Tips for running a family business

19 May 2016

A family business can be a fantastic work environment if they are run properly. However, a poorly run family business can tear a family apart. The root of a well-run family business is grounded in treating it like a business, not as an extension of the family. The following are some tips to help make running a family business workable:

Do not create jobs for family members

Either you have job vacancy for which they qualify, or you don’t. If possible, it is a good idea to encourage family members to work elsewhere before joining the family business. This will ensure that they are familiar with general business culture and expectations. They must prove to themselves, to you and to other employees that they can succeed on their own. It is also far healthier for the business to have them come in with some fresh ideas and training.

Treat family members like any other employee

You should make it clear that family members must adhere to the rules of the business just like all other employees. Give family members responsibility and authority as they become ready for it. This is difficult to do with any employee but is much more troublesome with family members, especially children. Avoid the two extremes – either cutting them too much slack or driving them harder than anyone else. Give them space to prove themselves.

Keep family and business issues separate

Family matters should never be discussed during working hours. Equally, you should use first names in the office rather than familial terms such as “dad” or “mum”. Family relationships should never be emphasized as it can lead to unhealthy rivalries between the team. Business should not be discussed at family gatherings or outside of working hours as it is important to maintain a healthy work-life balance.


Many business owners who employ family members forget that just because some staff are family, it doesn’t mean they can read minds. It is important to communicate with family members in the same way that you communicate with all staff. The family relationship should exist outside of the workplace and in the business, communication should be formal. It may seem strange to email a family member with a report or monthly update, but good management and business practices remain the same, regardless of your relationship.

Third generation syndrome

Yes, it’s true. Start it, build it, ruin it. The way it could go through the generations. It probably won’t if the correct family members become involved. But that’s not often the way. Generations are sometimes shoehorned in to ‘keep it in the family’ and the offspring just can’t do anything wrong.  Darling daughter, Sensible son. Selecting the correct skillset for management roles and supporting that with the correct ongoing training is crucial if the business is to survive. Remember the responsibilities to staff, suppliers and other investors as well. If it goes wrong what will be left. A percentage of something is better than 100% of nothing at all.

We help and support many family businesses. Contact us for an initial chat, and our experienced colleagues can listen, appreciate and work with you over time.

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