Do you ever wonder what it is that holds your family and your family business together? Some years ago I did an analysis of the family enterprises with whom I had worked as a consultant. The idea occurred to me that in every occupation, whatever it might be, there was a profile of successful behaviors for that occupation. If I could identify that profile for family business, then I could help my clients to do an analysis of their family situation and determine how they were doing compared to the optimum, prototypical, successful family business.
This process included reviewing a database of 250 families. The result is a profile of ten qualities I feel are essential to families in business. It has since been validated by two different university studies. Here, in brief, are the ten qualities families in business must have to be successful:
1. Shared values – this means values about people, work and money. When a family has the same views about these three areas, it is possible for them to create a shared vision for the future of the company. Without a shared vision among the owners and operators, any company is at great risk. You might ask yourself this question: “What is my vision for our company and is that vision shared by other family members?”
2. Shared power – this is not the same as equal power. It is about respecting one another’s talents and abilities – among siblings, across generations, between spouses. We know that it is OK to have an opinion but it is not OK that you insist that your opinion prevail on every matter. Each person has special skills and family members must learn to defer to the member most skilled on a given issue. How well do your family members share power? Could this be improved?
3. Traditions – Every family has traditions that set it apart from every other family. It could be a holiday trip, weekends on a boat or gathering for birthdays. Some large families gather once a quarter and celebrate all the birthdays in that quarter. What are the traditions in your family? As the family has evolved, have traditions been lost? What steps do you need to take to strengthen your family traditions?
4. Willingness to Learn and Grow – A family that is open to new ideas and new approaches is one that, as a group, can solve virtually any problem. This point of view makes it possible to consider alternatives to the way they have been done. How do people in your family respond to a new idea? Is the idea embraced and discussed? Do people shoot down new ideas? What can you do to assure that your family remains flexible in considering new ideas?
5. Activities to maintain relationships – Every relationship must have a “relationship bank,” a place where you accumulate credits and reserve. This means that you must create opportunities to interact and have enjoyable times together. These experiences contribute to building trust, the essential element in all relationships. As you work together in business, there will be differences. The more deposits you have in your “relationship bank,” the less likely it is that the differences will negatively impact your relationships. What is the balance in your most important relationship accounts? Do you need to do more?
6. Genuine Caring – This refers to openly expressing positive feelings for family members. It is about giving your “undivided attention” to a family member. It could be a phone call, going to a movie together or having dinner together. Is there a family member who needs your attention?
7. Mutual Respect – If you don’t have mutual respect, trust, then it is very difficult to do business together. Mutual respect is built on trust that comes from knowing that you can depend on a family member and they can depend on you. It means keeping your word and doing the things that you say you will do. What is the “mutual respect/trust quotient” in your family relationships? Are you a person who makes commitments, then follows through with them? How you do anything is how you do everything.
8. Assisting and Supporting one another – As we go through life, we experience grief, loss, pain and shame. It goes with the territory. When you or a family member is experiencing such difficulties, do other family members show up and help the struggling person through the difficulty? Families that “run” from the family member who is having trouble don’t stay together in business. How do you help your family members?
9. Privacy – Respecting one another’s personal privacy is an important element in successful family business. If you are working in the business, your lives are intertwined, your finances are exposed to others and you probably know a lot more about each other’s lives than other families who are not in business together. It is important to learn to say, “That’s a private matter,” and not discuss every aspect of one’s life.
10. Boundaries – The most common family-business relationship problems are usually a result of the violation of boundaries. If one person is assigned a job, then others must step aside and let that person do the job without intrusions. How are boundaries handled in your business? Are there job descriptions that include clear definition of responsibilities and a chain of accountability? Do family members meddle in areas where they do not have responsibility? Do you need to improve the understanding of boundaries in your family business?
The degree to which you have maximized within your family business the positive aspects of these ten qualities will have a great impact on the success and continuity of your business. A very productive exercise is to read this column with other family members and then discuss where you are on the continuum. The higher you rate yourselves on these qualities, the more likely it is that you have the right kind of “family glue.”
Does Your Family Business Need Help?
Family Business Matters has extensive experience assisting family businesses. With many decades of experience, we understand the wide variety of challenges that families face as they work together to build, grow and sustain a thriving family business generation after generation. Through conferences, continuing education programs, family business retreats, speaking engagements and private family business consulting services, Family Business Matters has assisted more than 450 family-owned businesses around the world chart their way through family business issues of all shapes and sizes.
For more information on how Family Business Matters can help your family business survive and thrive, please contact us today at (970) 948-5077.