Understanding the Family Business

Some people may say that having family members or relatives in your company is a bad idea. Maybe. But why are the biggest companies in this country family-owned? We’re talking about the owners of the gargantuan malls, real estate and land developers, and banks. Maybe because, despite the negative light on the idea of having family members in business, there are a lot of things people have overlooked.

Family members can hold trade secrets. They are people you can actually share the secrets and strategies of the company without fear of leakages. They can decide more objectively, unlike employees who would often say yes to their superiors. Family members will speak their hearts and minds because they trust you would listen. They are willing to take your shift, or accomplish your tasks when you fail or cannot do so. That is even without you telling them to. All these can be summed up in one truth: family members are committed.

For many years, I’ve learned a lot about how to effectively and meaningfully run a business with my family. There have been a lot of ups and downs, but the experience is a continuous learning process. The process is one hell of a ride, but truly, a family business is something you would hold dear. Here are some pointers for readers who plan to or have their own family business:

Set boundaries. Don’t fool yourself with pseudo genial attempts to have what you call “family day” when you just end up rattling off half-baked ideas for your company. Call it as it is: a meeting. You can even call it a conference or maybe a symposium if you eat in a fine dining restaurant. But on a serious note, learn how to set boundaries—for them and most especially for yourself as the business owner. Business matters should, if possible, stay within the business premises and during business hours—unless everyone agrees to hold them outside of work.

Establish rewards. Monetary rewards may be the most basic and smallest form of reward you can give next to a pat on the shoulder. Often, family members work for longer hours, during weekday nights, weekends, and even holidays. Some might even have foregone their personal dreams to help you with your business. Reward them with what they really deserve. How about providing a simple breakfast meal from time to time? Or give them time off from work to watch a movie or let them enroll for classes that may not be related to your business or does not have any monetary return, but still makes them happy and fulfilled. The proverbial “Give credit where credit is due” is not just for theses and research papers.

Boost their self-esteem. Have you ever given any thought to their suggestions? This goes not only for your family members in the business, but for any employee you have in general. If you have no intention of listening to your family members’ opinion on any matter, might as well let them go. Including your family in the business is not like having another employee. It is adding another mind, having another critic working by your side. You have to listen to them. They are not out to destroy your business in the first place. They are there to help you; they are the people whom you can trust.

Self -esteem is made with recognition and appreciation. If you keep on throwing away your family’s inputs, there will come a point when they will no longer have confidence in the business. They will shut down and watch you do your own thing while they resume with their daily tasks. You have to know that building your family members’ self-esteem in your workplace takes more than just a tap on the shoulder, but rather, making them feel that, as an employee and member of your family, they really are part of the organization and the decision-making process.

Have a succession plan in place. Do yourself a favor and stop saying “I’m doing this for my children to succeed.” You do not define their success. No matter how many times you try to convince yourself that the way to go is for your children to continue your legacy because it has a better income than the profession they have worked hard to have, it’s honestly just about you loving your company much more than you trusting your children to know how to stand on their own two feet. But if you see their interest and passion for your business, then there is your perfect opportunity to prepare the transition and succession. Train them well, but let them bring their own fresh ideas. You might have developed an ego because you saw your business flourish with your decisions, but never think that your principles are the absolute rules to follow. You have your own style and priorities. Teach them the fundamentals and core values, and let them build on these. Tell them of past pitfalls so they can avoid facing or prepare for them.

*Originally published by the Manila Bulletin. C-6, Sunday, November 9, 2014. Written by Ruben Anlacan, Jr. (President, BusinessCoach, Inc.) All rights reserved. May not be reproduced or copied without express written permission of the copyright holders.