Family ventures are a tricky business. Usually generations-old, these businesses and companies can be difficult to manage, confusing to run, and—most notably—troublesome to transition. Children often grow up within the business, learning the ropes at a very young age. When it comes time to take over from the previous generation, tempers can flare and disagreements come to light. Below are a few tips for a seamless and argument-free generational transition within a family business.
Define each family member’s role. If the family business is established, several family members and generations likely have a hand in its running. This is especially true if the business has been passed down from a parent to more than one child. Clearly communicate owners, board members, and managers within the family.
Don’t hire (or promote) family who is not qualified. Family businesses fail when employees notice nepotism. Do not promote a family member simply because of their last name. Moreover, refrain from promoting family members beyond their abilities—as with non-familial employee, each family member should have a role that matches their capabilities.
Don’t overpay your family members. Similar to the above mention, do not pay your family member more than another employee doing the same job. Doing so can result in complicated legal repercussions, unhappy employees, and a potential mass exodus of non-familial employees.
Remember: It’s a business, not a family. It may be difficult to divorce the business from regular family happenings and disagreements. When in the office or place of work, do your best to refrain from discussing family matters that do not pertain to the business. Similarly, closely monitor your financial data.