8 Tips for a Successful Family Business
Within the subset of MSMEs, are the crucial demographic of family businesses. These are businesses as small as the estate grocery shop to laundry shops, gas and water refil stations to as big as heavy weight transport and logistics companies, retail malls, professional services like lawyers, accountants and engineers. Family businesses are everywhere. But not all family businesses turn out successful.
Running a family business can be both a blessing and double-edged sword, depending on your approach and how you choose to manage the team. More often than not your loved ones will want to play a part, in the beginning rather enthusiastically, however, roles and responsibilities eventually blur. According to the World Bank Group, around the world roughly 90 per cent of all enterprises are micro, small and medium-sized enterprises (MSME), which include around 50 per cent of the labor force. MSMEs play a vital role in national economies around the world, generating employment and value added and contributing to innovation and growth.
The source of many a family feud, wounded ego, and financial strife, I wanted to share my top tips for running a successful family business, as well as a few key watch outs when tension starts to rise.
1. Learn to over-communicate
When entering into business with family, it’s never safe to assume that just because you are family, you can read each other’s minds. It’s better to over-communicate and know exactly where you stand, rather than keep matters to yourself and assume the message is clear.
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This is absolutely crucial to running a harmonious workplace, and ensuring work culture remains positive, for both staff and customers. Irrespective of whether they are family or not, all staff should be treated equally and with the same benefits ie. fair hours and rostering, holidays etc.
3. Organise your family life
The only way the family business will work is if you have an organised family life. I don’t mean the perfect family (let’s be real), but more knowing who needs to be where and when, school drop-offs, sport, dinner prep, and really allocating your time effectively to keep every plate spinning. If you can minimise the stress and chaos at home, it promotes a better work-life balance knowing the family is under control.
Building high-performance culture starts and ends at the top. The virtuous cycle that envelops the entire organization, has faced several challenges for the businesses. A thorny and complicated challenge among them is to deal with a non-performing family member. It remains to be sticky for the owners. In Kenya, our estimates suggest that more than 60 per cent of the MSMEs have some family members working either directly and indirectly and in over one-third of the cases, the owners are dissatisfied with their performance. Clearly, it is a significant issue to deal with, especially for MSMEs. This is particularly relevant when it comes to SMEs trying to scale up above a $1 million revenue threshold since at the start, often they are the same members who may have helped the owner!
4. Play to your strengths
Within The White Place, there is myself, my husband, my mother, sister, and sister in law, sometimes even my dad. It only works when we play to each other’s strengths and stick to our designated roles. We aren’t all good at every aspect of our business, and I think that is what makes the business so special, however acknowledging it is the important part.
5. Work hard, but plan a holiday
Inevitably, in a family and small business, we tend to be working 24/7 because it is quite difficult to switch off entirely. Weekends seldom exist, but we all really make sure that we organise a holiday (sometimes together, normally separately), so there is something in the calendar to really look forward to. Booking in that time to relax and recharge is so crucial, you can come back with a renewed love for what you do and really get the business firing again.
6. Arguing is healthy, but be reasonable
There’s no denying we argue, but it’s ok. I would say something strikes a chord between us all once every 6-12 months, so we have it out then quickly move on. Entering into business with family, this is to be expected, though I encourage that you never hold a grudge and learn to really laugh about it a little down the track. I know this element of the business journey was the hardest for my husband, but it is how my family was raised.
7. An equal husband and wife relationship
Perhaps this is specific to The White Place, maybe you and your husband run separate businesses, however, I want to stress how important it is to maintain an equal and open-minded relationship. Johnny, my husband, has been amazing at recognising that neither of us are breadwinners and both our contributions are valid in business and in family life.
8. The weekend isn’t always a weekend
Again, this will differ for every business, but for us specifically, Saturday’s and Sunday’s are our busiest trading days. Our weeks are often flipped on their head, we work all weekend and take time out during the week for more family time and attending personal commitments.
In summary, small business owners would do better if they know whether, when, and how should they involve their family members, without compromising on building a high-performance culture.
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