Columnists, Thom Finn, V2I3

Working with Family Members

The majority of businesses that I work with have some family members working alongside each other. That gives me a fairly good seat in the house when it comes to observing what works, what doesn’t work, and bystenders-1575664how to fix it. The family member could be a cousin or a brother who either works in the shop, or helps with deliveries for a multi-generational family business that may have the second or third generation employed.

To me, the most interesting cases have been the ones where more than two people share ownership and management. Let’s simplify things and call any combination of the above a “family business” for our coaching today.

There is a specific set of pros and cons to a family business (FB) when compared to a non-family business (NFB). The first advantage of a non-family business is the ease to “Call Things Tight.” As discussed previously in Shed Builder Magazine, this is the management practice of reprimanding an employee quickly and simply, much like telling a toddler “no-no” when touching a hot stove.

NFBs also have a leg up when it comes to the lingering effects of guilt after giving a reprimand or course correction. Very few men like to do it, but it’s much harder when it’s your own son or your brother who you just spent a great time with at grandfather’s birthday party last weekend.

Finally, a leader in a non-family business feels less responsibility for their worker’s short comings and developments. Even the most empowering leader will never have the same desire for a better life for his workers than a father will have for his son. NFB leaders won’t have this added sense of responsibility that the young foreman learns his lessons now to better prepare him for the future.

But the non-family business does have its drawbacks. From what I have seen, when the venture is successful it’s not as rewarding to share the blessings, gifts, and profits with non-family members as it is with your own blood. It’s far more rewarding to have what you need and then share the overflow with your sons, grandchildren, brothers and nephews, and their families.

Sometimes it can be tough for the managers to ask more of the workers who don’t have an ownership share. It’s one thing to expect 100 percent above the line behavior from your brother, but hard to be so exacting with someone who doesn’t have the same stake. As for the situation I’ve seen most, it’s often that the work and business ethics may not be the same. If you know you raised your son to use a certain definition of quality, it can be frustrating if those young boys from outside of the family that you recently hired have a different interpretation.

There are distinct advantages to family business. The most common one is that you know what you are dealing with better than any reference check could ever tell you. It could take years to learn that when you see the new man you hired get quiet and reserved, he’s actually furious and on the verge of exploding. This wouldn’t be the case with Cousin Leroy. He may have acted the same way when he made a bad play on the ball field as a child, and everyone knew to leave him alone until he cooled down on his own.

Family business leaders and managers also know that they can count on their blood for just a little more effort, especially when the going gets tough. It’s easier to ask your brother to stay and finish unloading this latest supply than it would be to ask the hired man. You both probably grew up with the same work ethic and he is far more likely to get it and do what must be done.

And finally, the senior manager in the family concern can find comfort in knowing that his relations are probably keeping an extra sharp pair of eyes and ears out in all areas of the business to make sure goals are met. Whether it’s on the saw, on the forklift, or on the lot talking to the customers, the family shares a sense of ownership in all departments.

But onto the meat. The core drawback to being a part of the family business is the lack of clear communication. Just because guys are related doesn’t mean they can read one another’s minds. Dad doesn’t realize that he may have forgotten more about sheds than son will ever know at this point. And I think it’s a strange form of laziness that dad won’t take the time and put effort into clearly stating what he wants and how he wants it done. Luckily, this damaging root cause is easily fixed with some lessons on clarity and objective communication.

There is a second frustration that I’ve only seen in FBs. The personal frustrations you as a manager have toward your employee—who is also your younger brother—always get in the way more than if he were not related. In one case, older brother always believed younger brother was lazy and would take short cuts where he could. So in the shop, older brother was like a sentry waiting to catch younger brother in the act of sloth and accuse him with “gotcha.” It’s no surprise that younger brother felt persecuted and no matter how he tried, it was never good enough.

The final commonality in most family businesses is the praise-reprimand dial is never calibrated just right. It’s normally set too high (lots of reprimands and very little praising), or more rarely, set too low (the reprimand is too infrequent and the praising is excessive). This is a tough situation. Dad doesn’t want to show any favoritism and makes up for this by being especially hard on the son. Meanwhile the son is working harder than the rest but rarely hears an encouraging word.

Where does this come from? If they take any continuing education at all, most consultants and coaches that I know follow a business path to learning. I became aware that my weak link was in close human relationships. So a few years ago I began studying “Couples and Family Therapy.” Not that I want to be a therapist, but the skills I have learned have been extremely helpful.

I know now that impressions, outlooks, and opinions that were learned/ taught to us as children are still evident as adults. The birth order can also impact our relations. Youngest children, for example, seem to have less expected of them and are not taken as seriously as eldest members, which makes it pretty interesting when the youngest grows up to be an entrepreneur and starts giving management direction to older brother, or even dad. Those of us who were raised with emphasis on Commandment Number 5 can also struggle when he has to manage dad or reprimand him.

If a situation becomes unbearable or starts destroying the fabric of the family, some folks will call in a trained mediator who can objectively assess the issues, provide stark feedback, and give recommendation to all in a way that it will be received. Simply by being an outsider,a mediator is neutral and just wants to reach the same goal as everyone else: Harmony.

Many FBs don’t need to take things to that level. The successful and harmonious FBs I have encountered all share the same characteristics. All members have egos in check. Both pop and son realize that son is the owner of the business, and pop realizes it’s not his role to wrestle with the big heavy questions. He can let son do it. And junior doesn’t blur the lines with inconsistent behavior with the parent. He doesn’t switch back and forth between a self-sufficient adult in one moment and a helpless child the next moment.

Successful family businesses show more respect than NFBs. (Remember, you will be seeing your brother-in-law this Sunday at the birthday party.) They are firm and sensitive in their course correcting and expectation setting, and never allow any personal insight or knowledge to slip out in managing.

Successful FBs all have a clear chain of command. This can be a tough conversation, but it is insurance that everyone will need to call upon. Whether it’s a formal organizational chart or an understanding of the pecking order, there must be clarity of who is in charge. And if it comes down to two partners, a remedy must be worked out ahead of time that covers topics like “Who gets final say on X, Y, and Z?” “Which decisions must be agreed upon by both?” and “What do we do if we are deadlocked?”

The last trait among successful FBs is the absence of obligation. The family member is clearly under no sense of obligation to work in it, nor is the owner obliged to employ them. Knowing this breathing room exists on both sides, seems to deflate any pent up pressure that could possibly explode.


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