Posted on: 30 April 2015
When there is a successful, established business in your family, the decision to join it is a tempting yet complicated one. The same can be said for the prospect of starting a business with members of your family.
In this guest blog, Amalia Brightley-Gillott explains the ground rules for going into business with your family. She also offers advice for how to make the most of your business whether you are joining your parents’ firm or starting up with relatives.
Amalia is PR and Marketing Director at Family Business Place. She works with her mother, Anita Brightley-Hodges, promoting and supporting British family firms.
As any entrepreneur will tell you, running a business is tough. It can be lonely, isolated and all the pressure is on your shoulders. The buck stops with you.
Very often, people choose to go into business with someone else – a partner who has a different set of skills and experience and who can share the responsibility. In some instances, that partner is another family member. Perhaps a spouse, sibling, parent or cousin who shares their values and passions.
Making the decision to set up shop with a relative needs to be carefully thought through. After all, if things were to go south it’s not just a business partner you would be losing, it’s a member of your own family.
Ground rules for going into business with your family
It’s worth laying down some ground rules so that everyone is crystal clear on their roles and responsibilities, and so that if there is a difference of opinion, everyone knows where they stand:
- What exactly is my role?
- What is expected of me? In the short-term, and in the long-term vision of the business?
- What tasks am I responsible for on a day-to-day basis?
- How is my performance measured?
- Which people am I responsible for?
- Is there a hierarchy? Where do I sit within this?
- How do we address and communicate with each other at work?
- How do we deal with a difference of opinion regarding the business so that it doesn’t affect our personal relationship?
- Do we work directly alongside each other or are we responsible for very different parts of the business?
- How do we ensure non-family employees don’t feel like ‘them and us’?
Working with a parent/child can have very different dynamics to being in business with a sibling/cousin and both have proven to be hugely successful business models.
Going into business with your parent
When a parent brings the next generation into the company, they have already developed a wealth of knowledge that they can pass down. Although their children might want to make their own mark and change how things are done, it’s important to remain respectful and have an appreciation for the experience their parents have.
Similarly, the older generation must acknowledge that the world has changed from when they first started out. New blood can bring with it new ideas, innovations and the potential to diversify or explore new markets.
In order for the child to feel they can take the business forward, their parents must commit to stepping back and handing over the reins when the time comes. Failure to do so will result in a frustrated younger generation, tension will begin to build and, ultimately, they could exit the business leaving it without a successor.
Going into business with your siblings or cousins
In contrast, many siblings or cousins who go into business are very often learning the ropes together and working as equals. It may be that they are better educated than their elders and have a more long-term, strategic view of the business, which they can grow and develop together.
Ideally they would have contrasting skill sets and be able to take responsibility for different aspects of the company making them a stronger unit overall. More often than not, siblings will have a competitive element to their relationship as well. It’s important this is channelled in the right way, to the benefit of the business. If it becomes too aggressive it makes for a very difficult working environment, particularly for other employees. This is where laying good ground rules can really help.
Family Business Place is dedicated to promoting and supporting British family firms. They create opportunities for family-run businesses to share stories, publicise achievements, engage with professional advisors and create a network of contacts with similar needs, issues, frustrations and experiences.
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