Advice Offered For Coping With Family-Owned Business Issues

Advice Offered For Coping With Family-Owned Business Issues

One of the greatest joys of working in the kitchen and bath industry is that so many businesses are family-owned and operated. However, that can also be one of the industry's biggest sources of headaches and heartaches for both family members and non-family employees.

Here some scenarios to scrupulously avoid:

  • The owner's son shows up at odd hours and quizzes workers as to what they do and why they do it that way. Is he a supervisor? Is he speaking for the owner? Is this an employee performance review?
  • A kitchen job goes poorly, with the wrong style cabinets ordered and the client unwilling to pay. The job is rehashed at home and Thanksgiving dinner is ruined, as even family members who are not involved weigh in on who must be at fault and what ought to be done to remedy the situation.
  • The owner manages the business, but the owner's father (who used to run the business) likes to pop in when the owner isn't there, to make sure things are "going smoothly." This usually ends with a shouting match between the owner and his father.
  • The company lunchroom is remodeled to become the owner's brother's private office, which is kept locked when the brother is not there (which is more than half the time). Employees now have to eat at their desks.
  • The owner's cousin, assigned to answer phones, responds to callers with, "Yeah?" or "It's your dime." When the phone isn't ringing, he's perusing the racing form. 

These scenarios may seem almost comic, but they are all actual nightmares from family businesses that are no longer in business. 

One of the chief sources of problems for family members involved in business is the inability to separate business matters from personal life. There are some experts who will tell you that business matters should never be discussed outside of business hours, and that business matters should be forgotten when outside of the workplace. 

However, a complete disconnection is not always possible. Still, if you're working with a spouse, sibling, parent or child, the best advice is try to make every effort not to let disagreements linger. Settle conflicts and problems as quickly as possible and keep them focused on the area of disagreement.

Comments like "That's how you are with everything, Mark," or "No wonder you've always been a failure," are not only going to make the issue of the mismeasured countertop worse, but are guaranteed to keep the resentment and bitterness going long after the new top has been ordered and installed.

Believe it or not, a family business actually needs to be more formal in structure than a business where no one is related. You can come to a verbal agreement with a stranger and negotiate the details in action. A family member, though, should have his or her duties, authority and compensation clearly spelled out in writing. Otherwise, for example, your son may feel pressured to okay a cabinet delivery when he's not sure what the order entailed because "his name is on the business."

You need to make absolutely sure that everyone in the organization knows the chain of command, knows what the family member is expected to be doing, and knows that the family member is reviewed and treated as much like other employees as humanly possible.

You may want to put a relative on the payroll because they're going through tough times or have been laid off elsewhere. However, you may be better off to pay them not to come in. After all, having deadwood lounging around working at half speed, or not working at all, will slow down your entire business.

Office relations also need to be clearly delineated, especially between family members and non-family members. Non-family members in a family business are in a very tough spot. They often feel that any chance for advancement or promotion is choked off, since the best positions will automatically go to a family member. They also often feel that family members spy on them as they go about their jobs. Maintaining morale can be a ticklish proposition and steady turnover may be a fact of life.

Succession can be the most difficult part of a family business. Although it sounds alienating, it's best to get a third party, preferably legal counsel, involved in planning transfer and ownership of business. 

One potential and commonly seen source of trouble for the family business is confusing obligation with ambition. For instance, just because your daughter helps out around the showroom does not mean she necessarily wants to enter the profession or inherit the business someday. (It doesn't mean he or she doesn't either.) Be sure that you're not forcing family members to do things that go against their wishes.

At the same time, if you have more than one child but only one wants to enter the family business, you're piling up difficulty for him or her by leaving equal shares in the business to the children whose ambitions lie elsewhere. Leave the business to the child who is interested in it not the ones who aren't.

Be sure the terms of succession are clearly spelled out. If you don't want to die in harness, plan to disengage yourself from the business at some point when predetermined conditions are met and do so. When you hand over the business to someone else, it is his or hers to succeed with or fail. You may offer advice, but meddling only makes your successor's job harder.

Lastly, remember, in the end it's only business. Ultimately, your family is much more important.