against family: By the same token, you also want to avoid over-compensating and treating family members as lesser employees in an effort to show how fair you are. That won’t go over well at the Thanksgiving table.
5. Have a conflict resolution process in place: Families bicker, that’s a fact. But family disagreements at the workplace are doubly dangerous, as they can be bad for relationships as well as for business. Families that negotiate tricky patches usually have good communication skills and a backup plan/arbiter when conflicts become too difficult to solve on their own.
6. Create a succession plan: How will the business be passed on, to whom, and when? What is expected of the next generation? Is there a buy-in? How will you avoid hurt feelings? All of this must be considered, in writing.
Family businesses can be great things, as long as there is a backbone of respect.
Do you have tips from working in a family-owned business? Share your story below.
About Steve Strauss
Steven D. Strauss is one of the world's leading experts on small business and is a lawyer, writer, and speaker. The senior small business columnist for USA Today, his Ask an Expert column is one of the most highly-syndicated business columns in the country. He is the best-selling author of 17 books, including his latest,The Small Business Bible, now out in a completely updated third edition. You can listen to his weekly podcast, Small Business Success, visit his new website TheSelfEmployed, and follow him on Twitter. © Steven D. Strauss