Behind and at front of a family Business are the family members, the driving force of success. It is this performance, investment of self along with family unity, pride and loyalty to the Business that achieves the best results. This is often described as socioemotional wealth that contributes to overall performance and results. A positive harmony of relationships.
But this harmony sometimes goes off key. Family Businesses become management nightmares, with conflicting missions of making a profit and providing jobs for family. For example, problems arise when family are underperforming at the expense of the Business performance.
What happens when relationship dynamics are not dynamic. How do you deal with under-performing, uninterested or unenthusiastic family or relatives? And What to do if rules are not adhered to, or relationship lines become blurred or overstepped!
What to do! Get back into tune by adopting some sound ‘people’ management techniques.
Firstly, let's look at performance, what influences and determines it. The top 4 factors are:
- Company culture
- Employee engagement
- Performance management
- Dealing with people problems
Company culture sets the framework. This is an agreed Mission statement and vision for the future that underpins the organisation. It is the shared values, behaviours and attitudes that make up a work environment and aligns with company branding and messaging. Culture is what creates the day-to-day experience at a company. The key is getting everyone on the same page.
Employee engagement. Whether employing outside recruits or family members, fair and equal processes and systems must be in place. Appointment on skill and merit is vital, supported by appropriate training as needed for all employees. Nepotism is a weakness of family businesses when those not qualified are selected or promoted, causing inefficiencies or resentment.
Performance Management. Just like an Oscar winning movie all performers in a Business must perform! Performance appraisals should be factored into HR policies and include all members of a Business, including Owners. Appraisals, if conducted effectively, have several positives. Such as, an opportunity to acknowledge skills, abilities and identify areas for improvement, along with role/career development.
Additionally, smart Businesses recognise the critical need to understand the strengths and weaknesses, opportunities and threats that are present in any Business. For this reason, a SWOT analysis is a useful strategic planning tool that can help evaluate your family Business performance and potential.
Dealing with people problems. From the above activity the next step is to deal with any poor performance issues. If a Business wants to be successful, operating at its best, every employee, including family must be held accountable to the same performance measures. Problems must be dealt with, despite potential ramifications, particularly with relatives, hurt, fallout and feuds.
To intervene, engaging an external expert can be helpful to act as an impartial mediator or moderator. They are outside the ‘circle’ and not aligned to any factions or emotional ties. Blackburn Accounting is experienced in these matters and available to help resolve issues and find solutions with you.
Behind and at front of a family Business are the family members, the driving force of success. I hope this article helps foster
healthy and harmonious relationships in your Business.
The above strategies are supported with our 7 Tips to Building a Happy, Successful Family Business.
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