Every game, including the “Game of Life,” has rules of engagement. Family businesses are best served when they clearly define the terms and conditions of employment for family members and for non-family.
Writing a letter that expresses business advice from the leader of a family business to the successors of the business is an excellent method for examining what is truly important. This exercise allows the family business leader to reflect on the values of the family, review past challenges and provide invaluable family business advice that will provide beneficial guidance.
The Little Red Book of Family Business, a compilation of quickly digestible ideas and tidbits about working and thriving in the complex world of family business, has been translated to Turkish and published in Istanbul. The book focuses on a set of ground rules that define expectations for how family members will function in a family business.
A corporate governance structure is a collection of customs and policies that affect the way a corporation is administered. This type of structure provides an internal discipline on how family and non-family members function within the business. A corporate governance structure helps professionalize the way a family business operates.
The process of family business strategic planning involves establishing and defining boundaries and maintaining specific roles. Failure to define boundaries between family and business often lies at the root of many family business problems. Family business boundaries need constant maintenance if they are going to do the job for which they are intended.
As a family business grows, the need for a well-defined family business structure becomes more important in order to keep the business growing. Once the entrepreneurial stage passes, more family business structure is required to define how the founder will interface with the business and find solutions to family business issues that arise.
It's important that the family members running a business have similar family business values. The real security of family business is knowledge that the family has the same core values, and that in good times as well as challenging times, every member of the family is committed to working together in the best interest of the business.