Family business structure and the concept of adapting and evolving applies to family-owned business. When creating solutions for a family business, the first step is to analyze the functions that need to take place to make the business work. Family business structure and efficiency can ultimately lead to higher profitability.
There are two types of family business nepotism - the bad kind and the good kind. The good kind allows business owners to take advantage of relationships with respected employees and colleagues to help find and hire employees with a similar work ethic and values. This kind of nepotism can actually help a business.
A family business advisory board can make a family business stronger, increase shareholder value and better position the company to capture the opportunities that are available in the marketplace. An advisory board is made up of outsiders who are experienced business leaders who can cause business owners to examine possibilities they might not otherwise consider.
An elder is a person who is still growing, still a learner, still with potential, and still continues to have promise and connection to the future. In relation to family business dynamics, an elder is a person who deserves honor and respect and who utilizes wisdom from long life experiences to formulate a legacy for future generations.
Anyone serving a role in a family enterprise needs wise elders to provide family business advice, guidance and wisdom. Elders play an important role in family business. Modern-day elders serve the same function as elders in ancient times. An elder's wisdom lives on in the countless people whose lives he or she influenced.
Family business policies should include periodic and scheduled performance evaluations. A performance evaluation presents an opportunity to discuss quality of contribution, work habits, professional growth, demeanor and attitude within the business and with customers. Family members set the standard for the company and their behavior must be a leading example for all employees.
Family business compensation is something that should be addressed within a family business's employment policies. Family members must understand that they will be paid fairly, at fair market rate, for the position they hold. This avoids a family member from obtaining an inflated view of their contribution to the family business.
A family employment policy should address what is necessary for a family member to enter into the business. Following specific pre-determined guidelines will help a business hire competent employee who will make a positive contribution to the business. It's important to remember that a job in the family business is not a birthright.
Every family business should establish a set of family business rules. These rules of engagement should encompass a policy that states how family members will be allowed to participate in the family business. The purpose of family business rules is to guide the business, and it's important to develop a written employment policy long before it is needed.
The hiring of family members is not something that should be taken lightly by any family business. Family members should be required to work for a company not associated with the family business, and gain experience and be successful in that position, before being hired into the family business.
